{"url_path":"/sec/pcsv/10-k/2026/item-1","section_key":"item-1","section_title":"Item 1 Business.**","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-26","source_url":"https://www.sec.gov/Archives/edgar/data/1122020/0001493152-26-030242-index.html","accession_number":"0001493152-26-030242","cik":"0001122020","ticker":"PCSV","issuer_name":"PCS Edventures!, Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1122020/0001493152-26-030242-index.html","primary_entity_key":"0001122020","primary_entity_name":"PCS Edventures!, Inc."},"word_count":3968,"has_tables":true,"body_markdown":"**Item\n1. Business.**\n\n \n\n**History\nand Organization**\n\n** **\n\nPCS\nEdventures!, Inc., an Idaho corporation (“PCS,” the “Company,” “we,” “our,” “us,”\nand words of similar import), was originated under the laws of the State of Idaho on August 3, 1994, as “PCS Education Systems,\nInc.” On March 27, 2000, we changed our name from “PCS Education Systems, Inc.” to “PCS Edventures!.com, Inc.”;\nand on August 31, 2015, we changed our name from “PCS Edventures!.com, Inc.” to “PCS Edventures!, Inc.” PCS Edventures!,\nInc. is our current company name.\n\n \n\nOn\nFebruary 18, 2016, we announced the completion of an asset purchase of Thrust-UAV, a privately-held company focused on drone technology.\n\n \n\nOn\nMarch 27, 2017, the Company filed a Form 15-12g with the United States Securities and Exchange Commission (the “Commission”)\nwhereby, under Rule 12g-4(a)(1) and Rule 12h-3 (b)(1)(i), it terminated its duty to file reports with the Commission.\n\n \n\nEffective\nDecember 31, 2017, the Company’s Executive Vice President, Director, and highest-ranking operations officer, resigned to pursue\nother interests. Given his tenure at the Company of over 20 years and his position at the time of his departure, this effectively caused\na change in executive leadership at the Company. On January 1, 2018, Michael J. Bledsoe, then Vice President and Treasurer, and a Director,\nwas appointed to assume responsibility for the operational oversight of the Company. On April 23, 2018, he was promoted to President,\na position he currently holds. Todd R. Hackett was Chairman of the Board and CEO at the time of this transition and remains in those\npositions with the Company.\n\n \n\nThe\nCompany’s Board of Directors determined that it was in the best interests of the shareholders of the Company to register its common\nstock pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and return to its\nformer status as a “fully-reporting” entity with the Commission given the Company’s improved financial condition and\nmanagement’s desire to improve the Company’s reporting quality to shareholders. Accordingly, the Company filed a Form 10\nRegistration Statement with the Commission on October 3, 2023, which became effective December 4, 2023 (the “Form 10 Registration\nStatement”).\n\n \n\nOn\nJanuary 22, 2025, the Board of Directors appointed Sean P. Iddings to the Board of Directors, bringing the Board members to three (3)\nDirectors.\n\n \n\nOn\nApril 10, 2025, the Board of Directors announced that it had authorized a share repurchase program allowing the Company to repurchase\nup to 10 million shares (pre-reverse split) of its common stock over the next three (3) years. The post-reverse split amount of the share\nrepurchase program is 833,334 shares of common stock.\n\n \n\nOn\nSeptember 15, 2025, the Company announced the appointment of Suzanne DeZego as its Chief Operating Officer.\n\n \n\nOn\nMarch 23, 2026, the Company filed a Definitive 14C Information Statement with the SEC (the “Definitive 14C”), announcing\na Special Meeting of Shareholders to be held on April 20, 2026, to vote on a one (1) for 12 reverse stock split and reducing our 125,000,000\nauthorized shares of common stock to 12 million shares. The Board of Directors held a majority of our outstanding shares and indicated\ntheir intent to vote in favor of the proposals in the Definitive 14C. The reverse split became effective May 4, 2026, before the filing\nof this fiscal year 2026 10-K Annual Report (the “Annual Report”). Consequently, all share metrics contained in this Annual\nReport will use the post-reverse split share numbers, unless otherwise notated.\n\n \n\nThe\nshare repurchase program announced on April 10, 2025, allows up to 833,334 shares to be repurchased. As of March 31, 2026, the Company\nhas repurchased 481,561 shares under this program.