CID Holdco, Inc. (DAIC) - 10-K Filing Summary
Business Context and Reporting Period
Company: CID Holdco, Inc. (formerly SEE ID Inc., dba Dot AI)
Reporting Period: Fiscal Year Ended December 31, 2025
Business Overview: CID Holdco develops an asset tracking platform (Dot Cloud) leveraging Industrial IoT, RFID, and AI for real-time location tracking. The company serves industries including construction, military, mining, and warehousing. Operations include hardware manufacturing in Puerto Rico and software development in the US and India.
Recent Corporate Action: On June 18, 2025, the company consummated a business combination with ShoulderUp Technology Acquisition Corp. (SUAC), resulting in a reverse recapitalization and public listing on Nasdaq under the symbol "DAIC".
Key Financial Metrics
| Metric | 2025 | 2024 |
|---|---|---|
| Revenue | $5,804,369 | $172,661 |
| Gross Profit | $2,671,230 | $129,027 |
| Gross Margin | 46.0% | 74.7% |
| Net Loss | $(36,718,071) | $(21,537,430) |
| Cash and Equivalents (Year End) | $865,624 | $721,032 |
| Working Capital | $(1,730,095) Deficit | $(1,215,988) Deficit |
| Accumulated Deficit | $(61,451,334) | $(24,733,263) |
Debt and Liquidity: As of December 31, 2025, the company held short-term debt of approximately $1.54 million (net) related to a senior secured convertible loan with J.J. Astor & Co. The company maintains a $50 million Equity Line of Credit (ELOC) with New Circle Principal Investments LLC, under which it raised approximately $555,000 in 2025.
Material Changes vs. Prior Period
- Revenue Growth: Revenue increased by 3,261.7% to $5.8 million, driven primarily by a shift from service-only revenue in 2024 to significant hardware sales (bridges, labels, gateways) in 2025.
- Margin Compression: Gross margin decreased from 74.7% to 46.0% due to the lower-margin mix of hardware sales compared to the previous year's service revenue.
- Expense Increases: General and Administrative expenses surged 332.7% to $6.8 million due to public company costs and business ramp-up. Sales and Marketing expenses increased 34.9% to $3.7 million.
- Non-Operating Items: The 2025 net loss includes significant non-cash charges: a $17.4 million change in fair value of SAFE notes (converted to equity), a $5.7 million loss on debt extinguishment, and $2.7 million in business combination transaction costs.
- Capital Structure: The company converted all outstanding SAFE notes into common stock and raised $10.8 million in PIPE financing during the business combination.
Guidance, Outlook, Risks, and Contingencies
Going Concern: The independent auditor has expressed substantial doubt about the company's ability to continue as a going concern. The company has a working capital deficit and expects to incur substantial operating losses. Continued operations depend on raising additional capital.
Outlook and Strategy: Management plans to pivot spending toward sales and marketing to drive customer acquisition. The company intends to expand internationally (Europe, India) and monetize data streams. Revenue forecasts are described as unstable through 2026 due to an immature sales pipeline.
Key Risks:
- Internal Controls: Material weaknesses were identified in internal controls over financial reporting, including insufficient accounting personnel and segregation of duties.
- Liquidity: Reliance on the ELOC and potential need for further equity or debt financing. Failure to secure funding could force spending reductions.
- Customer Concentration: In 2025, 100% of revenue came from three customers, with one customer accounting for approximately 85% of total revenue.
- Supplier Concentration: Dependence on a key supplier in Israel for critical components; switching suppliers could cause delays.
- Legal Proceedings: A lawsuit filed by a former employee (William Reny) alleging breach of employment agreement and tortious interference. The company is vigorously defending the action.
- Nasdaq Compliance: The company received deficiency notices in February 2026 regarding minimum bid price, market value, and publicly held share value requirements. It has 180 days to regain compliance or face delisting.
Investor Verification Checklist
- Liquidity Runway: Verify the sufficiency of the $865k cash balance against the $1.7M working capital deficit and upcoming debt service obligations.
- Customer Concentration: Assess the risk of losing the single customer representing 85% of 2025 revenue.
- Nasdaq Status: Monitor the company's progress in regaining compliance with Nasdaq listing standards to avoid delisting.
- Internal Controls: Review the remediation plan for identified material weaknesses in financial reporting.
- Debt Covenants: Examine the terms of the J.J. Astor & Co. loan, specifically the requirement to use ELOC proceeds for monthly payments and the conversion triggers upon default.
- Revenue Quality: Distinguish between one-time hardware sales and recurring SaaS subscription revenue to evaluate long-term sustainability.