ALIGN TECHNOLOGY INC 10-Q

Item 1. Financial Statements. ALIGN TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net revenues $ 1,056,192 $ 1,012,449 $ 2,096,279 $ 1,991,711 Cost of net revenues 298,762 304,332 602,262 603,486 Gross profit 757,430 708,117 1,494,017 1,388,225 Operating expenses: Selling, general and administrative 462,671 448,686 928,013 896,315 Research and development 102,032 96,398 200,690 193,599 Legal settlements and contingencies 38,714 — 69,346 4,178 Total operating expenses 603,417 545,084 1,198,049 1,094,092 Income from operations 154,013 163,033 295,968 294,133 Interest income and other income (expense), net: Interest income 4,636 2,859 8,547 8,175 Other income (expense), net ( 9,956 ) 7,624 ( 6,936 ) 11,650 Total interest income and other income (expense), net ( 5,320 ) 10,483 1,611 19,825 Net income before provision for income taxes 148,693 173,516 297,579 313,958 Provision for income taxes 40,399 48,908 76,514 96,120 Net income $ 108,294 $ 124,608 $ 221,065 $ 217,838 Net income per share: Basic $ 1.51 $ 1.72 $ 3.09 $ 2.98 Diluted $ 1.51 $ 1.72 $ 3.09 $ 2.98 Shares used in computing net income per share: Basic 71,495 72,565 71,460 73,061 Diluted 71,520 72,593 71,629 73,098 The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. 3 Table of Contents ALIGN TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in thousands) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net income $ 108,294 $ 124,608 $ 221,065 $ 217,838 Other comprehensive income: Change in foreign currency translation adjustment, net of tax ( 3,507 ) 43,010 ( 8,802 ) 55,209 Other comprehensive income (loss) ( 3,507 ) 43,010 ( 8,802 ) 55,209 Comprehensive income $ 104,787 $ 167,618 $ 212,263 $ 273,047 The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. 4 Table of Contents ALIGN TECHNOLOGY, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) (unaudited) June 30, 2026 December 31, 2025 ASSETS Current assets: Cash and cash equivalents $ 1,102,591 $ 1,094,908 Accounts receivable, net of allowance for doubtful accounts of $ 27,021 and $ 34,213 , respectively 1,148,392 1,101,757 Inventories 212,240 226,343 Prepaid expenses and other current assets 199,826 165,571 Assets held for sale — 27,983 Total current assets 2,663,049 2,616,562 Property, plant and equipment, net 1,114,261 1,131,453 Operating lease right-of-use assets, net 115,364 108,322 Goodwill 497,301 491,833 Intangible assets, net 94,927 93,933 Deferred tax assets 1,479,864 1,513,542 Other assets 452,815 278,048 Total assets $ 6,417,581 $ 6,233,693 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 109,841 $ 121,450 Accrued liabilities 611,568 536,749 Deferred revenues 1,187,188 1,261,816 Total current liabilities 1,908,597 1,920,015 Income tax payable 69,964 68,200 Operating lease liabilities 86,618 82,507 Other long-term liabilities 119,949 113,824 Total liabilities 2,185,128 2,184,546 Commitments and contingencies (Note 6 and Note 7) Stockholders’ equity: Preferred stock, $ 0.0001 par value ( 5,000 shares authorized; none issued) — — Common stock, $ 0.0001 par value ( 200,000 shares authorized; 71,245 and 71,364 issued and outstanding, respectively) 7 7 Additional paid-in capital 1,570,297 1,509,595 Accumulated other comprehensive income, net 66,586 75,388 Retained earnings 2,595,563 2,464,157 Total stockholders’ equity 4,232,453 4,049,147 Total liabilities and stockholders’ equity $ 6,417,581 $ 6,233,693 The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. 5 Table of Contents ALIGN TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (in thousands) (unaudited) Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss), Net Retained Earnings Total Three Months Ended June 30, 2026 Shares Amount Balance as of March 31, 2026 71,617 $ 7 $ 1,530,934 $ 70,093 $ 2,548,385 $ 4,149,419 Net income — — — — 108,294 108,294 Net change in foreign currency translation adjustment — — — ( 3,507 ) — ( 3,507 ) Issuance of common stock relating to employee equity compensation plans 24 — — — — — Tax withholdings related to net share settlements of equity awards ( 3 ) — ( 515 ) — — ( 515 ) Common stock repurchased and retired ( 393 ) — ( 5,682 ) — ( 61,116 ) ( 66,798 ) Stock-based compensation — — 45,560 — — 45,560 Balance as of June 30, 2026 71,245 $ 7 $ 1,570,297 $ 66,586 $ 2,595,563 $ 4,232,453 Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss), Net Retained Earnings Total Six Months Ended June 30, 2026 Shares Amount Balance as of December 31, 2025 71,364 $ 7 $ 1,509,595 $ 75,388 $ 2,464,157 $ 4,049,147 Net income — — — — 221,065 221,065 Net change in foreign currency translation adjustment — — — ( 8,802 ) — ( 8,802 ) Issuance of common stock relating to employee equity compensation plans 616 — 11,718 — — 11,718 Tax withholdings related to net share settlements of equity awards ( 156 ) — ( 29,166 ) — — ( 29,166 ) Common stock repurchased and retired ( 579 ) — ( 8,334 ) — ( 89,659 ) ( 97,993 ) Stock-based compensation — — 86,484 — — 86,484 Balance as of June 30, 2026 71,245 $ 7 $ 1,570,297 $ 66,586 $ 2,595,563 $ 4,232,453 6 Table of Contents Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income, Net Retained Earnings Total Three Months Ended June 30, 2025 Shares Amount Balance as of March 31, 2025 73,057 $ 7 $ 1,386,807 $ 18,177 $ 2,389,252 $ 3,794,243 Net income — — — — 124,608 124,608 Net change in foreign currency translation adjustment — — — 43,010 — 43,010 Issuance of common stock relating to employee equity compensation plans 15 — — — — — Tax withholdings related to net share settlements of equity awards ( 1 ) — ( 253 ) — — ( 253 ) Common stock repurchased and retired ( 585 ) — ( 8,221 ) — ( 88,816 ) ( 97,037 ) Stock-based compensation — — 48,208 — — 48,208 Balance as of June 30, 2025 72,486 $ 7 $ 1,426,541 $ 61,187 $ 2,425,044 $ 3,912,779 Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income, Net Retained Earnings Total Six Months Ended June 30, 2025 Shares Amount Balance as of December 31, 2024 73,849 $ 7 $ 1,362,234 $ 5,978 $ 2,483,766 $ 3,851,985 Net income — — — — 217,838 217,838 Net change in foreign currency translation adjustment — — — 55,209 — 55,209 Issuance of common stock relating to employee equity compensation plans 408 — 13,909 — — 13,909 Tax withholdings related to net share settlements of equity awards ( 100 ) — ( 19,830 ) — — ( 19,830 ) Common stock repurchased and retired ( 1,671 ) — ( 22,977 ) — ( 276,560 ) ( 299,537 ) Stock-based compensation — — 93,205 — — 93,205 Balance as of June 30, 2025 72,486 $ 7 $ 1,426,541 $ 61,187 $ 2,425,044 $ 3,912,779 The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. 7 Table of Contents ALIGN TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited ) Six Months Ended June 30, 2026 2025 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 221,065 $ 217,838 Adjustments to reconcile net income to net cash provided by operating activities: Deferred taxes 31,425 ( 759 ) Depreciation and amortization 96,679 79,724 Stock-based compensation 86,484 93,205 Non-cash operating lease cost 20,637 19,457 Gain on assets held for sale ( 11,699 ) — Fair value adjustment for equity investment ( 7,499 ) — Other non-cash operating activities 10,633 7,593 Changes in assets and liabilities, net of effects of acquisitions: Accounts receivable ( 72,020 ) ( 121,406 ) Inventories 6,088 9,044 Prepaid expenses and other assets ( 25,963 ) ( 22,701 ) Accounts payable ( 10,290 ) ( 7,516 ) Accrued and other long-term liabilities 60,570 ( 35,503 ) Long-term income tax payable 2,187 7,092 Deferred revenues ( 64,498 ) ( 64,742 ) Net cash provided by operating activities 343,799 181,326 CASH FLOWS FROM INVESTING ACTIVITIES: Acquisitions, net of cash acquired ( 18,963 ) — Purchase of property, plant and equipment ( 66,450 ) ( 46,768 ) Investment in convertible notes ( 69,834 ) — Purchase of equity investments ( 100,491 ) ( 10,000 ) Proceeds from sale of property, plant and equipment 42,000 — Net cash used in investing activities ( 213,738 ) ( 56,768 ) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of common stock 11,718 13,909 Common stock repurchases, net of excise tax ( 98,126 ) ( 297,134 ) Payroll taxes paid upon the vesting of equity awards ( 29,167 ) ( 19,830 ) Net cash used in financing activities ( 115,575 ) ( 303,055 ) Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash ( 6,689 ) 35,876 Net increase (decrease) in cash, cash equivalents, and restricted cash 7,797 ( 142,621 ) Cash, cash equivalents and restricted cash at beginning of the period 1,096,186 1,044,963 Cash, cash equivalents and restricted cash at end of the period $ 1,103,983 $ 902,342 The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements. 