SOBR Safe, Inc. Annual Report: A Plain-English Guide

I’ve put together this guide to help you understand how SOBR Safe, Inc. performed this year. My goal is to break down their financial filings into a simple conversation so you can decide if this company fits your investment goals.

1. What does this company do?

SOBR Safe is a safety-tech company focused on alcohol detection. They sell hardware, such as SOBRcheck (a touch-based scanner) and SOBRsure (a wearable band). These devices connect to their SOBRsafe software to provide real-time, cloud-based monitoring. They target high-risk industries like construction and fleet management to prevent accidents, while also working with addiction treatment centers and judicial programs. Their business model relies on selling hardware and charging monthly subscription fees for their software.

2. A Major Change: The Reverse Stock Split

You may have noticed a big jump in the stock price in April 2025. The company performed a 1-for-10 reverse stock split. Simply put: if you owned 100 shares before, you owned 10 shares after. The total value of your investment stayed the same, but the share count dropped and the price per share rose. Companies often do this to keep their stock price above $1.00, which is required to stay listed on the Nasdaq.

3. Financial Health and "Going Concern"

This is the most important part for you to understand. Since starting, the company has lost about $106.4 million. This year, they brought in roughly $0.4 million in revenue, but their expenses were much higher, leading to a large loss. Auditors have issued a "going concern" warning, which means the company does not have enough cash to fund operations for the next 12 months. Because they rely on outside funding to pay the bills, they frequently issue more shares. This causes dilution, meaning your "slice of the pie" gets smaller as they create more shares to raise cash.

4. The Nasdaq "Red Flag"

The company is fighting to stay on the Nasdaq. In March 2026, they received a notice that their stock price was trading below the $1.00 minimum. They have already performed reverse splits totaling 1-for-1,100 over the last two years, exhausting most of their options. They are currently appealing this to a Nasdaq panel. If the appeal fails, the stock will be delisted and move to the "Over-the-Counter" markets, which usually makes the stock harder to trade and less attractive to large investors.

5. Why the Future is Hard to Predict

The company admits their financial results are unpredictable. As an early-stage business, their revenue can swing wildly due to:

• Customer Adoption: Selling safety tech takes a long time, and they have struggled to turn pilot programs into large, long-term contracts.
• Funding: Their ability to raise cash depends on market interest and staying on the Nasdaq.
• Small Team Risks: With a small staff, losing key leaders could stall product development or sales.

6. Key Risks: What could go wrong?

• Funding Needs: The company expects to keep losing money. They must raise more cash to survive, which will likely dilute your shares further.
• Delisting Risk: If they are kicked off the Nasdaq, the stock could become a "penny stock." This triggers stricter rules and makes it harder for retail investors to trade.
• Market Adoption: They are trying to change how industries handle safety. Convincing conservative companies to adopt new alcohol-tracking tech requires a lot of cash for marketing. If they cannot grow quickly, their technology may become obsolete before they ever turn a profit.

Final Thought for Investors: When looking at a company like SOBR Safe, it is helpful to weigh the potential of their safety technology against the significant financial hurdles they face. Because they are currently operating at a loss and relying on share dilution to stay afloat, it is worth considering whether you are comfortable with the high level of risk associated with early-stage, cash-strapped companies. Always ensure your investment aligns with your personal risk tolerance and long-term financial strategy.