What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2026-07-14 compared with 2025-07-18 · 80 added, 92 removed, 236 unchanged (42% of the section changed)

26 unchanged sentences

In the second quarter of fiscal year 2025, the Company announced a modification to the Plan to maintain a presence in Queensbury, NY for the manufacturing of select products, customer service, logistics, shipping, quality and regulatory operations.

The restructuring activities associated with the modified Plan are still expected to be completed in the third quarter of fiscal year 2026.

The restructuring activities associated with the modified Plan are expected to be completed in the first quarter of fiscal year 2027.

The modified Plan is still expected to generate $15.0 million in annual cost savings starting in fiscal year 2027.

1 unchanged sentence

The timing and amount of any share repurchases under the authorization will be determined by management within certain parameters and based on market conditions and other considerations.

During the year ended May 31, 2025, the Company repurchased 243,847 shares of common stock in the open market at an aggregate cost of $1.7 million under the Repurchase Program.

There were no shares repurchased during the twelve months ended May 31, 2026.

During fiscal year 2025, the Company repurchased 243,847 shares of common stock in the open market at an aggregate cost of $1.7 million under the Repurchase Program.

As of May 31, 2026, $13.3 million remained available for repurchase under the Repurchase Program.

On December 24, 2024, the Company entered into an agreement to sell the manufacturing facilities in Queensbury, NY and Glens Falls, NY for a purchase price of $5.5 million and $1.2 million, respectively, and net proceeds of $5.2 million and

$1.1 million, respectively.

The Company simultaneously entered into lease agreements with future lease payments of $4.6 million over seven years for the Queensbury, NY facility and $0.4 million over three years for the Glens Falls, NY facility.

5 unchanged sentences

Year ended May 31, 2026:

• Revenue decreased by 3.8% to $292.5 million

• Med Tech growth of 19.0% and Med Device declined by 16.0%

• Revenue increased by 9.5% to $320.2 million

• Med Tech and Med Device growth of 18.4% and 2.6%, respectively

• Gross margin increased by 70 bps to 54.6%

• Net loss decreased by $150.4 million to $34.0 million

• Loss per share decreased by $3.76 to a loss of $0.83

• Cash flow from operations increased by $18.0 million resulting in cash used in operations of $10.1 million

For the year ended May 31, 2025, the decrease in revenue is due to the divestiture of the PICCs, Midline, dialysis and BioSentry businesses, along with the discontinuation of the RadioFrequency Ablation and Syntrax product lines, the total of which impacted sales by $33.4 million compared to the year ended May 31, 2024.

Our Med Tech business, comprised of Auryon, the thrombus management platform and NanoKnife grew 19.0% in fiscal year 2025 was driven by growth in growth in Auryon and the thrombus management platform, while Nanoknife sales remained consistent year over year.

Our Med Device business decreased 16.0% in fiscal year 2025 driven mainly by the divestiture of the PICCs, Midlines, dialysis and BioSentry businesses along with the discontinuation of the RadioFrequency Ablation product lines.

• Net loss increased by $2.7 million to $36.7 million

• Loss per share increased by $0.05 to a loss of $0.88

• Cash flow from operations increased by $13.2 million resulting in cash provided by operations of $3.1 million

Our Med Tech business, comprised of Auryon, the thrombus management platform and NanoKnife grew 18.4% in fiscal year 2026, driven by growth across all product lines.

Our Med Device business increased 2.6% in fiscal year 2026, driven mainly by growth in the Core and Venous product lines which was partially offset by softness in Ports and other Oncology products.

Strategic Initiatives to Drive Growth

6 unchanged sentences

The Company continued its disciplined product development process which is intended to improve the Company’s ability to bring new products to market and achieve clinical and regulatory pathway expansion.

