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What changed in Inuvo, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Inuvo, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+141 added−131 removedSource: 10-K (2026-03-05) vs 10-K (2025-02-27)

Top changes in Inuvo, Inc.'s 2025 10-K

141 paragraphs added · 131 removed · 84 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeInuvo’s intellectual property is protected by 19 issued and eight pending patents issued by the United States Patent and Trademark Office (“USPTO”). 4 Table of Contents Key Relationships We maintain long-standing relationships with several of the world's largest sources of advertising dollars including Yahoo! and Google. We maintain multi-year service contracts with these companies.
Biggest changeKey Relationships We maintain long-standing relationships with several of the world’s largest sources of advertising dollars including Yahoo! and Google. We have maintained multi-year service contracts with these companies. In addition to our Platform relationships, we maintain important distribution relationships with owners and publishers of websites and mobile applications.
We file with, or furnish to, the Securities and Exchange Commission (the "SEC") annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and amendments to those reports, as well as various other information. This information can be found on the SEC website at www.sec.gov.
We file with, or furnish to, the Securities and Exchange Commission (the “SEC”) annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and amendments to those reports, as well as various other information. This information can be found on the SEC website at www.sec.gov.
In the event of an issue, engineers are promptly notified, and corrective actions are swiftly implemented to minimize disruptions and ensure continuous service availability. 6 Table of Contents Intellectual Property Rights We own intellectual property (IP) and related IP rights that relate to our products, services and assets. Our IP portfolio includes patents, trade secrets and trademarks.
In the event of an issue, engineers are promptly notified, and corrective actions are swiftly implemented to minimize disruptions and ensure continuous service availability. Intellectual Property Rights We own intellectual property (IP) and related IP rights that relate to our products, services and assets. Our IP portfolio includes patents, trade secrets and trademarks.
We also protect details about our processes, products, and strategies as trade secrets, keeping confidential the information that we believe provides us with a competitive advantage. Employees and Human Capital Resources As of January 31, 2025, we had 82 full-time employees, none of which are covered by a collective bargaining agreement.
We also protect details about our processes, products, and strategies as trade secrets, keeping confidential the information that we believe provides us with a competitive advantage. Employees and Human Capital Resources As of January 31, 2026, we had 72 full-time employees, none of which are covered by a collective bargaining agreement.
Our intellectual property portfolio includes 19 patents issued by, and eight pending patent applications before, the USPTO. To distinguish our products and services from our competitors’ products, we have obtained trademarks and trade names for our products.
Our intellectual property portfolio includes 18 patents issued by, and three pending patent applications before, the USPTO. To distinguish our products and services from our competitors’ products, we have obtained trademarks and trade names for our products.
In 2009, following the weakness in the economy, a new team was called in to assess the array of businesses that had been acquired in the preceding years and as a result between 2009 and 2011, that team sold and/or retired eleven businesses as a part of the restructuring that became the foundation of Inuvo, Inc. 7 Table of Contents In March 2012, as part of a longer-term strategy, the Company acquired Vertro, Inc., which included an important relationship with Google.
In 2009, following the weakness in the economy, a new team was called in to assess the array of businesses that had been acquired in the preceding years and as a result between 2009 and 2011, that team sold and/or retired eleven businesses as a part of the restructuring that became the foundation of Inuvo, Inc.
Our primary competitive advantages include: · patented, proprietary generative large language artificial intelligence technology for the categorization of consumer intent, enabling us to match online audiences to relevant products, services, or brands across screens; · real-time visibility into advertising opportunities, allowing our technology to respond to over a million opportunities per second; and · patented advertising fraud prevention technology that safeguards our clients’ investments.
Our primary competitive advantages include: · patented, proprietary generative large language artificial intelligence technology for the categorization of consumer intent, enabling us to match online audiences to relevant products, services, or brands across screens; · real-time visibility into advertising opportunities, allowing our technology to respond to over a million opportunities per second; and · patented advertising fraud prevention technology that safeguards our clients’ investments. 5 Table of Contents While many of our competitors have greater name recognition and larger financial resources, our ability to stay competitive depends on our innovation and ability to deliver unique, effective solutions to both demand and supply-side customers.
Our approach to human capital management emphasizes the importance of talent investment, development, and engagement. We strive to create a culture where employees are empowered to contribute positively and reach their full potential. We promote our core values of innovation, encouragement, motivation, and curiosity, which help shape our workplace culture and foster an environment of growth and positivity.
Our approach to human capital management emphasizes the importance of talent investment, development, and engagement. We strive to create a culture where employees are empowered to contribute positively and reach their full potential.
In 1997, the business was reorganized and through 2006 several companies were acquired from within the advertising and internet marketing industry.
This endeavor was not profitable, and as a result from 1993 to 1997 the Company had essentially no operations. In 1997, the business was reorganized and through 2006 several companies were acquired from within the advertising and internet marketing industry.
In 2024, we had one individual customer with revenue concentration greater than 10% of our total revenues accounting for 75.0%. In 2023, we had two individual customers with revenue concentration greater than 10% of our total revenue accounting for 60.4% and 12.8%, respectively.
In 2025, we had two individual customers with revenue concentration greater than 10% of our total revenues accounting for 64.2% and 19.3%, respectively.
This revolutionary technology addresses critical issues such as third-party cookies, first-party cookies, IP addresses, URL tracking, audience segmentation, media measurement, and identity management. The strategy is to embed our technology as broadly as possible across the industry particularly as it transitions away from legacy targeting methods used by traditional advertising solutions.
The strategy is to embed our technology as broadly as possible across the industry particularly as it transitions away from legacy targeting methods used by traditional advertising solutions.
In 2013, with a grant funded by the State of Arkansas, the Company moved its headquarters to Arkansas where it has remained. In February 2017, the Company entered into an asset purchase agreement with NetSeer, Inc., which advanced the Company's artificial intelligence technology.
In February 2017, the Company entered into an asset purchase agreement with NetSeer, Inc., which advanced the Company’s artificial intelligence technology.
By leveraging our advanced technologies and unique capabilities, our sales executives demonstrate how we identify the most relevant audiences and target them at optimal moments when they are most likely to engage, respond, subscribe, or consume our clients’ messaging. 5 Table of Contents On the supply side, we build and maintain strong relationships with media placement partners who provide advertising inventory for auction to Inuvo’s clients.
On the demand side, our sales team engages directly with agencies, trading desks, brands, and platforms to generate interest. By leveraging our advanced technologies and unique capabilities, our sales executives demonstrate how we identify the most relevant audiences and target them at optimal moments when they are most likely to engage, respond, subscribe, or consume our clients’ messaging.
Additionally, our Board of Directors plays an active role in overseeing executive compensation, succession planning, and leadership development to ensure that we have the right leadership in place with the skills and experience needed to drive sustainable success. Seasonality Our future results of operations may be subject to fluctuation because of seasonality.
We promote our core values of innovation, encouragement, motivation, and curiosity, which help shape our workplace culture and foster an environment of growth and positivity. 6 Table of Contents Additionally, our Board of Directors plays an active role in overseeing executive compensation, succession planning, and leadership development to ensure that we have the right leadership in place with the skills and experience needed to drive sustainable success.
In addition to our Platform relationships, we support Agencies & Brands. Additionally, we maintain important distribution relationships with owners and publishers of websites and mobile applications. We provide these partners with advertisements which they use to monetize their websites and mobile applications. We continuously monitor our advertising quality with a variety of proprietary and patent protected software tools.
We provide these partners with advertisements which they use to monetize their websites and mobile applications. We continuously monitor our advertising quality using a variety of proprietary and patent-protected software tools, including IntentKey. IntentKey has long-standing relationships with several programmatic infrastructure companies that provide billions of bid transactions.
Our overarching goal is to be the driving engine behind advertising transaction decisions, rather than simply facilitating the ad placement process. Platforms: Our Platforms business mitigates market risk by partnering with some of the largest advertising platforms globally. This enables our business to scale rapidly, particularly as these platforms lead industry changes.
We leverage proprietary demand and supply technologies, targeting and application ad-unit technologies, AI-generated data, data management solutions, and advertising fraud detection systems. Our overarching goal is to be the driving engine behind advertising transaction decisions, rather than simply facilitating the ad placement process. Platforms: Our Platforms business mitigates market risk by partnering with some of the largest advertising platforms globally.
