0001493152-26-051865 | 10-Q | XBRL Viewer | Dragonfly Energy Holdings Corp

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SCHEDULE OF INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands	Sep. 30, 2026	Dec. 31, 2025
Intangible Asset, Finite-Lived [Line Items]
Gross carrying value	$ 1,867
Accumulated Amortization	(45)
Net carrying value	1,822
Website [Member]
Intangible Asset, Finite-Lived [Line Items]
Gross carrying value	201
Accumulated Amortization	(17)
Net carrying value	184
Customer Relationships [Member]
Intangible Asset, Finite-Lived [Line Items]
Gross carrying value	720
Accumulated Amortization	(20)
Net carrying value	700
Trade Names [Member]
Intangible Asset, Finite-Lived [Line Items]
Gross carrying value	946
Accumulated Amortization	(8)
Net carrying value	$ 938

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

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+ Details

SCHEDULE OF FAIR VALUE OF THE CONSIDERATION TRANSFERRED (Details) - USD ($) $ in Thousands		9 Months Ended
	Jul. 31, 2026	Sep. 30, 2026	Sep. 30, 2025
Business Combination, Contingent Consideration [Line Items]
Cash		$ 1,000
Dragonfly Energy Corp [Member]
Business Combination, Contingent Consideration [Line Items]
Cash	$ 1,000
187,500 shares of Dragonfly Energy Holdings Corp. common stock, valued at the $9.36 closing price on July 31, 2026	1,755
Total consideration transferred	$ 2,755

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

INTANGIBLE ASSETS (Tables)

9 Months Ended

Sep. 30, 2026

Intangible Asset, Goodwill and Other [Abstract]

SCHEDULE OF INTANGIBLE ASSETS

The following table summarizes the Company’s intangible assets as of September 30, 2026:

SCHEDULE OF INTANGIBLE ASSETS

(in 000s)	Gross carrying value		Accumulated Amortization			Net carrying value
(in 000s)	Gross carrying value		Accumulated Amortization			Net carrying value
Website		201		(17	)		184
Customer Relationships		720		(20	)		700
Trade Name		946		(8	)		938
Total		1,867		(45	)		1,822

SCHEDULE OF ESTIMATED AMORTIZATION FOR INTANGIBLE ASSETS

Estimated amortization for intangible assets for each of the next five years is as follows:

(in 000s)	Amount
2026 (remainder)		52
2027		208
2028		208
2029		208
2030		208
Thereafter		938
Total		1,822

SCHEDULE OF ACQUISITION-DATE FAIR VALUES ASSIGNED TO INTANGIBLE ASSETS ACQUIRED

(in 000s)	Acquisition-Date Fair Value		Estimated Useful Life
Customer Relationships		720	6 years
Trade Name		946	20 years
Total intangible assets acquired		1,666

WARRANTS

9 Months Ended

Sep. 30, 2026

Warrants

WARRANTS

Note 11 - WARRANTS

Common Stock Warrants classified as Equity

Public Warrants

The Company’s Public Warrants are classified as equity and as of September 30, 2026 and December 31, 2025, there were 13,087 Public Warrants issued and outstanding.

During the three and nine months ended September 30, 2026 and 2025, no public warrants were exercised.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 11 - WARRANTS (CONTINUED)

The following table presents a roll-forward of the Company’s equity warrants from January 1, 2026 to September 30, 2026:

	Public Warrants		Underwriters’ Warrants		Pre-Funded Underwriters’ Warrants
Warrants Outstanding, January 1, 2026		13,087		792		62,500
Exercise of warrants		-		-		(62,500	)
Warrants issued		-		-		-
Underwriters’ Warrants Outstanding, September 30, 2026		13,087		792		-

During the three and nine months ended September 30, 2026, the Company received proceeds of $0 and $1, respectively, from the exercise of equity warrants.

Common Stock Warrants classified as Liability

Private Placement Warrants

There were zero and 2,085 private warrants outstanding as of September 30, 2026 and December 31, 2025, respectively. The Company accounts for the Private Warrants issued in connection with the Initial Public Offering in accordance with the guidance contained in ASC 815-40. Such guidance provides that because the private warrants do not meet the criteria for equity treatment thereunder, each private warrant must be recorded as a liability. This liability is subject to re-measurement at each balance sheet date.

With each such re-measurement, the warrant liabilities will be adjusted to their current fair value, with the change in fair value recognized in the Company’s statement of operations. The Company will reassess the classification at each balance sheet date.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 11 - WARRANTS (CONTINUED)

Common Stock Warrants classified as Liability (Continued)

Private Placement Warrants (Continued)

The Private Placement Warrants are classified as Level 2 within the fair value hierarchy. Although these instruments are not actively traded, they are valued based on observable inputs, including the market price of the Company’s publicly traded warrants. The Company used a Black-Scholes model to estimate the fair value of the Private Placement Warrants, applying a discount to the value of the Public Warrants to account for the difference in remaining life. Because the valuation primarily relies on observable market data with limited adjustments, the Company determined that classification within Level 2 is appropriate.

Term Loan Warrants

In connection with the entry into the Term Loan Agreement on October 7, 2022, and as a required term and condition thereof, the Company issued (i) the penny warrants to the Term Loan Lenders exercisable to purchase an aggregate of 3,601 shares of common stock (the “Original Penny Warrants”) and (ii) warrants to the Term Loan Lenders exercisable to purchase an aggregate of 2,222 shares of common stock at $7,200 per share (the “$10 Warrants” and, together with the Original Penny Warrants, the “Term Loan Warrants”).

On February 26, 2025, the Company entered into the Fifth Amendment to the Term Loan with the Term Loan Lenders in connection with the February 2025 securities purchase agreement. The Fifth Amendment provided for a onetime issuance of penny warrants to the Term Loan Lenders to purchase up to 4,125 shares of the Company’s common stock, at an exercise price of $0.80 per share (the “February 2025 Penny Warrants”). The February 2025 Penny Warrants are immediately exercisable upon issuance and will expire ten years from the date of issuance.

In addition to the Original Penny Warrants, through December 31, 2024, the Company issued an additional 16,829 warrants to the Term Loan Lenders, of which 2,778 were exercised on a cashless basis. These warrants were issued in connection with prior amendments to the Term Loan in exchange for waivers of financial covenant testing and pursuant to anti-dilution provisions.

During the nine months ended September 30, 2026, the Term Loan Lenders exercised, on a cashless basis, all 21,777 remaining warrants held by them, consisting of the Original Penny Warrants, the additional warrants described above and the February 2025 Penny Warrants, and the Company agreed to issue 21,672 shares of common stock in connection with such exercises. As of September 30, 2026, none of these warrants remained outstanding.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 11 - WARRANTS (CONTINUED)

Common Stock Warrants classified as Liability (Continued)

The following table provides the significant inputs to the Black-Scholes method for the fair value of the Investor Warrants issued in the June 2023 Offering:

	As of September 30, 2026			As of December 31, 2025
Common stock price	$	6.81		$	26.00
Exercise price	$	1,440		$	1,440
Dividend yield		0	%		0	%
Term		1.73			2.48
Volatility		154.1	%		571.4	%
Risk-free rate		3.7	%		3.7	%
Fair value	$	0.18		$	26.00

The following table presents a roll-forward of the Company’s warrants from January 1, 2026 to September 30, 2026:

	Private Warrants			Term Loan Warrants			Investor Warrants
Warrants Outstanding, January 1, 2026		2,085			21,777			15,461
Exercise of warrants		-			(21,777	)		-
Warrants issued		-			-			-
Warrants expired		(2,085	)		-			-
Warrants Outstanding, September 30, 2026		-			-			15,461

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

SCHEDULE OF WARRANTY OBLIGATION (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2026	Sep. 30, 2025	Sep. 30, 2026	Sep. 30, 2025
Accounting Policies [Abstract]
Beginning warranty obligation			$ 867
Provision of warranty expense	$ 95	$ 132	293	$ 403
Settlement of warranty claims			(259)
Ending warranty obligation	$ 901		$ 901

COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) $ in Thousands		3 Months Ended			9 Months Ended
	May 08, 2025	Sep. 30, 2026	Jun. 30, 2026	Sep. 30, 2025	Sep. 30, 2026	Sep. 30, 2025	Mar. 31, 2025
Loss Contingencies [Line Items]
Lease payments		$ 644		$ 724	$ 1,876	$ 2,160
Lease options to extend	the Company entered into a sixth lease amendment with its landlord to extend the lease term for an additional sixty-four (64) month period for the research and development lab and engineering office in Reno
Lease expiration date	Nov. 30, 2030
Received tariffs refund		332	$ 1,142
Received tariffs refund from product sales		0			1,092
LithiumHub Technologies LLC [Member]
Loss Contingencies [Line Items]
License amount payable							$ 2,500
License amount payable in 2025							$ 562
License amount payable in 2026		$ 1,938			1,938
Minimum [Member]
Loss Contingencies [Line Items]
Lease payments					$ 111	$ 309
Finance lease term		3 years			3 years
Maximum [Member]
Loss Contingencies [Line Items]
Finance lease term		5 years 3 months			5 years 3 months

STOCK-BASED COMPENSATION

9 Months Ended

Sep. 30, 2026

Share-Based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

Note 14 - STOCK-BASED COMPENSATION

On October 15, 2025 at the 2025 Annual Meeting of Stockholders (the “Annual Meeting”) of the Company, the Company’s stockholders approved an amendment (the “Plan Amendment”) to the Company’s 2022 Equity Incentive Plan (the “2022 Plan”) increasing the number of shares available for issuance under the 2022 Plan by 112,500 shares. The Plan Amendment became effective following its approval by the Company’s stockholders.

The Company maintains the Dragonfly Energy Holdings Corp. Employee Stock Purchase Plan (the “ESPP”) which is designed to allow eligible employees and the eligible employees of the Company’s participating subsidiaries to purchase shares of common stock, at semi-annual intervals, with their accumulated payroll deductions. A total of 3,423 shares of common stock were initially available for issuance under the ESPP. The share limit will automatically increase on the first trading day in January of each year by an amount equal to the lesser of (1) 1% of the total number of outstanding shares of common stock on December 31 in the prior year, (2) 2,083 shares, or (3) such number as determined by the Board.

A summary of the Company’s option activity and related information follows:

	Number of Options			Weighted-Average Exercise Price		Weighted-Average Grant Date Fair Value		Weighted-Average Remaining Contractual Life (in years)		Aggregate intrinsic value
Balances, January 1, 2026		1,676		$	1,931.92	$	1,922.48		5.64	$	-
Options granted		14,589			23.92		23.92		9.45		-
Options forfeited		(1	)		5,150.22		54.55		-		-
Options expired		(288	)		1,832.49		4.64		-		-
Balances, September 30, 2026		15,976		$	191.03	$	21.98		9.05	$	-

At September 30, 2026
Vested and Exercisable		6,249		$	451.02				8.42	$	-
Vested and expected to vest		15,976		$	191.03				9.05	$	-

During the three and nine months ended September 30, 2026, the Company issued 0 and 14,589 stock options, respectively.

During the three and nine months ended September 30, 2025, the Company did not issue any stock options.

Share-based compensation expense for options and RSUs totaling $243 and $168 was recognized in the Company’s consolidated statements of operations for the three months ended September 30, 2026 and 2025, respectively. Share-based compensation expense for options and RSUs totaling $717 and $578 was recognized in the Company’s consolidated statements of operations for the nine months ended September 30, 2026 and 2025, respectively.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 14 - STOCK-BASED COMPENSATION (CONTINUED)

Of the $243 of share-based compensation incurred during the three months ended September 30, 2026, $4 is allocated to cost of goods sold, $11 to research and development, $68 to selling and marketing, and $160 to general and administrative expenses. Of the $168 of share-based compensation incurred during the three months ended September 30, 2025, $11 is allocated to cost of goods sold, $9 to research and development, $55 to selling and marketing, and $93 to general and administrative expenses.

Of the $717 of share-based compensation incurred during the nine months ended September 30, 2026, $14 is allocated to cost of goods sold, $36 to research and development, $244 to selling and marketing, and $423 to general and administrative expenses. Of the $578 of share-based compensation incurred during the nine months ended September 30, 2025, $45 is allocated to cost of goods sold, $36 to research and development, $179 to selling and marketing, and $318 to general and administrative expenses.

The valuation methodology used to determine the fair value of the options issued during the year was the Black Scholes option pricing model. The Black Scholes model requires the use of a number of assumptions including volatility of the stock price, the fair value of the underlying stock, the average risk free interest rate, and the weighted average expected life of the options. The expected term was estimated using the simplified method due to lack of sufficient history of option exercises.

	March 31, 2026
Weighted average fair value of options granted	$	22.31
Risk-free interest rate		3.87	%
Volatility		151	%
Expected life (years)		5.58
Dividend yield		0.00	%

Restricted Stock Units

On April 1, 2025 and May 19, 2025, the Company granted 47 and 11 RSUs, respectively. The RSUs will vest in three equal annual installments, with the first vesting date on the one (1) year anniversary of the date of issuance and the following two vesting dates on each subsequent anniversary of the date of issuance, subject to each employees’ continued employment as of each vesting date. The fair value of the RSUs was $4 and an immaterial amount was recorded as compensation expense during the nine months ended September 30, 2026. During the nine months ended September 30, 2025, $1 was recorded as compensation expense.

In March 2026, members of the Board were granted an aggregate of 1,671 RSUs. The RSUs will vest in three equal annual installments, with the first vesting occurring on April 1, 2026 and the following two vesting dates on each subsequent anniversary of the grant date, subject to continued Board service. The fair value of the RSUs was $23 and $3 and $6 was recorded as compensation expense during the three and nine months ended September 30, 2026, respectively.

On April 1, 2026, the Company granted 79,848 RSUs. The RSUs will vest in three equal annual installments, with the first vesting occurring immediately on April 1, 2026 and the following two vesting dates on each subsequent anniversary of the date of issuance, subject to each employees’ continued employment as of each vesting date. The fair value of the RSUs was $1,105 and $111 and $304 was recorded as compensation expense during the three and nine months ended September 30, 2026, respectively.

On May 28, 2026, the Company granted 283 RSUs that vested immediately on the date of issuance. The fair value of the RSUs was $5 and $0 and $5 was recorded as compensation expense during the three and nine months ended September 30, 2026, respectively.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 14 - STOCK-BASED COMPENSATION (CONTINUED)

On June 18, 2026, the Board authorized the issuance of 1,250 RSUs to the newly appointed Board member. The RSUs will vest in two equal installments, with one-half vesting immediately upon the date of grant and one-half vesting on the one-year anniversary of the date of the grant, subject to continued service to the Company. The fair value of the RSUs was $20 and $5 and $6 was recorded as compensation expense during the three and nine months ended September 30, 2026, respectively.

On July 13, 2026, the Company granted 1,250 RSUs. The RSUs will vest in two equal annual installments, with the first vesting occurring immediately on July 13, 2026 and the following vesting date on the subsequent anniversary of the date of issuance, subject to each employees’ continued employment. The fair value of the RSUs was $17 and $2 was recorded as compensation expense during the three and nine months ended September 30, 2026, respectively.

On August 3, 2026, the Company granted 1,875 RSUs. The RSUs will vest in three equal annual installments, with the first vesting occurring immediately on August 3, 2026 and the following two vesting dates on each subsequent anniversary of the date of issuance, subject to each employees’ continued employment as of each vesting date. The fair value of the RSUs was $18 and $1 was recorded as compensation expense during the three and nine months ended September 30, 2026, respectively.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 14 - STOCK-BASED COMPENSATION (CONTINUED)

The following table presents the restricted stock units activity for the nine months ended September 30, 2026:

	Number of Shares			Weighted-Average Fair Market Value
Unvested shares, January 1, 2026		2,098		$	362.40
Granted and unvested		86,177			13.78
Exercised		(28,793	)		24.95
Forfeited		(16,379	)		20.59
Vested		(629	)		18.95
Unvested shares, September 30, 2026		42,474		$	20.74

As of September 30, 2026 and 2025 there were 116,352 and 14,603 shares, respectively, of unissued authorized and available for future awards under the 2022 Equity Incentive Plan and Employee Stock Purchase Plan.

SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS UNDER OPERATING LEASES (Details) - USD ($)
$ in Thousands

Sep. 30, 2026

Dec. 31, 2025

Commitments and Contingencies Disclosure [Abstract]

December 31, 2026

^[1]

$ 1,075

3,746

3,860

3,614

3,446

12,600

28,341

Less imputed interest

7,214

Total operating lease liabilities

$ 21,127

$ 23,003

[1]	Represents scheduled payments for the remaining three-month period ending December 31, 2026.

SCHEDULE OF CHANGES IN THE CARRYING AMOUNT OF GOODWILL (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2026 USD ($)
Intangible Asset, Goodwill and Other [Abstract]
Gross goodwill, December 31, 2025
Goodwill acquired - Dakota Lithium (Note 6)	403
Balance, September 30, 2026	$ 403

- Definition

Amount, after accumulated impairment loss, of asset representing future economic benefit arising from other asset acquired in business combination or from joint venture formation or both, that is not individually identified and separately recognized.

+ References

+ Details

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2026

Accounting Policies [Abstract]

Basis of presentation

Basis of presentation

The accompanying unaudited condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”)for interim financial information, and with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) set forth in Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim financial statements furnished reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. Unaudited interim results are not necessarily indicative of the results for the full fiscal year. These condensed consolidated financial statements should be read along with the Annual Report on Form 10-K filed with the SEC on March 30, 2026 of the Company for the annual period ended December 31, 2025. The consolidated balance sheet as of December 31, 2025 was derived from the audited consolidated financial statements as of and for the year then ended.

Principles of consolidation

Principles of consolidation

The accompanying unaudited condensed consolidated financial statements and related notes have been prepared in accordance with U.S. GAAP and present the consolidated financial statements of the Company and its wholly owned subsidiaries. All significant intercompany transactions and balances are eliminated in consolidation.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Going Concern

Going Concern

The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

During the three and nine months ended September 30, 2026 and 2025, the Company incurred losses from operations and had negative cash flow from operations. As of September 30, 2026, the Company had $1,941 in cash and cash equivalents and working capital of $2,973. The Company’s ability to achieve profitability and positive cash flow depends, among other things, on its ability to increase revenue, contain its expenses and maintain compliance with the financial covenants in its outstanding indebtedness agreements.

In 2025, the Company completed several capital raising and debt restructuring transactions, resulting in aggregate net cash proceeds of approximately $90,930 and modifications to its term loan that extended the maturity to October 2027, deferred principal and interest payments, reduced outstanding principal (including partial cancellation and conversion of principal into preferred stock), and established minimum liquidity covenants. On January 30, 2026, the Company also entered into an at-the-market equity offering program under which it may, at its discretion and subject to market conditions, issue and sell up to $50 million of its common stock from time to time. For the nine months ended September 30, 2026, the Company sold 72,658 shares of common stock for net proceeds of $1,031. Refer to Annual Report on Form 10-K for the year ended December 31, 2025 for additional information regarding these equity offerings and term loan amendments.

Management has evaluated the conditions and events described above in relation to the Company’s obligations coming due within one year after the date these condensed consolidated financial statements are issued. Management’s plans to address these conditions include the strategic cost realignment, the integration of the Dakota Lithium acquisition, the pursuit of tariff refunds, the use of the at-the-market equity offering program, and the liquidity provisions of the Seventh and Eighth Amendments (each as defined in Note 9), including the ability to pay interest in kind through December 31, 2026 and the modification, deferral, or waiver of certain financial covenant requirements. The Company’s ability to continue as a going concern is also dependent on its ability to raise additional capital through equity offerings, debt financings, or other strategic transactions. There can be no assurance that such financing will be available in sufficient amounts, when and if needed, on acceptable terms or at all.

Although management is pursuing these plans, uncertainties remain regarding their successful implementation and effectiveness, including the Company’s ability to generate sufficient cash flows and obtain additional financing to meet its obligations as they become due. Accordingly, management has concluded that its plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern within one year after the date that these condensed consolidated financial statements are issued.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Inventory

Inventory

Inventories (Note 4), which consist of raw materials and finished goods, are stated at the lower of cost (first in, first out) or net realizable value, net of reserves for obsolete inventory. The Company continually analyzes its slow moving and excess inventories. Based on historical and projected sales volumes and anticipated selling prices, the Company established reserves. Inventory that is in excess of current and projected use is reduced by an allowance to a level that approximates its estimate of future demand. Products that are determined to be obsolete are written down to net realizable value. The Company had a reserve of $740 and $300 as of September 30, 2026 and December 31, 2025, respectively.

Finite-Lived Intangible Assets

Finite-Lived Intangible Assets

Intangible assets with finite useful lives are amortized over their estimated useful lives. The Company amortizes finite-lived intangible assets using a method that reflects the pattern in which the economic benefits of the asset are consumed. If that pattern cannot be reliably determined, the Company uses the straight-line method, consistent with ASC 350-30. Amortization expense was $38 and $45 for the three and nine months ended September 30, 2026, respectively. There was no amortization expense for the three and nine months ended September 30, 2025.