\n\n \n\n3\n\n \n\n** **\n\n**Overview**\n\n \n\nThe\nCompany specializes in creating experiential, hands-on, transitional kindergarten through 12th grade (TK-12) STEM (Science,\nTechnology, Engineering, and Math) education products and curriculum. “STEM” is often abbreviated as STEAM – Science,\nTechnology, Engineering, Arts, and Math – to include the arts. We use the terms STEM and STEAM interchangeably throughout this\nAnnual Report and make no significant distinction between the two (2) terms. Through our acquisition of Thrust-UAV, we have developed\neducational drones and drone curriculum. Our customers include schools and school districts from the collegiate to transitional kindergarten\nlevel, and providers of out-of-school programming, which include after-school programs, military education programs, home-schooling programs,\nsummer programs, and corporate outreach programs. We sell predominately in the United States and sell into nearly every state in the\nnation. We have a few international customers, but revenue from customers outside of the United States is not material, and we do not\nfocus our sales efforts on international markets at this time.\n\n \n\nOur\nproducts facilitate STEM education by providing engaging activities that demonstrate STEM concepts and inspire further STEM studies,\nwith the goal of ultimately leading students to pursue STEM career pathways. Due to our exceptionally detailed curriculum, our products\nare easy to teach and do not require a teaching degree or experience to administer.\n\n \n\nPCS’\neducational products are developed from both in-house efforts and contracted services. They are marketed through reseller channels, direct\nsales efforts, partner networks, and web-based channels.\n\n** **\n\n**Products**\n\n \n\nPCS\nhas developed and sells a variety of STEM education products into the TK-12 market, which can be categorized as follows:\n\n \n\n \n1.\nEnrichment\nPrograms\n\n \n \n \n\n \n \nThese\ncamps are for the informal learning market and are designed to be highly engaging for students while easily administered by the instructor.\nThe Company offers approximately 36 different enrichment programs and typically develops at least two (2) new programs each year.\nSome of the more popular programs include *Drone Designers; Ready, Set, Drone!; Rockin Robots; Influencer Camp; Cubelets Bot Builder;\nOceanic Exploration; Cosmic Coders; and World of Wonders.*\n\n \n \n \n\n \n2.\nDiscover\nSeries Products\n\n \n \n \n\n \n \nThese\nproducts are designed for the makerspace environment and include engaging STEM activities that motivate students to pursue educational\npathways toward STEM careers. The Discover Series includes *Discover Engineering; Discover Robotics & Physics; Discover Robotics\n& Programming; Discover STEM; and Discover Digital Video.*\n\n \n \n \n\n \n3.\nBrickLAB\nProducts\n\n \n \n \n\n \n \nThese\nproducts are designed for the grade school market and use the Company’s proprietary bricks (which are Lego compatible) and\ncurriculum to engage students to explore, imagine, and create within a STEM education framework. The Company offers a variety of\ngrade-specific BrickLAB products.\n\n \n\n \n4.\nDiscover\nDrones, Drone Pathways, Add-on Drone Packages, and Ala Carte Drone Items\n\n \n \n \n\n \n \nThese\nproducts are designed around using drones as a platform for STEM education and career exploration. These titles include the Discover\nDrones series of Products; *Discover Drones Indoor Coding Bundle; Indoor Racing Add-On; Outdoor Practice Add-on*; and all the\nspare parts and ala carte drone items offered in the Company’s comprehensive drone packages.\n\n \n\n4\n\n \n\n \n\n \n5.\nSTEAMventures\nBUILD Activity Book\n\n \n \n \n\n \n \nThese\nseries of activity books are designed for the TK-3 market and are ideal for a distance-learning environment. The series includes\n12 different issues. Instructor guides and/or family engagement guides are included. The Company also provides the necessary bricks\nfor the builds in the activity books as a separate, but related product.\n\n \n \n \n\n \n6.\nProfessional\nDevelopment Training\n\n \n \n \n\n \n \nThe\nCompany offers professional development trainings, for a fee, to educators who are implementing the Company’s products in their\nclassroom.\n\n \n\nThe\nCompany intends to continue developing STEM education products that address demand from large markets.\n\n \n\n**Distribution\nMethods of Products**\n\n** **\n\nThe\nCompany sells its products directly to customers and through resellers. The Company kits all of its products at its Meridian, Idaho,\nfacility and ships the products directly to customers. Resellers do not typically inventory the Company’s products, and the Company\n“drop ships” its products directly to the resellers’ customers. Trainings and Professional Development sessions are\nconducted either at the Company’s facilities or at the customer’s location, depending on the desires of the customer. Customers\ncan buy from the Company’s website, from a reseller’s website, or by presenting the Company with a valid purchase order.