With strong working capital, low receivables risk, and minimal go-to-market investment requirements, our Platforms business is well-positioned for growth. Our strategy within the Platforms sector is to deepen existing relationships, expand our footprint with current clients, and integrate emerging technologies from our Agencies & Brands business to enhance our competitive advantage.
Our strategy within the Platforms sector is to deepen existing relationships, expand our footprint with current clients, and integrate emerging technologies from our Agencies & Brands business to enhance our competitive advantage. Agencies & Brands: The Agencies & Brands business leverages our proprietary AI-driven technology to solve key challenges in modern advertising.
We compensate these partners for their services. Within our Platforms business, we offer unique technologies and content experiences that align with the objectives of our platform clients, allowing us to meet their specific needs effectively. Competition We operate in a highly competitive industry, where competitors are continuously expanding their product offerings to capture a larger share of the advertising market.
On the supply side, we build and maintain strong relationships with media placement partners who provide advertising inventory for auction to Inuvo’s clients. We compensate these partners for their services. Within our Platforms business, we offer unique technologies and content experiences that align with the objectives of our platform clients, allowing us to meet their specific needs effectively.
Historically, the second half of the year is typically stronger than the first half because of the changes in demand for marketing placements leading into the holiday season. If we are not able to appropriately adjust to seasonal or other factors, it could have a material adverse effect on our financial results.
Seasonality Our future results of operations may be subject to fluctuation because of seasonality. Historically, the second half of the year is typically stronger than the first half because of the changes in demand for marketing placements leading into the holiday season.
Strategy Our business strategy focuses on developing cutting-edge advertising technologies that disrupt the traditional intermediaries within the online advertising ecosystem, while fostering strong relationships that enable access to both media spend (advertisers) and media inventory (websites). We leverage proprietary demand and supply technologies, targeting and application ad-unit technologies, AI-generated data, data management solutions, and advertising fraud detection systems.
In 2024, we had one individual customer with revenue concentration greater than 10% of our total revenue accounting for 75.0%. 4 Table of Contents Strategy Our business strategy focuses on developing cutting-edge advertising technologies that disrupt the traditional intermediaries within the online advertising ecosystem, while fostering strong relationships that enable access to both media spend (advertisers) and media inventory (websites).
Inuvo Technology Platforms Our proprietary applications are constructed from established, readily available technologies.
However, there are no guarantees that we will be able to maintain this competitive positioning in the future. Inuvo Technology Platforms Our proprietary applications are constructed from established, readily available technologies.
History The Company was incorporated under the laws of the state of Nevada in October 1987 and originally operated within the oil and gas industry. This endeavor was not profitable, and as a result from 1993 to 1997 the Company had essentially no operations.
If we are not able to appropriately adjust to seasonal or other factors, it could have a material adverse effect on our financial results. History The Company was incorporated under the laws of the state of Nevada in October 1987 and originally operated within the oil and gas industry.
Agencies & Brands: The Agencies & Brands business leverages our proprietary AI-driven technology to solve key challenges in modern advertising. IntentKey technology, built on the foundation of large language generative AI, is designed to displace entrenched incumbents across the advertising value chain.
IntentKey technology, built on the foundation of large language generative AI, is designed to displace entrenched incumbents across the advertising value chain. This revolutionary technology addresses critical issues such as third-party cookies, first-party cookies, IP addresses, URL tracking, audience segmentation, media measurement, and identity management.
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ITEM 1. BUSINESS. Company Overview Inuvo is a leading advertising technology and services business that has successfully developed and commercialized large language generative artificial intelligence that can discover and target digital audiences instantly without having to track consumers around the internet.
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ITEM 1. BUSINESS. Company Overview Inuvo is a market leader in generative artificial intelligence for modeling media audiences.
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Inuvo’s innovative technology positions it as a leader within the advertising industry, offering a valuable solution to marketers seeking to navigate the evolving landscape of consumer privacy. Rather than targeting people, the artificial intelligence (AI) targets the reasons behind why people are interested in products, services and brands.
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As a leading provider of AI-driven data and advertising technology solutions, we have successfully commercialized a proprietary, patented large language model (“LLM”) that identifies and actions the reasons why consumers are interested in products, services, or brands - rather than who they are - offering a high-performance, privacy-by-design solution for the modern advertising landscape. Intelligence for the Agentic Era.
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Inuvo’s primary mission is to disrupt the advertising industry with its proprietary and patented artificial intelligence, a technology capable of identifying and targeting audiences without using a consumer’s identity or data.
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As the industry moves toward “agentic” systems - where autonomous AI agents increasingly handle the planning and execution of media tasks - Inuvo is uniquely positioned as a critical intelligence layer. Unlike legacy systems that rely on static historical data or consumer IDs (cookies), Inuvo’s technology provides the real-time, intent-based reasoning required for autonomous media planning and activation.
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The AI, marketed as IntentKey was designed to replace the consumer data, analytics, segmentation and lookalike modeling technologies that have traditionally served the advertising industry as it transitions to a new paradigm where targeting based on a consumer’s identity and data are no longer possible due to the legislative and technological changes occurring.
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By serving as the neural network for these adaptive systems, Inuvo enables brands to move from traditional audience targeting to dynamic model planning. Inuvo’s core competitive advantage lies in Intent Discovery. While the programmatic industry has traditionally relied on reaching known users based on past behavior, Inuvo’s AI discovers new, high-value audiences as their motivations form.
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The advertising industry Inuvo serves is going through an unprecedented change, the likes of which has never ensued with the potential to disrupt hundreds of billions in annual worldwide digital media spend that supports the internet. The cornerstone of the change revolves around the use of a consumer’s identity and data for ad-targeting.
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This intelligence is delivered through a suite of advanced visualization and compliance tools: · The Company’s flagship proprietary AI, IntentKey®, analyzes live content consumption across the open web, mapping human motivation to a concept graph of over 25 million ideas.
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While there are many ways to identify consumers, the principal method that has evolved within the browsers has been the cookie, which is the location within the browser where a consumer's identity gets accessed. When the cookie is no longer available, the means to look up a consumer’s personal information in a database is no longer possible. No Cookie.
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This allows Inuvo to predict purchase intent with precision, often identifying emerging audience shifts 24 hours before they become competitive in the open market.
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No Data. No Targeting. Nineteen states have now signed consumer privacy legislation and another 10 have privacy bills in process. Apple has already eliminated the use of cookies within its browser and Google is expected to announce its phase out of cookies in 2025.
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This, in turn, delivers targeting leverage that translates to superior supply/demand yields within bid streams. · IntentPath: A first-of-its-kind visualization that allows marketers to see “intent-in-motion,” mapping the real-time journey from initial discovery to final purchasing decision. · Ranger: An AI-powered quality assurance feature within our Campsight system that ensures ad creatives remain consistent, accurate and compliant across digital networks.
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Inuvo’s AI technology solves this identity challenge by leveraging artificial intelligence, data analytics, and automation that can optimize the purchase and placement of advertising in real time without consumer data.
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Inuvo delivers these capabilities through two primary business channels: · Agencies & Brands: Managed and self-service offerings that utilize Inuvo’s intelligence layer for precision audience discovery and brand-safe activation across CTV, Video, Audio, Native, and Display channels. · Platform: Inuvo provides strategic integrations for large consolidators of advertising demand.
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Inuvo clients, who are agencies and brands (collectively, “Agencies & Brands”) and large consolidators of advertising demand (“Platforms”) both benefit from Inuvo’s ability to intelligently process vast amounts of data, detect patterns in behavior, and enhance advertising efficiency, whether through direct media execution or integration into existing campaign management systems.
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This business is optimized to prioritize advertising quality, scalability, and compliance, leveraging AI to align merchant messaging with online content in a durable, defensible manner. Inuvo’s competitive moat and intellectual property are protected by 18 issued and three pending patents issued by the United States Patent and Trademark Office. Our IP portfolio includes patents, trade secrets and trademarks.
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These capabilities are typically sold with services both individually and in combination with each other based on client needs. Agencies & Brands utilize our artificial intelligence-based consumer intent recognition system to reach highly targeted mobile and desktop In-Market audiences with precision.
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We actively seek to protect our IP rights and to deter unauthorized use of our IP and other assets. While our IP rights are important to our success, our business is not significantly dependent on any single patent, trademark, or other IP right.
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The solution can serve multiple creative formats including display, video, audio and native across multiple device types including desktop, mobile, tablet, connected/smart TV and game consoles. The technology can be consumed by clients as a managed service or self-service (SaaS).
