Scinai Immunotherapeutics Ltd. (NASDAQ: SCNI) reported net income of approximately $1.6 million for the six months ended June 30, 2026, reversing a net loss of $4.1 million in the prior-year period.

The profitability shift was driven primarily by an approximately $6.4 million bargain purchase gain associated with the acquisition of Recipharm Israel. The company clarified that this gain does not represent operating revenue or operating cash flow.

Financial Performance

Revenue increased to $949 thousand, up from $773 thousand in the first half of 2025. The growth was attributable to the inclusion of revenues from the acquired Yavne operations from the acquisition date. Recognized revenue reflects only services performed and criteria satisfied through June 30, 2026, excluding the full value of signed work orders extending beyond the period.

Cost of revenues rose to $3.3 million from $2.0 million year-ago, reflecting the expanded cost base of the CDMO business following the Yavne acquisition. This included additional personnel, facility, depreciation, and manufacturing costs.

Research and development expenses decreased to approximately $0.8 million from $1.2 million, reflecting lower expenditures and resource allocation toward CDMO activities. Marketing, general, and administrative expenses increased slightly to $1.4 million from $1.3 million, due to integration costs of the Yavne operations.

The operating loss widened to approximately $4.6 million from $3.8 million in the first half of 2025.

What the Numbers Show

The reported net income of $1.6 million is entirely non-operational in nature. With an operating loss of $4.6 million and a bargain purchase gain of $6.4 million, the gain accounts for roughly 80% of the pre-tax income required to reach the bottom line. This indicates that core business operations remain loss-making despite revenue growth, with profitability currently dependent on acquisition-related accounting adjustments rather than operational efficiency or margin expansion.

Liquidity and Cash Position

Net cash used in operating activities was approximately $3.9 million, compared with $2.6 million in the prior-year period. As of June 30, 2026, cash, cash equivalents, and restricted cash totaled approximately $2.9 million. Shareholders' equity stood at approximately $11.7 million.

The post-acquisition liquidity position was bolstered by approximately €2.0 million in cash held by Recipharm Israel at closing, alongside funds for certain pre-closing expenses and liabilities.

Business Updates

Committed customer orders reached approximately $3.1 million as of August 16, 2026, with approximately $2.1 million invoiced. The company is progressing an expanded clinical manufacturing and CMC program for a U.S.-based biopharmaceutical company, building on an existing relationship.

Approximately $650 thousand in cash payments and advances have been received for this expanded program. Substantive activities are underway while the definitive agreement covering broader scope and commercial terms remains under negotiation. The program supports an investigational drug product toward U.S. IND submission and Phase III clinical development.

Scinai continues to pursue approximately $5 million in CDMO revenues for 2026. An investor webinar is scheduled for August 26, 2026, at 11:00 am EDT.

Scinai Immunotherapeutics Ltd reported a net income of $3.6 million for the first quarter ended March 31, 2026, compared to a net loss of $1.6 million in the prior-year period, primarily due to a non-cash bargain purchase gain of $6.2 million. The company completed the acquisition of Recipharm Israel, expanding its contract development and manufacturing organization (CDMO) platform through the addition of a second manufacturing site in Yavne, Israel. This strategic move established a commercial collaboration with Recipharm AB and added approximately $6.2 million of net identifiable assets to the balance sheet.

Revenues for the quarter were $489 thousand, compared to $586 thousand in the prior-year period, with approximately $200 thousand generated by the Yavne facility post-acquisition. Cost of revenues increased to $1.6 million from $0.4 million, reflecting the growth of CDMO operations and a revised cost allocation methodology that reclassified certain employee and facility costs from research and development to cost of revenues. Consequently, research and development expenses decreased to $0.6 million from $1.3 million, a change attributed to the accounting methodology rather than a reduction in R&D activities.

Marketing, general and administrative expenses rose to $0.7 million from $0.5 million, driven by the expansion of operations following the Recipharm Israel acquisition. The company reported an operating loss of $2.5 million, compared to $1.6 million in the prior year, due to increased expenses from CDMO expansion and changes in cost allocation. Cash, cash equivalents and restricted cash totaled $3.1 million as of March 31, 2026, compared to $1.8 million as of December 31, 2025, while total assets increased to $17.6 million and shareholders' equity rose to $11.8 million.

Financial Results

Operational Update

Scinai consolidated its CDMO activities under Scinai Biopharma Services Ltd following the acquisition. The combined platform now offers capabilities spanning biologics, sterile injectable products and small-molecule API development and manufacturing services. The company advanced multiple non-dilutive funding initiatives, including Polish FENG grant applications for its PC111 and systemic IL-17 bispecific NanoAb programs, and an Israel Innovation Authority grant application for the systemic IL-17 bispecific NanoAb program. Management expects several grant decisions during the second half of 2026.

The company prioritized the development of a systemic IL-17 bispecific antibody as the lead validation program for its NanoAb platform. Scinai continues its collaboration with the Max Planck Society and University Medical Center Göttingen and is engaged in discussions regarding the expansion and amendment of existing license arrangements.