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STATES**\n\n**SECURITIES AND EXCHANGE COMMISSION**\n\n**Washington, D.C. 20549**\n\n \n\n**FORM 10-Q**\n\n \n\n**(Mark One)**\n\n \n\n \n☒\n**QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE\nACT OF 1934**\n\n \n\nFor the quarterly period ended March 31,\n2026\n\n \n\nOR\n\n \n\n \n☐\n**TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE\nACT OF 1934**\n\n \n\nFor the transition period from ______ to\n______.\n\n \n\n**Commission File Number 001-41347**\n\n \n\n \n\n**Expion360 Inc.**\n\n(Exact name of registrant as specified\nin its charter)\n\n \n\n**Nevada**\n\n(state or other jurisdiction of\nincorporation or organization)\n\n**81-2701049**\n\n(IRS Employer Identification No.)\n\n \n\n**2025 SW Deerhound Avenue, Redmond, OR 97756**\n\n(Address of principal executive offices,\nincluding zip code)\n\n \n\nRegistrant’s telephone number, including\narea code: **(541) 797-6714**\n\n \n\nSecurities registered pursuant to Section\n12(b) of the Act:\n\n \n\n**Title of each class**\n**Trading Symbol(s)**\n**Name of each exchange on which registered**\n\nCommon Stock, par value $0.001 per share\nXPON\nThe Nasdaq Capital Market\n\n \n\nIndicate by check mark whether the registrant\n(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding\n12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to filing\nrequirements for the past 90 days. Yes ☒ No ☐\n\n \n\nIndicate by check mark whether the registrant\nhas submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405\nof this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit\nsuch files). Yes ☒ No ☐\n\n \n\nIndicate by check mark whether the registrant\nis a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth\ncompany. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting\ncompany” and \"emerging growth company\" in Rule 12b-2 of the Exchange Act.\n\n \n\nLarge accelerated filer\n \n☐\n \nAccelerated filer\n \n☐\n\nNon-accelerated filer\n \n☒\n \nSmaller reporting company\n \n☒\n\n \n \n \n \nEmerging growth company\n \n☒\n\n \n\nIf an emerging growth company, indicate\nby check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial\naccounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐\n\n \n\nIndicate by check mark whether the registrant\nis a shell company (as defined in Rule 12b-2 of the Exchange Act).\n\nYes ☐\nNo ☒\n\n \n\nAs of May 14, 2026, there were 11,438,298\nshares of the registrant’s common stock, par value $0.001 per share, outstanding.\n\n \n\n \n\n \n\n \n\n**TABLE OF CONTENTS**\n\n \n\n[CAUTIONARY\nNOTE REGARDING FORWARD-LOOKING STATEMENTS AND INDUSTRY DATA](#a001)\ni\n\n[INDUSTRY AND MARKET\nDATA](#a002)\nii\n\n[TRADEMARKS](#a003)\niii\n\n[PART I - FINANCIAL\nINFORMATION](#a004)\n1\n\n[ITEM 1. FINANCIAL\nSTATEMENTS](#a005)\n1\n\n[BALANCE SHEETS](#a006)\n1\n\n[STATEMENTS OF OPERATIONS\n(UNAUDITED)](#a007)\n2\n\n[STATEMENTS OF STOCKHOLDERS’\nEQUITY (UNAUDITED)](#a008)\n3\n\n[STATEMENTS OF CASH\nFLOWS (UNAUDITED)](#a009)\n4\n\n[NOTES TO FINANCIAL\nSTATEMENTS (UNAUDITED)](#a010)\n5\n\n[ITEM 2. MANAGEMENT’S\nDISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#a011)\n21\n\n[ITEM 3. QUANTITATIVE\nAND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](#a012)\n31\n\n[ITEM 4. CONTROLS AND\nPROCEDURES](#a013)\n31\n\n[PART II - OTHER INFORMATION](#a014)\n32\n\n[ITEM 1. LEGAL PROCEEDINGS](#a015)\n32\n\n[ITEM 1A. RISK FACTORS](#a016)\n32\n\n[ITEM 2. UNREGISTERED\nSALES OF EQUITY SECURITIES AND USE OF PROCEEDS](#a017)\n33\n\n[ITEM 3. DEFAULTS UPON\nSENIOR SECURITIES](#a018)\n33\n\n[ITEM 4. MINE SAFETY\nDISCLOSURES](#a019)\n33\n\n[ITEM 5. OTHER INFORMATION](#a020)\n33\n\n[ITEM 6. EXHIBITS](#a021)\n34\n\n[SIGNATURES](#a022)\n35\n\n \n\n \n\n \n\n \n\nCAUTIONARY NOTE\nREGARDING FORWARD-LOOKING STATEMENTS AND INDUSTRY DATA\n\n \n\nThis Quarterly Report on Form 10-Q (this\n“Quarterly Report”) includes “forward-looking statements” within the meaning of Section 27A of the Securities\nAct of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended\n(the “Exchange Act”).