\n\n** **\n\n**Competition**\n\n \n\nThe\nSTEM education market is not well defined and is very fragmented. Our products experience competition from multiple angles. Most schoolteachers\nwith exposure to STEM can create their own lesson plans, using their own materials, to emulate the educational benefits of using the\nCompany’s products, at a fraction of the cost. The value proposition of our products is less compelling in a budget-constrained\nenvironment, as cost becomes an overriding factor in many such cases. Additionally, there are several sources of free and inexpensive\ncurriculum that teachers can use to help them deliver STEM educational concepts similar to those experienced by the users of our products.\n\n \n\nIn\naddition to competition at the local level, many of our products face competition from similar products produced by multinational companies\nthat have significant advantages over us in terms of financial resources, human resources, brand loyalty, supply-chain costs, and global\nreach. While many of these companies primarily target the toy industry, their sheer size and cost advantages allow them to easily breach\nthe education market with their products. In this regard, the Company competes directly with Lego, Robolink, Fischertechnik, K’Nex\n(acquired by Basic Fun), and Vex IQ, among many others.\n\n \n\nThere\nare numerous for-profit companies of various sizes that develop and sell STEM educational products. A good example is Teacher Created\nMaterials, a company headquartered in Huntington Beach, California. They are very similar to our Company and much larger.\n\n \n\nWe\nalso compete against non-profit organizations, such as Project Lead The Way, who have a mission to promote and implement STEM education.\nThe programs they provide can be free, subsidized, government-sponsored, rigorously developed, and/or heavily promoted, creating intense\ncompetition for our products and services.\n\n \n\nWhile\nthere may be several characteristics that differentiate our Company’s products from those of our competition, all of us are competing\nfor a finite market. There are several potential solutions to STEM education demand and, oftentimes, companies can achieve a first-mover\nadvantage by developing a relationship with a customer or distributor, and integrating their suite of products and services into the\nsupply chain before we can showcase our offerings.\n\n \n\nWe\nbelieve that we have a competitive advantage in curriculum development. We employ STEM teachers who, through experience, understand the\nenvironment that educators operate within and the unique challenges they face, and\nwe develop our curriculum with the educator in mind for an easy, successful, and consistent implementation. Many of our competitors’\nproducts focus on the product or the student, with the educator left to figure out the details of implementation.\n\n \n\n5\n\n \n\n \n\n**Manufacturing,\nSupplies, and Quality Control**\n\n \n\nOur\nEnrichment Programs contain several types of materials, kitted in a box. There is no manufacturing involved in the creation of our final\nproduct in the Enrichment Program category. Nearly all materials used are non-proprietary and commercially available. The materials are\nmostly consumer discretionary (paper, crayons, pencils, tape, yarn, etc.) and sourced from a variety of vendors, some of which are located\noutside of the United States. Some of our Enrichment Programs contain proprietary products from other companies, commercially available,\nand the Company maintains close relationships with these suppliers. The final creation of the product via kitting and packaging is done\nat our warehouse facility in Meridian, Idaho. This includes the printing of the curriculum. All curriculum development oversight is performed\nat our corporate facility, also in Meridian, Idaho, but separate from our warehouse facility.\n\n \n\nWe\nhave been working closely with our vendors located outside of the United States to determine the impact of any tariff on our transactions.\nMost vendors pass a portion of the tariff amount onto their customers, including us. In some cases, we have negotiated to split the tariff\namount with the vendor. Tariffs are a relatively new development, and we are proactively assessing the impact of them on our costs.