◦ Received CE mark approval in Europe for Auryon;

◦ Received CPT Category I Codes for Irreversible Electroporation (IRE), the primary method of action for the NanoKnife System, for the treatment of lesions in the prostate and liver, effective January 2026;

◦ Received FDA 510(k) clearance for NanoKnife Prostate Tissue Ablation;

◦ Received CPT Category I Codes for Irreversible Electroporation (IRE), the primary method of action for the NanoKnife System, for the treatment of the pancreas, effective January 2027;

◦ Published APEX-AV trial results in the Journal of the Society for Cardiovascular Angiography & Interventions demonstrating the safety and efficacy of the AlphaVac F1885 System;

◦ Initiated RECOVER-AV Clinical Trial in Europe for AlphaVac;

◦ Initiated the AMBITION BTK RCT and Registry to generate definitive clinical evidence supporting the use of the Auryon Atherectomy System in treating below the knee lesions in patients with critical limb ischemia.

◦ Enrolled the first patients in both the AMBITION BTK and RECOVER-AV trials;

◦ Published the NanoKnife PRESERVE study in the journal of European Urology;

◦ Received FDA IDE approval for APEX-Return study evaluating AlphaReturn Blood Management System when used with AlphaVac F1885 System;

◦ Received FDA IDE approval for PAVE clinical study evaluating AngioVac System for treatment of right-sided infective endocarditis;

◦ Received FDA 510(k) clearance for modified AlphaVac F1885 System with expanded indication for use;

◦ Presented the two-year follow up data from its PRESERVE pivotal trial at AUA 2026 demonstrating NanoKnife’s durable prostate cancer outcomes;

◦ Finalized a local coverage determination with Palmetto covering NanoKnife IRE for qualifying Medicare patients in prostate and liver cancer, effective July 5, 2026;

◦ Received FDA IDE approval for the RELIEF BPH study evaluating NanoKnife IRE for the treatment of benign prostatic hyperplasia.

• Customer Centric Sales Performance.

7 unchanged sentences

This included:

◦ The announcement to restructure the manufacturing footprint, which includes maintaining a presence in Queensbury, NY for select products, customer service, logistics, shipping, quality and regulatory operations, and shifting all other products to an outsourced model utilizing third-party manufacturers to allow the Company to more effectively compete in chosen markets and fundamentally change its corporate gross margin profile.

The restructuring activities are expected to be completed in the third quarter of fiscal year 2026 and are expected to generate $15.0 million in annual cost savings starting in fiscal year 2027.

margin profile.

The restructuring activities are expected to be completed in the first quarter of fiscal year 2027 and are expected to generate $15.0 million in annual cost savings starting in fiscal year 2027.

Critical Accounting Policies and Use of Estimates

5 unchanged sentences

Under ASC 606, Revenue from Contracts with Customers , revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services.

To determine revenue recognition for arrangements, the Company performs the following five steps:

To determine revenue recognition for such arrangements, the Company performs the following five steps:

(i) identify the contract(s) with a customer;

24 unchanged sentences

Product returns after 30 days must be pre-approved by the Company and customers may be subject to a 20% restocking charge.

To be accepted, a returned product must be unadulterated, undamaged and have at least twelve months remaining prior to its expiration date.

To be accepted, a returned product must be

unadulterated, undamaged and have at least twelve months remaining prior to its expiration date.

The Company estimates the amount of its product sales that may be returned by its customers and records this estimate as a reduction of revenue in the period the related product revenue is recognized.

16 unchanged sentences

Inventories are written off against the reserve when they are physically disposed.

Intangible Assets

Intangible assets are amortized over their estimated useful lives, which range between two to eighteen years, on a straight-line basis over the expected period of benefit.

The Company periodically reviews the estimated useful lives of intangible assets and reviews such assets or asset groups for impairment whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable.

Such conditions could include significant adverse changes in the business climate, current-period operating or cash flow losses, significant declines in forecasted operations, or a current expectation that an asset group will be disposed of before the end of its useful life.

When testing for impairment of definite-lived intangible assets held for use, the Company groups assets at the lowest level for which cash flows are separately identifiable.

The Company operates as two reporting units and two asset groups.

If a triggering event is deemed to exist, the Company performs an undiscounted operating cash flow analysis to determine if an impairment exists.

