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Algorhythm Holdings, Inc. (NASDAQ:RIME) announced Friday it received a notice from the staff of The Nasdaq Stock Market stating that the company is not in compliance with Nasdaq Listing Rule 5550(b)(1), which requires listed companies to maintain a minimum stockholders’ equity of $2.5 million.
According to the company’s Quarterly Report on Form 10-Q for the period ended September 30, 2025, Algorhythm Holdings reported stockholders’ equity of $100,000. The notice, received Friday, has no immediate effect on the listing of the company’s common stock on Nasdaq.
Under Nasdaq rules, Algorhythm Holdings has 45 calendar days, or until January 12, 2026, to submit a plan to regain compliance. If the plan is accepted by the Nasdaq staff, the company may be granted an extension of up to 180 days from the date of the deficiency notice to meet the minimum equity requirement.
The company stated it intends to submit a compliance plan within the required timeframe. If the plan is not accepted, Algorhythm Holdings will have the opportunity to appeal the decision to a hearings panel, which would stay any delisting action during the appeal process.
The information is based on a press release statement included in the company’s recent SEC filing.
In other recent news, Algorhythm Holdings reported a significant increase in revenue for the third quarter of 2025. The company’s revenue rose to $1.7 million, reflecting a 1,300% year-over-year growth. Despite this impressive revenue surge, Algorhythm Holdings experienced a net loss of $1.8 million. The company has, however, made progress in reducing its losses compared to the previous year. These developments have been noteworthy for investors and analysts alike. The market’s reaction to these earnings was a decline in stock price, although specific figures were not the focus of analyst assessments. This revenue growth and loss reduction are key points for stakeholders to consider. The financial results indicate significant strides in the company’s operations and financial health.
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