Impairment

Impairment

Finite-lived intangible assets are reviewed for impairment in accordance with ASC 360-10 whenever events or changes in circumstances indicate that the carrying amount of the asset group may not be recoverable. Recoverability is assessed by comparing the carrying amount of the asset group to the undiscounted future cash flows expected to result from the use and eventual disposition of the asset group. If the carrying amount is not recoverable, the Company recognizes an impairment loss for the amount by which the carrying amount exceeds fair value. No impairment losses were recognized for the periods presented.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions relate to the measurement of lease right-of-use assets and related lease liabilities, the going concern assessment, asset impairment assessments, and the valuation of assets acquired in business combinations. Actual results could differ from those estimates.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Revenue Recognition

Revenue Recognition

Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer.

Revenue is recognized when control of the promised goods is transferred to the customer or reseller, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods and services. Revenue associated with products holding rights of return is recognized when the Company concludes there is not a risk of significant revenue reversal in the future periods for the expected consideration in the transaction. There are no material instances including discounts and refunds where variable consideration is constrained and not recorded at the initial time of sale. Generally, our revenue is recognized at a point in time for standard promised goods at the time of shipment when title and risk of loss pass to the customer.

The Company recognizes revenue from right-to-access license agreements over time as customers receive and consume the benefits of access to its intellectual property. Upfront fees are deferred and recognized on a straight-line basis over the estimated period of benefit. Royalties are recognized when the customer’s underlying sales occur and the related performance obligation has been satisfied, in whole or in part. In accordance with ASC 606, the Company determined that its obligation to provide continued access is satisfied over time. For the Stryten agreement, management determined the recognition period to be five years based on the minimum five-year access requirement and the Company’s right thereafter to terminate the agreement or negotiate revised payment terms if cumulative royalties paid are less than $15 million. The estimated recognition period is reassessed as facts and circumstances change.

Payment terms for distributors and OEMs are typically due within 30-90 days after shipment. The Company may receive payments at the onset of the contract before delivery of goods for customers in the retail channel. In such instances, the Company records a customer deposit liability. The Company recognizes these contract liabilities as sales after the revenue criteria are met. As of September 30, 2026 and December 31, 2025, the contract liability related to the Company’s customer deposits was approximately $242 and $121, respectively.

The Company recognized $121 of the contract liability as of December 31, 2025 during the nine months ended September 30, 2026. During the nine months ended September 30, 2025, the Company recognized $314 of the contract liability that was recorded as a January 1, 2025 beginning balance.

On July 29, 2024, Dragonfly Energy Corp. (“Legacy Dragonfly”), a wholly-owned subsidiary of the Company, and Battle Born Battery Products, LLC (“Battle Born LLC”), a wholly-owned subsidiary of Legacy Dragonfly, entered into a License Agreement (the “License Agreement”) with Stryten Energy LLC (“Stryten”). The $5,000 initial licensing fee is being recognized as revenue on a straight-line basis over five years. The Company has recorded $250 and $750 in revenue related to the License Agreement during the three and nine months ended September 30, 2026, respectively. As of September 30, 2026 and December 31, 2025, the contract liability related to the Company’s deferred revenue was approximately $2,833 and $3,583, respectively.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Disaggregation of Revenue

Disaggregation of Revenue

The following table presents our disaggregated revenues by distribution channel:

Sales	2026		2025		2026		2025
	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
Sales	2026		2025		2026		2025
Direct to customer	$	4,802	$	5,038	$	12,981	$	16,001
Original equipment manufacture		7,122		10,679		21,306		28,820
License fee revenue		250		250		750		750
Total	$	12,174	$	15,967	$	35,037	$	45,571

Grant Income

Grant Income

The Company recognizes grant income when there is reasonable assurance that the Company will comply with the conditions attached to the grant and that the grant will be received. Grants that reimburse qualifying operating expenses are recognized in earnings on a systematic basis in the periods in which the related qualifying costs are recognized. The Company presents such amounts as grant income within other income in the Consolidated Statements of Operations. During the three and nine months ended September 30, 2026, the Company recognized grant income of $408 and $531, respectively.

Business Combination

Business Combination

The Company accounts for business combinations using the acquisition method under ASC 805, Business Combinations. Identifiable assets acquired and liabilities assumed are recorded at their fair values on the acquisition date. Goodwill is the amount by which the fair value of the consideration transferred exceeds those net assets. Equity issued as consideration is measured at its fair value on the acquisition date. Determining these fair values requires significant estimates, particularly for intangible assets. Amounts may be provisional for a measurement period of up to one year after the acquisition date. During that period, the Company records adjustments to provisional amounts as new information becomes available about facts and circumstances that existed at the acquisition date. Acquisition-related costs are expensed as incurred. Costs to issue equity securities reduce additional paid-in capital.

Goodwill

Goodwill

Goodwill is not amortized. It is assigned to the reporting units expected to benefit from the combination. It is tested for impairment annually and between annual tests if events or changes in circumstances indicate a reporting unit’s fair value may be below its carrying amount. The Company may first assess qualitative factors to decide whether a quantitative test is needed. If a quantitative test is performed and a reporting unit’s carrying amount exceeds its fair value, the Company recognizes an impairment loss equal to the excess. The loss is limited to the goodwill allocated to that reporting unit.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Product Warranty

Product Warranty

The Company offers assurance type warranties from 5 to 10 years on its products. The Company estimates the costs associated with the warranty obligation using historical data of warranty claims and costs incurred to satisfy those claims. The Company estimates, based upon a review of historical warranty claim experience, the costs that may be incurred under its warranties and records a liability in the amount of such estimate at the time a product is sold. Factors that affect our warranty liability include the number of units sold, historical and anticipated rates of warranty claims, and cost per claim. The Company periodically assesses the adequacy of our recorded warranty liability and adjusts the accrual as claims data and historical experience warrant. The Company has assessed the costs of fulfilling its existing assurance type warranties and has determined that the estimated outstanding warranty obligation at September 30, 2026 and December 31, 2025 to be $901 and $867, respectively. The Company incurred warranty expense of $95 and $293 for the three and nine months ended September 30, 2026, respectively, and incurred warranty expense of $132 and $403 for the three and nine months ended September 30, 2025, respectively.

SCHEDULE OF WARRANTY OBLIGATION

	September 30 2026
Beginning warranty obligation	$	867
Provision of warranty expense		293
Settlement of warranty claims		(259	)
Ending warranty obligation	$	901

Concentrations

Concentrations

As of September 30, 2026, receivables from Customer A, Customer B, and Customer C comprised approximately 23%, 12%, and 10%, respectively, of accounts receivable. As of December 31, 2025, receivables from Customer A comprised approximately 31% of accounts receivable. There are no other significant accounts receivable concentrations.

Sales from Customer A comprised approximately 22% of the Company’s total revenue for the three months ended September 30, 2026. Sales from Customer A comprised approximately 35% of the Company’s total revenue for the three months ended September 30, 2025. Sales from Customer A comprised approximately 22% of the Company’s total revenue for the nine months ended September 30, 2026. Sales from Customer A comprised approximately 29% of the Company’s total revenue for the nine months ended September 30, 2025.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Concentrations (Continued)

As of September 30, 2026, payables to Vendor A and Vendor D comprised approximately 33% and 10%, respectively, of accounts payable. As of December 31, 2025, payables to Vendor A, Vendor B, and Vendor C comprised approximately 36%, 16%, and 12%, respectively, of accounts payable.

For the three months ended September 30, 2026, Vendor A accounted for approximately 19% of the Company’s total purchases. For the three months ended September 30, 2025, Vendor A, Vendor F, and Vendor B accounted for approximately 18%, 14%, and 12%, respectively, of the Company’s total purchases. For the nine months ended September 30, 2026, Vendor A and Vendor E accounted for approximately 12% and 10%, respectively, of the Company’s total purchases. For the nine months ended September 30, 2025, Vendor A and Vendor F accounted for approximately 17% and 10%, respectively, of the Company’s total purchases.

Stock-Based Compensation

Stock-Based Compensation

The Company accounts for stock based compensation arrangements with employees and non-employee consultants using a fair value method which requires the recognition of compensation expense for costs related to all stock based payments, including stock options (Note 14). The fair value method requires the Company to estimate the fair value of stock based payment awards to employees and non-employees on the date of grant using an option pricing model. Stock based compensation costs are based on the fair value of the underlying option calculated using the Black Scholes option pricing model and recognized as expense on a straight line basis over the requisite service period, which is the vesting period. Restricted stock unit awards are valued based on the closing trading value of the Company’s common stock on the date of grant and then amortized on a straight-line basis over the requisite service period of the award. The Company measures equity-based compensation awards granted to non-employees at fair value as the awards vest and recognizes the resulting value as compensation expense at each financial reporting period.

Determining the appropriate fair value model and related assumptions requires judgment, including estimating stock price volatility, expected dividend yield, expected term, risk free rate of return, and the estimated fair value of the underlying common stock. Due to the lack of company specific historical and implied volatility data, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. The historical volatility is calculated based on a period of time commensurate with the expected term assumption. The group of representative companies have characteristics similar to the Company, including stage of product development and focus on the lithium ion battery industry. The Company uses the simplified method, which is the average of the final vesting tranche date and the contractual term, to calculate the expected term for options granted to employees as it does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. The risk free interest rate is based on a treasury instrument whose term is consistent with the expected term of the stock options. The Company uses an assumed dividend yield of zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock. The Company accounts for forfeitures as they occur.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Income Taxes

Income Taxes

The Company determines its interim income tax provision by applying its estimated annual effective tax rate to year-to-date ordinary income or loss, adjusted for discrete items recognized during the period. For the nine months ended September 30, 2026, the Company recorded no income tax expense or benefit on a pretax loss of $16,550. The effective tax rate differed from the U.S. federal statutory rate primarily because the Company maintains a full valuation allowance against its deferred tax assets, as realization of the related tax benefits is not considered more likely than not. Prepaid income taxes were $359 at September 30, 2026.

The Company evaluated the tax effects of the Dakota Lithium acquisition, including tax-deductible goodwill and temporary differences related to the acquired indefinite-lived trade name, and determined that the resulting effects were immaterial to its condensed consolidated financial statements. The estimated amount of goodwill expected to be deductible for income tax purposes is $372.

On July 4, 2025, the One Big Beautiful Bill Act (the “OBBB Act”) was signed into law, modifying certain domestic and international income tax provisions with various effective dates beginning in 2025. The Company evaluated the applicable provisions and determined that the OBBB Act did not materially affect its income tax position as of September 30, 2026.

Net Loss per Common Share

Net Loss per Common Share

Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is calculated using the weighted-average number of common shares outstanding during the period and, if dilutive, the weighted-average number of potential shares of common stock.

The weighted-average number of common shares included in the computation of diluted net loss gives effect to all potentially dilutive common equivalent shares, including outstanding stock options and warrants.

Common stock equivalent shares are excluded from the computation of diluted net loss per share if their effect is antidilutive. In periods in which the Company reports a net loss, diluted net loss per share is generally the same as basic net loss per share since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

The following table sets forth the number of potential shares of common stock that have been excluded from diluted net loss per share because their effect was anti-dilutive:

	2026		2025
	September 30,
	2026		2025
Warrants		29,340		53,202
Restricted stock units		42,474		2,115
Series B Preferred Stock		99,206		-
Options		15,976		1,719
Total excluded shares		186,996		57,036

Reclassifications

Reclassifications

Certain amounts in the prior year’s consolidated financial statements have been reclassified to conform to the current year’s presentation. These reclassifications had no impact on previously reported net loss, total assets, total liabilities, stockholders’ equity, or the previously reported net decrease in cash and cash equivalents.

Segment Reporting

Segment Reporting

Operating segments are identified (Note 15) as components of the Company for which separate discrete financial information is available and that are regularly reviewed by the Company’s Chief Executive Officer, the chief operating decision maker, to make decisions about resource allocation and assess performance. The Company currently manages its business through two operating and reportable segments.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Recently issued accounting pronouncements:

Recently issued accounting pronouncements:

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires a public entity to disclose additional information about specific expense categories in the notes to the financial statements on an annual and interim basis. It is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. In January 2025, the FASB issued ASU 2025-01 to clarify that all public entities, including non-calendar year-end entities, should adopt the disclosure requirements of ASU 2024-03. The Company is currently evaluating the impact.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides a practical expedient related to the estimation of expected credit losses for certain financial assets measured on an amortized cost basis, including current accounts receivable and current contract assets under FASB Accounting Standards Codification 606 - Revenues from Contracts with Customers. Under the practical expedient, a public entity may assume that current conditions as of the balance sheet date remain unchanged over the remaining life of the financial asset when developing reasonable and supportable forecasts used to estimate expected credit losses. This ASU is effective for the Company on January 1, 2026, with early adoption permitted. The adoption of this new standard did not have a material impact on our consolidated financial statements.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies interim disclosure requirements and the applicability of Topic 270. This ASU is effective for the Company on January 1, 2028, with early adoption permitted. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements.

In April 2026, the FASB issued ASU 2026-01, Equity (Topic 505): Initial Measurement of Paid-in-Kind Dividends on Equity-Classified Preferred Stock. The guidance requires issuers to initially measure paid-in-kind (“PIK”) dividends using the PIK dividend rate and calculation basis specified in the preferred stock agreement and applies to preferred stock classified in temporary equity. The amendments are effective for annual reporting periods beginning after December 15, 2026, including interim periods within those annual periods. Upon adoption on January 1, 2027, the Company will apply the guidance prospectively to PIK dividends recognized on or after that date, including those on its outstanding Series B Preferred Stock (as defined in Note 12). Adoption is not expected to change the Company’s measurement of PIK dividends or materially affect its consolidated financial statements because the Company currently measures those dividends using the contractual rate and calculation basis specified in the Series B Certificate of Designation (as defined in Note 12). Under the prospective approach, previously recognized PIK dividends will not be adjusted.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

SCHEDULE OF ESTIMATED AMORTIZATION FOR INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands	Sep. 30, 2026	Dec. 31, 2025
Intangible Asset, Goodwill and Other [Abstract]
2026 (remainder)	$ 52
2027	208
2028	208
2029	208
2030	208
Thereafter	938
Intangible Assets, net	$ 1,822

SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS UNDER FINANCE LEASES (Details) - USD ($)
$ in Thousands

Sep. 30, 2026

Dec. 31, 2025

Commitments and Contingencies Disclosure [Abstract]

December 31, 2026

^[1]

$ 6

112

Less imputed interest

Total financing lease liabilities

$ 94

$ 63

[1]	Represents scheduled payments for the remaining three-month period ending December 31, 2026.

FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2026

Fair Value Disclosures [Abstract]

SCHEDULE OF FAIR VALUE OF ASSETS AND LIABILITIES

The following table presents assets and liabilities that were measured at fair value in the Unaudited Condensed Consolidated Balance Sheets on a recurring basis as of September 30, 2026.

	Carrying Amount		Fair Value		(Level 1)		(Level 2)		(Level 3)
	As of September 30, 2026
Liabilities
Warrant liability- June Public Offering	$	3	$	3	$	-	$	3	$	-
Total liabilities	$	3	$	3	$	-	$	3	$	-

The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheets on a recurring basis as of December 31, 2025:

	Carrying Amount		Fair Value		(Level 1)		(Level 2)		(Level 3)
	As of December 31, 2025
Liabilities
Warrant liability- Term Loan	$	565	$	565	$	-	$	565	$	-
Warrant liability- June Public Offering		148		148		-		148		-
Total liabilities	$	713	$	713	$	-	$	713	$	-

COMMON STOCK (Tables)

9 Months Ended

Sep. 30, 2026

Equity [Abstract]

SUMMARY OF RESERVED SHARES OF COMMON STOCK FOR ISSUANCE

For the nine months ended September 30, 2026 and 2025, the Company had reserved shares of common stock for issuance as follows:

	September 30, 2026		September 30, 2025
Options issued and outstanding		15,976		1,719
Common stock outstanding		1,878,418		771,777
Warrants outstanding		29,340		53,202
Earnout Shares		34,722		34,722
Series B Preferred Stock outstanding		99,206		-
Shares available for future issuance		116,352		14,603
Total		2,174,014		876,023

SCHEDULE OF WEIGHTED AVERAGE FAIR VALUE OF OPTIONS (Details) - $ / shares	3 Months Ended	9 Months Ended
	Mar. 31, 2026	Sep. 30, 2026
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Weighted average fair value of options granted		$ 23.92
Share-Based Payment Arrangement, Option [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Weighted average fair value of options granted	$ 22.31
Risk-free interest rate	3.87%
Volatility	151.00%
Expected life (years)	5 years 6 months 29 days
Dividend yield	0.00%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

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+ Details

SUMMARY OF RESERVED SHARES OF COMMON STOCK FOR ISSUANCE (Details) - shares	Sep. 30, 2026	Dec. 31, 2025	Sep. 30, 2025
Equity [Abstract]
Options issued and outstanding	15,976		1,719
Common stock outstanding	1,878,418	1,509,839	771,777
Warrants outstanding	29,340		53,202
Earnout Shares	34,722		34,722
Series B Preferred Stock outstanding	99,206
Shares available for future issuance	116,352		14,603
Total	2,174,014		876,023

- Definition

Number of shares of common stock outstanding. Common stock represent the ownership interest in a corporation.

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Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 505
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-Section 50
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-URI https://asc.fasb.org/1943274/2147481112/505-10-50-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
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+ Details

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2026	Dec. 31, 2025
Current Assets
Cash and cash equivalents	$ 1,941	$ 18,270
Accounts receivable, net of allowance for credit losses	4,214	4,215
Inventory	19,736	24,234
Prepaid expenses	652	1,088
Prepaid inventory	2,323	937
Prepaid income tax	359	353
Other current assets	2,429	1,083
Total Current Assets	31,654	50,180
Property and Equipment
Machinery and equipment	18,889	17,794
Office furniture and equipment	441	432
Leasehold improvements	7,666	7,563
Vehicle	124	33
Total	27,120	25,822
Less accumulated depreciation and amortization	(6,701)	(5,081)
Property and equipment, net	20,419	20,741
Intangible Assets, net	1,822
Goodwill	403
Operating lease right of use asset, net	14,350	15,240
Other assets	378	388
Total Assets	69,026	86,549
Current Liabilities
Accounts payable	9,418	10,322
Accrued payroll and other liabilities	2,389	4,053
Accrued tariffs	341	943
Customer deposits	242	121
Deferred revenue, current portion	1,000	1,000
Dividends Payable	518	317
Notes payable, current portion, net	12,483	433
Operating lease liability, current portion	2,273	2,533
Financing lease liability, current portion	17	35
Total Current Liabilities	28,681	19,757
Long-Term Liabilities
Deferred revenue, net of current portion	1,833	2,583
Warrant liabilities	3	713
Notes payable, non current portion, net		9,212
Operating lease liability, net of current portion	18,854	20,470
Financing lease liability, net of current portion	77	28
Total Long-Term Liabilities	20,767	33,006
Total Liabilities	49,448	52,763
Commitments and Contingencies (See Note 5)
Stockholders’ Equity (Deficit)
Preferred stock, 4,995,000 shares at $0.0001 par value, authorized, no shares issued and outstanding as of September 30, 2026 and December 31, 2025, respectively
Common stock, 50,000,000 shares at $0.0001 par value, authorized, 1,878,418 and 1,509,839 shares issued and outstanding as of September 30, 2026 and December 31, 2025, respectively
Additional paid in capital	164,099	163,623
Accumulated deficit	(168,643)	(152,093)
Total Stockholders’ Equity (Deficit)	(4,544)	11,530
Total Liabilities, Redeemable Preferred Stock and Stockholders’ Equity (Deficit)	69,026	86,549
Redeemable Preferred Stock Series B [Member]
Redeemable Preferred Stock
Redeemable Preferred Stock	$ 24,122	$ 22,256

Cover - $ / shares	9 Months Ended
Cover - $ / shares	Sep. 30, 2026	Nov. 10, 2026
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2026
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2026
Current Fiscal Year End Date	--12-31
Entity File Number	001-40730
Entity Registrant Name	DRAGONFLY ENERGY HOLDINGS CORP.
Entity Central Index Key	0001847986
Entity Tax Identification Number	85-1873463
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	12915 Old Virginia Road
Entity Address, City or Town	Reno
Entity Address, State or Province	NV
Entity Address, Postal Zip Code	89521
City Area Code	(775)
Local Phone Number	622-3448
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		1,948,863
Entity Listing, Par Value Per Share	$ 0.0001
Common Stock, par value $0.0001 per share
Title of 12(b) Security	Common Stock, par value $0.0001 per share
Trading Symbol	DFLI
Security Exchange Name	NASDAQ
Redeemable Warrants, exercisable for common stock
Title of 12(b) Security	Redeemable Warrants, exercisable for common stock
Trading Symbol	DFLIW
Security Exchange Name	NASDAQ

SCHEDULE OF ROLL FORWARD OF LIABILITY CLASSIFIED WARRANTS (Details)	9 Months Ended
	Sep. 30, 2026 shares
Private Warrants [Member]
LiabilityWarrantsLineItems [Line Items]
Warrants Outstanding, January 1, 2026	2,085
Exercise of warrants
Warrants issued
Warrants expired	(2,085)
Underwriters’ Warrants Outstanding, September 30, 2026
Term Loan Warrants [Member]
LiabilityWarrantsLineItems [Line Items]
Warrants Outstanding, January 1, 2026	21,777
Exercise of warrants	(21,777)
Warrants issued
Warrants expired
Underwriters’ Warrants Outstanding, September 30, 2026
Investor Warrants [Member]
LiabilityWarrantsLineItems [Line Items]
Warrants Outstanding, January 1, 2026	15,461
Exercise of warrants
Warrants issued
Warrants expired
Underwriters’ Warrants Outstanding, September 30, 2026	15,461

NATURE OF BUSINESS

9 Months Ended

Sep. 30, 2026

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NATURE OF BUSINESS

Note 1 - NATURE OF BUSINESS

Dragonfly Energy Holdings Corp. (the “Company”) sells lithium ion battery packs for use in a wide variety of applications. The Company sells to distributors under the Dragonfly Energy brand name, and sells direct to consumers under the trade name Battle Born Batteries. In addition, the Company develops technology for improved lithium ion battery manufacturing and assembly methods.