If an intangible asset is considered to be impaired, the amount of the impairment will equal the excess of the carrying value over the fair value of the asset.

Results of Operations for the years ended May 31, 2026 and 2025

10 unchanged sentences

Total $ 320,174 $ 292,498 $ 27,676

For the year ended May 31, 2025, net sales decreased $11.4 million to $292.5 million compared to the year ended May 31, 2024.

For the year ended May 31, 2026, net sales increased $27.7 million to $320.2 million compared to the year ended May 31, 2025.

At May 31, 2026, the Company had a backlog of $0.3 million compared to $0.3 million at the end of May 31, 2025.

2 unchanged sentences

• Increased Auryon sales of $10.0 million;

• Decreased sales of Syntrax of $0.4 million due to the discontinuation of this product line as of February 29, 2024;

• Increased sales of the thrombus management platform of $10.9 million, which was driven by increases in AngioVac, AlphaVac and thrombolytic sales of $5.8 million, $4.0 million and $1.1 million, respectively;

• NanoKnife sales remained consistent year over year, and was comprised of increased NanoKnife disposable sales of $1.7 million offset by decreased capital sales of $1.7 million.

The Med Device business net sales decreased $31.7 million for the year ended May 31, 2025 compared to the prior year.

• Increased sales of the thrombus management platform of $4.6 million, which was driven by increases in AngioVac and AlphaVac sales of $0.6 million and $4.7 million, respectfully, which was partially offset by a decrease in thrombolytic sales of $0.7 million;

• Increased NanoKnife sales of $8.6 million which was driven by increased disposable and capital sales.

The Med Device business net sales increased $4.4 million for the year ended May 31, 2026 compared to the prior year.

The backlog, which primarily impacted sales of Core and Vascular Access products, was $0.3 million at May 31, 2026 compared to $0.3 million at May 31, 2025.

The change in sales from the prior year was primarily driven by:

• Decreased sales of PICCs and Midline products of $30.1 million which was due to the divestiture of these businesses on February 15, 2024;

• Decreased sales of dialysis and BioSentry products of $0.7 million which was due to the divestiture of these businesses on June 8, 2023;

• Decreased sales of RadioFrequency Ablation of $2.2 million due to the discontinuation of this product line as of February 29, 2024;

• Increased sales of Core and Venous of $3.6 million and $2.2 million, respectively.

11 unchanged sentences

The change from the prior year was primarily driven by:

• The divestiture of the PICCs, Midline, dialysis and BioSentry businesses, which negatively impacted gross margin by $9.2 million;

• Sales volume, price and product mix, which positively impacted gross margin by $26.6 million;

• Other incentives and a prior year supplier recall, which positively impacted gross profit by $1.7 million;

• Production volume and other costs which negatively impacted gross margin by $1.5 million;

• Tariffs, along with inflationary costs on raw materials, labor shortages, freight and other costs, which negatively impacted gross margin by $1.6 million and $3.6 million, respectively;

• Incremental depreciation on placement units of $2.6 million.

• Benefits from product lines transitioned to third-party manufacturers along with other incentives, which positively impacted gross margin by $0.9 million;

• Production volume and other operations costs, which negatively impacted gross margin by $5.2 million;

• Tariffs, which negatively impacted gross margin by $3.2 million;

• Inflation, which negatively impacted gross margin by $1.9 million.

The Med Tech segment gross margin increased by $16.8 million compared to the prior year.

The change from the prior year was primarily driven by:

• Sales volume, price and product mix, which positively impacted gross margin by $17.2 million;

• Production volume and other incentives which negatively impacted gross margin by $1.5 million;

• Tariffs, along with inflationary costs on raw materials, labor shortages and freight costs, which negatively impacted gross margin by $1.1 million and $0.4 million, respectively;

• The abandonment of the Syntrax product line, which negatively impacted gross margin by $0.2 million;

• Sales volume and price, which positively impacted gross margin by $16.4 million;

• Favorable purchasing price variance due to shifting to lower cost suppliers, which positively impacted gross margin by $2.7 million;

• Tariffs, which positively impacted gross margin by $0.6 million due to refunds received and lower tariff rates;

• Freight and other costs, which negatively impacted gross margin by $1.2 million;

• Product mix, which negatively impacted gross margin by $0.7 million;

• Production volume, which negatively impacted gross margin by $0.1 million;

• Incremental depreciation on placement units of $0.8 million.