8 Table of Contents ALIGN TECHNOLOGY, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Note 1. Summary of Significant Accounting Policies Basis of Presentation and Preparation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared by Align Technology, Inc. (“we”, “our”, the “Company” or “Align”) on a consistent basis with the audited Consolidated Financial Statements for the year ended December 31, 2025, and contain all adjustments, including normal recurring adjustments, necessary to fairly state the information set forth herein. These unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”), and, therefore, omit certain information and footnote disclosures necessary to present the unaudited Condensed Consolidated Financial Statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Consolidated Financial Statements and notes thereto included in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on February 27, 2026. The results of operations for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026 or any other future period, and we make no representations related thereto. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition and deferred revenues, useful lives of intangible assets and property, plant and equipment, goodwill, income taxes, contingent liabilities, the fair values of financial instruments, stock-based compensation and the valuation of investments in privately held companies among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. In connection with the 2025 Restructuring activities discussed in Note 14 “Restructuring and Other Charges,” we committed to a plan to dispose of, other than by sale, specifically identified manufacturing assets prior to the end of their estimated useful lives during the third quarter of 2025. Accordingly, we have revised the estimated useful lives of these assets to reflect our use through the disposal date. For the six months ended June 30, 2026, we recorded $ 15.6 million of accelerated depreciation expense related to these assets. The increase in depreciation expense negatively impacted Net income, net of tax, by $ 11.6 million or $ 0.16 per basic share and $ 0.16 per diluted share. We have materially completed the disposition of these assets as of March 31, 2026. Certain Risks and Uncertainties Financial instruments which potentially expose the Company to concentration of credit risk, consist principally of cash and cash equivalents. These instruments have minimal credit risk exposures. Management regularly monitors their compositions and maturities. The Company maintains its cash and cash equivalents in bank accounts that exceed federally insured FDIC limits. Through June 30, 2026, the Company has not experienced any material credit losses on such deposits. We purchase certain inventory from sole suppliers. Additionally, we rely on a limited number of hardware manufacturers. The inability of any supplier or manufacturer to fulfill our supply requirements could materially and adversely impact our future operating results. Recent Accounting Pronouncements (i) New Accounting Pronouncements Recently Adopted On July 30, 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-05 (“ASU 2025-05”), “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets.” The amendments in this update provide a practical expedient for entities estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606, 9 Table of Contents R evenue from Contracts with Customers . Under this practical expedient, an entity is allowed to assume that the current conditions it has applied in determining credit loss allowances for current accounts receivable and current contract assets remain unchanged for the remaining life of those assets. The guidance is effective for fiscal years beginning after December 15, 2025, and interim reporting periods in those years. The Company adopted ASU 2025-05 effective January 1, 2026 on a prospective basis. The adoption of ASU 2025-05 did not have a material impact on the financial statements and related disclosures. (ii) Recent Accounting Pronouncements Not Yet Effective On September 29, 2025, the FASB issued ASU 2025-07, "Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract," which applies to all entities that enter into non-exchange-traded contracts with underlyings based on operations or activities specific to one of the parties to the contract. The new guidance excludes from derivative accounting non-exchange-traded contracts with underlyings that are based on operations or activities specific to one of the parties to the contract. ASU 2025-07 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those periods. Early adoption is permitted. The Company does not believe the adoption of the standard will have a material effect on the Company’s consolidated financial position or results of operations. On September 18, 2025, the FASB issued ASU 2025-06, “Intangibles-Goodwill and Other-Internal-Use Software.” The amendments in this ASU simplify the accounting for internal-use software by eliminating the existing project development stages and introducing new guidance for evaluating the probable-to-complete threshold for capitalization. The amendments in this ASU also require the application of ASC 360-10 disclosure requirements for all capitalized internal-use software costs, regardless of how those costs are presented in the financial statements. The provisions of ASU 2025-06 are effective for all entities for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years. Early adoption is permitted. The Company is evaluating the effect of this pronouncement on its annual consolidated financial statements. On November 4, 2024, the FASB issued ASU 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures. ” The amendments in this ASU require a public entity to disclose, in the notes to the financial statements, specified information about certain costs and expenses, including the amounts of inventory purchases, employee compensation, depreciation and intangible asset amortization. For public business entities, the provisions of ASU 2024-03 are effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. There will be no impact to our consolidated balance sheets or statements of operations; however, the Company is evaluating the effect of this pronouncement on our consolidated financial statement disclosures. Note 2. Financial Instruments Cash and Cash Equivalents The following tables summarize our cash and cash equivalents balances in our Condensed Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025 (in thousands): June 30, 2026 December 31, 2025 Cash $ 883,606 $ 770,051 Money market funds 203,320 308,940 Certificate of deposits 15,665 15,917 Total $ 1,102,591 $ 1,094,908 We had no short-term or long-term marketable securities as of June 30, 2026 or December 31, 2025. Fair Value Measurements Fair value is an exit price, representing the amount that would be received from selling an asset or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. We use the U.S. GAAP fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value: Level 1 — Inputs to the valuation techniques that are quoted prices in active markets for identical assets or liabilities. 10 Table of Contents Level 2 — Inputs to the valuation techniques that are other than quoted prices but are observable for the assets or liabilities, either directly or indirectly. Level 3 — Inputs to the valuation techniques that are unobservable for the assets or liabilities. The following tables summarize our financial assets measured at fair value as of June 30, 2026 and December 31, 2025 (in thousands): Description Balance as of June 30, 2026 Level 1 Cash equivalents: Money market funds $ 203,320 $ 203,320 Certificate of deposits 15,665 15,665 Total $ 218,985 $ 218,985 Description Balance as of December 31, 2025 Level 1 Cash equivalents: Money market funds $ 308,940 $ 308,940 Certificate of deposits 15,917 15,917 Total $ 324,857 $ 324,857 We have investments in convertible notes of $ 80.4 million, including $ 1.8 million of accrued interest, that are classified as loans receivable and measured on an amortized cost basis, net of an allowance for credit losses and included in Other assets within our Condensed Consolidated Balance Sheets. The notes are unsecured, are not guaranteed, interest rates range up to 10 %, and mature at various dates through December 2035. One borrower represented approximately 72 % of the aggregate carrying amount as of June 30, 2026. The allowance for credit losses is determined on our current estimate of expected credit losses, historical credit losses, estimates of recoveries, and future expectations at the balance sheet date. We evaluate the creditworthiness of our convertible notes when credit risk characteristics exist. Although these notes are not measured at fair value on a recurring basis, the estimated fair value of the instruments is classified within Level 3 of the fair value hierarchy as the fair value is derived from techniques in which one or more significant inputs are unobservable. As of June 30, 2026, the carrying value of our loans receivable approximated the fair value and the credit losses are expected to be immaterial. We had no Level 3 instruments measured at fair value on a recurring basis as of June 30, 2026 or December 31, 2025. Accounts Receivable Factoring We enter into factoring transactions on a non-recourse basis with financial institutions to sell certain of our non-U.S. accounts receivable. We account for these transactions as sales of financial assets as control over the transferred receivables is surrendered. Cash proceeds from the sale of receivable are included within cash flows from operations in the Condensed Consolidated Statements of Cash Flows. Total accounts receivable sold under factoring arrangements were $ 7.0 million and $ 18.3 million during the three months ended June 30, 2026 and 2025, respectively, and $ 18.2 million and $ 24.7 million during the six months ended June 30, 2026 and 2025, respectively. Factoring fees on the sales of receivables were recorded in Other income (expense), net in our Condensed Consolidated Statements of Operations and were not material. 