On October 8, 2026, the Company’s Board of Directors (the “Board”) approved a 1-for-8 reverse stock split of the Company’s authorized and issued and outstanding common stock. In connection with the reverse stock split, the Company’s authorized shares of common stock were reduced from 400,000,000 shares to 50,000,000 shares, and the par value of common stock remained unchanged at $0.0001 per share. The reverse stock split proportionately adjusted outstanding equity awards, shares reserved under equity incentive plans and related agreements, convertible preferred stock conversion factors, and outstanding warrants, including related exercise, grant, acquisition and conversion terms, as applicable. The Company’s authorized preferred stock was not impacted. The reverse stock split was effected upon market open on October 12, 2026, and shares of common stock began trading on a split-adjusted basis as of market open on October 12, 2026.

Unless otherwise indicated, all share and per-share amounts presented in the unaudited condensed consolidated financial statements and related notes have been retroactively adjusted to reflect the Company’s reverse stock splits, including the 1-for-10 reverse stock split effective December 18, 2025 and the 1-for-8 reverse stock split effective October 12, 2026.

SCHEDULE OF REPORTABLE SEGMENTS INFORMATION (Details) - USD ($)
$ in Thousands

3 Months Ended

9 Months Ended

Sep. 30, 2026

Jun. 30, 2026

Mar. 31, 2026

Sep. 30, 2025

Jun. 30, 2025

Mar. 31, 2025

Sep. 30, 2026

Sep. 30, 2025

Segment Reporting [Line Items]

Net Sales

$ 12,174

$ 15,967

$ 35,037

$ 45,571

Reconciling items

Consolidated Net Sales

12,174

15,967

35,037

45,571

Direct material

7,667

9,169

21,304

26,410

Direct labor

688

922

2,204

2,601

Direct overhead and depreciation

534

1,140

2,191

3,291

Total Cost of Goods Sold

8,889

11,231

25,699

32,302

Gross profit

3,285

4,736

9,338

13,269

Research & development

633

585

2,261

2,277

Sales tax adjustment

Credit card & amazon transaction fees

125

235

383

Other general & administrative

5,041

5,124

13,971

15,890

Shipping

479

870

1,509

2,260

Sales and marketing stock compensation

175

133

Sales and marketing wages

345

453

1,247

1,493

Marketing spend

421

625

1,626

2,067

Rent

Unallocated sales and marketing stock compensation

Unallocated sales and marketing wages

176

409

556

1,033

Other sales & marketing

200

308

603

Total Operating Expenses

7,338

8,514

22,017

26,242

Income (Loss) from Operations

(4,053)

(3,778)

(12,679)

(12,973)

Other income (expense)

411

534

Interest expense, net

(1,774)

(6,409)

(4,775)

(16,552)

Change in FMV of warrant liability

(123)

(883)

370

4,624

Total Other Income (Expense)

(1,486)

(7,292)

(3,871)

(11,928)

Net Income (Loss) before taxes

(5,539)

(11,070)

(16,550)

(24,901)

Income Tax Benefit

Net Income (Loss)

(5,539)

$ (4,386)

$ (6,625)

(11,070)

$ (7,034)

$ (6,797)

(16,550)

(24,901)

Reconciling items

Consolidated net loss

(5,539)

(11,070)

(16,550)

(24,901)

Direct To Consumers [Member]

Segment Reporting [Line Items]

Net Sales

4,802

5,038

12,981

16,001

Direct material

3,214

2,852

8,447

9,340

Direct labor

314

412

1,021

1,104

Direct overhead and depreciation

243

510

1,016

1,395

Total Cost of Goods Sold

3,771

3,774

10,484

11,839

Gross profit

1,031

1,264

2,497

4,162

Research & development

Sales tax adjustment

Credit card & amazon transaction fees

125

235

383

Other general & administrative

Shipping

272

628

970

1,439

Sales and marketing stock compensation

Sales and marketing wages

136

176

483

550

Marketing spend

385

569

1,471

1,892

Rent

Unallocated sales and marketing stock compensation

Unallocated sales and marketing wages

Other sales & marketing

Total Operating Expenses

890

1,573

3,234

4,337

Income (Loss) from Operations

141

(309)

(737)

(175)

Other income (expense)

Interest expense, net

Change in FMV of warrant liability

Total Other Income (Expense)

Net Income (Loss) before taxes

141

(309)

(737)

(175)

Income Tax Benefit

Net Income (Loss)

141

(309)

(737)

(175)

Original Equipment Manufacturers [Member]

Segment Reporting [Line Items]

Net Sales

7,122

10,679

21,306

28,820

Direct material

4,453

6,317

12,857

17,070

Direct labor

374

510

1,183

1,497

Direct overhead and depreciation

291

630

1,175

1,896

Total Cost of Goods Sold

5,118

7,457

15,215

20,463

Gross profit

2,004

3,222

6,091

8,357

Research & development

Sales tax adjustment

Credit card & amazon transaction fees

Other general & administrative

Shipping

207

242

539

821

Sales and marketing stock compensation

147

104

Sales and marketing wages

209

277

764

943

Marketing spend

155

175

Rent

Unallocated sales and marketing stock compensation

Unallocated sales and marketing wages

Other sales & marketing

Total Operating Expenses

492

608

1,618

2,056

Income (Loss) from Operations

1,512

2,614

4,473

6,301

Other income (expense)

Interest expense, net

Change in FMV of warrant liability

Total Other Income (Expense)

Net Income (Loss) before taxes

1,512

2,614

4,473

6,301

Income Tax Benefit

Net Income (Loss)

1,512

2,614

4,473

6,301

Other [Member]

Segment Reporting [Line Items]

Net Sales

250

^[1]

250

^[2]

750

^[3]

750

^[4]

Direct material

Direct labor

Direct overhead and depreciation

Total Cost of Goods Sold

Gross profit

250

750

Research & development

633

^[5]

585

^[6]

2,261

^[7]

2,277

^[8]

Sales tax adjustment

Credit card & amazon transaction fees

Other general & administrative

5,041

^[9]

5,124

^[10]

13,971

^[11]

15,890

^[12]

Shipping

Sales and marketing stock compensation

Sales and marketing wages

Marketing spend

Rent

Unallocated sales and marketing stock compensation

^[13]

^[14]

^[15]

^[16]

Unallocated sales and marketing wages

176

^[13]

409

^[14]

556

^[15]

1,033

^[16]

Other sales & marketing

^[13]

200

^[14]

308

^[15]

603

^[16]

Total Operating Expenses

5,956

6,333

17,165

19,849

Income (Loss) from Operations

(5,706)

(6,083)

(16,415)

(19,099)

Other income (expense)

411

534

Interest expense, net

(1,774)

(6,409)

^[17]

(4,775)

(16,552)

Change in FMV of warrant liability

(123)

(883)

^[17]

370

4,624

Total Other Income (Expense)

(1,486)

^[18]

(7,292)

(3,871)

^[19]

(11,928)

^[20]

Net Income (Loss) before taxes

(7,192)

(13,375)

(20,286)

(31,027)

Income Tax Benefit

Net Income (Loss)

$ (7,192)

$ (13,375)

$ (20,286)

$ (31,027)

[1]	Licensing Revenue which is not considered a segment as it is currently immaterial
[2]	Licensing Revenue which is not considered a segment as it is currently immaterial
[3]	Licensing Revenue which is not considered a segment as it is currently immaterial
[4]	Licensing Revenue which is not considered a segment as it is currently immaterial
[5]	Research and Development expenses including employee costs related to new products
[6]	Research and Development expenses including employee costs related to new products
[7]	Research and Development expenses including employee costs related to new products
[8]	Research and Development expenses including employee costs related to new products
[9]	Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses
[10]	Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses
[11]	Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses
[12]	Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses
[13]	General sales and marketing employee cost and other marketing expenses
[14]	General sales and marketing employee cost and other marketing expenses
[15]	General sales and marketing employee cost and other marketing expenses
[16]	General sales and marketing employee cost and other marketing expenses
[17]	Interest expense related to debt and change in fair market value of warrant liability
[18]	Other income, primarily consisting of grant income, interest expense related to debt, and change in fair market value of warrant liability
[19]	Other income, primarily consisting of grant income, interest expense related to debt and change in fair market value of warrant liability
[20]	Interest expense related to debt and change in fair market value of warrant liability

SCHEDULE OF FAIR VALUE OF THE CONSIDERATION TRANSFERRED (Details) (Parenthetical) - Common Stock [Member] - $ / shares		3 Months Ended
	Jul. 31, 2026	Sep. 30, 2026
Business Combination, Contingent Consideration [Line Items]
Number of shares issued	187,500	187,500
Closing price per share	$ 9.36

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- Definition

Number of shares of stock issued during the period pursuant to acquisitions.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
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-Name Accounting Standards Codification
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Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480657/210-10-S50-11

+ Details

REPORTABLE SEGMENTS (Details Narrative)	3 Months Ended		9 Months Ended
REPORTABLE SEGMENTS (Details Narrative)	Sep. 30, 2026 USD ($)	Sep. 30, 2025 USD ($)	Sep. 30, 2026 USD ($) Segment	Sep. 30, 2025 USD ($)
Segment Reporting [Line Items]
Number of reportable segments \| Segment			2
Net Sales	$ 12,174,000	$ 15,967,000	$ 35,037,000	$ 45,571,000
Original Equipment Manufacturers Segment [Member]
Segment Reporting [Line Items]
Net Sales	$ 2,588	$ 5,575	$ 7,535	$ 13,021
Original Equipment Manufacturers Segment [Member] \| Customer Concentration Risk [Member] \| Revenue Benchmark [Member] \| One Customer [Member]
Segment Reporting [Line Items]
Percentage of revenues	22.00%	35.00%	22.00%	29.00%

- Definition

For an entity that discloses a concentration risk in relation to quantitative amount, which serves as the "benchmark" (or denominator) in the equation, this concept represents the concentration percentage derived from the division.

+ References + Details

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

+ Details

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

SCHEDULE OF FAIR VALUES OF THE ASSETS ACQUIRED AND LIABILITIES ASSUMED (Details) - USD ($) $ in Thousands	Jul. 31, 2026	Sep. 30, 2026
Intangible assets:
Goodwill		$ 403
Dragonfly Energy Corp [Member]
Business Combination [Line Items]
Inventory	$ 639
Property and equipment	47
Intangible assets:
Total identifiable assets acquired	2,352
Goodwill	403
Total consideration transferred	2,755
Dragonfly Energy Corp [Member] \| Customer Relationships [Member]
Intangible assets:
Total identifiable assets acquired	720
Dragonfly Energy Corp [Member] \| Trade Names [Member]
Intangible assets:
Total identifiable assets acquired	$ 946

LONG TERM DEBT (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands				3 Months Ended				6 Months Ended	9 Months Ended
	Jul. 31, 2026	Apr. 01, 2025	Oct. 07, 2022	Sep. 30, 2026	Jun. 30, 2026	Sep. 30, 2025	Mar. 31, 2025	Mar. 31, 2025	Sep. 30, 2026	Sep. 30, 2025	Sep. 30, 2024	Oct. 01, 2026	Jul. 30, 2026	Dec. 31, 2025	Oct. 20, 2025	Apr. 01, 2024
Debt Instrument [Line Items]
Principal amount outstanding																$ 30,846
Debt instrument interest rate																14.00%
Long term debt				$ 19,526					$ 19,526
Unamortized debt discount				7,043					7,043
Shares of common stock, value				202	$ 829		$ 63
Paid in kind interest									445	$ 11,233
Legal and other direct costs				56					56
Cash and cash equivalent				1,941					1,941					$ 18,270
Maximum capital expenditure				5,000					$ 5,000
Dragonfly Energy Corp [Member]
Debt Instrument [Line Items]
Business combination, closing price per share	$ 9.36
Business combination, consideration transferred equity	$ 1,755
Business combination, consideration transferred	$ 2,755
Common Stock [Member]
Debt Instrument [Line Items]
Shares of common stock, value
Seventh and Eighth Amendment [Member]
Debt Instrument [Line Items]
Amendment fee															$ 450
Effective interest rate	60.06%
Seventh Amendment [Member]
Debt Instrument [Line Items]
Effective interest rate				60.66%					60.66%
Eighth Amendment [Member] \| Subsequent Event [Member]
Debt Instrument [Line Items]
Effective interest rate												63.07%
August 31, 2026 Through January 31, 2027 [Member]
Debt Instrument [Line Items]
Cash and cash equivalent				$ 4,000					$ 4,000
Thereafter [Member]
Debt Instrument [Line Items]
Cash and cash equivalent				5,000					5,000
Term Loan Agreement [Member]
Debt Instrument [Line Items]
Debt maturity date			Oct. 07, 2027
Debt monthly payment percentage			0.4167%
Amendment fee				450					450
Term Loan Agreement [Member] \| Senior Notes [Member]
Debt Instrument [Line Items]
Principal amount outstanding				19,526					19,526					19,344
Interest expense				640		$ 3,927			1,790	11,233
Amortization of debt issuance costs				1,153		$ 2,456			3,106	$ 5,240
Long term debt				12,483					12,483					9,645
Unamortized debt discount				7,043					7,043					$ 9,699
Term Loan Agreement [Member] \| Senior Secured Term Loan Facility [Member] \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member]
Debt Instrument [Line Items]
Variable rate, payable in cash								7.00%
Term Loan Agreement [Member] \| Senior Secured Term Loan Facility [Member] \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Variable rate, payable in cash		11.50%
Variable rate, payable in kind								4.50%
Term Loan Agreement [Member] \| Senior Secured Term Loan Facility [Member] \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Variable rate, payable in cash		13.50%
Variable rate, payable in kind								6.50%
Term Loan Agreement [Member] \| After April 1, 2023 Until October 1, 2024 [Member] \| Senior Secured Term Loan Facility [Member] \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member]
Debt Instrument [Line Items]
Variable rate, payable in cash											7.00%
Term Loan Agreement [Member] \| After April 1, 2023 Until October 1, 2024 [Member] \| Senior Secured Term Loan Facility [Member] \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Variable rate, payable in kind											4.50%
Term Loan Agreement [Member] \| After April 1, 2023 Until October 1, 2024 [Member] \| Senior Secured Term Loan Facility [Member] \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Variable rate, payable in kind											6.50%
Term Loan Agreement [Member] \| Sixth Amendment [Member]
Debt Instrument [Line Items]
Debt instrument interest rate															12.00%
Asset Purchase Agreement [Member] \| Dakota Lithium [Member]
Debt Instrument [Line Items]
Debt instrument interest rate	14.00%												12.00%
Shares of common stock, value	$ 4,000
Consisting cash value	$ 1,000
Minimum liquidity requirement description	The Seventh Amendment also reduces the minimum liquidity requirement to $4,000 at each month-end from August 31, 2026 through January 31, 2027, after which the minimum liquidity requirement increases to $5,000, and defers the commencement of the maximum senior leverage ratio and fixed charge coverage ratio covenants to the quarter ending September 30, 2027 (from March 31, 2027). Commencing with the fiscal quarter ending September 30, 2027, the maximum senior leverage ratio is 3.00:1.00, and a minimum fixed charge coverage ratio of 1.15:1.00 is required for the trailing four fiscal quarters if liquidity is below $15,000 at quarter-end.
Paid in kind interest				$ 445					$ 445
Asset Purchase Agreement [Member] \| Dakota Lithium [Member] \| Common Stock [Member]
Debt Instrument [Line Items]
Shares of common stock, value	$ 3,000

Dakota Lithium Acquisition (Tables)

9 Months Ended

Sep. 30, 2026

Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]

SCHEDULE OF FAIR VALUE OF THE CONSIDERATION TRANSFERRED

(in dollars 000s)	Amount
Cash	$	1,000
187,500 shares of Dragonfly Energy Holdings Corp. common stock, valued at the $9.36 closing price on July 31, 2026		1,755
Total consideration transferred	$	2,755

SCHEDULE OF FAIR VALUES OF THE ASSETS ACQUIRED AND LIABILITIES ASSUMED

(in dollars 000s)	Amount
Inventory	$	639
Property and equipment		47
Intangible assets:
Customer relationships		720
Trade name		946
Total identifiable assets acquired		2,352
Goodwill		403
Total consideration transferred	$	2,755

SCHEDULE OF PRO FORMA INFORMATION

The unaudited supplemental pro forma information below shows the Company’s combined results as if the acquisition had occurred on January 1, 2025:

SCHEDULE OF PRO FORMA INFORMATION

in 000s

Three months ended
Sept. 30, 2026⁽¹⁾

Three months ended
Sept. 30, 2025

Nine months ended
Sept. 30, 2026⁽¹⁾

Nine months ended
Sept. 30, 2025

Revenue

12,596

18,609

40,529

56,262

Net loss

(5,412

)

(12,355

)

(18,895

)

(27,203

)

(1)	Dakota Lithium’s results of operations have been included in the condensed consolidated financial statements since the Acquisition Date. Following the acquisition, Dakota Lithium’s operations were integrated into the Company’s existing operations

SCHEDULE OF FUTURE DEBT MATURITIES (Details) $ in Thousands	Sep. 30, 2026 USD ($)
Debt Disclosure [Abstract]
December 31, 2026	$ 240
December 31, 2027	19,286
Total debt	19,526
Less: Unamortized debt issuance costs	(7,043)
Total carrying amount	12,483
Less: Current portion of debt	(12,483)
Total long-term debt

- Definition

Amount, after deduction of unamortized premium (discount) and debt issuance cost, of long-term debt. Excludes lease obligation.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 942
-SubTopic 235
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SX 210.9-06)
-Publisher FASB
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 942
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480657/210-10-S50-9

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(22))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480566/210-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S50
-Paragraph 4
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480738/235-10-S50-4

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 3
-Subparagraph (SX 210.12-04(a))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-3

Reference 9: http://www.xbrl.org/2003/role/exampleRef
-Topic 835
-SubTopic 30
-Name Accounting Standards Codification
-Section 55
-Paragraph 8
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482949/835-30-55-8

Reference 10: http://www.xbrl.org/2003/role/exampleRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 55
-Paragraph 69B
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481568/470-20-55-69B

Reference 11: http://www.xbrl.org/2003/role/exampleRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 55
-Paragraph 69C
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481568/470-20-55-69C

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1D
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1D

Reference 13: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 944
-SubTopic 210
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-03(a)(16)(a)(2))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147478777/944-210-S99-1

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 4
-Subparagraph (b)(3)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-4

+ Details

SCHEDULE OF POTENTIAL SHARES OF COMMON STOCK EXCLUDED FROM DILUTED NET LOSS PER SHARE (Details) - shares	9 Months Ended
	Sep. 30, 2026	Sep. 30, 2025
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total excluded shares	186,996	57,036
Warrant [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total excluded shares	29,340	53,202
Restricted Stock Units (RSUs) [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total excluded shares	42,474	2,115
Series A Preferred Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total excluded shares	99,206
Share-Based Payment Arrangement, Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total excluded shares	15,976	1,719

WARRANTS (Tables)

9 Months Ended

Sep. 30, 2026

Warrants

SCHEDULE OF ROLL-FORWARD OF EQUITY WARRANTS

The following table presents a roll-forward of the Company’s equity warrants from January 1, 2026 to September 30, 2026:

	Public Warrants		Underwriters’ Warrants		Pre-Funded Underwriters’ Warrants
Warrants Outstanding, January 1, 2026		13,087		792		62,500
Exercise of warrants		-		-		(62,500	)
Warrants issued		-		-		-
Underwriters’ Warrants Outstanding, September 30, 2026		13,087		792		-

SCHEDULE OF SIGNIFICANT INPUTS OF FAIR VALUE OF WARRANTS

The following table provides the significant inputs to the Black-Scholes method for the fair value of the Investor Warrants issued in the June 2023 Offering:

	As of September 30, 2026			As of December 31, 2025
Common stock price	$	6.81		$	26.00
Exercise price	$	1,440		$	1,440
Dividend yield		0	%		0	%
Term		1.73			2.48
Volatility		154.1	%		571.4	%
Risk-free rate		3.7	%		3.7	%
Fair value	$	0.18		$	26.00

SCHEDULE OF ROLL FORWARD OF LIABILITY CLASSIFIED WARRANTS

The following table presents a roll-forward of the Company’s warrants from January 1, 2026 to September 30, 2026:

