Jet.AI Inc. Form 10-Q Summary
Business Context and Reporting Period
This Quarterly Report on Form 10-Q covers the period ended June 30, 2026. Jet.AI Inc. is an emerging provider of high-performance GPU infrastructure and AI cloud services, transitioning from its historical focus on private aviation (fractional ownership, jet cards, and aircraft management). The Company is classified as a non-accelerated filer, smaller reporting company, and emerging growth company. As of August 11, 2026, there were 3,557,521 shares of common stock outstanding.
Key Financial Metrics
| Metric | Three Months Ended June 30, 2026 | Six Months Ended June 30, 2026 |
|---|---|---|
| Revenues | $5,320,145 | $7,001,381 |
| Cost of Revenues | $5,503,893 | $7,419,352 |
| Gross Loss | $(183,748) | $(417,971) |
| Operating Expenses | $2,498,958 | $5,130,287 |
| Operating Loss | $(2,682,706) | $(5,548,258) |
| Net Loss | $(2,276,671) | $(4,957,773) |
| Cash and Cash Equivalents (End of Period) | $10,608,614 | |
| Accumulated Deficit | $(52,914,377) |
Other Key Metrics:
- Unrealized Gain on Investments: $399,000 (Q3) and $493,000 (YTD) primarily from the AI Infrastructure Acquisition Corp. (AIIA) investment.
- Stock-Based Compensation: $64,382 (Q3) and $128,764 (YTD).
- Net Cash Used in Operating Activities: $(5,698,607) for the six months ended June 30, 2026.
- Net Cash Provided by Financing Activities: $22,837,718 for the six months ended June 30, 2026, driven by ATM sales.
Material Changes vs. Prior Period
- Revenue Growth: Revenues increased 139% year-over-year for the quarter and 23% for the six-month period. This increase is primarily attributable to a one-time gross revenue of $3.45 million from the sale of a HondaJet aircraft in May 2026. Excluding this sale, recurring revenues from legacy aviation operations decreased.
- Operating Expenses: Total operating expenses increased slightly for the quarter but decreased for the six-month period compared to 2025. General and administrative expenses increased due to legal, consulting, and regulatory fees associated with the flyExclusive transaction and strategic transition, partially offset by a significant reduction in stock-based compensation ($1.3M in 2025 vs. $0.13M in 2026 YTD).
- Investment Activity: The Company made significant investments in its AI strategy, contributing $3.1 million to the Convergence Compute joint venture and $5.25 million for VERSO Capital equity certificates (tracking SpaceX) during the six-month period.
- Capital Structure: The Company completed a 1-for-200 reverse stock split effective April 8, 2026. All share and per-share data in this report are retroactively adjusted.
Guidance, Outlook, and Risks
Strategic Transition and Spin-Off: On July 13, 2026 (subsequent to the reporting period), the Company completed the spin-off of its fractional and jet card business to flyExclusive, Inc. Following this transaction, Jet.AI will focus on high-performance GPU infrastructure, AI cloud services, its data center joint venture, and its beneficial interest in AI Acquisition. The spin-off is expected to reduce stockholders' equity by approximately $18.4 million.
Reverse Takeover LOI: On July 15, 2026, the Company entered into a non-binding Letter of Intent (LOI) for a reverse takeover transaction with a privately held operating company valued at approximately $300 million. The transaction contemplates a spin-off of the Company's data center and AI Acquisition interests into a new public company.
Liquidity and Going Concern: The Company has incurred losses since inception and has an accumulated deficit of $52.9 million. Management has raised concerns about the Company's ability to continue as a going concern without additional capital. The Company plans to fund operations through retained cash, remaining operations, and potential equity or debt sales. In the absence of external financing, the Company is prepared to reduce cash burn significantly.
Risks: Key risks include the uncertainty of completing the reverse takeover transaction, the ability to raise additional capital, and the valuation volatility of Level 3 investments (AIIA and VERSO).
Investor Verification Checklist
- Spin-Off Accounting: Verify the final purchase price determination for the flyExclusive transaction and the resulting impact on the Company's balance sheet and equity.
- Investment Valuation: Review the fair value methodology (Level 3) for the AIIA Sponsor Equity Interest ($17.6M) and VERSO Capital certificates ($5.3M), noting the reliance on unobservable inputs and probability-weighted assumptions.
- Reverse Takeover Status: Monitor the progress of the non-binding LOI entered into in July 2026, including the execution of definitive agreements and regulatory approvals.
- Liquidity Runway: Assess the Company's cash burn rate post-spin-off and the sufficiency of the $10.6M cash balance (pre-spin-off) to fund operations until the next financing event.
- ATM Program Utilization: Track the remaining capacity under the $50 million At-The-Market (ATM) sales agreement and the dilution impact of subsequent share issuances.