Ondas Inc. Annual report [Section 13 and 15(d), not S-K Item 405]

Annual report [Section 13 and 15(d), not S-K Item 405]

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

Loss from operations before income taxes for the years ending December 31 were as follows:

	December 31,
(dollars in thousands)	2025			2024
United States	$	(116,726	)	$	(25,868	)
Non-United States		(16,166	)		(12,139	)
Loss before income taxes	$	(132,892	)	$	(38,007	)

Schedule of Provision Before Income Taxes

The provision (benefit) from income taxes was as follows:

	December 31,
(dollars in thousands)	2025			2024
Current
U.S. Federal	$	-		$	-
State and local		-			-
Non-U.S.		504			-
	$	504		$	-
Deferred
U.S. Federal	$	-		$	-
State and local		-			-
Non-U.S.		(16	)		-
	$	(16	)	$	-
Total
U.S. Federal	$	-		$	-
State and local		-			-
Non-U.S.		488			-
	$	488		$	-

Schedule of Effective Income Tax Rate

The effective income tax rate from operations for the years ended December 31 varies from the U.S. statutory federal income tax rate as follows. Periods presented that are prior to the adoption of ASU 2023-09 have not been adjusted.

	December 31, 2025
(dollars in thousands)	Amount			Percentage
U.S. Federal Statutory Rate	$	(27,907	)		21	%
State and local income tax, net of national income tax effect		-			-
Foreign tax effects
Israel
Statutory tax rate difference between Israel and United States		(323	)		0.2	%
Change in valuation allowance		4,207			(3.2	)%
Change in valuation allowance		6,505			(4.9	)%
Nontaxable or nondeductible items
Transaction costs		919			(0.7	)%
Stock-based compensation		(1,524	)		1.1	%
Other adjustments
Change in fair value of warrant liability, net		17,267			(13	)%
Deferred adjustment		1,344			(1	)%
Effective tax rate	$	488			(0.4	)%

A reconciliation of the provision for income taxes with the amounts computed by applying the Federal income tax rate to income from operations before the provision for income taxes is as follows for the year ended December 31, 2024:

	Year-ended December 31, 2024
U.S. federal statutory rate		21.0	%
Federal true ups		0.82	%
State taxes, net of federal benefit		1.29	%
Change in valuation allowance		(23.45	)%
Stock-based compensation		(0.25	)%
Acquisition costs		-
Foreign rate differential		0.66	%
Nondeductible expenses		(0.07	)%
Effective income tax rate		-	%

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows:

	December 31,
(dollars in thousands)	2025			2024
Deferred Tax Assets:
Tax benefit of net operating loss carry-forward	$	95,075		$	69,411
Accrued liabilities		349			570
Stock-based compensation		3,696			379
Depreciation		908			400
Amortization		-			4
Inventory reserve		291			64
Investment impairment		381			434
Operating lease liabilities		1,942			1,745
R&D capitalization		11,885			8,960
R&D credit		1,166			751
Other		2,095			1,428
Total deferred tax assets		117,788			84,146
Deferred Tax Liabilities:
Intangibles		(33,724	)		(5,603	)
Deferred rent		(1,352	)		(1,048	)
Unrealized gain		(1,373	)		-
Total deferred tax liabilities		(36,450	)		(6,651	)
Total net deferred tax assets		81,339			77,495
Valuation allowance for deferred tax assets		(95,870	)		(77,495	)
Deferred tax assets, net of valuation allowance	$	(14,531	)	$	-

Schedule of Change in Valuation Allowance

The change in the Company’s valuation allowance is as follows:

	Years Ended December 31,
(dollars in thousands)	2025		2024
Beginning of the year	$	77,495	$	68,902
Change in valuation account		18,375		8,593
End of the year	$	95,870	$	77,495