	Private Warrants			Term Loan Warrants			Investor Warrants
Warrants Outstanding, January 1, 2026		2,085			21,777			15,461
Exercise of warrants		-			(21,777	)		-
Warrants issued		-			-			-
Warrants expired		(2,085	)		-			-
Warrants Outstanding, September 30, 2026		-			-			15,461

SCHEDULE OF BREAKOUT OF OPERATING LEASES INVENTORY (Details) - USD ($) $ in Thousands	Sep. 30, 2026	Dec. 31, 2025
Commitments and Contingencies Disclosure [Abstract]
Operating lease right-of-use assets	$ 14,350	$ 15,240
Short-term operating lease liabilities	2,273	2,533
Long-term operating lease liabilities	18,854	20,470
Total operating lease liabilities	$ 21,127	$ 23,003
Weighted average remaining lease term	7 years 3 months 29 days	7 years 10 months 17 days
Weighted average discount rate	8.02%	7.99%

SCHEDULE OF OPTION ACTIVITY AND RELATED INFORMATION (Details) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2026	Sep. 30, 2025	Sep. 30, 2026	Sep. 30, 2025	Dec. 31, 2025
Share-Based Payment Arrangement [Abstract]
Number of Options, Balance at the beginning			1,676
Weighted- Average Exercise Price - Balances at the beginning			$ 1,931.92
Weighted- Average Grant Date Fair Value, Balances at the beginning			$ 1,922.48
Weighted- Average Remaining Contractual Life (in years)			9 years 18 days		5 years 7 months 20 days
Aggregate Intrinsic value, Balances at the beginning
Number of Options granted	0	0	14,589	0
Weighted- Average Exercise Price Options granted			$ 23.92
Weighted- Average Grant Date Fair Value, Options granted			$ 23.92
Weighted- Average Remaining Contractual Life (in years), Granted			9 years 5 months 12 days
Aggregate Intrinsic value Options granted
Number of Options forfeited			(1)
Weighted- Average Exercise Price Options forfeited			$ 5,150.22
Weighted- Average Grant Date Fair Value, Options forfeited			$ 54.55
Aggregate Intrinsic value Options forfeited
Number of Options expired			(288)
Weighted- Average Exercise Price Options expired			$ 1,832.49
Weighted- Average Grant Date Fair Value, Options expired			$ 4.64
Aggregate Intrinsic value Options expired
Number of Options, Balance at the end	15,976		15,976		1,676
Weighted- Average Exercise Price Balances at the end	$ 191.03		$ 191.03		$ 1,931.92
Weighted- Average Grant Date Fair Value, Balances at the end	$ 21.98		$ 21.98		$ 1,922.48
Aggregate Intrinsic value, Balances at the ending
Number of Options, Vested and Exercisable	6,249		6,249
Weighted- Average Exercise Price Vested and Exercisable	$ 451.02		$ 451.02
Weighted- Average Remaining Contractual Life (in years), Vested and Exercisable			8 years 5 months 1 day
Aggregate Intrinsic value Vested and Exercisable
Number of Options, Vested and expected to vest	15,976		15,976
Weighted- Average Exercise Price Vested and expected to vest	$ 191.03		$ 191.03
Weighted- Average Remaining Contractual Life (in years), Vested and expected to vest			9 years 18 days
Aggregate Intrinsic value Vested and expected to vest

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2026	Sep. 30, 2025	Sep. 30, 2026	Sep. 30, 2025
Income Statement [Abstract]
Net Sales	$ 12,174	$ 15,967	$ 35,037	$ 45,571
Cost of Goods Sold	8,889	11,231	25,699	32,302
Gross Profit	3,285	4,736	9,338	13,269
Operating Expenses
Research and development	633	585	2,261	2,277
General and administrative	5,112	5,299	14,211	16,275
Selling and marketing	1,593	2,630	5,545	7,690
Total Operating Expenses	7,338	8,514	22,017	26,242
Loss From Operations	(4,053)	(3,778)	(12,679)	(12,973)
Other (Expense) Income
Interest expense, net	(1,774)	(6,409)	(4,775)	(16,552)
Other income	411		534
Change in fair market value of warrant liability	(123)	(883)	370	4,624
Total Other (Expense) Income	(1,486)	(7,292)	(3,871)	(11,928)
Net Loss Before Taxes	(5,539)	(11,070)	(16,550)	(24,901)
Income Tax Expense (Benefit)
Net Loss	(5,539)	(11,070)	(16,550)	(24,901)
Less: Preferred Stock Dividends	(1,168)		(3,394)
Net Loss Attributable to Common Stockholders	$ (6,707)	$ (11,070)	$ (19,944)	$ (24,901)
Loss Per Share- Basic	$ (3.71)	$ (16.45)	$ (11.91)	$ (81.26)
Loss Per Share- Diluted	$ (3.71)	$ (16.45)	$ (11.91)	$ (81.26)
Weighted Average Number of Shares - Basic	1,807,571	673,112	1,674,085	306,438
Weighted Average Number of Shares - Diluted	1,807,571	673,112	1,674,085	306,438

NATURE OF BUSINESS (Details Narrative) - $ / shares	Oct. 12, 2026	Dec. 18, 2025	Sep. 30, 2026	Dec. 31, 2025
Subsequent Event [Line Items]
Stock reverse split		1-for-10 reverse stock split
Common stock, shares authorized			50,000,000	50,000,000
Common stock par value			$ 0.0001	$ 0.0001
Subsequent Event [Member]
Subsequent Event [Line Items]
Stock reverse split	1-for-8 reverse stock split
Common stock par value	$ 0.0001
Subsequent Event [Member] \| Maximum [Member]
Subsequent Event [Line Items]
Common stock, shares authorized	400,000,000
Subsequent Event [Member] \| Minimum [Member]
Subsequent Event [Line Items]
Common stock, shares authorized	50,000,000

SCHEDULE OF ACQUISITION-DATE FAIR VALUES ASSIGNED TO INTANGIBLE ASSETS ACQUIRED (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2026 USD ($)
Intangible Asset, Finite-Lived [Line Items]
Total intangible assets acquired	$ 1,666
Customer Relationships [Member]
Intangible Asset, Finite-Lived [Line Items]
Total intangible assets acquired	$ 720
Estimated Useful Life	6 years
Trade Names [Member]
Intangible Asset, Finite-Lived [Line Items]
Total intangible assets acquired	$ 946
Estimated Useful Life	20 years

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2026

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

Note 3 - FAIR VALUE MEASUREMENTS

ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances.

ASC 820 identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a three-tier fair value hierarchy that distinguishes between the following:

●	Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
●	Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for a similar asset or liability, either directly or indirectly.
●	Level 3 inputs are unobservable inputs that reflect the Company’s own assumptions about the inputs that market participants would use in pricing the asset or liability.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 3 - Fair Value Measurements (continued)

Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The following table presents assets and liabilities that were measured at fair value in the Unaudited Condensed Consolidated Balance Sheets on a recurring basis as of September 30, 2026.

	Carrying Amount		Fair Value		(Level 1)		(Level 2)		(Level 3)
	As of September 30, 2026
Liabilities
Warrant liability- June Public Offering	$	3	$	3	$	-	$	3	$	-
Total liabilities	$	3	$	3	$	-	$	3	$	-

The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheets on a recurring basis as of December 31, 2025:

	Carrying Amount		Fair Value		(Level 1)		(Level 2)		(Level 3)
	As of December 31, 2025
Liabilities
Warrant liability- Term Loan	$	565	$	565	$	-	$	565	$	-
Warrant liability- June Public Offering		148		148		-		148		-
Total liabilities	$	713	$	713	$	-	$	713	$	-

As of September 30, 2026 and December 31, 2025, the warrant liabilities were valued using the Black Scholes model.

The carrying amounts of accounts receivable, accounts payable, and dividends payable are approximate fair value as of September 30, 2026 and December 31, 2025 because of the relatively short maturity of these instruments.

The carrying value of the Term Loan as of September 30, 2026 and December 31, 2025 approximates fair value as the interest rate does not differ significantly from the current market rates available to the Company for similar debt and is considered Level 2.

There was no Level 3 activity for the three and nine months ended September 30, 2026 and 2025.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

STOCK-BASED COMPENSATION (Details Narrative) - USD ($) $ in Thousands									1 Months Ended	3 Months Ended		9 Months Ended
	Aug. 03, 2026	Jul. 13, 2026	Jun. 18, 2026	May 28, 2026	Apr. 01, 2026	Oct. 15, 2025	May 19, 2025	Apr. 01, 2025	Mar. 31, 2026	Sep. 30, 2026	Sep. 30, 2025	Sep. 30, 2026	Sep. 30, 2025
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Shares available for issuance										2,174,014	876,023	2,174,014	876,023
Number stock options issued										0	0	14,589	0
Share based compensation										$ 243	$ 168	$ 717	$ 578
Restricted Stock Units (RSUs) [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Restricted stock units, granted												86,177
Fair value of restricted stock units granted												$ 1,105
Number of shares granted stock options					79,848
Restricted Stock Units (RSUs) [Member] \| Share-Based Payment Arrangement, Tranche One [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of restricted stock units granted												5
Number of shares granted stock options				283
Restricted Stock Units (RSUs) [Member] \| Share-Based Payment Arrangement, Tranche Two [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares granted stock options		1,250
Restricted Stock Units (RSUs) [Member] \| Share-Based Payment Arrangement, Tranche Three [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares granted stock options	1,875
Restricted Stock Units (RSUs) [Member] \| Employees Two [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Restricted stock units, granted							11	47
Fair value of restricted stock units granted												4
Compensation expense													1
Restricted Stock Units (RSUs) [Member] \| Director [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of restricted stock units granted												23
Number of shares granted stock options									1,671
Number of issuance shares			1,250
Restricted Stock Units (RSUs) [Member] \| Board of Directors Chairman [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of restricted stock units granted												20
Restricted Stock Units RSU Two [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Compensation expense										111		304
Restricted Stock Units RSU Two [Member] \| Share-Based Payment Arrangement, Tranche One [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Compensation expense										0		5
Restricted Stock Units RSU Two [Member] \| Share-Based Payment Arrangement, Tranche Two [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Compensation expense										17		2
Restricted Stock Units RSU Two [Member] \| Share-Based Payment Arrangement, Tranche Three [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Compensation expense										18		1
Restricted Stock Units RSU Two [Member] \| Director [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Compensation expense										3		6
Restricted Stock Units RSU Two [Member] \| Board of Directors Chairman [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Compensation expense										5		6
Location, Statement of Income, Balance [Axis]: us-gaap:CostOfGoodsAndServicesSold
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share based compensation										4	11	14	45
Location, Statement of Income, Balance [Axis]: us-gaap:GeneralAndAdministrativeExpense
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share based compensation										160	93	423	318
Location, Statement of Income, Balance [Axis]: us-gaap:ResearchAndDevelopmentExpense
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share based compensation										11	9	36	36
Location, Statement of Income, Balance [Axis]: us-gaap:SellingAndMarketingExpense
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share based compensation										$ 68	$ 55	$ 244	$ 179
2022 Equity Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares available for issuance						112,500
Employee Stock Purchase Plan [Member] \| Common Stock [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Shares available for issuance						3,423
Shares limit description						The share limit will automatically increase on the first trading day in January of each year by an amount equal to the lesser of (1) 1% of the total number of outstanding shares of common stock on December 31 in the prior year, (2) 2,083 shares, or (3) such number as determined by the Board.
2022 Equity Incentive Plan and Employee Stock Purchase Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Unissued authorized and available for future awards										116,352	14,603	116,352	14,603

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2026

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Note 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

Principles of consolidation

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Going Concern

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Inventory

Finite-Lived Intangible Assets

Impairment

Use of Estimates

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Revenue Recognition

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Disaggregation of Revenue

The following table presents our disaggregated revenues by distribution channel:

Sales	2026		2025		2026		2025
	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
Sales	2026		2025		2026		2025
Direct to customer	$	4,802	$	5,038	$	12,981	$	16,001
Original equipment manufacture		7,122		10,679		21,306		28,820
License fee revenue		250		250		750		750
Total	$	12,174	$	15,967	$	35,037	$	45,571

Grant Income

Business Combination

Goodwill

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Product Warranty

SCHEDULE OF WARRANTY OBLIGATION

	September 30 2026
Beginning warranty obligation	$	867
Provision of warranty expense		293
Settlement of warranty claims		(259	)
Ending warranty obligation	$	901

Concentrations

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Concentrations (Continued)

Stock-Based Compensation

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Income Taxes

Net Loss per Common Share

The following table sets forth the number of potential shares of common stock that have been excluded from diluted net loss per share because their effect was anti-dilutive:

	2026		2025
	September 30,
	2026		2025
Warrants		29,340		53,202
Restricted stock units		42,474		2,115
Series B Preferred Stock		99,206		-
Options		15,976		1,719
Total excluded shares		186,996		57,036

Reclassifications

Segment Reporting

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 2 – Summary of Significant Accounting Policies (continued)

Recently issued accounting pronouncements:

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

SCHEDULE OF SIGNIFICANT INPUTS OF FAIR VALUE OF WARRANTS (Details) - Penny Warrants [Member] - $ / shares	9 Months Ended	12 Months Ended
	Sep. 30, 2026	Dec. 31, 2025
WarrantsLineItems [Line Items]
Common stock price	$ 6.81	$ 26.00
Exercise price	$ 1,440	$ 1,440
Dividend yield	0.00%	0.00%
Term	1 year 8 months 23 days	2 years 5 months 23 days
Volatility	154.10%	571.40%
Risk free rate, minimum	3.70%	3.70%
Fair value	$ 0.18	$ 26.00

WARRANTS (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended	21 Months Ended
	Sep. 30, 2026	Sep. 30, 2025	Sep. 30, 2026	Sep. 30, 2025	Dec. 31, 2025	Sep. 30, 2026	Mar. 15, 2026	Feb. 26, 2025	Oct. 07, 2022
Class of Warrant or Right [Line Items]
Proceeds from exercise of equity warrants	$ 0		$ 1
Share Price							$ 23.92
Public Warrants [Member]
Class of Warrant or Right [Line Items]
Warrants issued shares			13,087		13,087
Warrants outstanding	13,087		13,087		13,087	13,087
Warrants exercised
Private Placement Warrants [Member]
Class of Warrant or Right [Line Items]
Warrants outstanding	0		0		2,085	0
Penny Warrants [Member]
Class of Warrant or Right [Line Items]
Warrants to purchase common stock									3,601
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercises in Period						2,778
Stock Issued During Period, Shares, Other			21,777
Penny Warrants [Member] \| Common Stock [Member]
Class of Warrant or Right [Line Items]
Stock Issued During Period, Shares, Other			21,672
$10 Warrants [Member]
Class of Warrant or Right [Line Items]
Warrants to purchase common stock									2,222
Share Price									$ 7,200
February 2025 Penny Warrants [Member]
Class of Warrant or Right [Line Items]
Warrants to purchase common stock								4,125
Warrants exercise price								$ 0.80
Warrants term								10 years
Warrant [Member]
Class of Warrant or Right [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercises in Period						16,829

COMMON STOCK (Details Narrative) - USD ($) $ in Thousands		9 Months Ended
COMMON STOCK (Details Narrative) - USD ($) $ in Thousands	Jan. 30, 2026	Sep. 30, 2026
Accumulated Other Comprehensive Income (Loss) [Line Items]
Common stock offer and sell up to	$ 50,000
Common Stock [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Sold shares of common stock, shares		72,658
Proceeds from sale of stock		$ 1,031

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 30
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+ Details

SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY (Details) - Restricted Stock Units (RSUs) [Member]	9 Months Ended
	Sep. 30, 2026 $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of Shares, Unvested shares beginning balance \| shares	2,098
Weighted-Average Fair Market Value, Unvested shares beginning balance \| $ / shares	$ 362.40
Number of Shares, Unvested shares Granted \| shares	86,177
Weighted-Average Fair Market Value, Unvested shares Granted \| $ / shares	$ 13.78
Number of Shares, Exercised \| shares	(28,793)
Weighted-Average Fair Market Value, Exercised \| $ / shares	$ 24.95
Number of Shares, Forfeited \| shares	(16,379)
Weighted-Average Fair Market Value, Forfeited \| $ / shares	$ 20.59
Number of Shares, Vested \| shares	(629)
Weighted-Average Fair Market Value, Vested \| $ / shares	$ 18.95
Number of Shares, Unvested shares ending balance \| shares	42,474
Weighted-Average Fair Market Value, Unvested shares ending balance \| $ / shares	$ 20.74

SCHEDULE OF ROLL-FORWARD OF EQUITY WARRANTS (Details)	9 Months Ended
SCHEDULE OF ROLL-FORWARD OF EQUITY WARRANTS (Details)	Sep. 30, 2026 shares
Public Warrants [Member]
EquityWarrantsLineItems [Line Items]
Warrants Outstanding, January 1, 2026	13,087
Exercise of warrants
Warrants issued
Underwriters’ Warrants Outstanding, September 30, 2026	13,087
Underwriters Warrants [Member]
EquityWarrantsLineItems [Line Items]
Warrants Outstanding, January 1, 2026	792
Exercise of warrants
Warrants issued
Underwriters’ Warrants Outstanding, September 30, 2026	792
Pre Funded Underwriters Warrants [Member]
EquityWarrantsLineItems [Line Items]
Warrants Outstanding, January 1, 2026	62,500
Exercise of warrants	(62,500)
Warrants issued
Underwriters’ Warrants Outstanding, September 30, 2026

COMMITMENTS AND CONTINGENCIES (Tables)

9 Months Ended

Sep. 30, 2026

Commitments and Contingencies Disclosure [Abstract]

SCHEDULE OF BREAKOUT OF OPERATING LEASES INVENTORY

The following table presents the breakout of the operating leases as of:

	September 30, 2026			December 31, 2025
Operating lease right-of-use assets	$	14,350		$	15,240
Short-term operating lease liabilities		2,273			2,533
Long-term operating lease liabilities		18,854			20,470
Total operating lease liabilities	$	21,127		$	23,003
Weighted average remaining lease term		7.33 years			7.88 years
Weighted average discount rate		8.02	%		7.99	%

SCHEDULE OF SUPPLEMENTAL CASH FLOW INFORMATION RELATED TO THE LEASES

Supplemental cash flow information related to the leases where we are the lessee is as follows:

	2026		2025		2026		2025
	For The Three Months Ended September 30,				For The Nine Months Ended September 30,
	2026		2025		2026		2025
Cash paid for amounts included in the measurement of lease liabilities	$	644	$	724	$	1,876	$	2,160

SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS UNDER OPERATING LEASES

At September 30, 2026, the future minimum lease payments under these operating leases are as follows:

Fiscal Years Ending
December 31, 2026⁽¹⁾	$	1,075
December 31, 2027		3,746
December 31, 2028		3,860
December 31, 2029		3,614
December 31, 2030		3,446
Thereafter		12,600
Total lease payments		28,341
Less imputed interest		7,214
Total operating lease liabilities	$	21,127

⁽¹⁾

Represents scheduled payments for the remaining three-month period ending December 31, 2026.

SCHEDULE OF LEASE COST

		For The Three Months Ended September 30,				For The Nine Months Ended September 30,
Lease cost	Classification	2026		2025		2026		2025
Operating lease cost	Cost of goods sold	$	94	$	622	$	648	$	1,859
Operating lease cost	Research and development		45		21		132		98
Operating lease cost	General and administration		620		1,190		1,413		2,731
Operating lease cost	Selling and marketing		12		13		39		39
Total lease cost⁽¹⁾		$	771	$	1,846	$	2,232	$	4,727

(1)

During the nine months ended September 30, 2025, the Company recognized impairment charges related to the prior main warehouse lease and two impairment charges for two other warehouses as of December 31, 2025, resulting in a reduction of the related right-of-use assets and lease liabilities, as applicable. As a result, lease expense for the period ended September 30, 2026 decreased compared to the prior year.

SCHEDULE OF BREAKOUT OF FINANCE LEASES

The following table presents the breakout of the financing leases as of:

SCHEDULE OF BREAKOUT OF FINANCE LEASES

	September 30, 2026			December 31, 2025
Finance lease right-of-use assets	$	122		$	85
Short-term finance lease liabilities		17			35
Long-term finance lease liabilities		77			28
Total finance lease liabilities	$	94		$	63
Weighted average remaining lease term		5.07 years			2.15 years
Weighted average discount rate		6.8	%		5.2	%

SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS UNDER FINANCE LEASES

At September 30, 2026, the future minimum lease payments under these financing leases are as follows:

Fiscal Years Ending
December 31, 2026⁽¹⁾	$	6
December 31, 2027		22
December 31, 2028		22
December 31, 2029		22
December 31, 2030		20
Thereafter		20
Total lease payments		112
Less imputed interest		18
Total financing lease liabilities	$	94

⁽¹⁾

Represents scheduled payments for the remaining three-month period ending December 31, 2026.