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This enables our business to scale rapidly, particularly as these platforms lead industry changes. With strong working capital, low receivables risk, and minimal go-to-market investment requirements, our Platforms business is well-positioned for growth.
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For our Platform clients we utilize a collection of data, analytics, software, content management and website creation technologies to align merchant advertising messages with online content. Inuvo’s revenue is derived from the placement of digital advertising across devices, websites, applications and browsers within social, search and programmatic advertising channels.
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Competition We operate in a highly competitive industry, where competitors are continuously expanding their product offerings to capture a larger share of the advertising market.
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Inuvo facilitates and gets paid to deliver millions of advertising messages monthly and counts among its client's numerous world-renowned companies across industries. Inuvo generates revenue from Agencies & Brands through its fully managed and self-service offerings, both of which utilize IntentKey, and through the placement of advertising on third-party publisher and owned websites designed to meet Platform client requirements.
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In March 2012, as part of a longer-term strategy, the Company acquired Vertro, Inc., which included an important relationship with Google. In 2013, with a grant funded by the State of Arkansas, the Company moved its headquarters to Arkansas where it has remained.
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There are many barriers to entry associated with the Inuvo business model, including proficiency in large language model based artificial intelligence, large scale information processing, software development, consumer data products, analytics, IOT (internet of things) integration and the relationships required to execute within the IOT.
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On the demand side, our sales team engages directly with agencies, trading desks, brands, and platforms to generate interest.
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While many of our competitors have greater name recognition and larger financial resources, our ability to stay competitive depends on our innovation and ability to deliver unique, effective solutions to both demand and supply-side customers. However, there are no guarantees that we will be able to maintain this competitive positioning in the future.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn such an event, our ability to conduct our business as it is currently conducted would be in jeopardy. 12 Table of Contents Significant dilution will occur when outstanding restricted stock unit grants vest. As of December 31, 2024, we had 13,216,020 restricted stock units outstanding.
Biggest changeSignificant dilution will occur when outstanding restricted stock unit grants vest. As of December 31, 2025, we had 779,979 restricted stock units outstanding. If the restricted stock units vest, dilution will occur to our stockholders, which may be significant.
We are permitted to borrow against eligible accounts receivable and unbilled receivables. The Financing Agreement has a three year term and contains certain affirmative and negative covenants to which we are also subject. As of December 31, 2024, we were in compliance with these covenants. There are no assurances that we will be able to comply with all the covenants.
We are permitted to borrow against eligible accounts receivable and unbilled receivables. The Financing Agreement has a three year term and contains certain affirmative and negative covenants to which we are also subject. As of December 31, 2025, we were in compliance with these covenants. There are no assurances that we will be able to comply with all the covenants.
If we are unable to remain competitive and provide value to our advertisers, they may stop placing ads with us, which would have a material adverse effect on our business, prospects, financial condition and results of operations. We are dependent upon relationships with and the success of our supply partners. Our supply partners remain a critical component of our success.
If we are unable to remain competitive and provide value to our advertisers, they may stop placing ads with us, which would have a material adverse effect on our business, prospects, financial condition and results of operations. We are dependent upon relationships with and the success of our supply partners.
Although we maintain insurance coverage for various cybersecurity and business continuity risks, there can be no guarantee that all costs, damages, expenses or losses incurred will be fully insured. 10 Table of Contents We are subject to risks from publishers who could fabricate clicks either manually or technologically. Our business involves the establishment of relationships with website owners and publishers.
Although we maintain insurance coverage for various cybersecurity and business continuity risks, there can be no guarantee that all costs, damages, expenses or losses incurred will be fully insured. We are subject to risks from publishers who could fabricate clicks either manually or technologically. Our business involves the establishment of relationships with website owners and publishers.
The loss of material customers or a material change in the revenue or gross profit they generate would have a material adverse impact on our business, results of operations and financial condition in future periods. 8 Table of Contents We are exposed to credit risk on our accounts receivable and this risk is heightened during periods when economic conditions worsen .
The loss of material customers or a material change in the revenue or gross profit they generate would have a material adverse impact on our business, results of operations and financial condition in future periods. We are exposed to credit risk on our accounts receivable and this risk is heightened during periods when economic conditions worsen .
If our services were to be interrupted, it could cause loss of users, customers and business partners, which could have a material adverse effect on our results of operations and financial position. We employ information including operational technology systems to support our business and to collect, store and/or use proprietary and confidential information.
If our services were to be interrupted, it could cause loss of users, customers and business partners, which could have a material adverse effect on our results of operations and financial position. 9 Table of Contents We employ information including operational technology systems to support our business and to collect, store and/or use proprietary and confidential information.
As of December 31, 2024, we have approximately $2.5 million in cash and cash equivalents. Our net working capital deficit was $2.2 million. We have encountered recurring losses and cash outflows from operations, which historically we have funded through equity offerings and debt facilities.
As of December 31, 2025, we have approximately $2.8 million in cash and cash equivalents. Our net working capital deficit was $5.1 million. We have encountered recurring losses and cash outflows from operations, which historically we have funded through equity offerings and debt facilities.
The amount of revenue we receive from this customer is dependent on a number of factors outside of our control; this includes the amount the customer charges for advertisements, the depth of its available advertisements, and its ability to display relevant ads in response to end user queries and changes in advertising budgets resulting from their own business circumstances.
The amount of revenue we receive from these customers is dependent on a number of factors outside of our control; this includes the amount the customers charge for advertisements, the depth of their available advertisements, and their ability to display relevant ads in response to end user queries and changes in advertising budgets resulting from their own business circumstances.
We reported an operating loss of approximately $5.8 million in 2024 as compared to an operating loss of approximately $10.3 million in 2023. Though we have a credit facility dependent upon receivables, the negative cash flows generated from operating activities introduces potential risk of an interruption to operating activities.
We reported an operating loss of approximately $5.1 million in 2025 as compared to an operating loss of approximately $5.8 million in 2024. Though we have a credit facility dependent upon receivables, the negative cash flows generated from operating activities introduces potential risk of an interruption to operating activities.
The success of our owned sites is dependent on our ability to acquire traffic in a profitable manner. Our ALOT-branded websites are dependent on our ability to attract traffic in a profitable manner. We use a predictive model to calculate the rate of return for marketing campaigns, which includes estimates and assumptions.
Our ALOT-branded websites are dependent on our ability to attract traffic in a profitable manner. We use a predictive model to calculate the rate of return for marketing campaigns, which includes estimates and assumptions.
While there are currently relatively few laws or regulations directly applicable to Internet-based commerce or commercial search activity, there is increasing awareness of such activity and interest from state and federal lawmakers in regulating these services.
While there are currently limited federal laws directly applicable to certain aspects of Internet-based commerce or commercial search activity, there is increasing awareness of such activity and interest from state and federal lawmakers in regulating these services.
Our business operates in a rapidly changing technological landscape, evident with the introduction of AI tools like ChatGPT in 2022 along with the deprecation of third-party cookies. To stay competitive, we must swiftly adapt to evolving industry standards, new product releases, and changing customer preferences. Continual improvement of our services' speed, performance, and compatibility across diverse platforms is crucial.
Our business operates in a rapidly changing technological landscape, evident with the rapid adoption of artificial intelligence technologies and tools, as well as the deprecation of third-party cookies. To stay competitive, we must swiftly adapt to evolving industry standards, new product releases, and changing customer preferences. Continual improvement of our services’ speed, performance, and compatibility across diverse platforms is crucial.
If the NYSE American delists our common stock, investors may face material adverse consequences, including, but not limited to, a lack of trading market for our common stock, reduced liquidity, decreased analyst coverage of our common stock, and an inability for us to obtain any additional financing to fund our operations that we may need. 11 Table of Contents Financial Risks Our business is seasonal and our financial results may vary significantly from period to period.
If the NYSE American delists our common stock, investors may face material adverse consequences, including, but not limited to, a lack of trading market for our common stock, reduced liquidity, decreased analyst coverage of our common stock, and an inability for us to obtain any additional financing to fund our operations that we may need.
Our future results of operations may vary significantly from quarter to quarter and year to year because of numerous factors, including seasonality.
Financial Risks Our business is seasonal and our financial results may vary significantly from period to period. Our future results of operations may vary significantly from quarter to quarter and year to year because of numerous factors, including seasonality.
Any failure, or perceived failure, by us to comply with our posted privacy policies or with any data-related consent orders, Federal Trade Commission requirements or orders or other federal, state or international privacy or consumer protection-related laws, including the GDPR and CCPA, regulations or industry self-regulatory principles could result in claims, proceedings or actions against us by governmental entities or others or other liabilities, which could adversely affect our business.