\n\n \n\nOur\nDiscover series of products contains some proprietary products designed by our Company and manufactured abroad as well as non-proprietary,\ncommercially available products. Most of our Discover series of products are comprised of other companies’ final products, combined\nwith our curriculum. Our RubiQ education drone is a proprietary product of the Company and is the main component in Discover Drones.\nThe RubiQ education drone’s components are manufactured abroad and quality-controlled at our corporate facility. The final creation\nof the product via kitting and packaging is done at our warehouse facility in Meridian, Idaho. This includes the printing of the curriculum.\nAll curriculum development oversight is performed at our corporate facility, also in Meridian, Idaho, but separate from our warehouse\nfacility.\n\n \n\nOur\nBrickLAB products contain proprietary plastic building bricks (that are Lego compatible) manufactured for us by a long-time vendor with\nmanufacturing facilities in South Korea. The final creation of the product via kitting and packaging is done at our warehouse facility\nin Meridian, Idaho. This includes the printing of the curriculum; and all curriculum development oversight is also performed at our corporate\nfacility.\n\n \n\nThe\nSTEAMventures BUILD Activity Book was developed at our corporate facility. The final creation of the product via kitting and packaging\nis done at our warehouse facility. This includes the printing of the curriculum; and all curriculum development oversight is also performed\nat our corporate facility.\n\n \n\n**Sources\nand Availability of Raw Materials and Names of Principal Suppliers**\n\n \n\nRaw\nmaterial procurement became more challenging in the immediate aftermath of the Covid-19 pandemic. Backlogs created availability problems\nfor a few items, while shipping congestion significantly delayed shipment of many items from time to time, and prices of nearly all items\nincreased materially.\n\n \n\nSupply\nchains recovered as the Covid-19 pandemic receded, but tariff activity by the U.S. again complicated supply chain management. Consequently,\nwe experienced moderate inflation in the materials we use in our final products.\n\n \n\nThe\nrecent closure of the Strait of Hormuz has again elevated inflationary expectations. While we have experienced only modest raw materials\ncost increases, we expect that this could accelerate the longer the Strait remains closed.\n\n \n\nWith\nfew exceptions, we can generally source materials from multiple vendors, although the pricing from different vendors varies considerably.\nThus, supply problems that we experience generally do not impair our business from functioning. However, supply problems that cause us\nto procure from higher-priced sources negatively affect our gross margins as we cannot adjust our prices as quickly as the prices of\nour raw materials increase.\n\n \n\n6\n\n \n\n \n\nIn\nresponse to these challenging environments, we have raised prices on selected items every year to reset our margins back to desirable\nlevels after price increases of inputs. Additionally, we buy in bulk to achieve better pricing, and we have increased general inventory\nlevels. While we purchase from numerous vendors, below are our most used vendors by dollar volume:\n\n \n\n \nMida’s\nGlobal\n\n \nRobolink\n\n \nAmazon\n\n \nFPVelite\nElectronics\n\n \nFischertechnik\n\n \nErnest\nPackaging Solutions\n\n \nModular\nRobotics\n\n \niCreate\nto Educate\n\n \nMenards\n\n \n\n**Dependence\non One or a Few Major Customers**\n\n \n\nDuring\nFiscal Year 2026, we had four (4) major customers who each accounted for at least 5% of sales and who, when aggregated, accounted for\n22.8% of sales. The details of sales from our major customers are below:\n\n \n\n  \n  \n  \n  \nRelationship\n\nCustomer Designation \nFY 2026 \nFY 2025 \nFY 2024 \nDuration\n\nCustomer A \n 6.1% \n 3.3% \n 0.4% \n 7 years \n\nCustomer B \n 5.8% \n 8.7% \n 6.6% \n 14 years \n\nCustomer C \n 5.3% \n 4.6% \n 5.0% \n 11 years \n\nCustomer D \n 5.2% \n 7.9% \n 14.2% \n 15 years \n\n \n\nCustomers\nB and C are resellers. The sales from reseller customers represent the aggregation of many purchase orders each of these customers placed\nwith us throughout the year. Our reseller customers place an order with us when their customer orders our product from them. This cycle\nrecurs numerous times throughout any given year.\n\n \n\nWe\nwork closely and frequently with our larger customers to ensure that they are receiving the value proposition and service from us they\nrequire to continue doing business with us. We would categorize our relationship with these customers as excellent and do not believe\nthat there is a risk to any of these relationships over the next year.