INVENTORY

9 Months Ended

Sep. 30, 2026

Inventory Disclosure [Abstract]

INVENTORY

Note 4 - INVENTORY

Inventory consists of the following:

SCHEDULE OF INVENTORY

	September 30, 2026		December 31, 2025
Raw material	$	16,283	$	20,933
Finished goods		3,453		3,301
Total inventory	$	19,736	$	24,234

REDEEMABLE PREFERRED STOCK (Details Narrative) $ / shares in Units, $ in Thousands				3 Months Ended	9 Months Ended
	Oct. 30, 2026 USD ($)	Oct. 01, 2026 USD ($)	Oct. 20, 2025 USD ($) $ / shares shares	Sep. 30, 2026 USD ($)	Sep. 30, 2026 USD ($)	Sep. 30, 2025 USD ($)	Dec. 31, 2025 USD ($)
Class of Stock [Line Items]
Liquidation preference				$ 25,332	$ 25,332
Net proceeds of equity issuances, percentage			50.00%
Paid-in-kind dividend				130	382
Cash dividends				518
Preferred stock value
Percentage of Paid-in-kind dividends				200.00%	200.00%
Amendment fee for the waiver					$ 450
Subsequent Event [Member]
Class of Stock [Line Items]
Cash dividends		$ 129
Percentage of cash dividends	600.00%	200.00%
Remaining cash dividends	$ 389
Series B Preferred Stock [Member]
Class of Stock [Line Items]
Principal amount converted			$ 25,000
Preference stock, shares issued \| shares			25,000
Liquidation preference			$ 25,000
Liquidation preference per share \| $ / shares			$ 1,000
Dividends description			Dividends accrue daily at 10% per annum on the Liquidation Preference, on the basis of a 360-day year and the actual number of days elapsed. They are payable quarterly in arrears on the first Trading Day (as defined in the Series B Certificate of Designation) of each fiscal quarter. 80% of each quarterly dividend is payable in cash, and 20% is paid in kind by adding it to the Liquidation Preference.
Conversion price			252.00
Conversion value			$ 500,000
Accreted dividends				$ 520	1,482
Preferred dividends				648	1,912
Preferred stock value				24,122	24,122
Preferred stock redemption value				$ 25,980	$ 25,980

Dakota Lithium Acquisition (Details Narrative) - USD ($)
$ / shares in Units, $ in Thousands

3 Months Ended

9 Months Ended

Jul. 31, 2026

Sep. 30, 2026

^[1]

Sep. 30, 2025

Sep. 30, 2026

Sep. 30, 2025

Business Combination [Line Items]

Purchase price

$ 4,000

Amount of goodwill expected to be deductible for income tax

$ 372

Acquisition-related costs

$ 121

Revenue

$ 12,596

$ 18,609

40,529

^[1]

$ 56,262

Gross margin

$ (5,412)

$ (12,355)

(18,895)

^[1]

$ (27,203)

Trade Names [Member]

Business Combination [Line Items]

Intangible assets weighted-average useful lives

20 years

Customer Relationships [Member]

Business Combination [Line Items]

Intangible assets weighted-average useful lives

6 years

Dragonfly Energy Corp [Member]

Business Combination [Line Items]

Business combination, price per share

$ 16.00

Business combination, closing price per share

$ 9.36

Revenue

Gross margin

$ 66

[1]	Dakota Lithium’s results of operations have been included in the condensed consolidated financial statements since the Acquisition Date. Following the acquisition, Dakota Lithium’s operations were integrated into the Company’s existing operations

SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2026

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

Note 16 - SUBSEQUENT EVENTS

On October 1, 2026, the Company paid the 2% per annum cash dividend of $129 on the Series B Preferred Stock. The Company paid the remaining 6% per annum cash dividend of $389 on October 30, 2026.

On October 12, 2026, the Company effected a one-for-eight reverse stock split of its authorized and issued and outstanding common stock to support compliance with Nasdaq’s minimum bid price requirement. Every eight outstanding shares were combined into one share, and authorized common shares decreased from 400,000,000 to 50,000,000. The par value remained unchanged at $0.0001 per share. Fractional shares were rounded up to the nearest whole share, with no cash consideration paid. Proportionate adjustments were made to outstanding equity awards, warrants, equity plan share reserves, and the conversion terms of convertible preferred stock.

On November 9, 2026, as part of the IEEPA refunds due, the Company received additional tariff refunds of $2,233, consisting of $2,112 in tariff refunds and $121 in interest income. The majority of the tariff refund portion received is expected to be recognized as a reduction in cost of sales, as it relates to product sales.

In October 2026, the Company subleased a previously fully impaired leased facility to a third party for a two-year term beginning November 1, 2026. Aggregate base rent is approximately $1.2 million over the term. The Company remains the primary obligor under the master lease, and its lease liability is unchanged. The Company will account for the sublease as an operating lease and recognize sublease income on a straight-line basis beginning in the fourth quarter of 2026.

In November 2026, the Company entered into a 5five-year operating lease for a new facility to relocate operations from one of its existing leased facilities. The lease is expected to commence on December 1, 2026, and aggregate base rent is approximately $4.4 million over the term. The Company will recognize a right-of-use asset and lease liability at commencement.

In lieu of issuing fractional shares in connection with the reverse stock split effected in October 2026, the Company issued 70,411 shares of common stock as a result of rounding.

LONG TERM DEBT (Tables)

9 Months Ended

Sep. 30, 2026

Debt Disclosure [Abstract]

SCHEDULE OF FUTURE DEBT MATURITIES

At September 30, 2026, the future debt maturities are as follows:

SCHEDULE OF FUTURE DEBT MATURITIES

Fiscal Years Ending
December 31, 2026⁽¹⁾	$	240
December 31, 2027		19,286
Total debt		19,526
Less: Unamortized debt issuance costs		(7,043	)
Total carrying amount		12,483
Less: Current portion of debt		(12,483	)
Total long-term debt	$	-

(1)	Represents scheduled payments for the remaining three-month period ending December 31, 2026.

SCHEDULE OF DISAGGREGATED REVENUES BY DISTRIBUTION CHANNEL (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2026	Sep. 30, 2025	Sep. 30, 2026	Sep. 30, 2025
Disaggregation of Revenue [Line Items]
Total	$ 12,174	$ 15,967	$ 35,037	$ 45,571
Sales Channel, Directly to Consumer [Member]
Disaggregation of Revenue [Line Items]
Total	4,802	5,038	12,981	16,001
Original Equipment Manufacture [Member]
Disaggregation of Revenue [Line Items]
Total	7,122	10,679	21,306	28,820
License Fee Revenue [Member]
Disaggregation of Revenue [Line Items]
Total	$ 250	$ 250	$ 750	$ 750

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 7
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-7

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 5
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-URI https://asc.fasb.org/1943274/2147479806/606-10-50-5

Reference 3: http://www.xbrl.org/2003/role/exampleRef
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Reference 4: http://www.xbrl.org/2003/role/exampleRef
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Reference 7: http://www.xbrl.org/2003/role/exampleRef
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Reference 9: http://www.xbrl.org/2003/role/exampleRef
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-URI https://asc.fasb.org/1943274/2147479777/606-10-55-91

GOODWILL

9 Months Ended

Sep. 30, 2026

Intangible Asset, Goodwill and Other [Abstract]

GOODWILL

Note 7 - GOODWILL

Goodwill is the amount by which the purchase price of an acquired business exceeds the fair value of the identifiable net assets acquired. Goodwill is not amortized. It is tested for impairment at the reporting-unit level at least once a year and more often if events or changes in circumstances indicate the fair value of a reporting unit may be below its carrying amount.

The changes in the carrying amount of goodwill were as follows:

(in 000s)	Total
Gross goodwill, December 31, 2025	$	-
Goodwill acquired - Dakota Lithium (Note 6)		403
Balance, September 30, 2026	$	403

Goodwill from the July 31, 2026 acquisition of Dakota Lithium was assigned as of the acquisition date to the DTC reporting unit within the Company’s DTC segment, which includes Dakota Lithium and is expected to benefit from the combination’s synergies. The purchase price allocation is provisional, so the goodwill amount may change during the measurement period, which ends no later than July 31, 2027. No goodwill impairment was recognized during the three or nine months ended September 30, 2026.

- Definition

The entire disclosure for goodwill.

+ References + Details

SCHEDULE OF FAIR VALUE OF ASSETS AND LIABILITIES (Details) - USD ($) $ in Thousands	Sep. 30, 2026	Dec. 31, 2025
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Carrying Amount	$ 3	$ 713
Fair Value, Recurring [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Carrying Amount	3	713
Fair Value	3	713
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 1 [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Fair Value
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 2 [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Fair Value	3	713
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 3 [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Fair Value
Fair Value, Recurring [Member] \| June Public Offering [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Carrying Amount	3	148
Fair Value	3	148
Fair Value, Recurring [Member] \| June Public Offering [Member] \| Fair Value, Inputs, Level 1 [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Fair Value
Fair Value, Recurring [Member] \| June Public Offering [Member] \| Fair Value, Inputs, Level 2 [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Fair Value	3	148
Fair Value, Recurring [Member] \| June Public Offering [Member] \| Fair Value, Inputs, Level 3 [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Fair Value
Fair Value, Recurring [Member] \| Term Loan [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Carrying Amount		565
Fair Value		565
Fair Value, Recurring [Member] \| Term Loan [Member] \| Fair Value, Inputs, Level 1 [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Fair Value
Fair Value, Recurring [Member] \| Term Loan [Member] \| Fair Value, Inputs, Level 2 [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Fair Value		565
Fair Value, Recurring [Member] \| Term Loan [Member] \| Fair Value, Inputs, Level 3 [Member]
Fair Value, off-Balance-Sheet Risks, Disclosure Information [Line Items]
Fair Value

SCHEDULE OF LEASE COST (Details) - USD ($)
$ in Thousands

3 Months Ended

9 Months Ended

Sep. 30, 2026

Sep. 30, 2025

Sep. 30, 2026

Sep. 30, 2025

Commitments and Contingencies Disclosure [Abstract]

Operating lease cost, Cost of goods sold

$ 94

$ 622

$ 648

$ 1,859

Operating lease cost, Research and development

132

Operating lease cost, General and administration

620

1,190

1,413

2,731

Operating lease cost, Selling and marketing

Total lease cost

^[1]

$ 771

$ 1,846

$ 2,232

$ 4,727

[1]

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2026
Insider Trading Arrangements [Line Items]
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

COMMON STOCK

9 Months Ended

Sep. 30, 2026

Equity [Abstract]

COMMON STOCK

Note 13 - COMMON STOCK

Common stockholders are entitled to dividends if and when declared by the Board subject to the rights of the preferred stockholders. No dividends on common stock have been declared by the Company.

On January 30, 2026, the Company entered into an Equity Distribution Agreement with Canaccord Genuity LLC, as lead agent and representative of the other sales agents, establishing an at-the-market offering program under which the Company may, from time to time and at its discretion, offer and sell up to $50 million of its common stock. The Company is not obligated to sell any shares under the program and retains sole discretion over the timing, amount, pricing, and other terms of any sales effected through the lead agent. The program is intended to provide the Company with a flexible source of capital to support its liquidity needs and is subject to customary closing conditions, a 3% sales commission and reimbursement of specified expenses payable to the agents, and customary indemnification and contribution provisions. As of September 30, 2026, the Company sold 72,658 shares of common stock for net proceeds of $1,031.

For the nine months ended September 30, 2026 and 2025, the Company had reserved shares of common stock for issuance as follows:

	September 30, 2026		September 30, 2025
Options issued and outstanding		15,976		1,719
Common stock outstanding		1,878,418		771,777
Warrants outstanding		29,340		53,202
Earnout Shares		34,722		34,722
Series B Preferred Stock outstanding		99,206		-
Shares available for future issuance		116,352		14,603
Total		2,174,014		876,023

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 20
-Name Accounting Standards Codification
-Section S50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479951/505-20-S50-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 20
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479982/505-20-S25-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 1
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-URI https://asc.fasb.org/1943274/2147480008/505-10-S99-1

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147480070/505-10-S50-1

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-Section S45
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480100/505-10-S45-3

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-Name Accounting Standards Codification
-Section S45
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480100/505-10-S45-2

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-Name Accounting Standards Codification
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-13

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-Section S50
-Paragraph 2
-Publisher FASB
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-Section S25
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-Publisher FASB
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-Name Accounting Standards Codification
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-Name Accounting Standards Codification
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-Paragraph 5
-Subparagraph (f)
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-Name Accounting Standards Codification
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-Name Accounting Standards Codification
-Section 50
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-SubTopic 235
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Reference 32: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (i)
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-Topic 505
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-Name Accounting Standards Codification
-Section 50
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-Subparagraph (a)
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Reference 34: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
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-Subparagraph (c)
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Reference 35: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 16
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-16

+ Details

GOODWILL (Tables)

9 Months Ended

Sep. 30, 2026

Intangible Asset, Goodwill and Other [Abstract]

SCHEDULE OF CHANGES IN THE CARRYING AMOUNT OF GOODWILL

The changes in the carrying amount of goodwill were as follows:

(in 000s)	Total
Gross goodwill, December 31, 2025	$	-
Goodwill acquired - Dakota Lithium (Note 6)		403
Balance, September 30, 2026	$	403

- Definition

Tabular disclosure of goodwill.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482573/350-20-50-2

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 55
-Paragraph 24
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482548/350-20-55-24

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482573/350-20-50-1

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482573/350-20-50-1

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
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-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482573/350-20-50-1

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482573/350-20-50-1

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (c)
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Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482573/350-20-50-1

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482573/350-20-50-1

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
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Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
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-Subparagraph (g)
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-URI https://asc.fasb.org/1943274/2147482573/350-20-50-1

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1A
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482573/350-20-50-1A

+ Details

SCHEDULE OF INVENTORY (Details) - USD ($) $ in Thousands	Sep. 30, 2026	Dec. 31, 2025
Inventory Disclosure [Abstract]
Raw material	$ 16,283	$ 20,933
Finished goods	3,453	3,301
Total inventory	$ 19,736	$ 24,234

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) $ in Thousands			3 Months Ended				9 Months Ended		12 Months Ended
	Jan. 30, 2026	Jul. 29, 2024	Sep. 30, 2026	Jun. 30, 2026	Sep. 30, 2025	Mar. 31, 2025	Sep. 30, 2026	Sep. 30, 2025	Dec. 31, 2025
Product Information [Line Items]
Cash and cash equivalents			$ 1,941				$ 1,941		$ 18,270
Working capital							$ 2,973
Net increase in cash									90,930
Number of shares issued, value			202	$ 829		$ 63
Number of shares converted							72,658
Net proceeds from conversion of preferred stock								$ 7,330
Inventory reserves			740				740		300
Amortization expense			38		$ 0		45	0
Impairment loss							0	0
Customer deposits			242		314		242	314	121
Revenue			12,174		15,967		35,037	45,571
Grant income			408				531
Warranty obilgation outstanding			901				901		867
Warranty expense			95		$ 132		293	$ 403
Income tax reconciliation pretax loss							16,550
Prepaid income taxes			$ 359				359		$ 353
Amount of goodwill expected to be deductible for income tax							$ 372
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Customer A [Member]
Product Information [Line Items]
Concentration risk, percentage							23.00%		31.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Customer B [Member]
Product Information [Line Items]
Concentration risk, percentage							12.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Customer C [Member]
Product Information [Line Items]
Concentration risk, percentage							10.00%
Revenue from Contract with Customer Benchmark [Member] \| Customer Concentration Risk [Member] \| Customer A [Member]
Product Information [Line Items]
Concentration risk, percentage			22.00%		35.00%		22.00%	29.00%
Accounts Payable [Member] \| Supplier Concentration Risk [Member] \| Vendor A [Member]
Product Information [Line Items]
Concentration risk, percentage							33.00%		36.00%
Accounts Payable [Member] \| Supplier Concentration Risk [Member] \| Vendor B [Member]
Product Information [Line Items]
Concentration risk, percentage							10.00%		16.00%
Accounts Payable [Member] \| Supplier Concentration Risk [Member] \| Vendor C [Member]
Product Information [Line Items]
Concentration risk, percentage									12.00%
Total Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor A [Member]
Product Information [Line Items]
Concentration risk, percentage			19.00%		18.00%		12.00%	17.00%
Total Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor B [Member]
Product Information [Line Items]
Concentration risk, percentage			12.00%
Total Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor F [Member]
Product Information [Line Items]
Concentration risk, percentage					14.00%
Total Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor E [Member]
Product Information [Line Items]
Concentration risk, percentage							10.00%	10.00%
Minimum [Member]
Product Information [Line Items]
Payment term for distributors and OEMs							30 days
Term of product warranty provided							5 years
Maximum [Member]
Product Information [Line Items]
Payment term for distributors and OEMs							90 days
Term of product warranty provided							10 years
Series A Convertible Preferred Stock [Member]
Product Information [Line Items]
Net proceeds from conversion of preferred stock							$ 1,031
Equity Distribution Agreement [Member]
Product Information [Line Items]
Number of shares issued, value	$ 50,000
License Agreement [Member]
Product Information [Line Items]
Licensing fee		$ 5,000
Estimated useful life		5 years
Revenue			$ 250				750
Deferred revenue			$ 2,833				$ 2,833		$ 3,583

Condensed Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) - USD ($) $ in Thousands	Preferred Stock [Member] Series A Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance at Dec. 31, 2024			$ 72,750	$ (82,154)	$ (9,404)
Balance, shares at Dec. 31, 2024		90,408
Net loss				(6,797)	(6,797)
Common stock issued in public offering (ATM), net of costs			63		63
Common stock issued in public offering (ATM), net of costs, shares		290
Redeemable preferred stock issued, net	$ 3,180
Redeemable preferred stock issued, net, shares	350
Shares issued for vested restricted stock units
Shares issued for vested restricted stock units, shares		274
Conversion of preferred to common stock	$ (273)		273		273
Conversion of preferred stock to common stock, shares	(30)	3,899
Stock compensation expense			220		220
Balance at Mar. 31, 2025	$ 2,907		73,306	(88,951)	(15,645)
Balance, shares at Mar. 31, 2025	320	94,871
Balance at Dec. 31, 2024			72,750	(82,154)	(9,404)
Balance, shares at Dec. 31, 2024		90,408
Net loss					(24,901)
Balance at Sep. 30, 2025			85,478	(107,055)	(21,577)
Balance, shares at Sep. 30, 2025		771,777
Balance at Mar. 31, 2025	$ 2,907		73,306	(88,951)	(15,645)
Balance, shares at Mar. 31, 2025	320	94,871
Net loss				(7,034)	(7,034)
Redeemable preferred stock issued, net	$ 4,150
Redeemable preferred stock issued, net, shares	450
Shares issued for vested restricted stock units
Shares issued for vested restricted stock units, shares		804
Conversion of preferred to common stock	$ (5,812)		5,812		5,812
Conversion of preferred stock to common stock, shares	(634)	371,061
Stock compensation expense			190		190
Share issuance under ESPP			73		73
Share issuance under ESPP, shares		1,094
Balance at Jun. 30, 2025	$ 1,245		79,381	(95,985)	(16,604)
Balance, shares at Jun. 30, 2025	136	467,830
Net loss				(11,070)	(11,070)
Shares issued for vested restricted stock units
Shares issued for vested restricted stock units, shares		224
Conversion of preferred to common stock	$ (1,245)		1,245		1,245
Conversion of preferred stock to common stock, shares	(136)	28,973
Stock compensation expense			168		168
Common stock issued in public offering, net			4,684		4,684
Common stock issued in public offering, net, shares		274,750
Balance at Sep. 30, 2025			85,478	(107,055)	(21,577)
Balance, shares at Sep. 30, 2025		771,777
Balance at Dec. 31, 2025			163,623	(152,093)	11,530
Balance, shares at Dec. 31, 2025		1,509,839
Net loss				(6,625)	(6,625)
Shares issued for vested restricted stock units
Shares issued for vested restricted stock units, shares		11
Stock compensation expense			100		100
Cashless exercise of liability classified as warrants
Cashless exercise of liability classified warrants, shares		8,748
Dividends Preferred Series B - Paid-in-kind			(125)		(125)
Dividends Preferred Series B			(502)		(502)
Accretion of discount on Series B Preferred			(468)		(468)
Balance at Mar. 31, 2026			162,628	(158,718)	3,910
Balance, shares at Mar. 31, 2026		1,518,598
Balance at Dec. 31, 2025			163,623	(152,093)	11,530
Balance, shares at Dec. 31, 2025		1,509,839
Net loss					(16,550)
Balance at Sep. 30, 2026			164,099	(168,643)	(4,544)
Balance, shares at Sep. 30, 2026		1,878,418
Balance at Mar. 31, 2026			162,628	(158,718)	3,910
Balance, shares at Mar. 31, 2026		1,518,598
Net loss				(4,386)	(4,386)
Common stock issued in public offering (ATM), net of costs			829		829
Common stock issued in public offering (ATM), net of costs, shares		51,388
Shares issued for vested restricted stock units
Shares issued for vested restricted stock units, shares		21,634
Stock compensation expense			374		374
Share issuance under ESPP			26		26
Share issuance under ESPP, shares		2,184
Cashless exercise of liability classified as warrants			193		193
Cashless exercise of liability classified warrants, shares		12,924
Dividends Preferred Series B - Paid-in-kind			(127)		(127)
Dividends Preferred Series B			(510)		(510)
Accretion of discount on Series B Preferred			(494)		(494)
Exercise of Pre-Funded Underwriters Warrants			1		1
Exercise of Pre-Funded Underwriters Warrants, shares		62,500
Balance at Jun. 30, 2026			162,920	(163,104)	(184)
Balance, shares at Jun. 30, 2026		1,669,228
Net loss				(5,539)	(5,539)
Common stock issued in public offering (ATM), net of costs			202		202
Common stock issued in public offering (ATM), net of costs, shares		21,270
Shares issued for vested restricted stock units
Shares issued for vested restricted stock units, shares		420
Stock compensation expense			243		243
Dividends Preferred Series B - Paid-in-kind			(130)		(130)
Dividends Preferred Series B			(518)		(518)
Accretion of discount on Series B Preferred			(520)		(520)
Adjustment for prior quarter warrant exercise			147		147
Issuance of common stock pursuant to the Asset Purchase Agreement			1,755		1,755
Issuance of common stock pursuant to the Asset Purchase Agreement, shares		187,500
Balance at Sep. 30, 2026			$ 164,099	$ (168,643)	$ (4,544)
Balance, shares at Sep. 30, 2026		1,878,418

RELATED PARTY

9 Months Ended

Sep. 30, 2026

RELATED PARTY

Note 10 - RELATED PARTY

On March 15, 2026, the Company’s executive leadership team agreed to reduce their salaries by approximately 20% for the remainder of fiscal 2026, effective April 1, 2026. The adjusted salaries are as follows: Dr. Phares - $498; Mr. Seaburg - $221; Mr. Bourns - $264; and Dr. Singh - $280.