Any failure, or perceived failure, by us to comply with our posted privacy policies or with any data-related consent orders, Federal Trade Commission requirements or orders or other federal, state or international privacy or consumer protection-related laws, including the GDPR and CCPA, regulations or industry self-regulatory principles could result in claims, proceedings or actions against us by governmental entities or others or other liabilities, which could adversely affect our business. 10 Table of Contents We are subject to the continued listing standards of the NYSE American and our failure to satisfy these criteria may result in delisting of our common stock .
The acquisition of assets or businesses that we believe to be complementary to our business is an important component of our strategy. We believe that acquisition opportunities may arise from time to time, and that any such acquisitions could be significant. At any given time, discussions with one or more potential sellers may be at different stages.
We believe that acquisition opportunities may arise from time to time, and that any such acquisitions could be significant. At any given time, discussions with one or more potential sellers may be at different stages.
In addition, our investment in internally developed software consists primarily of labor costs which are of a fixed nature. Through December 31, 2024, our accumulated deficit was $173.2 million. See Liquidity and Capital Resources under ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS for a more thorough discussion.
In addition, our investment in internally developed software consists primarily of labor costs which are of a fixed nature. Through December 31, 2025, our accumulated deficit was $178.3 million. See Liquidity and Capital Resources under ITEM 7.
If we fail to attract new personnel or fail to retain and motivate our current personnel, our business and future growth prospects could be severely harmed. 9 Table of Contents Technological Risks Our business must keep pace with rapid technological change to remain competitive.
If our stock price performs poorly, it may adversely affect our ability to retain highly skilled employees. If we fail to attract new personnel or fail to retain and motivate our current personnel, our business and future growth prospects could be severely harmed. Technological Risks Our business must keep pace with rapid technological change to remain competitive.
Failure to keep pace with these technological shifts could adversely affect our financial position and results of operations. Our services may be interrupted if we experience problems with our network infrastructure . The performance of our network infrastructure is critical to our business and reputation.
Our services may be interrupted if we experience problems with our network infrastructure . The performance of our network infrastructure is critical to our business and reputation.
Business Risks We have a history of losses. We cannot anticipate with any degree of certainty what our revenues will be in future periods. Our revenues increased approximately 13.4% in 2024 as compared to 2023, our gross profit margin remained level at 85.6% in 2024 and 85.8% in 2023.
Business Risks We have a history of losses. We cannot anticipate with any degree of certainty what our revenues will be in future periods. Our revenues increased approximately 2.9% in 2025 as compared to 2024, however, our gross profit margin decreased by 10.1% to 74.5% in 2025.
If the restricted stock units vest, dilution will occur to our stockholders, which may be significant. Our financial condition may be adversely affected if we are unable to identify and complete future acquisitions, fail to successfully integrate acquired assets or businesses, or are unable to obtain financing for acquisitions on acceptable terms.
Our financial condition may be adversely affected if we are unable to identify and complete future acquisitions, fail to successfully integrate acquired assets or businesses, or are unable to obtain financing for acquisitions on acceptable terms. The acquisition of assets or businesses that we believe to be complementary to our business is an important component of our strategy.
In order to maintain this listing, we must maintain a certain share price, financial and share distribution targets, including maintaining a minimum amount of shareholders’ equity and a minimum number of public shareholders.
Our common stock is listed on the NYSE American. In order to maintain this listing, we must maintain a certain share price, a minimum amount of shareholders’ equity and a minimum market value of publicly held shares.
To sustain growth, we must continue to recruit and retain partners who can drive traffic effectively to their websites and mobile applications, resulting in clicks on advertisements we have delivered. However, supply partners may face challenges in attracting and maintaining users due to competition, rapidly evolving market dynamics, technological advancements, industry consolidation, and shifting consumer preferences.
While we continue to recruit and retain supply partners and have made progress in stabilizing and expanding our supply network, turnover within our partner base remains inherent to our business. Supply partners may face challenges due to competition, rapidly evolving market dynamics, technological advancements, industry consolidation, and shifting consumer preferences, which may reduce traffic volumes or engagement levels.
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We rely on one customer for a significant portion of our revenues. A significant portion of our revenue is derived from one customer. During 2024 this customer accounted for 75.0% of our revenues. In 2023, the same customer accounted for 60.4% of our revenues.
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS for a more thorough discussion. 7 Table of Contents We rely on two customers for a significant portion of our revenues. A significant portion of our revenue is derived from two customers. During 2025 these two customers accounted for 64.2% and 19.3% of our revenues, respectively.
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Throughout 2024, we have successfully onboarded a significant number of new supply partners, strengthening our ability to deliver high-quality traffic and engagement for our advertisers. While turnover within our supply partner network still occurs, it has decreased compared to prior periods.
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In 2024, the same two customers accounted for 75.0% and 7.0% of our revenues, respectively.
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Although our supply partner base has expanded, maintaining strong relationships remains a priority. Some partners may explore direct relationships with advertisers, consider us as competitors, or find competing solutions more attractive.
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Our supply partners, including owners and publishers of websites and mobile applications, remain a critical component of our success. Our ability to generate revenue depends on these partners’ capacity to attract and retain users and deliver traffic that results in engagement with advertisements we distribute.
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Additionally, while we have made progress in stabilizing and expanding our supply network, there can be no assurance that traffic levels will continue to increase or that all departing partners will be replaced. Any disruptions in our ability to sustain and enhance our supply partnerships could have a material adverse effect on our business, financial position, and results of operations.
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In addition, some partners may pursue direct relationships with advertisers, view us as competitors, or find alternative solutions more attractive. As a result, traffic levels and advertising inventory available through our supply network may fluctuate, and there can be no assurance that departing partners will be replaced or that traffic volumes will increase.
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If our stock price performs poorly, it may adversely affect our ability to retain highly skilled employees.
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Any disruption in our ability to maintain, replace, or effectively scale our supply partnerships could materially adversely affect our business, financial condition, and results of operations. Our business depends on third-party advertising platforms that establish and enforce their own policies, and changes in those policies, standards or commercial terms could adversely affect our revenue and operating results.
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We are subject to the continued listing standards of the NYSE American and our failure to satisfy these criteria may result in delisting of our common stock . Our common stock is listed on the NYSE American.
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We generate a portion of our revenue through relationships with third-party advertising platforms that control the distribution, monetization and measurement of advertising traffic. These platforms establish and enforce their own policies, quality standards, compliance requirements and commercial terms, which may change from time to time.
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We do not control the interpretation or application of such policies, nor do we control the algorithms and systems used by these platforms to evaluate traffic quality and performance.
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If a third-party platform determines that certain traffic does not meet its standards, or concludes that our practices are inconsistent with its policies or commercial requirements, it may reduce traffic allocations, modify monetization rates, delay or withhold payments, require operational changes, or suspend or terminate our participation.
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In addition, platforms periodically modify their algorithms, compliance standards, demand allocation methodologies and pricing models, which may result in fluctuations in revenue, margins and traffic volumes.
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Any such actions or changes could adversely affect our Platform revenue, operating results and cash flows, and could require us to adjust our business practices or incur additional costs to maintain compliance. 8 Table of Contents The success of our owned sites is dependent on our ability to acquire traffic in a profitable manner.
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Failure to keep pace with these technological shifts could adversely affect our financial position and results of operations. Our increasing use of artificial intelligence and machine learning technologies also exposes us to risks related to data quality, model performance, regulatory scrutiny, and evolving legal standards governing the use of automated decision-making technologies.
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In such an event, our ability to conduct our business as it is currently conducted would be in jeopardy. 11 Table of Contents In addition to our credit facility, we may incur additional indebtedness from time to time, including convertible or other debt instruments.
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Any such indebtedness could increase our leverage, require the use of significant cash resources to service or repay obligations, and limit our financial flexibility. Our ability to meet these obligations depends on our future operating performance, cash flows, and access to capital, which are subject to market conditions and other factors beyond our control.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeITEM 1C. CYBERSECURITY The Company has processes for assessing, identifying, and managing material risks from cybersecurity threats. These processes are integrated into the Company’s overall risk management systems, as overseen by the Company’s board of directors, primarily through its audit committee. These processes also include overseeing and identifying risks from cybersecurity threats.