\n\n \n\nAll statements in this Quarterly Report,\nother than statements of historical fact, are “forward-looking statements” for purposes of these provisions, including,\nwithout limitation, any projections regarding the markets where we operate, any statements of the plans and objectives of our\nmanagement for future operations, any statements concerning proposed new products or services, any statements regarding expected\ncapital expenditures, any statements regarding future economic conditions or performance, and any statements of assumptions underlying\nany of the foregoing. All forward-looking statements included in this Quarterly Report are made as of the date hereof and are\nbased on information available to us as of such date. We assume no obligation to update any forward-looking statement, except\nas required by applicable law. In some cases, forward-looking statements can be identified by the use of terminology such as “may,”\n“will,” “expects,” “plans,” “should,” “anticipates,” “intends,”\n“seeks,” “believes,” “estimates,” “potential,” “forecasts,” “continue,”\nor other forms of these words or similar words or expressions, or the negative thereof or other comparable terminology. Although\nwe believe the expectations reflected in the forward-looking statements contained herein are reasonable, there can be no assurance\nthat such expectations or any of the forward-looking statements will prove to be correct. Investors are cautioned not to place\nundue reliance on any such forward-looking statements.\n\n \n\nForward-looking statements are neither\nhistorical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations, and\nassumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the\neconomy, and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties,\nrisks, and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results\nand financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not\nrely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition\nto differ materially from those indicated in the forward-looking statements include, among others, the following:\n\n \n\n●We\noperate in an extremely competitive industry and are subject to pricing pressures.\n\n●We\nhave a history of losses. As our costs increase, we may not be able to generate sufficient\nrevenue to achieve and sustain profitability.\n\n●Our\naudited financial statements include a statement that there is a substantial doubt about\nour ability to continue as a going concern and a continuation of negative financial trends\ncould result in our inability to continue as a going concern.\n\n●Our\nresults of operations could be adversely affected by changes in the cost and availability\nof raw materials and our reliance on third-party manufacturers and suppliers.\n\n●Increases\nin costs, disruption of supply, or shortage of any of our battery components, such as\nelectronic and mechanical parts could harm our business.\n\n●We\nmay not be able to raise additional capital on acceptable terms or at all, and our failure\nto obtain additional financing could adversely affect our ability to continue as a going\nconcern.\n\n●Our\nbusiness and future growth depends on the needs and success of our customers.\n\n●We\nhave substantial customer concentration, with a limited number of customers accounting\nfor a substantial portion of our sales, and the loss of or reduction in purchases by\nany of these customers could adversely affect our results of operations.\n\n●If\nwe fail to expand our sales and distribution channels, our business could suffer.\n\n●The\nuncertainty in global economic conditions could negatively affect our results of operations.\n\n●Tariffs\non imported battery components may increase our costs, and we may be unable to fully\nmitigate such increases.\n\n●We\nare currently, and will likely continue to be, dependent on a limited number of warehouse\nfacilities. If our facilities become inoperable for any reason, our ability to produce\nour products could be negatively impacted.\n\n \n\ni \n\n \n\n \n\n●We\ncould face potential product liability or warranty claims relating to our products, including\nthe components thereof, which could reduce market adoption, result in reputation damage,\nand result in significant costs and liabilities, which would reduce our profitability.\n\n●Our\noperations expose us to litigation, tax, environmental, and other legal compliance risks.\n\n●Our\nfailure to introduce new products and product enhancements that respond to customer and\nend consumer demand, and any broad market acceptance of new technologies introduced by\nour competitors, could adversely affect our business.\n\n●We\nmay not be able to adequately protect our proprietary intellectual property and technology\nand we may need to defend ourselves against intellectual property infringement claims.\n\n●Any\nacquisitions or other strategic transactions that we complete may not achieve their intended\nbenefits and may involve significant costs, diversion of management attention and resources,\nintegration difficulties, or unanticipated liabilities, and may have adverse effects\non our financial condition and results of operations.