In lieu of cash compensation, the executives were granted stock options under the Company’s 2022 Plan at an exercise price of $23.92 per share: Dr. Phares - 4,783 shares; Mr. Seaburg - 4,576 shares; Mr. Bourns - 2,538 shares; and Dr. Singh - 2,692 shares. The options vest in three equal annual installments beginning April 1, 2026, subject to continued service and the terms of the Plan.

Additionally, each non-employee director agreed to a comparable 20% reduction in cash compensation for the remainder of fiscal 2026. In lieu thereof, the directors were granted an aggregate of 1,671 RSUs under the Plan, subject to the same vesting terms and continued Board service.

On June 18, 2026, the Company appointed Lukas Lutz as an independent director. In connection with his appointment, the Company granted him 1,250 restricted stock units with one-half vesting upon the date of grant and one-half vesting on the one-year anniversary, subject to continued service on the Board.

During the three months ended September 30, 2026, the Company received services from Battery Sphere GmbH, of which Lukas Lutz, a member of the Board, is the Chief Executive Officer. The expense for these services was $77 and is included in general and administrative expenses in the Condensed Consolidated Statements of Operations.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

+ Details

RELATED PARTY (Details Narrative) - USD ($)				1 Months Ended	9 Months Ended
RELATED PARTY (Details Narrative) - USD ($)	Jun. 18, 2026	Apr. 01, 2026	Mar. 15, 2026	Mar. 31, 2026	Sep. 30, 2026
Related Party Transaction [Line Items]
Common stock exercise price			$ 23.92
Other expenses					$ 77,000
Board of Directors Chairman [Member]
Related Party Transaction [Line Items]
Granted restricted stock units, shares	$ 1,250
Restricted Stock Units (RSUs) [Member]
Related Party Transaction [Line Items]
Number of stock options granted		79,848
Granted restricted stock units, shares					1,105,000
Denis Phares [Member]
Related Party Transaction [Line Items]
Salaries		$ 498,000
Number of stock options granted			4,783
Wade Seaburg [Member]
Related Party Transaction [Line Items]
Salaries		221,000
Number of stock options granted			4,576
Tyler Bourns [Member]
Related Party Transaction [Line Items]
Salaries		264,000
Number of stock options granted			2,538
Vickram Singh [Member]
Related Party Transaction [Line Items]
Salaries		$ 280,000
Number of stock options granted			2,692
Director [Member] \| Restricted Stock Units (RSUs) [Member]
Related Party Transaction [Line Items]
Number of stock options granted				1,671
Number of RSUs granted			$ 1,671
Granted restricted stock units, shares					$ 23,000

SCHEDULE OF SUPPLEMENTAL CASH FLOW INFORMATION RELATED TO THE LEASES (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2026	Sep. 30, 2025	Sep. 30, 2026	Sep. 30, 2025
Commitments and Contingencies Disclosure [Abstract]
Cash paid for amounts included in the measurement of lease liabilities	$ 644	$ 724	$ 1,876	$ 2,160

INVENTORY (Tables)

9 Months Ended

Sep. 30, 2026

Inventory Disclosure [Abstract]

SCHEDULE OF INVENTORY

Inventory consists of the following:

SCHEDULE OF INVENTORY

	September 30, 2026		December 31, 2025
Raw material	$	16,283	$	20,933
Finished goods		3,453		3,301
Total inventory	$	19,736	$	24,234

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2026	Sep. 30, 2025
Cash flows from Operating Activities
Net Loss	$ (16,550)	$ (24,901)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities
Stock based compensation	717	578
Amortization of debt discount	3,106	5,240
Change in fair market value of warrant liability	(370)	(4,624)
Non-cash interest expense (paid-in kind)	445	11,233
Provision (recovery) from credit losses	(10)	87
Depreciation and amortization	1,733	1,810
Amortization of right of use of assets	890	1,948
Loss on disposal of property and equipment	42	156
Loss on impairment of right-of-use assets		454
Changes in Assets and Liabilities
Accounts receivable	11	(2,463)
Inventories	5,137	(1,002)
Prepaid expenses	436	(43)
Prepaid inventory	(1,386)	125
Prepaid income tax	(6)
Other current assets	(1,346)	61
Other assets	10	(6)
Accounts payable and accrued expenses	(2,753)	3,780
Operating lease liabilities	(1,876)	(2,160)
Accrued tariffs	(602)	(324)
Accrued settlement		(375)
Deferred revenue	(750)	(750)
Income tax payable		(4)
Customer deposits	121	(65)
Total Adjustments	3,549	13,656
Net Cash Used in Operating Activities	(13,001)	(11,245)
Cash Flows From Investing Activities
Cash paid for acquisition of business	(1,000)
Purchase of intangibles	(131)
Purchase of property and equipment	(1,134)	(1,808)
Net Cash Used in Investing Activities	(2,265)	(1,808)
Cash Flows From Financing Activities
Proceeds from public offering (ATM), net	1,031	63
Proceeds from public offering, net		4,684
Repayment of note payable	(713)
Proceeds from preferred stock offering, net of fees		7,330
Principal payments on finance leases	(55)	(35)
Proceeds from the exercise of pre-funded warrants	1
Payment of dividends	(1,327)
Net Cash Provided by (Used in) Financing Activities	(1,063)	12,042
Net Decrease in cash and cash equivalents	(16,329)	(1,011)
Beginning Cash and cash equivalents - beginning of period	18,270	4,849
Ending Cash and cash equivalents - end of period	1,941	3,838
Supplemental Disclosures of Cash Flow Information:
Cash paid for income taxes	6	4
Cash paid for interest	1,938	4
Supplemental Non-Cash Investing and Financing Activities
Purchases of property, equipment, and intangibles not yet paid	390	16
Recognition of right of use asset obtained in exchange for operating lease liability		642
Recognition of machinery & equipment obtained in exchange for financing lease liability	86
Recognition of warrant liability - Investor Warrants		696
Conversion of preferred stock to common stock		7,330
Declaration of dividends	1,530
Dividends paid in kind	382
Accretion of preferred stock discount	1,482
Noncash consideration transferred pursuant to the Asset Purchase Agreement	1,755
Settlement of accrued liability for employee stock purchase plan	26	73
Reclassification of assets held for sale to machinery and equipment		644
Cashless exercise of penny warrants	$ 340

REDEEMABLE PREFERRED STOCK

9 Months Ended

Sep. 30, 2026

Equity [Abstract]

REDEEMABLE PREFERRED STOCK

Note 12 - REDEEMABLE PREFERRED STOCK

Terms

The Company’s Series B Convertible Preferred Stock (the “Series B Preferred Stock”) was issued in connection with the Sixth Amendment to the Term Loan, entered into on October 20, 2025. Under the related Exchange Agreement, dated November 4, 2025, $25.0 million of outstanding Term Loan principal was exchanged for 25,000 shares of Series B Preferred Stock with an aggregate liquidation preference of $25.0 million. The rights, preferences and restrictions of the Series B Preferred Stock are set forth in the Certificate of Designation of the Powers, Preferences and Relative, Participating, Optional and Other Restrictions of Series B Convertible Preferred Stock (the “Series B Certificate of Designation”). All outstanding shares are held by the Term Loan Lenders (see Note 9).

The Series B Preferred Stock is non-voting and carries a base liquidation preference of $1,000 per share, plus any accrued and unpaid PIK dividends and any capitalized cash dividends (collectively, the “Applicable Preference Amount”). The Applicable Preference Amount, together with any accrued and unpaid interest thereon, constitutes the Liquidation Preference (“Liquidation Preference”). The Series B Preferred Stock ranks senior to the Company’s common stock in a liquidation.

Dividends accrue daily at 10% per annum on the Liquidation Preference, on the basis of a 360-day year and the actual number of days elapsed. They are payable quarterly in arrears on the first Trading Day (as defined in the Series B Certificate of Designation) of each fiscal quarter. 80% of each quarterly dividend is payable in cash, and 20% is paid in kind by adding it to the Liquidation Preference. A Non-Payment Event (as defined in the Series B Certificate of Designation) occurs if any accrued cash dividend remains unpaid after the second business day following the applicable dividend date. In that case:

● the unpaid amount is added to the Liquidation Preference; and

● the holders may require the Company to redeem the Series B Preferred Stock.

Each share of Series B Preferred Stock is convertible, at the holder’s option beginning six months after the original issuance date, into shares of the Company’s common stock at a fixed conversion price of $252.00 per share, as adjusted for the reverse stock splits (see Note 1). Each conversion must have a minimum aggregate value of $500,000 per conversion, and conversions are subject to customary beneficial ownership and exchange caps.

The Series B Preferred Stock is redeemable in the following circumstances, generally at a price per share equal to the greater of (i) the Liquidation Preference, including accrued but unpaid dividends, and (ii) the as-converted value determined by reference to recent volume-weighted average trading prices of the Company’s common stock:

● at the Company’s option;

● at the holders’ option two years after the original issuance date, or earlier upon a Non-Payment Event;

● at the holders’ option upon a Change of Control (as defined in the Series B Certificate of Designation);

● mandatorily, from 50% of the net proceeds of certain equity issuances by the Company.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 12 - REDEEMABLE PREFERRED STOCK (CONTINUED)

Accounting

The Company evaluated the Series B Preferred Stock under ASC 480, Distinguishing Liabilities from Equity. It concluded that the Series B Preferred Stock is not a liability, because it is not mandatorily redeemable and does not otherwise meet the definition of a liability.

For purposes of ASC 815, Derivatives and Hedging, the host contract was determined to be more akin to debt. The conversion feature is not clearly and closely related to the host, but it qualifies for the equity scope exception because the conversion price is fixed, and the feature is indexed to the Company’s own stock.

Certain redemption rights are not solely within the Company’s control. The Series B Preferred Stock is therefore presented in temporary equity and was initially measured at fair value on the issuance date. It is not currently redeemable, but it is probable that it will become redeemable because the holders’ redemption right becomes exercisable with the passage of time. The Company accretes the carrying amount to the redemption value, using the interest method, through the earliest date on which the holders may require redemption, or October 7, 2027.

Accretion and dividends, both cash and paid in kind, are recognized as deemed and preferred dividends. They are recorded against additional paid-in capital, because the Company has an accumulated deficit, and they reduce income available to common stockholders. For the three and nine months ended September 30, 2026, the Company recognized accretion of $520 and $1,482 and preferred dividends of $648 and $1,912, respectively, related to the Series B Preferred Stock.

At September 30, 2026:

● the Liquidation Preference was $25,332, excluding the paid-in-kind dividend of $130 for the quarter ended September 30, 2026, which was added to the Liquidation Preference on October 1, 2026;

● accrued cash dividends of $518 for the quarter were included in dividends payable;

● the carrying amount of the Series B Preferred Stock was $24,122, and its redemption value was $25,980 (the latter includes the $518 third quarter accrued cash dividends).

Series B Preferred Stockholder Limited Waiver

On September 30, 2026, in connection with the Eighth Amendment (see Note 9), the Company and the holders of all of the outstanding shares of Series B Preferred Stock entered into the Series B Waiver, pursuant to which the holders waived, solely with respect to the dividend for the quarter ended September 30, 2026, their right to receive payment of the full cash dividend on or prior to October 1, 2026, on the following conditions:

(a) the Company pays cash dividends equal to 2% per annum on or before October 1, 2026; and

(b) the Company pays the remaining cash dividends equal to 6% per annum on or before October 30, 2026.

Paid-in-kind dividends continue to accrue at 2% per annum. If the Company makes both payments, the deferral does not constitute a Non-Payment Event or Preferred Default (as defined in the Series B Certificate of Designation). All other terms of the Series B Preferred Stock, including the dividend rate, accrual provisions, and rights and preferences of the holders, remain in effect.

The Company was charged a $450 amendment fee for the waiver, which was paid in kind and added to the Term Loan balance due. The Company concluded that the waiver did not modify the Series B Preferred Stock in a manner that transferred value to the holders, so no deemed dividend was recognized. The waiver also did not change the classification or measurement of the Series B Preferred Stock.

On October 1, 2026, the Company paid cash dividends of $129. On October 30, 2026, the Company paid the remaining cash dividends of $389.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Dakota Lithium Acquisition

9 Months Ended

Sep. 30, 2026

Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]

Dakota Lithium Acquisition

Note 6 - Dakota Lithium Acquisition

Acquisition of Dakota Lithium

On July 31, 2026 (the “Acquisition Date”), Legacy Dragonfly, a wholly-owned subsidiary of the Company, bought substantially all of the operating assets of the Dakota Lithium business. The seller was Clean Liquidation, LLC, acting as assignee for the benefit of creditors of Clean Republic SODO, LLC. The purchase was made under an asset purchase agreement (the “Asset Purchase Agreement”) and a related securities receipt agreement (the “Securities Receipt Agreement”), both dated July 31, 2026. Dakota Lithium designs and sells lithium battery products under the Dakota Lithium brand. The Company bought the business to expand its branded consumer and specialty battery portfolio, add an established customer base and product designs, and achieve sourcing and operating synergies. The Company obtained control of the business on the Acquisition Date, when title to the purchased assets passed and it took possession of them.

The Company accounted for the transaction as a business combination using the acquisition method under ASC 805, Business Combinations. Under that method, identifiable assets acquired and liabilities assumed are recorded at their fair values as of the Acquisition Date.

Consideration transferred

The Asset Purchase Agreement states a purchase price of $4,000. That amount assumed a negotiated value of $16.00 per share. For accounting purposes, the shares are measured at their fair value on the Acquisition Date.

The fair value of the consideration transferred was:

(in dollars 000s)	Amount
Cash	$	1,000
187,500 shares of Dragonfly Energy Holdings Corp. common stock, valued at the $9.36 closing price on July 31, 2026		1,755
Total consideration transferred	$	2,755

The shares were issued to recipients designated by the seller, including the seller’s secured lender, in exchange for the purchased assets and the release of the lender’s liens on those assets. The shares are subject to two separate restrictions on sale, and ASC 820 treats them differently. First, the shares are unregistered restricted securities that may be resold only pursuant to an exemption from registration, such as Rule 144. This restriction transfers to any holder of the shares, so it is a characteristic of the security and is considered in measuring fair value (ASC 820-10-35-36B and 820-10-55-52). Second, the shares are subject to a contractual lock-up that lasts 12 months from the Acquisition Date. A contractual sale restriction is a characteristic of the holder rather than of the security, so it is excluded from the fair value measurement (ASC 820-10-35-36B and 820-10-55-52A). Accordingly, the fair value of the shares was measured using the $9.36 closing price of the Company’s common stock on the Acquisition Date, without adjustment. A discount for the six-month Rule 144 holding period was evaluated and determined to be immaterial. No discount was applied for the 12-month contractual lock-up, because a contractual sale restriction is not considered in measuring fair value (ASC 820-10-35-36B). The arrangement includes no contingent consideration.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Preliminary allocation of consideration

The table below shows the preliminary fair values of the assets acquired at the Acquisition Date:

Note 6 - Dakota Lithium Acquisition (CONTINUED)

(in dollars 000s)	Amount
Inventory	$	639
Property and equipment		47
Intangible assets:
Customer relationships		720
Trade name		946
Total identifiable assets acquired		2,352
Goodwill		403
Total consideration transferred	$	2,755

The acquired intangible assets have weighted-average useful lives as follows: trade name, 20 years; customer relationships, 6 years.

Goodwill is the amount by which the consideration transferred exceeds the fair value of the identifiable net assets acquired. It mainly reflects the assembled workforce, which is not recognized separately, and expected synergies from integrating Dakota Lithium’s products, customers and vendor relationships into the Company’s existing operations. The estimated amount of goodwill expected to be deductible for income tax purposes is $372.

The purchase price allocation is preliminary. The Company is still finalizing the valuations of the acquired intangible assets, inventory and equipment, the identification of liabilities assumed, and the related deferred income taxes. These amounts may change as additional information is obtained during the measurement period, which ends no later than July 31, 2027.

Transactions recognized separately and acquisition-related costs

The Company’s post-acquisition arrangements with retained employees and a contractor are accounted for as post-combination compensation and are not part of the consideration transferred. Acquisition-related costs totaled $121 and were expensed as incurred in general and administrative.

Results of operations and supplemental pro forma information (unaudited)

Dakota Lithium’s results have been included in the condensed consolidated financial statements since the Acquisition Date. Following the acquisition, Dakota Lithium’s operations were integrated into the Company’s existing operations. As a result, determining the net income or loss attributable separately to Dakota Lithium from the Acquisition Date through September 30, 2026 is impracticable. Revenue of $81 and gross margin of $66 attributable to Dakota Lithium are included in the condensed consolidated financial statements for the period from the Acquisition Date through September 30, 2026.

The unaudited supplemental pro forma information below shows the Company’s combined results as if the acquisition had occurred on January 1, 2025:

SCHEDULE OF PRO FORMA INFORMATION

in 000s

Three months ended
Sept. 30, 2026⁽¹⁾

Three months ended
Sept. 30, 2025

Nine months ended
Sept. 30, 2026⁽¹⁾

Nine months ended
Sept. 30, 2025

Revenue

12,596

18,609

40,529

56,262

Net loss

(5,412

)

(12,355

)

(18,895

)

(27,203

)

(1)	Dakota Lithium’s results of operations have been included in the condensed consolidated financial statements since the Acquisition Date. Following the acquisition, Dakota Lithium’s operations were integrated into the Company’s existing operations

The unaudited pro forma amounts present the combined historical revenue and net loss of the Company and the acquired business as if the acquisition had occurred on January 1, 2025. Acquisition-related pro forma adjustments have been omitted because their effects were not material. These amounts do not necessarily reflect the results that would have occurred had the acquisition taken place on that date or the Company’s future results.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

- Definition

The entire disclosure for business combination.

+ References

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+ Details

LONG TERM DEBT

9 Months Ended

Sep. 30, 2026

Debt Disclosure [Abstract]

LONG TERM DEBT

Note 9 - LONG TERM DEBT

Term Loan Agreement

As of September 30, 2026 and December 31, 2025, the Company had an outstanding term loan (the “Term Loan”) under a Term Loan, Guarantee and Security Agreement (the “Term Loan Agreement”), dated October 7, 2022, with Alter Domus (US) LLC, as agent, and certain lenders (the “Term Loan Lenders”). As amended, the Term Loan matures on October 7, 2027 and requires monthly installments based on 0.4167% of the principal amount of the Term Loan outstanding beginning December 1, 2025. The obligations under the Term Loan Agreement are secured by a first priority lien on substantially all of the Company’s assets, including certain mortgaged properties.