Biggest changeITEM 1C. CYBERSECURITY Risk Management & Strategy The Company has processes for assessing, identifying, and managing material risks from cybersecurity threats. These processes are integrated into the Company’s overall risk management systems, as overseen by the Company’s board of directors, primarily through its audit committee. These processes also include overseeing and identifying risks from cybersecurity threats.
The Company from time to time engages third-party consultants in evaluating and testing the Company’s risk management systems and assessing and remediating certain potential cybersecurity incidents as appropriate. 13 Table of Contents Governance Board of Directors The audit committee of the Company’s board of directors oversees, among other things, the adequacy and effectiveness of the Company’s internal controls, including internal controls designed to assess, identify, and manage material risks from cybersecurity threats.
The Company from time to time engages third-party consultants in evaluating and testing the Company’s risk management systems and assessing and remediating certain potential cybersecurity incidents as appropriate. 12 Table of Contents Governance Board of Directors The audit committee of the Company’s board of directors oversees, among other things, the adequacy and effectiveness of the Company’s internal controls, including internal controls designed to assess, identify, and manage material risks from cybersecurity threats.
The Company’s Disclosure Committee, with the assistance of the DIT, is responsible for overseeing the establishment and effectiveness of controls and other procedures, including controls and procedures related to the public disclosure of material cybersecurity matters. The Company’s Disclosure Committee is comprised of, among others, the Company’s Chief Executive Officer, President, Chief Financial Officer, General Counsel, and Senior Vice Presidents.
The Company’s Disclosure Committee, with the assistance of the DIT, is responsible for overseeing the establishment and effectiveness of controls and other procedures, including controls and procedures related to the public disclosure of material cybersecurity matters. The Company’s Disclosure Committee is comprised of, among others, the Company’s Chief Executive Officer, Chief Financial Officer, and Senior Vice Presidents.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS. We may be subject to legal proceedings, investigations and claims incidental to the conduct of our business from time to time. We are not currently a party to any material litigation or other legal proceedings brought against us.
Biggest changeITEM 3. LEGAL PROCEEDINGS. We may be involved from time to time in legal proceedings, investigations and claims incidental to the conduct of our business. On January 29, 2026, Carambolico LTD commenced a lawsuit, captioned Carambolico LTD v. Alot, Inc., No. 04CV-26-458 (Ark.
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We are also not aware of any legal proceeding, investigation or claim, or other legal exposure that has a more than remote possibility of having a material adverse effect on our business, financial condition or results of operations. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. 14 Table of Contents PART II
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Cir. filed Jan. 29, 2026), in the Circuit Court of Benton County, Arkansas naming Alot, Inc., a wholly owned subsidiary of Inuvo, Inc., as defendant. The complaint asserts breach of contract and tort claims under a services agreement that was between Carambolico Ltd. and Alot, Inc. and seeks $1.5 million in fees thereunder.
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Inuvo believes the claims asserted are without merit. Inuvo intends to vigorously contest this lawsuit. As previously disclosed, on January 29, 2026, pursuant to a class action settlement agreement, we received approximately $6.2 million in proceeds as a claimant in such class action lawsuit. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. 13 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. Market Information Our common stock is listed on the NYSE American under the symbol "INUV.” As of January 30, 2025, there were approximately 415 record owners of our common stock.
Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. Market Information Our common stock is listed on the NYSE American under the symbol “INUV.” As of January 30, 2026, there were approximately 415 record owners of our common stock.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeIf our plan to grow the IntentKey product is unsuccessful, we may need to fund operations through private or public sales of securities, debt financings or partnering/licensing transactions over the long term. 19 Table of Contents Cash Flows The table below sets forth a summary of our cash flows for the years ended 2024 and 2023: 2024 2023 Net cash provided by/(used) in operating activities $ 229,554 $ (2,554,075 ) Net cash provided by/(used in) investing activities $ (1,857,375 ) $ 606,190 Net cash provided by/(used in) financing activities $ (353,388 ) $ 3,456,924 Cash Flows - Operating Net cash provided by operating activities was $229,554 during 2024.
Biggest changeCash Flows The table below sets forth a summary of our cash flows for the years ended 2025 and 2024: 2025 2024 Net cash provided by/(used) in operating activities $ (1,786,301 ) $ 229,554 Net cash provided by/(used in) investing activities $ (1,601,903 ) $ (1,857,375 ) Net cash provided by/(used in) financing activities $ 3,768,880 $ (353,388 ) Cash Flows - Operating Net cash used in operating activities was $1,786,301 during 2025.
Customer contracts are typically captured in an Insertion Order ("IO") where revenue is recognized upon delivery of services during the period covered by the IO, or in multi-year master service agreements where revenue is recognized based on the number of advertisements placed or clicked on in the period they occur.
Customer contracts are typically captured in an Insertion Order (“IO”) where revenue is recognized upon delivery of services during the period covered by the IO, or in multi-year master service agreements where revenue is recognized based on the number of advertisements placed or clicked on in the period they occur.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion of our financial condition and results of operations for 2024 and 2023 should be read in conjunction with the consolidated financial statements and the notes to those statements that are included elsewhere in this report.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion of our financial condition and results of operations for 2025 and 2024 should be read in conjunction with the consolidated financial statements and the notes to those statements that are included elsewhere in this report.
In addition, uncertain tax positions and tax-related valuation allowances are initially recorded in connection with a business combination as of the acquisition date. We periodically conduct a review of long-lived assets to assess potential triggering events for impairment within the Inuvo reporting unit.
In addition, uncertain tax positions and tax-related valuation allowances are initially recorded in connection with a business combination as of the acquisition date. 19 Table of Contents We periodically conduct a review of long-lived assets to assess potential triggering events for impairment within the Inuvo reporting unit.
If the carrying amount of a reporting unit exceeds the reporting unit’s fair value, the amount it exceeds fair value is equivalent to the amount of impairment loss. There is judgment involved in estimating the fair value, useful life and in the evaluation of any impairment. 21 Table of Contents ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
If the carrying amount of a reporting unit exceeds the reporting unit’s fair value, the amount it exceeds fair value is equivalent to the amount of impairment loss. There is judgment involved in estimating the fair value, useful life and in the evaluation of any impairment. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
There is judgment involved in determining the validity of capitalization, estimating the useful life and evaluating whether any impairment occurred. Capitalized software development costs were $1.8 million and $1.7 million, respectively, for the years ended December 31, 2024 and 2023.
There is judgment involved in determining the validity of capitalization, estimating the useful life and evaluating whether any impairment occurred. Capitalized software development costs were $1.5 million and $1.8 million, respectively, for the years ended December 31, 2025 and 2024.
The Company will pay Wainwright a commission rate of up to 3.0% of the aggregate gross proceeds from each sale of Shares. For the year ended December 31, 2024, the Company has not sold any shares of common stock under the ATM Agreement.
We will pay Wainwright a commission rate of up to 3.0% of the aggregate gross proceeds from each sale of Shares. For the year ended December 31, 2024, we did not sell any shares of common stock under the ATM Agreement.
At December 31, 2024 and 2023, there were no outstanding balances due under the Agreement. On July 30, 2024, we entered into a Financing and Security Agreement and Collateral Documents (“Financing Agreement”) with SLR Digital Finance LLC (“SLR”). Under the terms of the Financing Agreement, SLR has provided us with a $10,000,000 line of credit commitment.
Credit Agreement On July 30, 2024, we entered into a Financing and Security Agreement and Collateral Documents (“Financing Agreement”) with SLR Digital Finance LLC (“SLR”). Under the terms of the Financing Agreement, SLR has provided us with a $10,000,000 line of credit commitment.
These policies and others are described in Note 2 — Summary of Significant Accounting Policies, of the Consolidated Financial Statements included elsewhere in this Report. 20 Table of Contents Revenue recognition - We generate revenue by identifying audiences and presenting advertisements on behalf of our customers.
These policies and others are described in Note 2 — Summary of Significant Accounting Policies, of the Consolidated Financial Statements included elsewhere in this Report. Revenue recognition - We generate revenue by identifying audiences and presenting advertisements on behalf of our customers. Our revenue is derived from the placements of advertisements across advertising channels, browsers, applications and devices.
Compensation expense was lower for the year ended December 31, 2024 compared to the same time period in 2023 due primarily to lower incentive, commission, and stock-based compensation expense. Our total employment, both full and part-time, was 81 at December 31, 2024 compared to 93 at December 31, 2023.
Compensation expense was flat for the year ended December 31, 2025, compared to the same time period in 2024. Our total employment, both full and part-time, was 79 at December 31, 2025 compared to 81 at December 31, 2024.