\n\n \n\nWe\nbelieve that the risk of losing any one (1) of these customers is small, and we are actively, and successfully, soliciting larger customers\nto diversify our current customer concentration. While we believe the risk of losing any one (1) of these major customers over the next\nyear is small, the loss of any two (2) of these customers, without similar replacement, would pose a significant risk to the financial\nhealth of the Company.\n\n** **\n\n**Seasonality\nof Business**\n\n \n\nOur\nbusiness is subjected to strong seasonal patterns during any given year, with our busiest period coinciding with summer learning and\nthe planning leading up to providing summer programs (January through July). The period between Thanksgiving and the New Year is our\nslowest time, coinciding with the holiday season, as most schools observe the holidays with significant time off during this period.\nThe table below demonstrates this seasonality:\n\n \n\n  \nQuarterly Revenue\n\n  \n2023 \n2024 \n2025\n\n3/31 \n 2,521,470  \n 2,262,772  \n 1,292,819 \n\n6/30 \n 2,605,281  \n 3,159,923  \n 2,423,309 \n\n9/30 \n 3,767,326  \n 2,267,338  \n 1,529,503 \n\n12/31 \n 459,087  \n 701,147  \n 754,889 \n\n \n\n7\n\n \n\n** **\n\n**Patents,\nTrademarks, Licenses, Franchises, Concessions, Royalty Agreements or Labor Contracts, including Duration**\n\n \n\nWe\ndo not have any designs or equipment which are patented, registered trademarked, or licensed.\n\n \n\n**Research\nand Development Costs During the Last Two Fiscal Years**\n\n \n\nWe\ncurrently expense our costs under a general operating expense category instead of capitalizing any research and development expenses.\n\n \n\n**Employees**\n\n \n\nAs\nof March 31, 2026, we had 28 full-time employees and one (1) part-time employee.\n\n \n\n**Growth\nPlan**\n\n \n\nOur\nprimary focus is to continue penetrating the U.S. market with our current product line as we feel the market is large relative to our\ncurrent market share and receptive to our value proposition of high-quality, easily implemented, hands-on STEM programs. We are actively\npursuing larger customers who can implement our programs at multiple sites, recognizing that some unique product development may be required\nfor these sales. We intend to develop new products and to enhance our current product line based on market feedback we receive, both\nsolicited and unsolicited, and based on developments within our market. We intend to further develop and enhance our educational drone\nproduct line, and we are prepared to compete intensely in this product category, as we believe that 1), our curriculum offers us a competitive\nadvantage in this space, and 2), the educational drone market is nascent and is expected to continue to grow significantly.\n\n \n\nIn\nresponse to new policies on education by the new administration, we are embarking on two (2) new initiatives that complement our current\nstrategies. The first initiative is to align our products more closely with state and standards and quality guidelines, especially where\nsuch a conversion is easy. In the past, we have aligned our products closer to national standards and quality guidelines (than state\nstandards) for the following three (3) reasons:\n\n \n\n1.\nMany of the programs we serve receive their funding from federal grants;\n\n2.\nWhen state standards are relevant, they are loosely applied to out-of-school-time programs; and\n\n3.\nThere is considerable overlap between federal standards and many of the state’s standards.\n\n \n\nGiven\nthe administration’s vocal desire to return education administration to the states, we believe that if it is successful in that\nendeavor, then paying more attention to state-level priorities will enhance the competitiveness and attractiveness of our products. This\nincludes the Career and Technical Education (“CTE”) space, which is well-funded.\n\n \n\nThe\nsecond initiative is to provide evidence that our products accomplish certain desired educational outcomes. Many of the opportunities\nthat we see that are sponsored by a state entity require evidence-based solutions. We anticipate that the evidence-based requirement\nwill grow over time, so we have commissioned studies to be conducted on our Drone Pathways and Bugs & Slugs. We expect to have the\nresults from these studies later this summer. In December of 2026, we plan to commission similar studies for our Content Creators and\nAI Innovators products.\n\n \n\n**Regulation\nand Environmental Compliance**\n\n \n\nPresently,\nnone of our products are in highly regulated industries.