The Med Device segment gross margin decreased by $8.3 million compared to the prior year.

The Med Device segment gross margin increased by $0.3 million compared to the prior year.

The change from the prior year was primarily driven by:

• The divestiture of the PICCs, Midline, dialysis and BioSentry businesses, which negatively impacted gross margin by $9.0 million;

• Price and product mix, which positively impacted gross margin by $11.5 million;

• Other incentives and a prior year supplier recall, which positively impacted gross profit by $2.7 million;

• Sales volume and production volume which negatively impacted gross margin by $1.4 million;

• Tariffs, along with inflationary costs on raw materials, labor shortages and freight and other costs, which negatively impacted gross margin by $0.5 million and $3.7 million, respectively;

• Incremental depreciation on placement units of $0.1 million.

• Benefits from product lines transitioned to third-party manufacturers along with other incentives, which positively impacted gross margin by $2.1 million;

• Sales volume, which negatively impacted gross margin by $0.5 million;

• Production volume and other operations costs, which negatively impacted gross margin by $5.1 million;

• Tariffs, which negatively impacted gross margin by $3.8 million;

• Inflation, which negatively impacted gross margin by $4.6 million;

• A decrease in incremental depreciation on placement units of $0.8 million.

Operating Expenses and Other Income (Expense)

8 unchanged sentences

Research and development expense - Research and development (“R&D”) expense includes internal and external costs to develop new products, enhance existing products, validate new and enhanced products, manage clinical, regulatory and medical affairs.

R&D expense decreased $5.3 million compared to the prior year.

R&D expense increased $3.2 million compared to the prior year.

The change from the prior year was primarily driven by:

• The timing of certain projects, clinical spend and other costs associated with the ongoing clinical trials, which decreased R&D expense by $5.1 million;

• Compensation and benefits expenses, which decreased $0.2 million.

• The timing of certain projects and clinical spend associated with the ongoing clinical trials, which increased R&D expense by $2.0 million;

• Compensation and benefits expenses, which increased $1.2 million.

Sales and marketing expense - Sales and marketing (“S&M”) expense consists primarily of salaries, commissions, travel and related business expenses, attendance at medical society meetings, product promotions and marketing activities.

1 unchanged sentence

The change from the prior year was primarily driven by:

• Compensation and benefits expense, which increased by $7.6 million;

• Consulting, travel and other selling expenses, which increased $1.7 million;

• Trade shows, subscriptions and other marketing expenses, which increased $1.0 million.

• Consulting and other selling expenses, which increased $0.7 million;

• Compensation and benefits expense, which decreased by $2.0 million.

General and administrative expense - General and administrative (“G&A”) expense includes executive management, finance, information technology, human resources, business development, legal, and the administrative and professional costs associated with those activities.

2 unchanged sentences

• Compensation and benefits expense, which increased $5.6 million;

• Other outside consultant spend, which increased $0.8 million;

• Other outside consultant spend, which decreased $3.2 million;

• Depreciation and other corporate expenses, which decreased $0.8 million.

2 unchanged sentences

Amortization of intangibles $ 10,682 $ 10,318 $ 364

Goodwill impairment $ — $ 159,476 $ (159,476)

Change in fair value of contingent consideration $ — $ 272 $ (272)

2 unchanged sentences

Amortization of intangibles - Represents the amount of amortization expense that was taken on intangible assets held by the Company.

• Amortization expense decreased $2.7 million compared to the prior year.

The decrease is due to assets being included in the sale of the dialysis, BioSentry, PICCs and Midlines businesses and the abandonment of the Syntrax product line.

Goodwill impairment - Represents the impairment charge taken on goodwill.