Prior to any amendments, the Term Loan accrued interest based on the Company’s senior leverage ratio. From inception through September 30, 2024, interest accrued at a per annum rate equal to adjusted secured overnight financing rate (“SOFR”) (subject to a floor of 1.0%) plus 7.0% payable in cash, plus an additional 4.5% to 6.5% payable in kind, depending on the Company’s senior leverage ratio. Effective April 1, 2024, interest payable to lenders subject to the regulations of the U.S. Small Business Administration (the “SBA”) (with $30,846 of principal outstanding as of that date) was limited to 14.0% per annum, excluding default interest permitted under applicable SBA regulations. From October 1, 2024 through March 31, 2025, interest on the non-SBA regulated portion continued to accrue at adjusted SOFR plus 7.0% payable in cash, and 4.5% to 6.5% payable in kind. Beginning April 1, 2025, interest on all outstanding balances was payable entirely in cash, at a rate equal to adjusted SOFR plus a margin ranging from 11.5% to 13.5%, depending on the Company’s senior leverage ratio. In February 2025, the Company entered into the Fifth Amendment to the Term Loan (the “Fifth Amendment”), which extended the loan’s maturity date by one year to October 2027 and deferred all principal and interest payments until April 2026. Effective October 20, 2025, the Company entered into the Sixth Amendment to the Term Loan (the “Sixth Amendment”), which adjusted the interest rate on the remaining outstanding principal amount under the Term Loan Agreement to a fixed rate of 12% per annum, payable monthly commencing December 31, 2025, with maturity in October 2027. The interest rate was subsequently modified by the Seventh Amendment, as described below.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 9 - LONG TERM DEBT (CONTINUED)

Term Loan Agreement (continued)

During the three months ended September 30, 2026 and 2025, the Company recognized interest expense of $640 and $3,927, respectively. During the nine months ended September 30, 2026 and 2025, the Company recognized interest expense of $1,790 and $11,233, respectively. Amortization of the debt issuance costs amounted to $1,153 and $2,456, respectively, for the three months ended September 30, 2026 and 2025. Amortization of the debt issuance costs amounted to $3,106 and $5,240, respectively, for the nine months ended September 30, 2026 and 2025. As of September 30, 2026, the carrying value of the Term Loan was $12,483, consisting of $19,526 in principal net of $7,043 in unamortized debt discount. As of December 31, 2025, the carrying value of the Term Loan was $9,645, consisting of $19,344 in principal net of $9,699 in unamortized debt discount.

Subsequent to the original execution of the Term Loan Agreement, the Company entered into eight amendments which modified terms of the facility, including, but not limited to, interest rate mechanics, the timing of principal payments, and certain financial and operational covenants.

Seventh Amendment

On July 31, 2026, the Company entered into the Seventh Amendment (the “Seventh Amendment”) to the Term Loan in connection with the Asset Purchase Agreement, pursuant to which Legacy Dragonfly acquired substantially all of the operating assets associated with the Dakota Lithium® brand. The aggregate purchase price was $4,000, consisting of $3,000 of the Company’s common stock and $1,000 in cash. For accounting purposes, the shares are measured at fair value on the Acquisition Date based on the $9.36 closing price of the Company’s common stock on that date, resulting in a value of $1,755 in common stock and total consideration of $2,755. Refer to Note 6 for more information. The Seventh Amendment provides additional near-term liquidity flexibility by establishing a payment-in-kind period through December 31, 2026, during which interest accrues at 14% per annum (from 12%) and is payable entirely in kind rather than in cash. The Seventh Amendment also reduces the minimum liquidity requirement to $4,000 at each month-end from August 31, 2026 through January 31, 2027, after which the minimum liquidity requirement increases to $5,000, and defers the commencement of the maximum senior leverage ratio and fixed charge coverage ratio covenants to the quarter ending September 30, 2027 (from March 31, 2027). Commencing with the fiscal quarter ending September 30, 2027, the maximum senior leverage ratio is 3.00:1.00, and a minimum fixed charge coverage ratio of 1.15:1.00 is required for the trailing four fiscal quarters if liquidity is below $15,000 at quarter-end. Interest has been paid in kind beginning August 2026. During the three and nine months ended September 30, 2026, $445 of PIK interest was added to the principal balance of the Term Loan under the Seventh Amendment.

Limited Waiver and Eighth Amendment

On September 30, 2026, the Company, Legacy Dragonfly, and Battle Born LLC entered into the Limited Waiver and Eighth Amendment (the “Eighth Amendment”) to the Term Loan Agreement. Pursuant to the Eighth Amendment, (i) the Term Loan Lenders waived testing of the minimum liquidity covenant solely for the fiscal month ended September 30, 2026, (ii) the Term Loan Lenders waived any default under the Term Loan Agreement arising from the deferral of a portion of the cash dividend payable on October 1, 2026 on the Series B Preferred Stock (as defined in Note 12), provided that such cash dividend is paid in accordance with the modified payment schedule set forth in the Series B Waiver (as defined below), and (iii) the Company agreed to pay the Term Loan Lenders an amendment fee of $450, which was paid in kind by adding it to the outstanding principal balance of the Term Loan on September 30, 2026. Also on September 30, 2026, the Company and the holders of all of the outstanding shares of Series B Preferred Stock entered into a limited waiver (the “Series B Waiver”) with respect to the dividend for the quarter ended September 30, 2026. Refer to Note 12 for more information.

All eight amendments were in effect as of September 30, 2026.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 9 - LONG TERM DEBT (CONTINUED)

Term Loan Agreement (continued)

Accounting for the Seventh Amendment and Eighth Amendment

The Company evaluated the Seventh Amendment and Eighth Amendment under ASC 470-60, Troubled Debt Restructurings by Debtors. It concluded that the Company was experiencing financial difficulty on each amendment date, and that the lenders had granted a concession because the Company’s effective borrowing rate decreased. The Sixth Amendment was entered into on October 20, 2025, less than one year before each of these amendments. The Company therefore compared the effective borrowing rate of the restructured debt with the effective borrowing rate immediately before the Sixth Amendment, applied to the principal that remains outstanding after the October and November 2025 principal reductions. Accordingly, the Seventh Amendment and the Eighth Amendment were each accounted for as a troubled debt restructuring involving only a modification of terms. Total future cash payments under the restructured terms exceed the carrying amount of the Term Loan. As a result, the Company recognized no gain on the restructuring, the carrying amount of the Term Loan was not adjusted, and the effect of the revised terms is recognized prospectively through a new effective interest rate from each amendment date, and the $450 amendment fee is included in the restructured cash flows and will be recognized as interest expense over the remaining term. The effective interest rate on the Term Loan was 60.06% for the period from July 1 to July 31, 2026. Following the Seventh Amendment, the effective interest rate increased to 60.66% for the period from August 1 to September 30, 2026. Subsequently, following the Eighth Amendment, the effective interest rate further increased to 63.07%, effective October 1, 2026.

Legal and other direct costs of $56 incurred in connection with the amendments were expensed during the three and nine months ended September 30, 2026. No assets were transferred, and no equity interests were granted, in settlement of the Term Loan in connection with either amendment. The restructured terms do not include any contingently payable amounts.

As of September 30, 2026, the entire balance of the Term Loan was reclassified to a current liability.

Financial Covenants

The Company is currently subject to two restrictive financial covenants, one which pertains to liquidity, requiring the Company to maintain cash and cash equivalents equal to or greater than $4,000 at each month-end from August 31, 2026 through January 31, 2027 and $5,000 thereafter, and a maximum capital expenditure threshold of $5,000 per year. The financial covenants pertaining to maximum senior leverage ratio and fixed charge coverage ratio are both delayed until the quarter ending September 30, 2027. As mentioned above, as of September 30, 2026, the Company did not meet the minimum liquidity covenant and received a waiver from the Term Loan lenders.

At September 30, 2026, the future debt maturities are as follows:

SCHEDULE OF FUTURE DEBT MATURITIES

Fiscal Years Ending
December 31, 2026⁽¹⁾	$	240
December 31, 2027		19,286
Total debt		19,526
Less: Unamortized debt issuance costs		(7,043	)
Total carrying amount		12,483
Less: Current portion of debt		(12,483	)
Total long-term debt	$	-

(1)	Represents scheduled payments for the remaining three-month period ending December 31, 2026.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

REPORTABLE SEGMENTS

9 Months Ended

Sep. 30, 2026

Segment Reporting [Abstract]

REPORTABLE SEGMENTS

Note 15 - REPORTABLE SEGMENTS

The Company has two reportable segments: DTC and OEM. The DTC segment pertains to Battle Born, LLC and Dakota Lithium branded batteries which are sold directly to consumers. The OEM segment pertains to Dragonfly branded batteries which are sold to original equipment manufacturers.

The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The Company evaluates performance for all of its reportable segments based on both segment gross and net profit or loss from operations.

For the direct-to-consumer (“DTC”) and original equipment manufacturer (“OEM”) segments, the Chief Operating Decision Maker (“CODM”) uses both segment gross and net profit and loss from operations to allocate resources (including employees, property, and financial or capital resources) for each segment predominantly in the annual budget and forecasting process.

Assets information for the reported segments is not disclosed as it is not used by the CODM in evaluating the performance of, or making decisions about, the reported segments.

The Company’s reportable segments are strategic business units that offer different branded products. They are managed separately because each segment requires different technology and marketing strategies.

The Company’s CODM is the Chief Executive Officer.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 15 - REPORTABLE SEGMENTS (CONTINUED)

The following table presents the reportable segments information for the nine months ended September 30, 2026:

	DTC			OEM		Other			Total

Net Sales	$	12,981		$	21,306	$	750(1)	⁽¹⁾	$	35,037

Reconciliation of Net Sales
Reconciling items										-
Consolidated Net Sales									$	35,037

Direct material		8,447			12,857		-			21,304
Direct labor		1,021			1,183		-			2,204
Direct overhead and depreciation		1,016			1,175		-			2,191

Total Cost of Goods Sold		10,484			15,215		-			25,699

Gross profit		2,497			6,091		750			9,338

Operating Expenses
Research & development		-			-		2,261(2)	⁽²⁾		2,261
Sales tax adjustment		5			-		-			5
Credit card & amazon transaction fees		235			-		-			235
Other general & administrative		-			-		13,971(3)	⁽³⁾		13,971
Shipping		970			539		-			1,509
Sales and marketing stock compensation		28			147		-			175
Sales and marketing wages		483			764		-			1,247
Marketing spend		1,471			155		-			1,626
Rent		42			13		-			55
Unallocated sales and marketing stock compensation		-			-		69(4)	(4)		69
Unallocated sales and marketing wages		-			-		556(4)	(4)		556
Other sales & marketing		-			-		308(4)	(4)		308

Total Operating Expenses		3,234			1,618		17,165			22,017

Income (Loss) from operations		(737	)		4,473		(16,415	)		(12,679	)

Other income		-			-		534			534
Interest expense, net		-			-		(4,775	)		(4,775	)
Change in FMV of warrant liability		-			-		370			370

Total Other Income (Expense)		-			-		(3,871(5)	)⁽⁵⁾		(3,871	)

Net Income (Loss) Before Taxes		(737	)		4,473		(20,286	)		(16,550	)

Income Tax Benefit		-			-		-			-

Net Income (Loss)	$	(737	)	$	4,473	$	(20,286	)	$	(16,550	)

Reconciliation of net loss
Reconciling items										-
Consolidated net loss									$	(16,550	)

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 15 - REPORTABLE SEGMENTS (CONTINUED)

(1)

Licensing Revenue which is not considered a segment as it is currently immaterial

(2)

Research and Development expenses including employee costs related to new products

(3)

Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses

(4)

General sales and marketing employee cost and other marketing expenses

(5)

Other income, primarily consisting of grant income, interest expense related to debt and change in fair market value of warrant liability

There were no significant customer revenues from the Company’s DTC segment for the nine months ended September 30, 2026.

Revenues from one customer of the Company’s OEM segment represent approximately $7,535, or 22%, of the Company’s consolidated revenues for the nine months ended September 30, 2026.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 15 - REPORTABLE SEGMENTS (CONTINUED)

The following table presents the reportable segments information for the nine months ended September 30, 2025:

	DTC			OEM		Other			Total

Net Sales	$	16,001		$	28,820	$	750(1)	⁽¹⁾	$	45,571

Reconciliation of Net Sales
Reconciling items										-
Consolidated Net Sales									$	45,571

Direct material		9,340			17,070		-			26,410
Direct labor		1,104			1,497		-			2,601
Direct overhead and depreciation		1,395			1,896		-			3,291

Total Cost of Goods Sold		11,839			20,463		-			32,302

Gross profit		4,162			8,357		750			13,269

Operating Expenses
Research & development		-			-		2,277(2)	⁽²⁾		2,277
Sales tax adjustment		2			-		-			2
Credit card & amazon transaction fees		383			-		-			383
Other general & administrative		-			-		15,890(3)	⁽³⁾		15,890
Shipping		1,439			821		-			2,260
Sales and marketing stock compensation		29			104		-			133
Sales and marketing wages		550			943		-			1,493
Marketing spend		1,892			175		-			2,067
Rent		42			13		-			55
Unallocated sales and marketing stock compensation		-			-		46(4)	⁽⁴⁾		46
Unallocated sales and marketing wages		-			-		1,033(4)	⁽⁴⁾		1,033
Other sales & marketing		-			-		603(4)	⁽⁴⁾		603

Total Operating Expenses		4,337			2,056		19,849			26,242

Income (Loss) from operations		(175	)		6,301		(19,099	)		(12,973	)

Interest expense, net		-			-		(16,552	)		(16,552	)
Change in FMV of warrant liability		-			-		4,624			4,624

Total Other Income (Expense)		-			-		(11,928(5)	)⁽⁵⁾		(11,928	)

Net Income (Loss) Before Taxes		(175	)		6,301		(31,027	)		(24,901	)

Income Tax Benefit		-			-		-			-

Net Income (Loss)	$	(175	)	$	6,301	$	(31,027	)	$	(24,901	)

Reconciliation of net loss
Reconciling items										-
Consolidated net loss									$	(24,901	)

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 15 - REPORTABLE SEGMENTS (CONTINUED)

(1)

Licensing Revenue which is not considered a segment as it is currently immaterial

(2)

Research and Development expenses including employee costs related to new products

(3)

Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses

(4)

General sales and marketing employee cost and other marketing expenses

(5)

Interest expense related to debt and change in fair market value of warrant liability

There were no significant customer revenues from the Company’s DTC segment for the nine months ended September 30, 2025.

Revenues from one customer of the Company’s OEM segment represent approximately $13,021, or 29%, of the Company’s consolidated revenues for the nine months ended September 30, 2025.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 15 - REPORTABLE SEGMENTS (CONTINUED)

The following table presents the reportable segments information for the three months ended September 30, 2026:

	DTC		OEM		Other			Total

Net Sales	$	4,802	$	7,122	$	250(1)	(1)	$	12,174

Reconciliation of Net Sales
Reconciling items									-
Consolidated Net Sales								$	12,174

Direct material		3,214		4,453		-			7,667
Direct labor		314		374		-			688
Direct overhead and depreciation		243		291		-			534

Total Cost of Goods Sold		3,771		5,118		-			8,889

Gross profit		1,031		2,004		250			3,285

Operating Expenses
Research & development		-		-		633(2)	⁽²⁾		633
Sales tax adjustment		2		-		-			2
Credit card & amazon transaction fees		69		-		-			69
Other general & administrative		-		-		5,041(3)	⁽³⁾		5,041
Shipping		272		207		-			479
Sales and marketing stock compensation		13		36		-			49
Sales and marketing wages		136		209		-			345
Marketing spend		385		36		-			421
Rent		13		4		-			17
Unallocated sales and marketing stock compensation		-		-		19(4)	⁽⁴⁾		19
Unallocated sales and marketing wages		-		-		176(4)	⁽⁴⁾		176
Other sales & marketing		-		-		87(4)	⁽⁴⁾		87

Total Operating Expenses		890		492		5,956			7,338

Income (Loss) from operations		141		1,512		(5,706	)		(4,053	)

Other income		-		-		411			411
Interest expense, net		-		-		(1,774	)		(1,774	)
Change in FMV of warrant liability		-		-		(123	)		(123	)

Total Other Income (Expense)		-		-		(1,486(5)	)⁽⁵⁾		(1,486	)

Net Income (Loss) Before Taxes		141		1,512		(7,192	)		(5,539	)

Income Tax Benefit		-		-		-			-

Net Income (Loss)	$	141	$	1,512	$	(7,192	)	$	(5,539	)

Reconciliation of net loss
Reconciling items									-
Consolidated net loss								$	(5,539	)

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 15 - REPORTABLE SEGMENTS (CONTINUED)

(1)

Licensing Revenue which is not considered a segment as it is currently immaterial

(2)

Research and Development expenses including employee costs related to new products

(3)

Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses

(4)

General sales and marketing employee cost and other marketing expenses

(5)

Other income, primarily consisting of grant income, interest expense related to debt, and change in fair market value of warrant liability

There were no significant customer revenues from the Company’s DTC segment for the three months ended September 30, 2026.

Revenues from one customer of the Company’s OEM segment represent approximately $2,588, or 22%, of the Company’s consolidated revenues for the three months ended September 30, 2026.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 15 - REPORTABLE SEGMENTS (CONTINUED)

The following table presents the reportable segments information for the three months ended September 30, 2025:

	DTC			OEM		Other			Total

Net Sales	$	5,038		$	10,679	$	250(1)	⁽¹⁾	$	15,967

Reconciliation of Net Sales
Reconciling items										-
Consolidated Net Sales									$	15,967

Direct material		2,852			6,317		-			9,169
Direct labor		412			510		-			922
Direct overhead and depreciation		510			630		-			1,140

Total Cost of Goods Sold		3,774			7,457		-			11,231

Gross profit		1,264			3,222		250			4,736

Operating Expenses
Research & development		-			-		585(2)	⁽²⁾		585
Sales tax adjustment		50			-		-			50
Credit card & amazon transaction fees		125			-		-			125
Other general & administrative		-			-		5,124(3)	⁽³⁾		5,124
Shipping		628			242		-			870
Sales and marketing stock compensation		11			29		-			40
Sales and marketing wages		176			277		-			453
Marketing spend		569			56		-			625
Rent		14			4		-			18
Unallocated sales and marketing stock compensation		-			-		15(4)	⁽⁴⁾		15
Unallocated sales and marketing wages		-			-		409(4)	⁽⁴⁾		409
Other sales & marketing		-			-		200(4)	⁽⁴⁾		200

Total Operating Expenses		1,573			608		6,333			8,514

Income (Loss) from Operations		(309	)		2,614		(6,083	)		(3,778	)

Other income (expense)		-			-		-			-
Interest expense, net		-			-		(6,409(5)	)(5)		(6,409	)
Change in FMV of warrant liability		-			-		(883(5)	)⁽⁵⁾		(883	)

Total Other Income (Expense)		-			-		(7,292	)		(7,292	)

Net Income (Loss) before taxes		(309	)		2,614		(13,375	)		(11,070	)

Income Tax Benefit		-			-		-			-

Net Income (Loss)	$	(309	)	$	2,614	$	(13,375	)	$	(11,070	)

Reconciliation of net loss
Reconciling items										-
Consolidated net loss									$	(11,070	)

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 15 - REPORTABLE SEGMENTS (CONTINUED)

(1)

Licensing Revenue which is not considered a segment as it is currently immaterial

(2)

Research and Development expenses including employee costs related to new products

(3)

Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses

(4)

General sales and marketing employee cost and other marketing expenses

(5)

Interest expense related to debt and change in fair market value of warrant liability

There were no significant customer revenues from the Company’s DTC segment for the three months ended September 30, 2025.

Revenues from one customer of the Company’s OEM segment represent approximately $5,575, or 35%, of the Company’s consolidated revenues for the three months ended September 30, 2025.