\n\n \n\n**Need\nfor any Governmental Approval of Principal Products or Services**\n\n \n\nNo\nproducts presently being manufactured or sold by us are subject to prior governmental approvals. Notwithstanding the forgoing, the educational\ndrone market is relatively new and undergoing significant regulatory evolution. We stay current on these regulatory developments and\nhelp our customers understand and comply with new regulations. \n\n \n\n8\n\n \n\n** **\n\n**Effect\nof Existing or Probable Governmental Regulations on the Business**\n\n \n\nOur\nForm 10 Registration Statement became effective 60 days after filing with the Commission (December 4, 2023, by reason of the 60th\nday being a Saturday), at which point our securities became registered pursuant to Section 12(g) of the Exchange Act. Issuers with securities\nregistered under Section 12(g) are subject to numerous regulatory requirements under the Exchange Act. For example, we are subject to\nthe Sarbanes-Oxley Act of 2002. The Sarbanes-Oxley Act creates a strong and independent accounting oversight board to oversee the conduct\nof auditors of public companies and strengthens auditor independence. It also requires steps to enhance the direct responsibility of\nsenior members of management for financial reporting and for the quality of financial disclosures made by public companies; establishes\nclear statutory rules to limit, and to expose to public view, possible conflicts of interest affecting securities analysts; creates guidelines\nfor audit committee members appointment, compensation, and oversight of the work of public companies’ auditors; prohibits certain\ninsider trading during pension fund blackout periods; and establishes a federal crime of securities fraud, among other provisions.\n\n \n\nSection\n14(a) of the Exchange Act requires all companies with securities registered pursuant to Section 12(g) of the Exchange Act to comply with\nthe rules and regulations of the Commission regarding proxy solicitations, as outlined in Regulation 14A. Matters submitted to stockholders\nof our Company at a special or annual meeting thereof or pursuant to a written consent will require that we provide our stockholders\nwith the information outlined in Schedules 14A or 14C of Regulation 14 of the SEC; preliminary copies of this information must be submitted\nto the Commission at least 10 days prior to the date that definitive copies of this information are forwarded to our stockholders.\n\n \n\nWith\nthe effectiveness of our Form 10 Registration Statement, we also became required to file annual reports on Form 10-K and quarterly reports\non Form 10-Q with the Commission on a regular basis, and will be required to timely disclose certain material events (e.g., changes in\ncorporate control; acquisitions or dispositions of a significant amount of assets other than in the ordinary course of business; changes\nin executive officers and directors; and bankruptcy) in a Current Report on Form 8-K.\n\n** **\n\nWe\ndo not hold any intellectual property rights. While we use reasonable efforts to protect our trade and business secrets, we cannot assure\nthat our employees, consultants, contractors, or advisors will not, unintentionally or wilfully, disclose our trade secrets to competitors\nor other third parties. In addition, courts outside the United States are sometimes less willing to protect trade secrets. Moreover,\nour competitors may independently develop equivalent knowledge, methods, and know-how. If we are unable to defend our trade secrets from\nothers use, or if our competitors develop equivalent knowledge, it could have a material adverse effect on our business. Any infringement\nof our proprietary rights could result in significant litigation costs, and any failure to adequately protect our proprietary rights\ncould result in our competitors offering similar products, potentially resulting in loss of a competitive advantage and decreased revenue.\nExisting patent, copyright, trademark, and trade secret laws afford only limited protection. In addition, the laws of some foreign countries\ndo not protect our proprietary rights to the same extent as do the laws of the United States. Therefore, we may not be able to protect\nour proprietary rights against unauthorized third-party use. Enforcing a claim that a third party illegally obtained and is using the\nCompany’s trade secrets could be expensive and time-consuming, and the outcome of such a claim is unpredictable. Litigation may\nbe necessary in the future to protect our trade secrets or to determine the validity and scope of the proprietary rights of others. This\nlitigation could result in substantial costs and diversion of resources and could materially adversely affect our future operating results."}