11 Table of Contents Investments in Privately Held Companies Our investments in privately held companies in which we cannot exercise significant influence and do not own a majority equity interest or otherwise control are accounted for as investments in equity securities. We have elected to account for these investments in equity securities in accordance with the measurement alternative. Under the measurement alternative, we record the value of our investments in equity securities at cost, minus impairment, if any. Additionally, we adjust the carrying value of our investments in equity securities for observable transactions for identical or similar investments of the same issuer. On April 24, 2023 and April 22, 2024, we entered into Subscription Agreements (the “Heartland Subscription Agreements”) with Heartland Dental Holding Corporation (“Heartland”). Pursuant to the Subscription Agreements, we acquired less than a 5 % equity interest in total through the purchase of Class A Common Stock for $ 150.0 million ($ 75.0 million each in April 2023 and April 2024). In the fourth quarters of 2024 and 2025, we recorded a $ 6.0 million and $ 18.0 million increase to the carrying value of our Heartland investment, respectively. These adjustments increased the total carrying value of our investment in Heartland to $ 174.0 million as of December 31, 2025. On March 19, 2026, we entered into a new Subscription Agreement with Heartland (the “March 2026 Subscription Agreement”). Pursuant to the March 2026 Subscription Agreement, we acquired additional Class A Common Stock for $ 50.0 million. Following this investment, our total equity interest in Heartland was still less than 5 %. Based on a review of the relevant facts and circumstances, primarily observable transactions for identical investments, we recorded a $ 7.7 million increase to the carrying value of our Heartland investment in the first quarter of 2026. These adjustments increased the total carrying value of our investment in Heartland to $ 231.7 million as of March 31, 2026. On May 15, 2026, we entered into a new Subscription Agreement with Heartland (the “May 2026 Subscription Agreement”). Pursuant to the May 2026 Subscription Agreement, we acquired additional Class A Common Stock for $ 50.0 million. Following this investment, our total equity interest in Heartland was still less than 5 %. The total carrying value of our investment in Heartland was $ 281.7 million as of June 30, 2026. On December 19, 2024 and June 5, 2025, we entered into Subscription Agreements (the “Smile Doctors Subscription Agreements”) with New SD Holding Company, L.P. (“SD Holding Company”). Pursuant to the Smile Doctors Subscription Agreements, we acquired less than a 3 % equity interest through the purchase of Class A Common Units for $ 40 million. SD Holding Company owns a controlling interest, through intermediary entities, in Smile Doctors, LLC. Based on a review of the relevant facts and circumstances, primarily observable transactions for identical investments, we determined that no adjustment to the carrying value of our investment was necessary for the three months ended June 30, 2026. Our investments in privately held companies in which we can exercise significant influence are accounted for as equity method investments. We have elected to account for our equity method investments under the fair value option. As of June 30, 2026, we did not hold any material investments in which we exercised significant influence. The carrying value of our investments in equity securities and equity method investments are reported in our Condensed Consolidated Balance Sheets as Other assets and any price adjustments or impairment, if any, are recorded in Other income (expense), net in our Condensed Consolidated Statements of Operations. Derivatives Not Designated as Hedging Instruments We enter into foreign currency forward contracts to minimize the short-term impact of foreign currency exchange rate fluctuations on certain assets and liabilities. These forward contracts are classified within Level 2 of the fair value hierarchy using observable market-based inputs, including foreign currency spot and forward rates. As a result of the settlement of foreign currency forward contracts, we recognized a net gain of $ 0.5 million and a net loss of $ 27.1 million during the three months ended June 30, 2026 and 2025, respectively, and a net gain of $ 8.4 million and a net loss of $ 38.6 million, during the six months ended June 30, 2026 and 2025, respectively. Recognized gains and losses from the settlement of foreign currency forward contracts are recorded in Other income (expense), net in our Condensed Consolidated Statements of Operations. As of June 30, 2026 and December 31, 2025, the fair value of outstanding foreign exchange forward contracts was no t material. 12 Table of Contents The following tables present the gross notional value of all our foreign exchange forward contracts outstanding as of June 30, 2026 and December 31, 2025 (in thousands): June 30, 2026 Local Currency Amount Notional Contract Amount (USD) Euro € 200,700 $ 229,042 Canadian Dollar C$ 87,100 61,317 British Pound £ 34,400 45,482 Polish Zloty PLN 144,200 38,255 Israeli Shekel ILS 82,700 27,809 Brazilian Real R$ 106,500 20,379 Japanese Yen ¥ 3,100,000 19,137 Chinese Yuan ¥ 31,700 4,676 New Taiwan Dollar NT$ 124,400 3,883 Swiss Franc CHF 3,000 3,721 Korean Won ₩ 4,900,000 3,162 Australian Dollar A$ 3,900 2,686 New Zealand Dollar NZ$ 4,200 2,382 Czech Koruna Kč 15,800 743 Total notional contract amount $ 462,674 December 31, 2025 Local Currency Amount Notional Contract Amount (USD) Euro € 183,700 $ 215,895 Canadian Dollar C$ 90,000 65,802 British Pound £ 38,500 51,782 Polish Zloty PLN 174,800 48,605 Israeli Shekel ILS 80,500 25,283 Japanese Yen ¥ 3,200,000 20,447 Brazilian Real R$ 63,500 11,440 Chinese Yuan ¥ 52,000 7,461 Swiss Franc CHF 4,200 5,316 New Taiwan Dollar NT$ 121,500 3,851 New Zealand Dollar NZ$ 6,020 3,474 Korean Won ₩ 4,600,000 3,207 Australian Dollar A$ 3,500 2,337 Czech Koruna Kč 26,000 1,262 Total notional contract amount $ 466,162 13 Table of Contents Note 3. Balance Sheet Components Inventories consist of the following (in thousands): June 30, 2026 December 31, 2025 Raw materials $ 92,010 $ 107,296 Work in process 64,677 65,679 Finished goods 55,553 53,368 Total inventories $ 212,240 $ 226,343 Prepaid expenses and other current assets consist of the following (in thousands): June 30, 2026 December 31, 2025 Value added tax receivables 1 $ 46,541 $ 55,819 Prepaid expenses 101,098 62,478 Other current assets 52,187 47,274 Total prepaid expenses and other current assets $ 199,826 $ 165,571 1 Refer to Note 7 "Commitments and Contingencies" of the Notes to Condensed Consolidated Financial Statements for discussion of tax matter. Accrued liabilities consist of the following (in thousands): June 30, 2026 December 31, 2025 Accrued payroll and benefits $ 245,230 $ 226,149 Accrued expenses 62,882 61,049 Accrued professional fees 51,174 12,245 Accrued income taxes 39,509 44,049 UK VAT settlement 1 37,514 — Accrued sales and marketing expenses 36,759 29,941 Current operating lease liabilities 34,224 31,939 Accrued property, plant and equipment 9,236 10,469 Other accrued liabilities 95,040 120,908 Total accrued liabilities $ 611,568 $ 536,749 1 Refer to Note 7 "Commitments and Contingencies" of the Notes to Condensed Consolidated Financial Statements for discussion of tax matter. Accrued warranty, which is included in the “Other accrued liabilities” category of the Total accrued liabilities table above, consists of the following activity (in thousands): Six Months Ended June 30, 2026 2025 Balance at beginning of period $ 24,411 $ 31,211 Charge (credit) to cost of net revenues ( 8,633 ) 12,688 Actual warranty