- Definition

The entire disclosure for segment reporting.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-40

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

REPORTABLE SEGMENTS (Tables)

9 Months Ended

Sep. 30, 2026

Segment Reporting [Abstract]

SCHEDULE OF REPORTABLE SEGMENTS INFORMATION

The following table presents the reportable segments information for the nine months ended September 30, 2026:

	DTC			OEM		Other			Total

Net Sales	$	12,981		$	21,306	$	750(1)	⁽¹⁾	$	35,037

Reconciliation of Net Sales
Reconciling items										-
Consolidated Net Sales									$	35,037

Direct material		8,447			12,857		-			21,304
Direct labor		1,021			1,183		-			2,204
Direct overhead and depreciation		1,016			1,175		-			2,191

Total Cost of Goods Sold		10,484			15,215		-			25,699

Gross profit		2,497			6,091		750			9,338

Operating Expenses
Research & development		-			-		2,261(2)	⁽²⁾		2,261
Sales tax adjustment		5			-		-			5
Credit card & amazon transaction fees		235			-		-			235
Other general & administrative		-			-		13,971(3)	⁽³⁾		13,971
Shipping		970			539		-			1,509
Sales and marketing stock compensation		28			147		-			175
Sales and marketing wages		483			764		-			1,247
Marketing spend		1,471			155		-			1,626
Rent		42			13		-			55
Unallocated sales and marketing stock compensation		-			-		69(4)	(4)		69
Unallocated sales and marketing wages		-			-		556(4)	(4)		556
Other sales & marketing		-			-		308(4)	(4)		308

Total Operating Expenses		3,234			1,618		17,165			22,017

Income (Loss) from operations		(737	)		4,473		(16,415	)		(12,679	)

Other income		-			-		534			534
Interest expense, net		-			-		(4,775	)		(4,775	)
Change in FMV of warrant liability		-			-		370			370

Total Other Income (Expense)		-			-		(3,871(5)	)⁽⁵⁾		(3,871	)

Net Income (Loss) Before Taxes		(737	)		4,473		(20,286	)		(16,550	)

Income Tax Benefit		-			-		-			-

Net Income (Loss)	$	(737	)	$	4,473	$	(20,286	)	$	(16,550	)

Reconciliation of net loss
Reconciling items										-
Consolidated net loss									$	(16,550	)

(1)

Licensing Revenue which is not considered a segment as it is currently immaterial

(2)

Research and Development expenses including employee costs related to new products

(3)

Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses

(4)

General sales and marketing employee cost and other marketing expenses

(5)

Other income, primarily consisting of grant income, interest expense related to debt and change in fair market value of warrant liability

The following table presents the reportable segments information for the nine months ended September 30, 2025:

	DTC			OEM		Other			Total

Net Sales	$	16,001		$	28,820	$	750(1)	⁽¹⁾	$	45,571

Reconciliation of Net Sales
Reconciling items										-
Consolidated Net Sales									$	45,571

Direct material		9,340			17,070		-			26,410
Direct labor		1,104			1,497		-			2,601
Direct overhead and depreciation		1,395			1,896		-			3,291

Total Cost of Goods Sold		11,839			20,463		-			32,302

Gross profit		4,162			8,357		750			13,269

Operating Expenses
Research & development		-			-		2,277(2)	⁽²⁾		2,277
Sales tax adjustment		2			-		-			2
Credit card & amazon transaction fees		383			-		-			383
Other general & administrative		-			-		15,890(3)	⁽³⁾		15,890
Shipping		1,439			821		-			2,260
Sales and marketing stock compensation		29			104		-			133
Sales and marketing wages		550			943		-			1,493
Marketing spend		1,892			175		-			2,067
Rent		42			13		-			55
Unallocated sales and marketing stock compensation		-			-		46(4)	⁽⁴⁾		46
Unallocated sales and marketing wages		-			-		1,033(4)	⁽⁴⁾		1,033
Other sales & marketing		-			-		603(4)	⁽⁴⁾		603

Total Operating Expenses		4,337			2,056		19,849			26,242

Income (Loss) from operations		(175	)		6,301		(19,099	)		(12,973	)

Interest expense, net		-			-		(16,552	)		(16,552	)
Change in FMV of warrant liability		-			-		4,624			4,624

Total Other Income (Expense)		-			-		(11,928(5)	)⁽⁵⁾		(11,928	)

Net Income (Loss) Before Taxes		(175	)		6,301		(31,027	)		(24,901	)

Income Tax Benefit		-			-		-			-

Net Income (Loss)	$	(175	)	$	6,301	$	(31,027	)	$	(24,901	)

Reconciliation of net loss
Reconciling items										-
Consolidated net loss									$	(24,901	)

(1)

Licensing Revenue which is not considered a segment as it is currently immaterial

(2)

Research and Development expenses including employee costs related to new products

(3)

Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses

(4)

General sales and marketing employee cost and other marketing expenses

(5)

Interest expense related to debt and change in fair market value of warrant liability

The following table presents the reportable segments information for the three months ended September 30, 2026:

	DTC		OEM		Other			Total

Net Sales	$	4,802	$	7,122	$	250(1)	(1)	$	12,174

Reconciliation of Net Sales
Reconciling items									-
Consolidated Net Sales								$	12,174

Direct material		3,214		4,453		-			7,667
Direct labor		314		374		-			688
Direct overhead and depreciation		243		291		-			534

Total Cost of Goods Sold		3,771		5,118		-			8,889

Gross profit		1,031		2,004		250			3,285

Operating Expenses
Research & development		-		-		633(2)	⁽²⁾		633
Sales tax adjustment		2		-		-			2
Credit card & amazon transaction fees		69		-		-			69
Other general & administrative		-		-		5,041(3)	⁽³⁾		5,041
Shipping		272		207		-			479
Sales and marketing stock compensation		13		36		-			49
Sales and marketing wages		136		209		-			345
Marketing spend		385		36		-			421
Rent		13		4		-			17
Unallocated sales and marketing stock compensation		-		-		19(4)	⁽⁴⁾		19
Unallocated sales and marketing wages		-		-		176(4)	⁽⁴⁾		176
Other sales & marketing		-		-		87(4)	⁽⁴⁾		87

Total Operating Expenses		890		492		5,956			7,338

Income (Loss) from operations		141		1,512		(5,706	)		(4,053	)

Other income		-		-		411			411
Interest expense, net		-		-		(1,774	)		(1,774	)
Change in FMV of warrant liability		-		-		(123	)		(123	)

Total Other Income (Expense)		-		-		(1,486(5)	)⁽⁵⁾		(1,486	)

Net Income (Loss) Before Taxes		141		1,512		(7,192	)		(5,539	)

Income Tax Benefit		-		-		-			-

Net Income (Loss)	$	141	$	1,512	$	(7,192	)	$	(5,539	)

Reconciliation of net loss
Reconciling items									-
Consolidated net loss								$	(5,539	)

(1)

Licensing Revenue which is not considered a segment as it is currently immaterial

(2)

Research and Development expenses including employee costs related to new products

(3)

Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses

(4)

General sales and marketing employee cost and other marketing expenses

(5)

Other income, primarily consisting of grant income, interest expense related to debt, and change in fair market value of warrant liability

The following table presents the reportable segments information for the three months ended September 30, 2025:

	DTC			OEM		Other			Total

Net Sales	$	5,038		$	10,679	$	250(1)	⁽¹⁾	$	15,967

Reconciliation of Net Sales
Reconciling items										-
Consolidated Net Sales									$	15,967

Direct material		2,852			6,317		-			9,169
Direct labor		412			510		-			922
Direct overhead and depreciation		510			630		-			1,140

Total Cost of Goods Sold		3,774			7,457		-			11,231

Gross profit		1,264			3,222		250			4,736

Operating Expenses
Research & development		-			-		585(2)	⁽²⁾		585
Sales tax adjustment		50			-		-			50
Credit card & amazon transaction fees		125			-		-			125
Other general & administrative		-			-		5,124(3)	⁽³⁾		5,124
Shipping		628			242		-			870
Sales and marketing stock compensation		11			29		-			40
Sales and marketing wages		176			277		-			453
Marketing spend		569			56		-			625
Rent		14			4		-			18
Unallocated sales and marketing stock compensation		-			-		15(4)	⁽⁴⁾		15
Unallocated sales and marketing wages		-			-		409(4)	⁽⁴⁾		409
Other sales & marketing		-			-		200(4)	⁽⁴⁾		200

Total Operating Expenses		1,573			608		6,333			8,514

Income (Loss) from Operations		(309	)		2,614		(6,083	)		(3,778	)

Other income (expense)		-			-		-			-
Interest expense, net		-			-		(6,409(5)	)(5)		(6,409	)
Change in FMV of warrant liability		-			-		(883(5)	)⁽⁵⁾		(883	)

Total Other Income (Expense)		-			-		(7,292	)		(7,292	)

Net Income (Loss) before taxes		(309	)		2,614		(13,375	)		(11,070	)

Income Tax Benefit		-			-		-			-

Net Income (Loss)	$	(309	)	$	2,614	$	(13,375	)	$	(11,070	)

Reconciliation of net loss
Reconciling items										-
Consolidated net loss									$	(11,070	)

(1)

Licensing Revenue which is not considered a segment as it is currently immaterial

(2)

Research and Development expenses including employee costs related to new products

(3)

Administrative and Engineering employee costs along with legal, insurance, professional fees related to administration and other general office expenses

(4)

General sales and marketing employee cost and other marketing expenses

(5)

Interest expense related to debt and change in fair market value of warrant liability

- Definition

Tabular disclosure of segment reporting. Includes, but is not limited to, reconciliation of reportable segment amount to corresponding consolidated total.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 31
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-31

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 280
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-Name Accounting Standards Codification
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+ Details

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 30, 2026	Jun. 30, 2026	Mar. 31, 2026	Sep. 30, 2025	Jun. 30, 2025	Mar. 31, 2025	Sep. 30, 2026	Sep. 30, 2025
Pay vs Performance Disclosure [Table]
Net Income (Loss)	$ (5,539)	$ (4,386)	$ (6,625)	$ (11,070)	$ (7,034)	$ (6,797)	$ (16,550)	$ (24,901)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

SCHEDULE OF PRO FORMA INFORMATION (Details) - USD ($)
$ in Thousands

3 Months Ended

9 Months Ended

Sep. 30, 2026

^[1]

Sep. 30, 2025

Sep. 30, 2026

^[1]

Sep. 30, 2025

Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]

Revenue

$ 12,596

$ 18,609

$ 40,529

$ 56,262

Net loss

$ (5,412)

$ (12,355)

$ (18,895)

$ (27,203)

[1]	Dakota Lithium’s results of operations have been included in the condensed consolidated financial statements since the Acquisition Date. Following the acquisition, Dakota Lithium’s operations were integrated into the Company’s existing operations

STOCK-BASED COMPENSATION (Tables)

9 Months Ended

Sep. 30, 2026

Share-Based Payment Arrangement [Abstract]

SCHEDULE OF OPTION ACTIVITY AND RELATED INFORMATION

A summary of the Company’s option activity and related information follows:

	Number of Options			Weighted-Average Exercise Price		Weighted-Average Grant Date Fair Value		Weighted-Average Remaining Contractual Life (in years)		Aggregate intrinsic value
Balances, January 1, 2026		1,676		$	1,931.92	$	1,922.48		5.64	$	-
Options granted		14,589			23.92		23.92		9.45		-
Options forfeited		(1	)		5,150.22		54.55		-		-
Options expired		(288	)		1,832.49		4.64		-		-
Balances, September 30, 2026		15,976		$	191.03	$	21.98		9.05	$	-

At September 30, 2026
Vested and Exercisable		6,249		$	451.02				8.42	$	-
Vested and expected to vest		15,976		$	191.03				9.05	$	-

SCHEDULE OF WEIGHTED AVERAGE FAIR VALUE OF OPTIONS

	March 31, 2026
Weighted average fair value of options granted	$	22.31
Risk-free interest rate		3.87	%
Volatility		151	%
Expected life (years)		5.58
Dividend yield		0.00	%

SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY

The following table presents the restricted stock units activity for the nine months ended September 30, 2026:

	Number of Shares			Weighted-Average Fair Market Value
Unvested shares, January 1, 2026		2,098		$	362.40
Granted and unvested		86,177			13.78
Exercised		(28,793	)		24.95
Forfeited		(16,379	)		20.59
Vested		(629	)		18.95
Unvested shares, September 30, 2026		42,474		$	20.74

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Sep. 30, 2026	Dec. 31, 2025
Preferred stock, shares authorized	4,995,000	4,995,000
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, shares authorized	50,000,000	50,000,000
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares issued	1,878,418	1,509,839
Common stock, shares outstanding	1,878,418	1,509,839
Series B Preferred Stock [Member]
Redeemable preferred stock, shares authorized	25,000	25,000
Redeemable preferred stock, par value	$ 0.0001	$ 0.0001
Redeemable preferred stock, shares issued	25,000	25,000
Redeemable preferred stock, shares outstanding	25,000	25,000

COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2026

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

Note 5 - COMMITMENTS AND CONTINGENCIES

Litigation

From time to time the Company may be named in claims arising in the ordinary course of business. Currently, no legal proceedings, governmental actions, administrative actions, investigations or claims are pending against the Company or involve the Company that, in the opinion of the Company’s management, could reasonably be expected to have a material adverse effect on the Company’s business and financial condition.

Operating Leases

The Company has leases related to the main office, warehouse space, research and development lab, engineering office, and sales office, all located in Reno, Nevada. The leases require annual escalating monthly payments ranging from $111 to $309.

On May 8, 2025, the Company entered into a sixth lease amendment with its landlord to extend the lease term for an additional sixty-four (64) month period for the research and development lab and engineering office in Reno, Nevada. Under the terms of the amended lease, the base rent due shall be fully abated for the four (4) month period commencing on August 1, 2025, and ending on November 30, 2025. The lease is set to expire on November 30, 2030.

The following table presents the breakout of the operating leases as of:

	September 30, 2026			December 31, 2025
Operating lease right-of-use assets	$	14,350		$	15,240
Short-term operating lease liabilities		2,273			2,533
Long-term operating lease liabilities		18,854			20,470
Total operating lease liabilities	$	21,127		$	23,003
Weighted average remaining lease term		7.33 years			7.88 years
Weighted average discount rate		8.02	%		7.99	%

Assumptions used in determining our incremental borrowing rate include our implied credit rating and an estimate of secured borrowing rates based on comparable market data.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 5 - Commitments and Contingencies (continued)

Supplemental cash flow information related to the leases where we are the lessee is as follows:

	2026		2025		2026		2025
	For The Three Months Ended September 30,				For The Nine Months Ended September 30,
	2026		2025		2026		2025
Cash paid for amounts included in the measurement of lease liabilities	$	644	$	724	$	1,876	$	2,160

At September 30, 2026, the future minimum lease payments under these operating leases are as follows:

Fiscal Years Ending
December 31, 2026⁽¹⁾	$	1,075
December 31, 2027		3,746
December 31, 2028		3,860
December 31, 2029		3,614
December 31, 2030		3,446
Thereafter		12,600
Total lease payments		28,341
Less imputed interest		7,214
Total operating lease liabilities	$	21,127

⁽¹⁾

Represents scheduled payments for the remaining three-month period ending December 31, 2026.

		For The Three Months Ended September 30,				For The Nine Months Ended September 30,
Lease cost	Classification	2026		2025		2026		2025
Operating lease cost	Cost of goods sold	$	94	$	622	$	648	$	1,859
Operating lease cost	Research and development		45		21		132		98
Operating lease cost	General and administration		620		1,190		1,413		2,731
Operating lease cost	Selling and marketing		12		13		39		39
Total lease cost⁽¹⁾		$	771	$	1,846	$	2,232	$	4,727

(1)

All lease costs included in the schedule above are fixed.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 5 - Commitments and Contingencies (continued)

Financing Leases

The Company entered into finance lease agreements for equipment to support the Company’s operations. Payments under the finance lease agreements are fixed for a term of 3-5.25 years. The leased assets are recognized in property, plant and equipment.

The following table presents the breakout of the financing leases as of:

SCHEDULE OF BREAKOUT OF FINANCE LEASES

	September 30, 2026			December 31, 2025
Finance lease right-of-use assets	$	122		$	85
Short-term finance lease liabilities		17			35
Long-term finance lease liabilities		77			28
Total finance lease liabilities	$	94		$	63
Weighted average remaining lease term		5.07 years			2.15 years
Weighted average discount rate		6.8	%		5.2	%

Assumptions used in determining our incremental borrowing rate include our implied credit rating and an estimate of secured borrowing rates based on comparable market data.

At September 30, 2026, the future minimum lease payments under these financing leases are as follows:

Fiscal Years Ending
December 31, 2026⁽¹⁾	$	6
December 31, 2027		22
December 31, 2028		22
December 31, 2029		22
December 31, 2030		20
Thereafter		20
Total lease payments		112
Less imputed interest		18
Total financing lease liabilities	$	94

⁽¹⁾

Represents scheduled payments for the remaining three-month period ending December 31, 2026.

Other Contingencies

In March 2025, the Company agreed to pay LithiumHub a total of $2,500, of which approximately $562 is payable in 2025 and approximately $1,938 is payable in 2026, in exchange for a non-exclusive license in LithiumHub Technologies, LLC’s patent rights related to the Patents-in-Suit. In accordance with the Settlement Agreement, the Company and LithiumHub terminated the ongoing patent litigation between them. The Settlement Agreement includes no admission of infringement by the Company. On October 22, 2025, the Company paid the settlement amount in full.

On February 20, 2026, the United States Supreme Court issued a decision invalidating tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”). In March 2026, the U.S. Court of International Trade issued an additional ruling stating that importers that have paid tariffs under IEEPA are due refunds. The Company began to receive tariff refunds in the second quarter of fiscal 2026 and has received refunds of $1,142, inclusive of an immaterial amount of interest as of September 30, 2026, of which $332 was received during the three months ended September 30, 2026.

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 5 - Commitments and Contingencies (continued)

During the three and nine months ended September 30, 2026, $0 and $1,092, respectively, of the tariff refund related to product sales was recognized as a reduction in cost of sales. The Company continues to monitor developments and assess the potential impact on its condensed consolidated financial statements and results of operations.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

9 Months Ended

Sep. 30, 2026

Accounting Policies [Abstract]

SCHEDULE OF DISAGGREGATED REVENUES BY DISTRIBUTION CHANNEL

The following table presents our disaggregated revenues by distribution channel:

Sales	2026		2025		2026		2025
	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
Sales	2026		2025		2026		2025
Direct to customer	$	4,802	$	5,038	$	12,981	$	16,001
Original equipment manufacture		7,122		10,679		21,306		28,820
License fee revenue		250		250		750		750
Total	$	12,174	$	15,967	$	35,037	$	45,571

SCHEDULE OF WARRANTY OBLIGATION

	September 30 2026
Beginning warranty obligation	$	867
Provision of warranty expense		293
Settlement of warranty claims		(259	)
Ending warranty obligation	$	901

SCHEDULE OF POTENTIAL SHARES OF COMMON STOCK EXCLUDED FROM DILUTED NET LOSS PER SHARE

The following table sets forth the number of potential shares of common stock that have been excluded from diluted net loss per share because their effect was anti-dilutive:

	2026		2025
	September 30,
	2026		2025
Warrants		29,340		53,202
Restricted stock units		42,474		2,115
Series B Preferred Stock		99,206		-
Options		15,976		1,719
Total excluded shares		186,996		57,036

INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2026

Intangible Asset, Goodwill and Other [Abstract]

INTANGIBLE ASSETS

Note 8 - INTANGIBLE ASSETS

The Company’s intangible assets consist of finite-lived and goodwill. Finite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives and are reviewed for impairment under ASC 360 whenever events or changes in circumstances indicate that the carrying amount of the asset group may not be recoverable. The Company’s goodwill asset is not amortized and is tested for impairment annually, or more frequently if events or changes in circumstances indicate that the asset may be impaired. Costs incurred to renew or extend the term of recognized intangible assets are expensed as incurred.

During the period ended September 30, 2026, the Company acquired certain intangible assets, including intangible assets recognized in connection with the Dakota Lithium acquisition. Intangible assets acquired in a business combination are recognized separately from goodwill when they are identifiable and are measured at their acquisition-date fair values. The disclosure below presents the Company’s total intangible assets as of September 30, 2026, including any intangible assets that existed before the Dakota Lithium acquisition and any intangible assets recognized in connection with the acquisition.

The following table summarizes the Company’s intangible assets as of September 30, 2026:

SCHEDULE OF INTANGIBLE ASSETS

(in 000s)	Gross carrying value		Accumulated Amortization			Net carrying value
(in 000s)	Gross carrying value		Accumulated Amortization			Net carrying value
Website		201		(17	)		184
Customer Relationships		720		(20	)		700
Trade Name		946		(8	)		938
Total		1,867		(45	)		1,822

DRAGONFLY ENERGY HOLDINGS CORP.

Notes to Unaudited Condensed Consolidated Financial Statements

(in thousands, except share and per share data)

Note 8 - INTANGIBLE ASSETS (CONTINUED)

Estimated amortization for intangible assets for each of the next five years is as follows:

(in 000s)	Amount
2026 (remainder)		52
2027		208
2028		208
2029		208
2030		208
Thereafter		938
Total		1,822

Intangible Assets Recognized in the Dakota Lithium Acquisition

In connection with the Dakota Lithium acquisition, the Company recognized identifiable intangible assets at their acquisition-date fair values. The intangible assets recognized included customer relationships and trade name. The acquisition-date fair values assigned to intangible assets acquired in the Dakota Lithium acquisition were as follows:

(in 000s)	Acquisition-Date Fair Value		Estimated Useful Life
Customer Relationships		720	6 years
Trade Name		946	20 years
Total intangible assets acquired		1,666

SUBSEQUENT EVENTS (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands						1 Months Ended
	Nov. 09, 2026	Oct. 30, 2026	Oct. 12, 2026	Oct. 01, 2026	Dec. 18, 2025	Nov. 30, 2026	Oct. 31, 2026	Oct. 11, 2026	Sep. 30, 2026	Dec. 31, 2025
Subsequent Event [Line Items]
Reverse stock split					1-for-10 reverse stock split
Common stock, shares authorized									50,000,000	50,000,000
Common stock, per shares									$ 0.0001	$ 0.0001
Subsequent Event [Member]
Subsequent Event [Line Items]
Cash dividend percent		6.00%
Cash dividend		$ 389
Reverse stock split			1-for-8 reverse stock split
Common stock, per shares			$ 0.0001
Additional tariff refunds	$ 2,233
Tariff refunds	2,112
Interest income	$ 121
Payment for rent						$ 4,400	$ 1,200
Operating lease term						5 years
Shares issued							70,411
Subsequent Event [Member] \| Common Stock [Member]
Subsequent Event [Line Items]
Reverse stock split			one-for-eight reverse stock split
Common stock, shares authorized			50,000,000					400,000,000
Common stock, per shares			$ 0.0001
Subsequent Event [Member] \| Series B Preferred Stock [Member]
Subsequent Event [Line Items]
Cash dividend percent				2.00%
Cash dividend				$ 129

SCHEDULE OF BREAKOUT OF FINANCE LEASES (Details) - USD ($) $ in Thousands	Sep. 30, 2026	Dec. 31, 2025
Commitments and Contingencies Disclosure [Abstract]
Finance lease right-of-use assets	$ 122	$ 85
Short-term finance lease liabilities	17	35
Long-term finance lease liabilities	77	28
Total finance lease liabilities	$ 94	$ 63
Weighted average remaining lease term	5 years 25 days	2 years 1 month 24 days
Weighted average discount rate	6.80%	5.20%