We recognize revenue when control of the contracted services or product is transferred to our customer, in an amount that reflects the consideration we expect to be entitled to in exchange for those services or products.
We assume the risk associated of finding placements at a cost below that for which it had been sold. We recognize revenue when control of the contracted services or product is transferred to our customer, in an amount that reflects the consideration we expect to be entitled to in exchange for those services or products.
Cash Flows - Financing Net cash used in financing activities was $353,388 during 2024, primarily due to the election of certain participants to have the Company withhold the issuance of shares pursuant to vesting restricted stock units in consideration of the Company’s payment of taxes on behalf of such participants.
Net cash used in financing was $353,388 during 2024, primarily due to the election of certain participants to have the Company withhold the issuance of shares pursuant to vesting restricted stock units in consideration of the Company’s payment of taxes on behalf of such participants. 18 Table of Contents Critical Accounting Policies and Estimates The preparation of financial statements in conformity with U.S.
We reported a net loss of $5,761,801, which included non-cash expenses: depreciation and amortization of $2,515,177, stock-based compensation of $1,501,444, $800,000 for the impairment and amortization of a referral and support services agreement, and amortization of right of use assets of $54,356; partially offset by an adjustment to expect losses on accounts receivable of $1,442,533.
We reported a net loss of $5,761,801 which included the non-cash expenses of depreciation and amortization of $2,515,177, stock-based compensation expenses of $1,501,444, $800,000 for the impairment and amortization of a referral and support services agreement, and amortization of right of use assets of $54,356. The change in operating assets and liabilities was a net provision of cash of $2,342,255.
The change in operating assets and liabilities was a net provision of cash of $1,433,655. Cash Flows - Investing Net cash used in investing activities was $1,857,375 for 2024 and consisted primarily of capitalized internal development costs.
Cash Flows - Investing Net cash used in investing activities was $1,601,903 for 2025 and consisted primarily of capitalized internal development costs. Net cash used in investing activities in 2024 was $1,857,375 and consisted primarily of capitalized internal development costs.
Management plans to support the Company’s future operations and capital expenditures primarily through cash generated from its credit facility until such time as we reach profitability. The credit facility is due upon demand and therefore there can be no assurances that sufficient borrowings will be available to support future operations until profitability is reached.
The credit facility is due upon demand and therefore there can be no assurances that sufficient borrowings will be available to support future operations until profitability is reached.
Repayment of the Financing Agreement will be made through collections from eligible accounts receivable. At December 31, 2024 there were no outstanding balances due under the Financing Agreement. 2024 Overview We reported net revenue of $83.8 million in 2024, a 13.4% increase over the prior year.
Repayment of the Financing Agreement will be made through collections from eligible accounts receivable. At December 31, 2025 the outstanding balance under the Financing Agreement at that date was $3,288,100. 2025 Overview We reported net revenue of $86.2 million in 2025, a 2.9% increase over the prior year.
Additionally, our investment in investing activities totaled approximately $1.9 million for the year ended December 31, 2024. This amount primarily consists of internally developed software costs, which are largely comprised of fixed labor costs, along with other capitalized expenditures. Through December 31, 2024, our accumulated deficit was $173.2 million.
This amount primarily consists of internally developed software costs, which are largely comprised of fixed labor costs, along with other capitalized expenditures. Through December 31, 2025, our accumulated deficit was $178.3 million.
Marketing costs for the year ended December 31, 2024 compared to the same period in 2023 was 14.8% higher due primarily to higher revenue from Platform advertisers in the comparable periods. Marketing costs in 2024 include the fully amortized remaining balance of $500,000 of the referral and support services asset (see Note 8 – Commitments to our Consolidated Financial Statements).
Marketing costs for the year ended December 31, 2025 compared to the same period in 2024 was 13.0% lower due primarily to lower revenue in 2025 from the Platform client mentioned in Net Revenue section above and to fully amortizing the remaining balance of $600,000 of the referral and support services asset in the third quarter of 2024 (see Note 8 – Business Development Agreement to our Consolidated Financial Statements).
The change in operating assets and liabilities was a net provision of cash of $2,342,255 primarily due to increases in accrued expenses and other liabilities of $2,329,295 and accounts payable balance of $1,990,231 partially offset by an increase in the accounts receivable balance by $1,876,282. Our terms are such that we generally collect receivables prior to paying trade payables.
The change in operating assets and liabilities was a net use of cash of $303,348 primarily due to a decrease in the accounts receivable balance of $6,703,509, offset by decreases in accrued expenses and other liabilities of $5,565,487 and accounts payable of $1,331,567. Our terms are such that we generally collect receivables prior to paying trade payables.
If we are successful in implementing our plan, we expect to return to and maintain positive cash flows from operations. However, there is no assurance that we will be able to achieve this objective. As of December 31, 2024, we have approximately $2.5 million in cash and cash equivalents. Our net working capital deficit was $2.2 million.
However, there is no assurance that we will be able to achieve this objective. As of December 31, 2025, we have approximately $2.8 million in cash and cash equivalents. Our net working capital deficit was $5.1 million. We have encountered recurring losses and cash outflows from operations, which historically we have funded through equity offerings and debt facilities.
Financing expense, net Finance expense, net of interest income, for the year ended December 31, 2024 was approximately $266,000 expense and was primarily due to interest expense of approximately $221,000 and commitment fee expense of approximately $66,000 offset by interest income of approximately $71,000. 18 Table of Contents Finance expense, net of interest income, for the year ended December 31, 2023 was approximately $30,000 expense and was primarily due to interest expense of approximately $77,000 and commitment fee expense of approximately $18,000 offset by interest income of approximately $63,000.
Financing expense, net Finance expense, net of interest income, for the year ended December 31, 2025 was approximately $259,000 expense and was primarily due to interest and financing expenses of approximately $400,000 and commitment fee expense of approximately $80,000 offset by interest income of approximately $218,000.
See Note 6 – Bank Debt to our Consolidated Financial Statements. We have focused our resources behind a plan to market our collective multi-channel advertising capabilities differentiated by our AI technology, the IntentKey, where we have a technological advantage and higher margins.
We have focused our resources behind a plan to market our collective multi-channel advertising capabilities differentiated by our AI technology, the IntentKey, where we have a technological advantage and higher margins. If we are successful in implementing our plan, we expect to return to and maintain positive cash flows from operations.
General and administrative costs were lower for the year ended December 31, 2024 compared to the same time period in 2023 due primarily to an adjustment in the reserve for expected credit losses. During 2024, we made an adjustment to the allowance for expected credit losses for a balance due from a former client in 2022.
General and administrative expenses increased for the year ended December 31, 2025 compared to the same period in 2024 primarily due to a $1.4 million reduction in the allowance for expected credit losses recorded in 2024 related to a balance due from a former client.
We believe our current cash position and credit facility will be sufficient to sustain operations for at least the next twelve months from the date of this filing.
We believe our current cash position, together with availability under our credit facility and proceeds received subsequent to December 31, 2025 from the $6.2 million class action settlement and the subordinated convertible note issued in January 2026, will be sufficient to sustain operations for at least the next twelve months from the date of this filing.
Our revenue is a function of the number of advertisements placed combined with the price we obtain (using our technologies) for the placements made on behalf of our clients. We assume the risk associated of finding placements at a cost below that for which it had been sold.
Pricing for those advertisement placements is typically either on a cost-per-click or cost per thousand impressions basis. Our revenue is a function of the number of advertisements placed combined with the price we obtain (using our technologies) for the placements made on behalf of our clients.
Liquidity and Capital Resources Our principal sources of liquidity are the sale of our common stock and our credit facility discussed in Note 6 – Bank Debt to our Consolidated Financial Statements. On May 7, 2024, we entered into an At The Market Offering Agreement (the “ATM Agreement”) with H.C. Wainwright & Co.
On May 7, 2024, we entered into an At The Market Offering Agreement (the “ATM Agreement”) with H.C. Wainwright & Co.
The increase in cost of revenue for the year ended December 31, 2024, compared to the same time period in 2023 was related to higher revenue within a Platform client this year. Gross margin of 85.6% for the year ended December 31, 2024 was nearly level as compared to 85.8% in the prior year period.
As mentioned above, revenue from a new product introduced in the fourth quarter of 2024 accounted for the increase in cost of revenue. The change in gross margin in the current year ended December 31, 2025, 74.5% compared to 85.6% in the same period of 2024 was primarily due to a change in the revenue mix.