expenditures ( 3,554 ) ( 6,251 ) Balance at end of period $ 12,224 $ 37,648 Deferred revenues consist of the following (in thousands): 14 Table of Contents June 30, 2026 December 31, 2025 Deferred revenues - current $ 1,187,188 $ 1,261,816 Deferred revenues - long-term 1 90,458 85,543 Total deferred revenues $ 1,277,646 $ 1,347,359 1 Included in Other long-term liabilities within our Condensed Consolidated Balance Sheets. During the three months ended June 30, 2026 and 2025, we recognized $ 1,056.2 million and $ 1,012.4 million of net revenues, respectively, of which $ 234.3 million and $ 229.4 million was included in the deferred revenues balance at December 31, 2025 and 2024, respectively. During the six months ended June 30, 2026 and 2025, we recognized $ 2,096.3 million and $ 1,991.7 million of net revenues, respectively of which $ 480.7 million and $ 475.4 million was included in the deferred revenues balance at December 31, 2025 and 2024, respectively. Our unfulfilled performance obligations, including deferred revenues and backlog, as of June 30, 2026 were $ 1,277.9 million. These performance obligations are expected to be fulfilled over a period of up to five years . Substantially all remaining performance obligations relate to clear aligner contracts and system and services arrangements, with the associated transaction price largely reflected in deferred revenue balances. Note 4 . Goodwill and Intangible Assets Goodwill The change in the carrying value of goodwill for the six months ended June 30, 2026, categorized by reportable segment, is as follows (in thousands): Clear Aligner Systems and Services Total Balance as of December 31, 2025 $ 164,255 $ 327,578 $ 491,833 Additions from acquisition 1 — 18,588 18,588 Foreign currency translation adjustments ( 2,719 ) ( 10,401 ) ( 13,120 ) Balance as of June 30, 2026 $ 161,536 $ 335,765 $ 497,301 1 We recorded $ 18.6 million of goodwill within the Systems and Services segment for an immaterial acquisition that was completed in the first quarter of 2026. The amount recorded is based on preliminary estimates of the fair values of assets acquired and liabilities assumed and is subject to adjustment during the measurement period. Intangible Assets Acquired intangible assets, excluding intangibles that were fully amortized, are as follows (in thousands): Weighted Average Amortization Period (in years) Gross Carrying Amount as of June 30, 2026 Accumulated Amortization Net Carrying Value as of June 30, 2026 Existing technology 11 $ 146,652 $ ( 74,561 ) $ 72,091 Customer relationships 10 21,500 ( 13,438 ) 8,062 Trademarks and tradenames 7 9,800 ( 8,750 ) 1,050 Patents 12 480 ( 340 ) 140 Total finite-lived intangible assets 178,432 ( 97,089 ) 81,343 In-process research and development 1 12,558 12,558 Foreign currency translation adjustments 1,026 Total intangible assets, net $ 94,927 15 Table of Contents 1 In connection with the immaterial acquisition completed during the first quarter of 2026, the Company recorded $ 12.6 million in acquired in-process research and development within the Systems and Services segment. Acquired in-process research and development is considered an indefinite-lived intangible asset until completion of the associated research and development efforts at which time the asset will be amortized over its estimated useful life. Weighted Average Amortization Period (in years) Gross Carrying Amount as of December 31, 2025 Accumulated Amortization Net Carrying Value as of December 31, 2025 Existing technology 11 $ 146,651 $ ( 67,138 ) $ 79,513 Customer relationships 10 21,500 ( 12,363 ) 9,137 Trademarks and tradenames 7 9,800 ( 8,050 ) 1,750 Patents 12 480 ( 320 ) 160 Total finite-lived intangible assets $ 178,431 $ ( 87,871 ) 90,560 Foreign currency translation adjustments 3,373 Total intangible assets, net $ 93,933 The total estimated future amortization expense for the acquired finite-lived intangible assets as of June 30, 2026 is as follows (in thousands): Fiscal Year Ending December 31, Amortization Remainder of 2026 $ 8,705 2027 15,607 2028 14,505 2029 14,505 2030 6,328 2031 3,615 Thereafter 18,078 Total $ 81,343 Amortization expense for the three months ended June 30, 2026 and 2025 was $ 4.8 million and $ 4.7 million, respectively. Amortization expense for the six months ended June 30, 2026 and 2025 was $ 9.6 million and $ 9.3 million, respectively. Note 5 . Credit Facility We maintain a revolving credit facility, as amended in March 2026, which provides for a $ 300.0 million unsecured revolving commitment, including a $ 50.0 million letter of credit sub-limit. The amendment included certain modifications to non-financial and immaterial terms of the facility. The facility matures on December 23, 2027 and loans under the facility accrue interest, at our election, based on either the Secured Overnight Financing Rate (“SOFR”) for the applicable period or a base rate, in each case plus an applicable margin. The facility includes financial covenants and performance requirements. As of June 30, 2026, we had no outstanding borrowings under the facility and were in compliance with the terms and conditions of the facility in all material respects. Note 6. Legal Proceedings Under Securities and Exchange Commission Regulation S-K, Item 103, we are required to briefly describe any material pending legal proceedings other than ordinary routine litigation incidental to our business, to which we or any of our subsidiaries are a party or of which any of our or our subsidiaries’ property is subject. The descriptions below are intended to comply with such regulations based on information reasonably known to us as of the date of this Quarterly Report on Form 10-Q. These descriptions are not intended to imply or predict outcomes in any of the matters described or any other litigation or disputes to which we are or may hereafter be a party. We are currently unable to 16 Table of Contents predict the outcome of these lawsuits or any future litigation, and therefore we cannot determine the likelihood of loss, if any, nor estimate a range of possible loss. As of June 30, 2026, we accrued $ 31.8 million for legal settlements, substantially all of which relates to the Section 2 and related state law claims brought by Misty Snow, which are described below under the heading “Antitrust Class Actions”. Antitrust Class Actions On June 5, 2020, a dental practice, Simon and Simon, PC (doing business as City Smiles), brought an antitrust action in the U.S. District Court for the Northern District of California on behalf of itself and a putative class of similarly situated practices seeking treble monetary damages, interest, costs, attorneys’ fees, and injunctive relief relating to our alleged market activities in alleged clear aligner and intraoral scanner markets. Plaintiff filed an amended complaint and added VIP Dental Spas as a plaintiff on August 14, 2020. On December 18, 2023, the court certified a class of persons or entities that purchased Invisalign directly from us between January 1, 2019 and March 31, 2022. The court denied Plaintiffs’ motion to certify a class of purchasers of scanners. On February 21, 2024, the court granted our motion for summary judgment on all claims brought by the plaintiffs. Plaintiffs have appealed the district court’s summary judgment ruling to the United States Court of Appeals for the Ninth Circuit. Oral argument was held on April 10, 2025. On May 3, 2021, an individual named Misty Snow brought an antitrust action in the U.S. District Court for the Northern District of California on behalf of herself and a putative class of similarly situated individuals seeking treble monetary damages, interest, costs, attorneys’ fees, and injunctive relief relating to our alleged market activities in alleged clear aligner and intraoral scanner markets based on Section 2 of the Sherman Act. Plaintiffs have since filed several amended complaints adding new plaintiffs and various state law claims. On November 29, 2023, the court certified a class of indirect purchasers of Invisalign between July 1, 2018 and December 31, 2023 and a class of indirect purchasers of Invisalign seeking injunctive relief. On February 21, 2024, the court granted our motion for summary judgment on the claims related to Section 2 allegations. The court entered judgment for the Section 2 and related state law claims on March 22, 2024. Plaintiffs have appealed the district court’s summary judgment ruling to the United States Court of Appeals for the Ninth Circuit. Oral argument was held on April 10, 2025. Straumann Litigation On April 11, 2024, we filed a lawsuit in the U.S. District Court for the Western District of Texas against ClearCorrect Operating, LLC, ClearCorrect Holdings, Inc. and Institut Straumann AG, (collectively the “Defendants”). The complaint asserted infringement of our patents related to aligner material, treatment planning, and intraoral scanner technologies. Among other things, the complaint sought relief enjoining the Defendants’ infringement of multiple Align multilayer material patents through Defendants’ manufacture, sale and offer for sale of aligners made with Zendura FLX/ClearQuartz materials. On July 9, 2024, Defendants filed counterclaims against us alleging antitrust violations and unfair competition. Among other things, the counterclaims sought injunctive relief and money damages. On August 29, 2025, Defendants filed amended counterclaims, which additionally alleged that Align procured certain materials patents by fraud. A jury trial commenced on June 22, 2026, and concluded on July 2, 2026. On July 2, the jury returned a verdict in Align’s favor on the Defendants’ antitrust and unfair competition claims. The jury also entered a verdict in Align’s favor on Defendants’ claim that Align procured certain patents by fraud. The jury found that the Defendants infringed the asserted claims of four of Align’s patents (US Patent Nos. 10,973,613; 11,154,384, 11,648,090, and 11,648,091) by the making, using, selling, and offering for sale of aligners made with Zendura FLX/ClearQuartz materials. The jury found that the asserted claims of US Patent Nos. 10,973,613; 11,154,384, 11,648,090, and 11,648,091 were invalid for lack of enablement. Before trial, the District Court judge found that the asserted claims 1, 2, 11 and 39 of US Patent No. 8,038,444 (the treatment planning patent) were invalid under 35 U.S.C. § 101 and during the trial, granted Defendants’ motion for judgment as a matter of law on the asserted claims of US Patent No. 10,791,936 (the scanner patent). Align is evaluating post-trial motions and potential appeal relating to certain of the District Court judge’s and jury’s determinations relating to its patents. To the extent Defendants’ file post-trial motions or appeal the jury verdict in Align’s favor on the Defendants’ antitrust and unfair competition claims on Defendants’ claim that Align procured certain patents by fraud, or otherwise, Align intends to continue to vigorously defend itself. 17 Table of Contents On April 10, 12 and 14, 2025, Defendants filed eight inter partes review (“IPR”) petitions with the United States Patent Trial and Appeal Board (“PTAB”), alleging that eight of the patents asserted by Align against the Defendants are unpatentable. On October 23, 2025, the PTAB issued decisions denying institution of two of Defendants eight IPRs. On October 23, October 27, October 30, and November 6, 2025, the PTAB issued decisions instituting proceedings on the remaining six IPRs. We anticipate that the final decisions from the PTAB on each IPR will be issued no later than November 9, 2026. We believe the petitions are without merit and intend to defend ourselves vigorously. Angelalign Litigation On August 15, 2025, we initiated two actions in the European Unified Patent Court against various Angelalign entities including Angelalign Technology, Inc.; Angelalign France Technology SASU; Europe Angelalign Technology B.V.; Angelalign Technology (Germany) GmbH; Italy Angelalign Technology S.R.L. and Shanghai EA Medical Instruments Co., Ltd. One of these actions, alleging infringement of a patent related to user interfaces for treatment planning, sought provisional measures (i.e., provisional remedies) including a preliminary injunction. The other action alleged infringement of a patent related to the “power ridge” feature of clear aligners. Subsequently, on November 27, 2025, we initiated a third action in the Unified Patent Court against the same entities seeking provisional measures for infringement of a patent related to treatments in complex cases. The accused entities challenged the validity of the asserted patent in each of these actions. On January 13, 2026, Angelalign Technology (Germany) GmbH filed an action in the European Patent Office challenging the validity of the treatment-planning patent referenced above and on May 11, 2026, it also filed an action in the European Patent Office challenging the validity of the patent related to treatments in complex cases referenced above. On February 12, 2026, the Unified Patent Court issued its decision in the provisional-measures action related to treatment planning, entering a preliminary injunction in Align’s favor and against Angel that prohibits Angel from using its “Live Now” feature, a user interface for treatment planning. Angel must pay € 20,000 EUR per day or cease offering this infringing software feature. Angel was also ordered to pay interim costs of € 400,000 EUR to Align. Angel has appealed the decision issued in this provisional-measures action, but on July 8, 2026, the Court of Appeal of the Unified Patent Court issued its decision, rejecting Angel’s appeal and maintaining the preliminary injunction, as well as ordering Angel to pay the costs of the proceedings. In parallel, on March 16, 2026, Align initiated a merits infringement action under the treatment-planning patent seeking a permanent injunction and damages. This merits action additionally named UK Angelalign Technology Ltd. and Angel Technology Spain, S.L. as defendants. On May 12, 2026, the Unified Patent Court issued its decision in the provisional-measures action related to complex cases, declining to award a preliminary injunction on the basis that there was insufficient evidence in those accelerated proceedings to determine that the patent was infringed. The decision in the provisional-measures proceedings was not appealed, yet Align can still enforce that same patent through a merits infringement action before the Unified Patent Court. The merits actions before the Unified Patent Court related to the treatment-planning feature and the “power ridge” feature referenced above are currently pending. On August 18, 2025, we initiated an action in the U.S. District Court for the Eastern District of Texas against Angelalign Technology Inc; Wuxi EA Medical Instruments Technologies Ltd.; Wuxi EA Bio-Tech Co., Ltd.; and Shanghai EA Medical Instruments Co., Ltd. This action alleges infringement of patents related to multilayer materials for clear aligners and “bite ramp” and “power ridge” features of clear aligners. On January 2, 2026, following institution of an investigation by the U.S. International Trade Commission, referenced below, this action was stayed pending further order of the court. On August 18, 2025, we initiated two actions in China’s Zhengzhou Intermediate People’s Court against Shanghai Angelalign Medical Devices Co., Ltd.; Wuxi Angelalign Medical Device Technology Co., Ltd.; and Wuxi Angelalign Biotechnology Co., Ltd. These actions allege infringement of patents related to tooth attachments and treatment planning. Separately, on September 10, 2025, we filed an action against the same entities in the Jinan Intermediate People’s Court alleging infringement of a patent related to extraction site closure. And on January 12, 2026, we filed an action against these entities in the Fuzhou Intermediate People’s Court alleging infringement of a patent related to extraction site closure. On April 4, 2026, we initiated an additional civil action against these entities alleging infringement of a patent related to treatment planning. These actions are currently pending. On June 26, 2026, the Zhengzhou Intermediate People’s Court issued first-instance judgments finding no infringement of Align’s two patents relating to tooth attachments and treatment planning. Align disagrees with the court’s findings and intends to appeal both judgments to the Supreme People’s Court of China. On January 16, 2026 and March 11, 2026, Shanghai Angelalign Medical Devices Co., Ltd. filed a petition with the China National Intellectual Property Administration (“CNIPA”) challenging the validity of our two patents related to extraction site closure, which patent is the subject of the above-referenced infringement action filed before Jinan Intermediate People’s Court. On January 22 and February 12, 2026, Shanghai Angelalign Medical Devices Co., Ltd. filed two separate petitions with the 18 Table of Contents CNIPA challenging the validity of our patent related to tooth attachments and another patent related to treatment planning, both of which are the subject of the above-referenced infringement actions filed with Zhengzhou Intermediate People’s Court. These invalidity actions are currently pending. On August 22, 2025, Shanghai Angelalign Medical Devices Co., Ltd. and Wuxi Angelalign Medical Devices Technology Co., Ltd. initiated an action against us in the Beijing Intellectual Property Court. The complaint alleges that we infringe a patent relating to undercut detection for mold manufacturing. We believe that these allegations are without merit and intend to defend ourselves vigorously. On January 19, 2026, we filed a petition with the CNIPA challenging the validity of the above-referenced Angel patent related to undercut detection for mold manufacturing. On September 23, 2025, we filed a complaint at the U.S. International Trade Commission (“ITC”) against Angelalign Technology Inc., Wuxi EA Medical Instruments Technologies Ltd.; Wuxi EA Bio-Tech Co., Ltd.; Shanghai EA Medical Instruments Co., Ltd.; and USA Angelalign Technology Corp. (collectively, “the ITC Respondents”). This complaint alleges unlawful importation and sale of clear aligners that infringe patents related to multilayer materials for clear aligners and “bite ramp” and “power ridge” features of clear aligners, in violation of 19 U.S.C.