\n\n●If\nour electronic data is compromised, or we experience a failure in our information technology\nor storage systems, our business could be significantly harmed.\n\n●Our\nability to raise capital in the future may be limited, which could make us unable to\nfund our capital requirements and our stockholders may be diluted by future securities\nofferings.\n\n●We\ndepend on our senior management team and other key employees, and significant attrition\nwithin our management team or unsuccessful succession planning could adversely affect\nour business.\n\n●We\nmay be unable to maintain compliance with the continued listing requirements of The Nasdaq\nCapital Market, including the minimum bid price requirement, which could result in the\ndelisting of our common stock.\n\n●Our\nstock price may fluctuate significantly, and you may lose all or a part of your investment.\n\n●Sales\nof substantial amounts of our securities in the public markets, including sales under\nour at-the-market program, or the perception that such sales might occur, could reduce\nthe price of our securities and may dilute your voting power and your ownership interest\nin us.\n\n●The\nexercise of outstanding warrants may result in a substantial increase in the number of\nshares of our common stock that are outstanding.\n\n●The\nSeries A Warrants and Series B Warrants may have an adverse effect on the market price\nof our common stock and make it more difficult to effect a business combination.\n\n●Our\nlong-term lease and debt obligations could adversely affect our ability to raise additional\ncapital to fund operations and limit our ability to enter into certain transactions.\n\n \n\nThese\nand other risks and uncertainties are described in greater detail under “*Risk Factors*” in Item 1A of our Annual\nReport filed on March 17, 2026. Moreover, new risks and uncertainties emerge occasionally, and it is not possible for us to predict\nall risks and uncertainties, nor can we assess the impact of all factors on our business, or the extent to which any factor, or\ncombination of factors, may cause our actual future results to be materially different from any results expressed in or implied\nby any forward-looking statements. Financial estimates are subject to change and are not intended to be relied upon as predictions\nof future results of operations. Except as required by applicable law or the listing rules of The Nasdaq Stock Market, we expressly\ndisclaim any intent or obligation to update any forward-looking statements. If we do update or correct any forward-looking statements,\ninvestors and others should not conclude that we will make additional updates or corrections. All forward-looking statements attributable\nto us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements.\n\n \n\nINDUSTRY\nAND MARKET DATA\n\n \n\nThis\nQuarterly Report includes statistical and other industry and market data that we obtained from industry publications and research,\nsurveys, and studies conducted by third parties, as well as our own projections and estimates. All of the market data used in\nthis report involve a number of assumptions and limitations, and investors are cautioned not to unduly rely on such data. Industry\npublications and research, surveys, and studies generally indicate that their information has been obtained from sources believed\nto be reliable, although they do not guarantee the accuracy or completeness of such information. Our estimates of the potential\nmarket opportunities for our products include several key assumptions based on our industry knowledge, industry publications and\nresearch, and other surveys, which may be based on a small sample size and may fail to accurately reflect market opportunities.\nWhile we believe our internal assumptions are reasonable, no independent source has verified such assumptions.\n\n \n\nii \n\n \n\n \n\nTRADEMARKS\n\n \n\nThis\nQuarterly Report includes trademarks, tradenames, and service marks that are our property or the property of others. Solely for\nconvenience, such trademarks and tradenames sometimes appear without any “™” or “®” symbol.\nHowever, failure to include such symbols is not intended to suggest, in any way, that we will not assert our rights or the rights\nof any applicable licensor, to these trademarks and tradenames.\n\n \n\niii \n\n \n\n \n\nPART\nI - FINANCIAL INFORMATION"}