• The Company recorded a non-cash goodwill impairment charge of $159.5 million for the year ended May 31, 2024 as the fair value of the Med Tech reporting unit was less than its carrying value.

• Amortization expense remained consistent compared to the prior year.

Change in fair value of contingent consideration - Represents changes in contingent consideration driven by changes to estimated future payments on earn-out liabilities created through acquisitions and amortization of present value discounts on long-term contingent consideration.

• The change in the fair value for the year ended May 31, 2025 is related to the Eximo contingent consideration and the increased probability of achieving the revenue milestones.

• The change in the fair value for the year ended May 31, 2026 is related to the Eximo contingent consideration.

The final milestone associated with the contingent consideration was reached during the third quarter of fiscal year 2025 and was paid during the fourth quarter of fiscal year 2025.

Acquisition, restructuring and other items, net - Acquisition, restructuring and other items, net represents costs associated with mergers and acquisitions, restructuring expenses, legal costs that are related to litigation that is not in the ordinary course of business, legal settlements and other one-time items.

Acquisition, restructuring and other items, net decreased by $37.6 million compared to the prior year.

Acquisition, restructuring and other items, net increased by $2.0 million compared to the prior year.

The change from the prior year was primarily driven by:

• Legal expense, related to litigation that is outside of the normal course of business, which decreased $34.2 million and was driven by the $19.3 million settlement between the Company and BD in the prior year;

• Mergers and acquisitions expense, which increased $0.3 million;

• Plant closure expense, related to the restructuring of our manufacturing footprint which was announced on January 5, 2024, which increased $4.3 million;

• An impairment of $3.4 million on the Syntrax product technology intangible and fixed assets and an inventory write-off of $2.9 million was taken in the third quarter of fiscal year 2024 related to the abandonment of the Syntrax and RF product lines;

• Legal expense, related to litigation that is outside of the normal course of business, which increased $1.3 million;

• Mergers and acquisitions expense, which decreased $0.7 million;

• Transaction services agreements that were entered into as a result of the divestiture of the PICCs, Midline, dialysis and BioSentry businesses.

The increase in the fees invoiced was $0.7 million;

• Manufacturing relocation expense related to the move of certain manufacturing lines from Queensbury, New York to a third party, which decreased $0.6 million;

• Other expenses, mainly severance associated with organizational changes, which decreased $0.4 million.

The decrease in the fees invoiced was $0.3 million;

• Plant closure expense, related to the restructuring of our manufacturing footprint which was announced on January 5, 2024, which decreased $0.6 million;

• Transition expenses related to the upcoming retirement of our CEO which was announced on January 6, 2026, which increased $1.6 million;

• Other expenses, mainly severance associated with organizational changes, which increased $0.1 million.

Other income (expense) - Other expense includes interest income and expense, foreign currency impacts and bank fees.

Other income, net increased by $5.1 million compared to the prior year.

Other income, net decreased by $2.3 million compared to the prior year.

The change from the prior year was primarily driven by:

• The Company achieved the $5.5 million sales milestone related to divested products in the third quarter of fiscal year 2025;

• Unrealized foreign currency fluctuations, which increased $0.2 million;

• The Company achieved the manufacturing transfer milestone related to divested products in the third quarter of fiscal year 2026 and recorded the associated revenue of $5.0 million which was paid to the Company in the third quarter of fiscal year 2026;

• The Company achieved the sales milestone related to the divested products in the third quarter of fiscal year 2025 and recorded a receivable of $5.5 million which was paid to the Company in the fourth quarter of fiscal year 2025;

• Unrealized foreign currency fluctuations and bank fees, which increased $0.2 million and $0.4 million, respectively;

• Interest income, which decreased $1.3 million compared to the prior year.

Income Tax Benefit

Income Tax Expense (Benefit)

Year ended May 31,

(in thousands) 2026 2025

Income tax benefit $ (39) $ (7,289)

Income tax expense (benefit) $ 442 $ (39)

Effective tax rate (1.2) % 0.1 %

Our effective tax rate was a benefit of 0.1% for fiscal year 2025 compared with an effective tax rate benefit of 3.8% for the prior year.