§ 1337. Further, the complaint requests that the ITC institute an investigation and issue an exclusion order blocking the ITC Respondents’ importation of infringing products into the United States, and a cease-and-desist order prohibiting the ITC Respondents from selling, marketing, or transferring infringing products within the United States. On December 19, 2025, the ITC instituted the requested investigation, which is currently pending. On January 26, 2026, the Chief Administrative Law Judge (“CALJ”) presiding over the investigation set a 14.7-month target date of March 22, 2027, which is the date by which the ITC’s final determination is expected to be issued. On July 20-24, 2026, the CALJ presided over the evidentiary hearing in Washington, D.C. The CALJ’s initial determination on the merits is due by November 20, 2026. In addition to the above, in the ordinary course of our operations, we are involved in a variety of claims, suits, investigations, and proceedings, including actions with respect to intellectual property claims, patent infringement claims, government investigations, labor and employment claims, breach of contract claims, tax, and other matters. Regardless of the outcome, these proceedings can have an adverse impact on us because of defense costs, diversion of management resources, and other factors. Although the results of complex legal proceedings are difficult to predict and our view of these matters may change in the future as litigation and events related thereto unfold; we currently do not believe that these matters, individually or in the aggregate, will materially affect our financial position, results of operations or cash flows. However, in the event of unexpected further developments, it is possible that the ultimate resolution of these matters, or other similar matters, if unfavorable, may be materially adverse to our financial position, results of operations or cash flows. Note 7 . Commitments and Contingencies Tax Matter Beginning in the third quarter of 2023 and continuing through the first quarter of 2024, we received cumulative assessments of approximately $ 100 million from His Majesty’s Revenue and Customs (“HMRC”) for unpaid value added tax (“VAT”) related to certain clear aligner sales made during the period of October 2019 through May 2023. We were required to pay these assessments prior to contesting or litigating the matter in statutory appeal. We have historically asserted and continue to assert that doctor prescribed clear aligners sold by dentists for the orthodontic treatment of patient malocclusions are exempt from VAT, that we have reasonably relied upon statements and guidance by HMRC and that our interpretation of United Kingdom legislation is appropriate. In October 2024, the Company and HMRC reached a settlement agreement regarding the unpaid VAT related to certain aligner sales made during the period of October 2019 through mid-October 2023. As part of the settlement, HMRC agreed to vacate the judicial review (before the Administrative Court) originally scheduled for October 9th and October 10th, 2024, refund to the Company all assessments paid for the period of October 2019 through May 2023 and withdraw any potential assessments for the period from June 2023 through mid-October 2023. HMRC has refunded to the Company the assessed amounts, approximately $ 100 million. A statutory appeal (before the First-tier Tribunal - “Tax Tribunal”) was held on January 27th through January 30th, 2025. On April 24, 2025, the Tax Tribunal issued a ruling in our favor indicating that clear aligners are “dental prostheses for the purposes of VAT”, which is a key condition for the VAT exemption. On June 13, 2025, HMRC applied for permission to appeal the Tax Tribunal decision, which was granted on July 15, 2025. On August 1, 2025, HMRC lodged their grounds for appeal to the Upper Tribunal. In August 2025, we stopped charging VAT to our United Kingdom (“UK”) customers. 19 Table of Contents A hearing in front of the Upper Tribunal was held on May 7, 2026. On July 7, 2026, the Upper Tribunal released its decision and held that aligners are not “dental prostheses” for the purposes of VAT and are therefore subject to VAT in the UK. Based on the information available, we determined that a loss is probable and reasonably estimable and recorded an estimated liability of approximately $ 37.5 million, inclusive of estimated interest, related to UK VAT as Legal settlements and contingencies under Accrued liabilities in our Condensed Consolidated Balance Sheets as of June 30, 2026. The recorded amount reflects our best estimate of the obligation as of the reporting date. We intend to exhaust all available appeals and vigorously defend our position; however, the ultimate resolution of this matter remains subject to significant uncertainty. Indemnification Provisions In the normal course of business, to facilitate transactions in our services and products, we indemnify certain parties: customers, vendors, lessors and other parties with respect to certain matters, including, but not limited to, services to be provided by us and intellectual property infringement claims made by third parties. In addition, we have entered into indemnification agreements with our directors and our executive officers that will require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. Several of these agreements limit the time within which an indemnification claim can be made and the amount of the claim. It is not possible to make a reasonable estimate of the maximum potential amount of future payments, if any, under these indemnification agreements due to the unique facts and circumstances involved in each particular agreement. Additionally, we have a limited history of prior indemnification claims and the payments we have made under such agreements have not had a material adverse effect on our results of operations, cash flows or financial position. However, to the extent that valid indemnification claims arise in the future, future payments by us could be significant and could have a material adverse effect on our results of operations or cash flows in a particular period. As of June 30, 2026, we did not have any material indemnification claims that were probable or reasonably possible. Note 8. Stockholders’ Equity As of June 30, 2026, the Align Technology, Inc. 2005 Incentive Plan, as amended, has a total reserve of 34,668,895 shares, of which 2,888,952 shares are available for issuance. Summary of Stock-Based Compensation Expense Stock-based compensation related to our stock-based awards and employee stock purchase plan for the three and six months ended June 30, 2026 and 2025 is as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Cost of net revenues $ 1,846 $ 1,636 $ 3,466 $ 3,174 Selling, general and administrative 33,011 33,485 62,003 64,351 Research and development 10,703 13,087 21,015 25,680 Total stock-based compensation $ 45,560 $ 48,208 $ 86,484 $ 93,205 20 Table of Contents Restricted Stock Units (“RSUs”) The fair value of RSUs is based on the closing price of our stock on the date of grant. Generally, RSUs vest over a period of four years . A summary for the six months ended June 30, 2026 is as follows: Number of Shares Underlying RSUs (in thousands) Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Unvested as of December 31, 2025 1,250 $ 256.80 Granted 798 189.19 Vested and released ( 452 ) 283.14 Forfeited ( 64 ) 229.45 Unvested as of June 30, 2026 1,532 $ 214.93 1.75 $ 258,338 As of June 30, 2026, we expect to recognize $ 257.8 million of total unamortized compensation costs, net of estimated forfeitures, related to RSUs over a weighted average period of 2.9 years. Market-Performance Based Restricted Stock Units (“MSUs”) We grant MSUs to members of senior management. Each MSU represents the right to one share of our common stock. The actual number of MSUs which will be eligible to vest will be based on the performance of our stock price relative to the performance of a stock market index over the vesting period. The fair value of MSUs was estimated using a Monte Carlo model. Because the awards contain a market condition, the related compensation expense is recognized over the service period regardless of whether the market condition is ultimately achieved, provided the service condition is satisfied. MSUs vest over a period of three years and the maximum number of shares eligible to vest is 250 % of the number of MSUs initially granted. The following table summarizes the MSU performance activity for the six months ended June 30, 2026: Number of Shares Underlying MSUs (in thousands) Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Unvested as of December 31, 2025 263 $ 507.88 Granted 149 378.44 Vested and released 1 ( 63 ) 622.37 Forfeited ( 37 ) 532.75 Unvested as of June 30, 2026 312 $ 419.99 1.92 $ 52,623 1 Includes MSUs vested during the period below 100 % of the original grant as actual shares released are based on our stock performance relative to a market index over the vesting period. As of June 30, 2026, we expect to recognize $ 69.0 million of total unamortized compensation costs, net of estimated forfeitures, related to MSUs over a weighted average period of 1.92 years. Employee Stock Purchase Plan (“ESPP”) As of June 30, 2026, we have 1,626,275 shares available for future issuance under the Align Technology, Inc. 2010 Employee Stock Purchase Plan (as amended and restated, the “2010 Purchase Plan”). 