Other income, net Other income, net, for the year ended December 31, 2024 was income of approximately $26,000 for setup charges to new Platform partners. Other income, net, for the year ended December 31, 2023 was income of approximately $15,000 from net realized and unrealized gains and losses.
Other income, net, for the year ended December 31, 2024 was income of approximately $26,000 for setup charges to new Platform partners. Liquidity and Capital Resources Our principal sources of liquidity are the sale of our common stock and our credit facility discussed in Note 6 – Bank Debt to our Consolidated Financial Statements.
Cost of Revenue Cost of revenue is primarily composed of payments to advertising exchanges that provide access to digital inventory where we serve advertisements. To a lesser extent, cost of revenue includes payments to website publishers and app developers that host advertisements.
To a lesser extent, cost of revenue includes payments to advertising exchanges that provide access to digital inventory where we serve advertisements. The increase in cost of revenue for the year ended December 31, 2025, compared to the same time period in 2024 was primarily related to the change in mix within Platform revenue.
The client has since paid off their full outstanding balance and no longer has any obligation to us as of December 31, 2024.
That client subsequently paid its outstanding balance in full and had no remaining obligations to the Company as of December 31, 2025.
Operating Expenses For the Year Ended December 31, 2024 2023 Change % Change Marketing costs $ 59,663,061 $ 51,982,572 $ 7,680,489 14.8 % Compensation 12,065,783 13,793,309 (1,727,526 ) (12.5 %) General and administrative 5,545,049 8,050,890 (2,505,841 ) (31.1 %) Operating expenses $ 77,273,893 $ 73,826,771 $ 3,447,122 4.7 % Marketing costs consist mostly of media costs incurred on behalf of clients.
Operating Expenses For the Year Ended December 31, 2025 2024 Change % Change Marketing costs $ 51,890,162 $ 59,663,061 $ (7,772,899 ) (13.0 )% Compensation 12,086,350 12,065,783 20,567 0.2 % General and administrative 6,933,684 5,545,049 1,388,635 25.0 % Operating expenses $ 70,910,196 $ 77,273,893 $ (6,363,697 ) (8.2 )% Marketing costs consist primarily of traffic acquisition, or media, costs and include expenses incurred to attract and direct audience traffic to various web properties.
We have encountered recurring losses and cash outflows from operations, which historically we have funded through equity offerings and debt facilities. For the year ended December 31, 2024 we had a net loss of $5.8 million and net cash flow from operations of $0.2 million.
For the year ended December 31, 2025 we had a net loss of $5.1 million and the net cash used in operations was $1.8 million. Additionally, our investment in investing activities totaled approximately $1.6 million for the year ended December 31, 2025.
However, our Media sales arrangements typically have slower payment terms than the terms of related payables. During 2023, cash used in operating activities was $2,554,075. We reported a net loss of $10,389,653 which included the non-cash expenses of depreciation and amortization of $2,655,368, amortization of right of use assets $96,190 and stock-based compensation expenses of $1,986,296.
However, our media sales arrangements typically have slower payment terms than the terms of related payables. During 2024, cash provided by operating activities was $229,554.
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Item 1. Business and Item 1A. Risk Factors.
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Item 1. Business and Item 1A. Risk Factors. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to identify forward-looking statements. Company Overview Inuvo is a market leader in generative artificial intelligence for modeling media audiences.
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We use words such as "anticipate," "estimate," "plan," "project," "continuing," "ongoing," "expect," "believe," "intend," "may," "will," "should," "could," and similar expressions to identify forward-looking statements. 15 Table of Contents Company Overview Inuvo is a leading advertising technology and services business that has successfully developed and commercialized large language generative artificial intelligence that can discover and target digital audiences instantly without having to track consumers around the internet.
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As a leading provider of AI-driven data and advertising technology solutions, we have successfully commercialized a proprietary, patented large language model (“LLM”) that identifies and actions the reasons why consumers are interested in products, services, or brands - rather than who they are - offering a high-performance, privacy-by-design solution for the modern advertising landscape. Intelligence for the Agentic Era.
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Inuvo’s innovative technology positions it as a leader within the advertising industry, offering a valuable solution to marketers seeking to navigate the evolving landscape of consumer privacy. Rather than targeting people, the artificial intelligence (AI) targets the reasons behind why people are interested in products, services and brands.
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As the industry moves toward “agentic” systems - where autonomous AI agents increasingly handle the planning and execution of media tasks - Inuvo is uniquely positioned as a critical intelligence layer. Unlike legacy systems that rely on static historical data or consumer IDs (cookies), Inuvo’s technology provides the real-time, intent-based reasoning required for autonomous media planning and activation.
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Inuvo sells its information technology solutions to agencies and brands (collectively, “Agencies & Brands”) along with large consolidators of advertising demand (“Platforms”). Inuvo’s revenue is derived from the placement of digital advertising across devices, websites, applications and browsers within social, search and programmatic advertising channels.
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By serving as the neural network for these adaptive systems, Inuvo enables brands to move from traditional audience targeting to dynamic model planning. 14 Table of Contents Inuvo’s core competitive advantage lies in Intent Discovery. While the programmatic industry has traditionally relied on reaching known users based on past behavior, Inuvo’s AI discovers new, high-value audiences as their motivations form.
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Inuvo facilitates and gets paid to deliver millions of advertising messages monthly and counts among its client's numerous world-renowned companies across industries. Inuvo’s primary mission is to disrupt the advertising industry with its proprietary and patented artificial intelligence, a technology capable of identifying and targeting audiences without using a consumer’s identity or data.
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This intelligence is delivered through a suite of advanced visualization and compliance tools: · The Company’s flagship proprietary AI, IntentKey®, analyzes live content consumption across the open web, mapping human motivation to a concept graph of over 25 million ideas.
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The AI, marketed as IntentKey was designed to replace the consumer data, analytics, segmentation and lookalike modeling technologies that have traditionally served the advertising industry as it transitions to a new paradigm where targeting based on a consumer’s identity and data are no longer possible due to the legislative and technological changes occurring.
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This allows Inuvo to predict purchase intent with precision, often identifying emerging audience shifts 24 hours before they become competitive in the open market.
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Inuvo’s AI technology solves the identity challenge by leveraging artificial intelligence, data analytics, and automation that can optimize the purchase and placement of advertising in real time without consumer data. The technology can be consumed by clients as a managed service or self-service (SaaS).
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This, in turn, delivers targeting leverage that translates to superior supply/demand yields within bid streams. · IntentPath: A first-of-its-kind visualization that allows marketers to see “intent-in-motion,” mapping the real-time journey from initial discovery to final purchasing decision. · Ranger: An AI-powered quality assurance feature within our Campsight system that ensures ad creatives remain consistent, accurate and compliant across digital networks.
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Additionally, Inuvo has developed proprietary technology and assets tailored to certain clients that include digital content, websites, automated campaigns, ad fraud detection, performance reporting, and predictive media mix modeling.
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Inuvo delivers these capabilities through two primary business channels: · Agencies & Brands: Managed and self-service offerings that utilize Inuvo’s intelligence layer for precision audience discovery and brand-safe activation across CTV, Video, Audio, Native, and Display channels. · Platform: Inuvo provides strategic integrations for large consolidators of advertising demand.
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There are many barriers to entry associated with the Inuvo business model, including a proficiency in large language model based artificial intelligence, large scale information processing, software development, consumer data products, analytics, IOT (internet of things) integration and the relationships required to execute within the IOT. Inuvo’s intellectual property is protected by 19 issued and eight pending patents.
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This business is optimized to prioritize advertising quality, scalability, and compliance, leveraging AI to align merchant messaging with online content in a durable, defensible manner. Inuvo’s competitive moat and intellectual property are protected by 18 issued and three pending patents issued by the United States Patent and Trademark Office. Our IP portfolio includes patents, trade secrets and trademarks.
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Credit Agreement On March 12, 2020, we closed on the Loan and Security Agreement dated February 28, 2020 with Hitachi. Under the terms of the Loan and Security Agreement, Hitachi has provided us with a $5,000,000 line of credit commitment.
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We actively seek to protect our IP rights and to deter unauthorized use of our IP and other assets. While our IP rights are important to our success, our business is not significantly dependent on any single patent, trademark, or other IP right.
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We were permitted to borrow (i) 90% of the aggregate Eligible Accounts Receivable, plus (ii) the lesser of (A) 75% of the aggregate Unbilled Accounts Receivable or (B) 50% of the amount available to borrow under (i), up to the maximum credit commitment.
