Revenues: $1.42 million, increased by 33% from the prior fiscal year primarily due to an increase in shipments for the large-scale DNA manufacturing business. Gross Profit: $0.84 million, decreased by 14% from the prior fiscal year, with a gross profit percentage of 39% compared to 46% in the previous year, primarily due to a change in product mix. Loss from Operations: $16.05 million, increased by 17% from the prior fiscal year, driven by increased research and development expenses and a decrease in service revenue. Net Loss: $15.35 million, reflecting ongoing challenges in transitioning to a new business model and increased research and development expenses.
Digital Asset Treasury Strategy: The company has adopted BNB, the native cryptocurrency of the Binance blockchain ecosystem, as its primary reserve asset. This strategy involves accumulating BNB and utilizing it as a productive treasury asset to produce yield via Binance native and DeFi opportunities.
LineaRx Business Strategy: LineaRx, a subsidiary, is focused on commercializing nucleic acid production solutions for the biopharmaceutical and diagnostics markets. This includes the development of LineaDNA, LineaRNAP, and LineaIVT platforms for the manufacture of synthetic DNA and RNA.
Product Revenue Segments: The company reported an increase in product revenues primarily within its Therapeutic DNA Production Services segment, driven by an increase in shipments for its large-scale DNA manufacturing business. Service Revenue Segments: There was a decrease in service revenues, primarily due to a decline in textile isotopic testing services and decreased research and development projects within the Therapeutic DNA Production Services segment.
Operational Restructuring: The company has undergone significant restructuring, including exiting its DNA Tagging and Security Products and Services segment, and reducing its workforce to focus on its synthetic DNA manufacturing business and BNB Strategy. Future Outlook: The company plans to continue advancing its nucleic acid production solutions and expects to have product and service revenue from LineaRx in the near term. It is also building the operational framework necessary to implement its BNB Strategy.
New Subsidiaries: The formation of Build & Build, LLC and BNBX Ltd. to house certain cryptocurrency assets as part of the BNB Strategy. Strategic Partnerships and Agreements: The company has entered into various strategic agreements, including a Strategic Digital Assets Services Agreement and a Strategic Advisor Agreement, to support its BNB Strategy.
Research and Development Focus: The company is focusing its R&D efforts on optimizing its LineaDNA platform, having incurred significant expenses in this area during the fiscal year. Workforce Changes: The company has reduced its workforce by approximately 72% since January 2025, aiming for a 70% reduction in payroll expenses compared to the previous fiscal year.
Strategic Initiatives: The company has strategically pivoted to a digital asset treasury model, focusing on accumulating BNB, the native cryptocurrency of the Binance blockchain, as its primary reserve asset. This shift is part of the company’s BNB Strategy, which involves managing digital assets through staking and participation in Binance ecosystem and DeFi yield opportunities. Additionally, the company is concentrating resources on its LineaRx business, which focuses on synthetic DNA manufacturing, by enhancing its LineaDNA and LineaIVT platforms and pursuing strategic partnerships.
Capital Management: The company completed a private placement in October 2025, raising $26.8 million in cash and crypto assets, with potential additional proceeds of up to $30.8 million from future warrant exercises. This capital is intended to support the BNB Strategy and other operational needs. The company also implemented several workforce reductions and restructuring plans to reduce operating costs and focus resources on its core business areas. Furthermore, the company executed two reverse stock splits in March and June 2025 to adjust its share structure and improve stock price stability.
Future Outlook: The company expects to have sufficient cash and liquid cryptocurrency to fund operations for the next twelve months, supported by the recent private placement and warrant exercises. It plans to continue advancing its BNB Strategy and LineaRx business, with anticipated capital expenditures of less than $70,000 in fiscal 2026, primarily for research and development in the Therapeutic DNA Production segment. The company is also exploring further strategic partnerships to enhance its business operations.
Challenges and Risks: The company faces significant risks related to its business strategies, particularly in implementing its BNB digital treasury strategy and Therapeutic DNA Production Services. A material weakness in internal controls over financial reporting has been identified, which could undermine investor confidence. The company also faces potential market risks from the sale of a significant number of shares, which could depress stock prices.
Management’s use of proceeds from offerings, including investments in BNB, may not yield expected returns, affecting liquidity and growth prospects. Compliance with Nasdaq listing standards is critical, as failure could lead to delisting, impacting capital raising and stock liquidity. Risks related to cryptocurrencies are prominent, with the development and acceptance of the BNB Chain and other networks being uncertain.
The largely unregulated nature of digital asset trading platforms poses additional risks, including potential manipulation and lack of legal recourse. Regulatory developments could adversely affect the business, with the classification of BNB as a security being a significant concern. The emergence of other digital assets and central bank digital currencies could negatively impact BNB’s value.
Management acknowledges the challenges in successfully implementing business strategies, particularly in the rapidly evolving synthetic DNA industry. The company must continually innovate to remain competitive, facing extensive competition from larger firms with greater resources. The limited revenue history makes future prospects uncertain, increasing the risk of not achieving business objectives. The company is exposed to extreme price volatility in BNB, which could lead to substantial losses.
The concentration of BNB trading on the Binance Exchange, controlled by Binance, adds to the risk of price manipulation. Regulatory scrutiny and potential actions against Binance could further impact BNB’s liquidity and market value, affecting the company’s stock price.
Leave a Reply