21 Table of Contents The fair value of the option component of the 2010 Purchase Plan shares was estimated at the grant date using the Black-Scholes option pricing model with the following weighted average assumptions: Six Months Ended June 30, 2026 2025 Expected term (in years) 0.9 1.1 Expected volatility 41.4 % 40.9 % Risk-free interest rate 3.6 % 4.2 % Expected dividends — — Weighted average fair value at grant date $ 51.66 $ 70.62 As of June 30, 2026, we expect to recognize $ 5.6 million of total unamortized compensation costs related to future employee stock purchases over a weighted average period of 0.5 years. Note 9. Common Stock Repurchase Programs In January 2023, our Board of Directors authorized a plan to repurchase up to $ 1.0 billion of our common stock (the “January 2023 Repurchase Program”). The January 2023 Repurchase Program was completed in its entirety in the second quarter of 2025. In April 2025, our Board of Directors authorized a plan to repurchase up to $ 1.0 billion of our common stock (the “April 2025 Repurchase Program”). The April 2025 Repurchase Program is expected to be completed over a period of up to three years . As of June 30, 2026, we have $ 733.3 million remaining available for repurchase under the April 2025 Repurchase Program. The following tables summarize the total repurchases of our common stock pursuant to Accelerated Share Repurchase (“ASR”) agreements and Open Market Repurchase (“OMR”) programs under the January 2023 and April 2025 Repurchase Programs: Accelerated Share Repurchase Agreements Agreement Date Repurchase Program Amount Paid (in millions) Completion Date Total Shares Received Average Price per Share Q4 2023 January 2023 $ 250.0 Q1 2024 1,086,334 $ 230.13 Open Market Repurchases Agreement Date Repurchase Program Amount Paid (in millions) Completion Date Total Shares Received Average Price per Share Q4 2023 January 2023 $ 100.0 Q4 2023 465,518 $ 214.81 Q2 2024 January 2023 $ 150.0 Q2 2024 598,302 $ 250.73 Q4 2024 January 2023 $ 275.0 Q1 2025 1,241,509 $ 221.50 Q1 2025 January 2023 $ 225.0 Q2 2025 1,339,124 $ 168.02 Q3 2025 April 2025 $ 200.0 Q1 2026 1,390,364 $ 143.85 Q2 2026 April 2025 $ 66.7 N/A 1 393,419 $ 169.45 1 On May 1, 2026, we initiated a $ 200 million open market repurchase program which is expected to be completed by October 2026. The total number of shares to be repurchased and the average price per share are not determinable as of the filing of this Quarterly Report on Form 10-Q. The amount paid, total shares received and average price per share per the table above are determined as of June 30, 2026. During the three months ended June 30, 2026, we repurchased approximately 0.4 million shares of our common stock under the April 2025 Repurchase Program at an average price of $ 169.45 per share for an aggregate purchase price of approximately $ 66.7 million. As of June 30, 2026, $ 733.3 million remained available for repurchase under the program. 22 Table of Contents Note 10. Accounting for Income Taxes Our provision for income taxes was $ 40.4 million and $ 48.9 million for the three months ended June 30, 2026 and 2025, respectively, representing effective tax rates of 27.2 % and 28.2 %, respectively. Our provision for income taxes was $ 76.5 million and $ 96.1 million for the six months ended June 30, 2026 and 2025, respectively, representing effective tax rates of 25.7 % and 30.6 %. Our effective tax rate differs from the statutory federal income tax rate of 21% for the three and six months ended June 30, 2026 and 2025 primarily due to the recognition of additional tax expense resulting from U.S. taxes on foreign earnings, state income taxes, and non-deductible expenses in the U.S., partially offset by the foreign income taxed at different rates. We exercise significant judgment in regard to estimates of future market growth, forecasted earnings and projected taxable income in determining the provision for income taxes and for purposes of assessing our ability to utilize any future benefit from deferred tax assets. We continue to assess the realizability of the deferred tax assets as we take into account new information. We may be required to adjust the valuation allowance for deferred tax assets if we determine, based on available evidence at the time of the determination, that it is more likely than not that some portion or all of the deferred tax assets will not be realized. This assessment includes deferred tax assets associated with our Switzerland tax deductible basis created from our 2020 intra-entity transfer of intellectual property, which have a finite utilization period and depend on our ability to generate sufficient taxable income in that jurisdiction. Any changes to the valuation allowance, particularly those related to our Switzerland deferred tax assets, could have a material adverse effect on our results of operations. Our total gross unrecognized tax benefits, excluding interest and penalties, were $ 120.9 million and $ 117.4 million as of June 30, 2026 and December 31, 2025, respectively, a material amount of which would impact our effective tax rate if recognized. The increase in our unrecognized tax benefits relates primarily to positions taken on income tax return calculations finalized during the three and six months ended June 30, 2026. 23 Table of Contents Note 11 . Net Income per Share The following table sets forth the computation of basic and diluted net income per share attributable to common stock (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Numerator: Net income $ 108,294 $ 124,608 $ 221,065 $ 217,838 Denominator: Weighted average common shares outstanding, basic 71,495 72,565 71,460 73,061 Dilutive effect of potential common stock 25 28 169 37 Total shares, diluted 71,520 72,593 71,629 73,098 Net income per share, basic $ 1.51 $ 1.72 $ 3.09 $ 2.98 Net income per share, diluted $ 1.51 $ 1.72 $ 3.09 $ 2.98 The number of common share equivalents excluded from the computation of diluted earnings per share because the effect would have been anti-dilutive were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 MSUs 285 — 248 — RSUs 1,482 1,502 799 1,375 ESPP 1 3 1 2 Total 1,768 1,505 1,048 1,377 Note 12 . Supplemental Cash Flow Information The supplemental cash flow information consists of the following (in thousands): Six Months Ended June 30, 2026 2025 Non-cash investing and financing activities: Acquisition of property, plant and equipment in accounts payable and accrued liabilities $ 17,185 $ 12,995 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 21,076 $ 19,323 Non-cash lease activities: Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 26,590 $ 12,259 24 Table of Contents Note 13 . Segments and Geographical Information Segment Information We report segment information based on the management approach. The management approach designates the internal reporting used by our Chief Operating Decision Maker (“CODM”), our Chief Executive Officer, for decision making and performance assessment as the basis for determining our reportable segments. We group our operations into two reportable segments; Clear Aligner segment and Imaging Systems and CAD/CAM services (“Systems and Services”) segment, which are based on our predominant product lines. Our CODM uses gross profit and income from operations to assess each reportable segment's performance, by reviewing each measure against internal forecasts and historical performance. Our CODM may also benchmark each segment's performance against our competitors and external expectations. Summarized financial information by reportable segment