Added
The highlights of 2025, include: · Inuvo introduced IntentPath for next-level audience visualization capability that predicts how audiences move from awareness to engagement to conversion. · The Company launched Ranger, an advanced quality assurance and compliance capability within its Campsight system, designed to strengthen responsible monetization and improve creative verification and message consistency. · The Company appointed Rob Buchner as Chief Operating Officer in a newly created role to support operational scale and accelerate go-to-market execution for IntentKey, and he was subsequently appointed Chairman and Chief Executive Officer in January 2026. · 15 new Agencies/Brands were signed up. 15 Table of Contents Results of Operations For the Years Ended December 31, 2025 2024 Change % Change Net Revenue $ 86,209,305 $ 83,793,859 $ 2,415,446 2.9 % Cost of Revenue 21,995,153 12,033,777 9,961,376 82.8 % Gross Profit $ 64,214,152 $ 71,760,082 $ (7,545,930 ) (10.5 )% Net Revenue We reported $86.2 million in net revenue for the year ended December 31, 2025, a 2.9% increase compared to $83.8 million during the same period in 2024.
Removed
The interest rate under the Hitachi agreement was 2% in excess of the Wall Street Journal Prime Rate, with a minimum rate of 6.75% per annum, on outstanding amounts. The principal and all accrued but unpaid interest were due on demand.
Added
Platform clients represented 83.8% of the overall revenue for the year ended December 31, 2025 compared to 82.8% in the same period of 2024. For the year ended December 31, 2025, our two largest clients, both Platform clients, accounted for 64.2% and 19.3% of our overall revenue, respectively.
Removed
In the event of a default under the terms of the Loan and Security Agreement, the interest rate increases to 6% greater than the interest rate in effect from time to time prior to a default.
Added
During 2024 our largest client, also a Platform client, accounted for 75.0% of our revenues. Revenue from one of our largest Platform clients increased significantly in 2025 compared to the prior year due to the introduction of a new product in the fourth quarter of 2024.
Removed
The Loan and Security Agreement contained certain affirmative and negative covenants to which we were also subject. 16 Table of Contents On March 1, 2023, we entered into Amendment No. 1 to Loan and Security Agreement and Collateral Documents (“Agreement”) with Mitsubishi HC Capital America, Inc., f/k/a/ Hitachi Capital America Corp. (“MHCA”).
Added
However, this increase was offset by a decline in revenue from our largest Platform client, as advertising activity was reduced during the second half of 2025 to comply with our client's new requirements. Cost of Revenue Cost of revenue is primarily composed of payments to website publishers and app developers that host advertisements.
Removed
Under the terms of the Agreement, MHCA provided us with a $5,000,000 line of credit commitment. We were permitted to borrow up to 85% of the aggregate Eligible Accounts Receivable, up to the maximum credit commitment of $5,000,000. We paid MHCA monthly interest at the rate of 1.75% in excess of the Wall Street Journal Prime Rate.
Added
During 2025, the Company received a delayed refund from the Internal Revenue Service (IRS) of which $158,000 was recorded as interest income. 16 Table of Contents Finance expense, net of interest income, for the year ended December 31, 2024 was approximately $266,000 expense and was primarily due to interest expense of approximately $221,000 and commitment fee expense of approximately $66,000 offset by interest income of approximately $71,000.
Removed
We paid MHCA an amendment fee of $10,000 on issuance of the Agreement, and thereafter an annual commitment fee of $10,000. We also paid MHCA a quarterly service fee of 0.20% on the monthly unused amount of the maximum credit line. All obligations to MHCA have been satisfied and the Agreement was terminated on July 31, 2024.
Added
Other income, net Other income, net, for the year ended December 31, 2025 was income of approximately $1.9 million. During the year ended December 31, 2025, the Company received a payment from the IRS totaling $610,352 in connection with an amended form filed in May 2023 for the Employee Retention Credit (ERC) related to the first quarter of 2021.
Removed
The highlights of 2024, include: · 13.4% increase in net revenue to $83.8 million · 13% increase in gross profit to $71.8 million · 45% reduction in the net loss · 6X improvement in the adjusted EBITDA loss for 2024 · Net cash provided by operating activities of $230,000 in 2024 · All time company quarterly record of $26.2 million of net revenue in Q4 2024 · Net Income of $141,000 in Q4 2024 · 33 new Agencies/Brands were signed up · Secured a $10.0 million credit line in July · Completed a Master Services Agreement with one of the largest retailers in the world, and · Launched the IntentKey Platform, an advanced AI agent specifically designed for audience modeling.
Added
Of this amount, $533,093 was recognized in Other Income, and $77,259 of interest was recorded in Financing expense, net. The Company received an additional ERC payment from the IRS related to the second quarter of 2021, totaling $606,156. Of this amount, $525,085 was recognized in Other Income, and $81,071 of interest was recorded in Financing expense, net.
Removed
Results of Operations For the Years Ended December 31, 2024 2023 Change % Change Net Revenue $ 83,793,859 $ 73,911,528 $ 9,882,331 13.4 % Cost of Revenue 12,033,777 10,477,272 1,556,505 14.9 % Gross Profit $ 71,760,082 $ 63,434,256 $ 8,325,826 13.1 % 17 Table of Contents Net Revenue We reported $83.8 million in net revenue for the year ended December 31, 2024, a 13.4% increase compared to $73.9 million during the same period in 2023.
Added
During the year ended December 31, 2025, the Company received a refund of approximately $700,000 from a partner related to amounts previously paid in 2022. The refund was recognized in other income during 2025 and represents a non-recurring item.
Removed
During 2024, the higher revenue was primarily driven by Platform customers where we launched new product enhancements tailored to their needs. Net revenue for the quarter ended December 31, 2024 was $26.2 million, representing the highest quarterly revenue in the Company's history and a 25% increase compared to the same period in 2023.
Added
During the year ended December 31, 2025, we utilized the ATM Agreement and sold 165,641 shares of common stock for gross proceeds of $1,184,740, before deducting commissions and other offering-related costs. On July 31, 2024, we entered into a Financing and Security Agreement (the “Financing Agreement”) with SLR Digital Finance LLC (“SLR”), effective July 30, 2024.
Removed
The higher revenue was due to increasing demand within both Platforms and Agencies & Brands. Our largest Platform partner, which introduced a new product in 2023, continued to generate strong performance throughout 2024. During 2024 our largest customer accounted for 75% of our revenues. In 2023, the same customer accounted for 60.4% of our revenues.
Added
Pursuant to the terms of the Financing Agreement, SLR will finance up to $10 million subject to availability based on the amount of eligible accounts receivable. Eligibility is determined by criteria such as geographic location of the customer and aging of receivables.
Removed
On July 31, 2024, we entered into a Financing and Security Agreement (the "Financing Agreement”) with SLR Digital Finance LLC ("SLR”), effective July 30, 2024. Pursuant to the terms of the Financing Agreement, SLR will finance up to $10 million dependent upon eligible receivables. Availability as of December 31, 2024 equaled the maximum credit commitment of $10,000,000.
Added
As of December 31, 2025, our accounts receivable, net of allowance for credit losses, were $5,887,884, of which a substantial portion qualified as eligible under the Financing Agreement. At December 31, 2025, the outstanding balance due under the Financing Agreement was $3,288,100. See Note 6 – Bank Debt to our Consolidated Financial Statements.
Removed
Net cash provided by investing activities in 2023 was $606,190 and consisted primarily of proceeds from the sale of marketable securities partially offset by capitalized internal development costs.
Added
Subsequent to December 31, 2025, on January 14, 2026, the Company entered into a securities purchase agreement with a certain investor pursuant to which the Company authorized the issuance of subordinated convertible notes in the aggregate principal amount of approximately $3.33 million, subject to a 10% original issue discount.
Removed
Net cash provided by financing was $3,456,924 during 2023, primarily from the proceeds from the capital raise (see Note 1 – Organization and Business to our Consolidated Financial Statements). Critical Accounting Policies and Estimates The preparation of financial statements in conformity with U.S.
Added
The subordinated convertible note is convertible into shares of the Company’s common stock at a conversion price of $3.10 per share, subject to applicable NYSE American ownership limits and certain registration rights obligations.
Removed
Our revenue is derived from the placements of advertisements across advertising channels, browsers, applications and devices. Pricing for those advertisement placements is typically either on a cost-per-click or cost per thousand impressions basis.

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