Nephros Announces Financial Results for Quarter Ended

Announces Financial Results for Quarter Ended March 31, 2025

Net Revenue of $4.9 million;

Growth Drives 38% Increase in Net Revenue

ORANGE, NJ, May 8, 2025 - Nephros, Inc. (Nasdaq: NEPH), a leading water technology company providing filtration solutions

to the medical and commercial markets, today announced financial results for the first quarter ended March 31, 2025.

2025 marked a strong start to the year, with a record quarterly net revenue of $4.9M characterized by robust growth and all-time highs

in both core programmatic business and emergency response business. Net revenue increased by $1.4 million, or 38%, in the first quarter

of 2025 compared to the same period in 2024," said Robert Banks, President and Chief Executive Officer of Nephros. "More

specifically, the results of our programmatic business in the first quarter represent a pinnacle in performance, additionally complemented

by a similar peak within our dialysis business. These increases in demand reflect improved reorder rates and, we believe, demonstrate

the value of our product portfolio."

Banks noted, "As mentioned above, we saw a record escalation in emergency business along with more geographically diverse demand

than in prior periods. While we continue to position ourselves as the company to rely on in a water-safety-related crisis, we do not

anticipate this level of emergency activity to persist throughout the year, particularly with recent administrative changes and attitudes

toward regulation. Rather, we continue to focus on our core programmatic business, an approach which continues to yield positive returns."

on overall performance and outlook, Robert Banks continued, "Taking the totality of our business results into account, our first-quarter

results highlight growing market adoption and operational momentum, as further evidenced by our expanding number of active sites-a

record high of 1,600 in Q1-and the hundreds of filter locations logged within our digital support app. Looking ahead, although

the recent tariff activity has created some macro-economic uncertainties, we believe Nephros is well-positioned among long-term customers

and with strong margins, to maintain our footing and weather challenges. To reinforce our standing, Nephros will continue to innovate

with a pipeline of new product launches and capability advancements."

Performance for the Quarter Ended March 31, 2025

revenue for the three months ended March 31, 2025, and 2024 was $4.9 million, and $3.5 million respectively, an increase of 38%. Our

core programmatic revenue grew by 23% over the same period in 2024. The increase in programmatic sales reflects strong reorders, a number

of new active sites, as well as some pre-ordering for the year ahead of a small price increase put through in February 2025.

of goods sold for the first quarter of 2025 was $1.7 million, compared with $1.3 million in the first quarter of 2024, an increase of

margin for the first quarter of 2025 was 65%, compared with 62% in the first quarter of 2024. The increase in gross margin was primarily

driven by a price increase implemented during the first quarter and a more favorable product mix coupled with lower inventory reserves

and write-offs compared to the prior period.

general and administrative expenses for the first quarter of 2025 were approximately $2.3 million, compared with $2.1 million in 2024,

an increase of 5% due to higher sales commissions resulting from increased revenue and stock compensation expense.

and development expenses for the first quarter of 2025 were $0.3 million, compared with $0.2 million in the first quarter of 2024, an

increase of 39% due to higher headcount.

and amortization expenses for the first quarter of 2025 were approximately $39,000, compared with approximately $33,000 in the first

a result of the improved sales and gross margins, net income for the first quarter of 2025 was $0.6 million, compared with a net loss

of ($0.2 million) during the same period in 2024. We are extremely pleased to show our second quarterly net income in the Company's

EBITDA for the first quarter 2025 was approximately $0.7 million, compared with approximately ($0.1 million) in the first quarter of

of March 31, 2025, Nephros had cash and cash equivalents of approximately $4.1 million, compared to $3.8 million as of December 31, 2024,

and remains debt free.

EBITDA Definition and Reconciliation to GAAP Financial Measures

EBITDA is calculated by taking net income (loss) calculated in accordance with generally accepted accounting principles ("GAAP")

and excluding all interest-related expenses and income, tax-related expenses and income, non-recurring expenses and income, and non-cash

items, including depreciation, amortization, non-cash inventory write-offs, and non-cash compensation. The following tables present a

reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure, for the first quarter of

the 2025 fiscal year:

believes that Adjusted EBITDA provides useful information to management and investors regarding certain financial and business trends

relating to Nephros' financial condition and results of operations. Management does not consider Adjusted EBITDA in isolation or

as an alternative to financial measures determined in accordance with GAAP. The principal limitation of Adjusted EBITDA is that it excludes

significant expenses and income that are required by GAAP to be recognized in Nephros' financial statements. In addition, Adjusted

EBITDA is subject to inherent limitations as it reflects the exercise of judgments by management about which expenses and income are

excluded or included in determining Adjusted EBITDA. To compensate for these limitations, management presents Adjusted EBITDA in connection

with net income (loss), the most directly comparable GAAP financial measure. Nephros urges investors to review the reconciliation of

Adjusted EBITDA to net income (loss) and not to rely on any single financial measure to evaluate the business.

Call Today at 4:30pm Eastern Time

will host a conference call today at 4:30pm ET, during which management will discuss Nephros' financial results and provide a general

may dial into the call as follows:

access: 1 (844) 808-7106

access: 1 (412) 317-5285

joining, please ask to be joined into the Nephros conference call.

audio archive of the call will be available shortly after the call on the Nephros Investor Relations page.

a replay of the call may be accessed until May 15th, 2025 at 1 (877) 344-7529 or

(412) 317-0088 for international callers and entering replay access code: 5819979.

is committed to improving the human relationship with water through leading, accessible technology. We provide innovative water filtration

products and services, along with water-quality education, as part of an integrated approach to water safety. Nephros goods serve the

needs of customers within healthcare and commercial markets, offering both proactive and emergency solutions for water management.

more information about Nephros, please visit nephros.com.

release contains forward-looking statements that are subject to various risks and uncertainties. Such statements include statements regarding

Nephros' expected future revenue growth and the timing of such growth, the effect of new regulations on future revenue growth,

the expected competitive advantages and anticipated impact of new product offerings, and other statements that are not historical facts,

including statements that may be accompanied by the words "intends," "may," "will," "plans,"

"expects," "anticipates," "projects," "predicts," "estimates," "aims,"

"believes," "hopes," "potential" or similar words. Actual results could differ materially from those

described in these forward-looking statements due to certain factors, including Nephros' ability to further develop its sales organization

and realize increased revenues, the extent to which financial results based on emergency response sales can be outside Nephros'

control, the extent to which U.S. tariffs may increase our expenses, inflationary factors and other economic and competitive conditions,

the availability of capital when needed, dependence on third-party manufacturers and researchers, and regulatory reforms. These and other

risks and uncertainties are detailed in Nephros' reports filed with the U.S. Securities and Exchange Commission, including its

Annual Report on Form 10-K for the year ended December 31, 2024, which it may update in Part II, Item 1A - Risk Factors in its

Quarterly Reports on Form 10-Q that it has filed or will file hereafter. You should not place undue reliance on forward-looking statements.

Each forward-looking statement speaks only as of the date of this release, and Nephros does not undertake any responsibility to update

any forward-looking statements that it makes, except as may be required by law.

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