is as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net revenues Clear Aligner $ 870,874 $ 804,617 $ 1,726,898 $ 1,601,460 Systems and Services 185,318 207,832 369,381 390,251 Total net revenues $ 1,056,192 $ 1,012,449 $ 2,096,279 $ 1,991,711 Cost of net revenues 1 Clear Aligner $ 249,370 $ 240,811 $ 492,525 $ 475,565 Systems and Services 49,392 63,521 109,737 127,921 Total cost of net revenues $ 298,762 $ 304,332 $ 602,262 $ 603,486 Gross profit Clear Aligner $ 621,504 $ 563,806 $ 1,234,373 $ 1,125,895 Systems and Services 135,926 144,311 259,644 262,330 Total gross profit $ 757,430 $ 708,117 $ 1,494,017 $ 1,388,225 Other Segment expenses Clear Aligner $ 296,031 $ 296,795 $ 601,101 $ 598,660 Systems and Services 58,274 58,574 115,916 118,130 Unallocated corporate expenses 249,112 189,715 481,032 377,302 Total operating expenses $ 603,417 $ 545,084 $ 1,198,049 $ 1,094,092 Segment income from operations Clear Aligner $ 325,473 $ 267,011 $ 633,272 $ 527,235 Systems and Services 77,652 85,737 143,728 144,200 Total segment income from operations $ 403,125 $ 352,748 $ 777,000 $ 671,435 1 Management has identified Cost of net revenues as a significant expense for our Clear Aligner and Systems and Services reportable segments. Other segment expenses typically include employee related costs, marketing and advertising costs and depreciation and amortization expense incurred by various functions including selling, marketing, general and administrative and research and development. Income from operations for each segment includes all geographic revenues, related cost of net revenues and operating expenses directly attributable to the reportable segment. Certain operating expenses are not directly attributable to a reportable segment and must be allocated. Each allocation is measured differently based on the nature of the cost being allocated. Certain other operating expenses are not specifically allocated to segment income from operations and generally include various corporate expenses such as stock-based compensation and costs related to information technology (“IT”), facilities, human resources, accounting and finance, legal and regulatory, other separately managed general and administrative costs outside the reportable segments and restructuring costs. 25 Table of Contents The following table reconciles total segment income from operations in the table above to net income before provision for income taxes (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Total segment income from operations $ 403,125 $ 352,748 $ 777,000 $ 671,435 Unallocated corporate expenses ( 249,112 ) ( 189,715 ) ( 481,032 ) ( 377,302 ) Total income from operations 154,013 163,033 295,968 294,133 Interest income 4,636 2,859 8,547 8,175 Other income (expense), net ( 9,956 ) 7,624 ( 6,936 ) 11,650 Net income before provision for income taxes $ 148,693 $ 173,516 $ 297,579 $ 313,958 The following table includes certain non-cash expenses for each reportable segment (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Stock-based compensation Clear Aligner $ 6,387 $ 6,065 $ 12,336 $ 11,883 Systems and Services 406 403 783 806 Unallocated corporate expenses 38,767 41,740 73,365 80,516 Total stock-based compensation $ 45,560 $ 48,208 $ 86,484 $ 93,205 Depreciation and amortization Clear Aligner 1 $ 21,782 $ 19,495 $ 59,420 $ 38,399 Systems and Services 10,572 9,302 21,106 17,771 Unallocated corporate expenses 7,777 11,779 16,153 23,554 Total depreciation and amortization $ 40,131 $ 40,576 $ 96,679 $ 79,724 1 Includes $ 15.6 million of accelerated depreciation for the six months ended June 30, 2026 as disclosed in Note 1 “Summary of Significant Accounting Policies." Our CODM does not regularly review total assets at the reportable segment level; however, we have provided geographical information related to our long-lived assets below. Geographical Information Net revenues are presented below by geographic area (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net revenues 1 : U.S. $ 395,174 $ 422,801 $ 799,662 $ 846,119 Switzerland 248,618 235,247 493,766 459,379 Other International 412,400 354,401 802,851 686,213 Total net revenues $ 1,056,192 $ 1,012,449 $ 2,096,279 $ 1,991,711 1 Net revenues are attributed to countries based on the location of where revenues are recognized by our legal entities. 26 Table of Contents Long-lived assets, which includes Property, plant and equipment, net and Operating lease right-of-use assets, net, are presented below by geographic area (in thousands): June 30, 2026 December 31, 2025 Long-lived assets 1 : Switzerland $ 481,493 $ 493,584 U.S. 197,317 200,343 Other International 550,815 545,848 Total long-lived assets $ 1,229,625 $ 1,239,775 1 Long-lived assets are attributed to countries based on the location of our entity that owns or leases the assets. Note 14. Restructuring and Other Charges 2024 Restructuring In the fourth quarter of 2024, we incurred approximately $ 37.0 million in restructuring expenses, of which $ 13.0 million remained unpaid and were included in Accrued liabilities as of December 31, 2024. During the year ended 2025, we reduced our December 31, 2024 restructuring liability by approximately $ 14.6 million primarily due to cash payments, offset by approximately $ 2.1 million of additional restructuring expense recorded in Cost of net revenues. As of June 30, 2026, we had no remaining restructuring liability related to the 2024 Restructuring. 2025 Restructuring In the third quarter of 2025, we initiated a plan to realign certain business groups and reduce our global workforce as part of our continued effort to right size our labor force in response to the current macroeconomic environment. We incurred approximately $ 40.9 million in restructuring expenses, of which $ 17.1 million remained unpaid and were included in Accrued liabilities as of December 31, 2025. For the six months ended June 30, 2026, we reduced our December 31, 2025 restructuring liability by approximately $ 14.0 million primarily due to cash payments and an adjustment of approximately $ 0.7 million, most of which was recorded in Selling, general and administrative expense in our Condensed Consolidated Statements of Operations. As of June 30, 2026, $ 2.5 million remained unpaid and was included in Accrued liabilities in our Condensed Consolidated Balance Sheets. We have completed the 2025 restructuring plan and incurred approximately $ 40.2 million in total restructuring expenses. We do not expect to incur additional restructuring expenses in connection with the 2025 restructuring plan. The 2024 and 2025 restructuring activities were primarily related to involuntary termination benefits, including employee severance and other post-employment benefits. Activity related to the restructuring liabilities associated with our restructuring initiatives consists of the following (in thousands): For the twelve months ended December 31, 2025 2024 Restructuring 2025 Restructuring 2 Total Balance at beginning of period 1 $ 13,001 $ — $ 13,001 Restructuring and other charges 2,056 40,888 42,944 Cash payments and adjustments ( 14,569 ) ( 23,776 ) ( 38,345 ) Balance at end of period 1 $ 488 $ 17,112 $ 17,600 For the six months ended June 30, 2026 2024 Restructuring 2025 Restructuring 2 Total Balance at beginning of period 1 $ 488 $ 17,112 $ 17,600 Restructuring and other charges — ( 678 ) ( 678 ) Cash payments and adjustments ( 488 ) ( 13,970 ) ( 14,458 ) Balance at end of period 1 $ — $ 2,464 $ 2,464 1 Included in “Accrued liabilities” within our Condensed Consolidated Balance Sheets. 2 2025 restructuring activities include an immaterial amount of charges not related to post-employment benefits. 27 Table of Contents Note 15 . Assets Held for Sale In connection with the 2025 restructuring activities discussed in Note 14 “Restructuring and Other Charges,” during the third quarter of 2025, we classified a disposal group associated with a manufacturing facility in Juarez, Mexico as held for sale and recognized an impairment loss of $ 23.1 million. During the first quarter of 2026, we recognized a gain of $ 11.7 million resulting from an increase in fair value less costs to sell, driven by updated market‑based information. The gain did not exceed the cumulative impairment losses previously recognized on the disposal group. The gain was recorded within Cost of net revenues in our Condensed Consolidated Statements of Operations and was attributable to our Clear Aligner reportable segment. During the second quarter of 2026, we completed the sale of the disposal group associated with the manufacturing facility in Juarez, Mexico and received net proceeds of approximately $ 42 million. The carrying value of the disposal group had been adjusted to fair value less cost to sell as of March 31, 2026 and accordingly, no material gain or loss was recognized upon sale. 28 Table of Contents