Our effective tax rate was (1.2)% for fiscal year 2026 compared with an effective tax rate of 0.1% for the prior year.

The current year and prior year effective tax rates differ from the U.S.

statutory rate primarily due to the impact of the valuation allowance, foreign taxes, and other non-deductible permanent items (such as non-deductible meals and entertainment, Section 162(m) excess compensation), goodwill impairment and the impact of stock-based compensation.

The Company regularly assesses its ability to realize its deferred tax assets.

21 unchanged sentences

During the years ended May 31, 2026 and 2025, cash flows consisted of the following:

Cash used in operating activities:

Cash provided by (used in) operating activities:

Years ended May 31, 2026 and 2025:

• Net loss of $34.0 million and $184.3 million, respectively, plus the non-cash items, primarily driven by depreciation and amortization, gain on the divestiture and related expenses, goodwill impairment and stock-based compensation, along with the changes in working capital below, contributed to cash used in operations of $10.1 million and $28.2 million for the years ended May 31, 2025 and 2024, respectively;

• Net loss of $36.7 million plus the non-cash items, primarily driven by depreciation and amortization and stock-based compensation, along with the changes in working capital below, contributed to cash provided by operations of $3.1 million for the year ended May 31, 2026.

• For the year ended May 31, 2026, working capital was favorably impacted by decreased inventory of $10.0 million.

This was partially offset by a decrease in accounts payable, accrued liabilities and other liabilities of $5.8 million, along with increased accounts receivable and prepaid expenses of $5.8 million and $1.1 million, respectively.

• Net loss of $34.0 million plus the non-cash items, primarily driven by depreciation and amortization and stock-based compensation, along with the changes in working capital below, contributed to cash used in operations of $10.1 million for the year ended May 31, 2025.

• For the year ended May 31, 2025, working capital was unfavorably impacted by decreased accounts payable and accrued liabilities and inventory on hand of $15.9 million and $1.3 million, respectively.

This was partially offset by decreased prepaid expenses of $3.1 million.

• For the year ended May 31, 2024, working capital was unfavorably impacted by increased prepaid expenses and inventory on hand of $11.6 million and $9.4 million, respectively.

This was partially offset by decreased accounts receivable and increased accounts payable and accrued liabilities of $7.9 million and $27.5 million, respectively.

Cash (used in) provided by investing activities:

Cash used in investing activities:

Years ended May 31, 2026 and 2025:

1 unchanged sentence

• $3.4 million and $5.7 million, respectively, of cash was used for Auryon placement and evaluation unit additions.

• $134.5 million of cash was received for the divestiture of the PICCs, Midline, dialysis and BioSentry businesses in fiscal year 2024;

• $3.3 million of cash was used for the acquisition of exclusive licenses in fiscal year 2024.

Cash provided by (used in) financing activities:

Years ended May 31, 2026 and 2025:

• $6.3 million of proceeds from financing arrangements offset with $0.1 million of principal payments on the financing arrangements in fiscal year 2025;

• $0.4 million and $0.1 million, respectively, of principal payments on the financing arrangements;

• $6.3 million of proceeds from financing arrangements in fiscal year 2025;

• $5.0 million of contingent consideration payments in fiscal year 2025;

• $1.7 million of cash was used for the repurchase of common shares in fiscal year 2025;

• $5.0 million and $15.0 million, respectively, of contingent consideration payments;

• $50.0 million repayment of the Credit Agreement in connection with the completion of the dialysis and BioSentry divestiture in fiscal year 2024;

• $0.7 million write-off of deferred financing fees related to the repayment of the Credit Agreement fiscal year 2025;

• $0.9 million and $0.9 million, respectively, of proceeds from stock option and ESPP activity.

7 unchanged sentences

Cash payments due by period as of May 31, 2026

(in thousands) Total Less than

(in thousands) Less than

One Year 1-3 Years 3-5 Years After 5

11 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis