What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-03-10 compared with 2025-03-11 · 172 added, 174 removed, 832 unchanged (29% of the section changed)

18 unchanged sentences

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

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As described further in Note B to the consolidated financial statements, for aircraft and engine parts that originate from dismantled aircraft and engines (“USM dismantled inventory”), cost is determined using a ratio calculated based on the relationship of the cost of the dismantled aircraft or engine at the time of purchase to the total estimated sales value of the dismantled aircraft or engine at the time of purchase.

The Company evaluates this ratio periodically, and if necessary, updates sales value estimates and makes prospective adjustments to this ratio on a product line basis.

identified with an estimated sales value lower than the carrying value is reduced to the estimated net realizable value at the time of the review.

The Company evaluates this ratio periodically, and if necessary,

updates sales value estimates and makes prospective adjustments to this ratio on a product line basis.

Any amounts identified with an estimated sales value lower than the carrying value is reduced to the estimated net realizable value at the time of the review.

We identified the assessment of the USM dismantled inventory cost as a critical audit matter.

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Assessment of Goodwill Impairment within the Asset Management Solutions (“AMS”) and Aircraft Composite Technologies (“ACT”) Reporting Units

As described in Note B and F to the consolidated financial statements, goodwill related to the Asset Management Solutions (“AMS”) and Aircraft Composite Technologies (“ACT”) reporting units was $13.4 million and $6.0 million, respectively, as of December 31, 2024.

As described in Notes B and F to the consolidated financial statements, goodwill related to the Asset Management Solutions (“AMS”) and Aircraft Composite Technologies (“ACT”) reporting units was $13.4 million and $6.0 million, respectively, as of December 31, 2025.

Goodwill is tested at least annually for impairment, or when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable, by assessing qualitative factors or performing a quantitative analysis in determining whether it is more likely than not that its fair value exceeds the carrying value.

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● We evaluated the reasonableness of the significant assumptions used by management related to future revenues and certain operating expenses, operating margins, terminal growth rates, and discount rates.

The evaluation management’s assumptions related to future revenues and certain operating expenses, operating margins, and terminal growth rates involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the AMS and ACT

reporting units;

(ii) the consistency with external market and industry data;

The evaluation of management’s assumptions related to future revenues and certain operating expenses, operating margins, and terminal growth rates involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the AMS and ACT reporting units;

consistency with external market and industry data;

and (iii) whether the assumptions were consistent with evidence obtained in other areas of the audit.

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We have served as the Company’s auditor since 2017

Miami, Florida

Fort Lauderdale, Florida

March 10, 2026

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Cash and cash equivalents

Accounts receivable, net of allowance for credit losses of $ 1,173 and $ 978 as of December 31, 2024 and December 31, 2023, respectively

Accounts receivable, net of allowance for credit losses of $ 1,173 as of December 31, 2025 and December 31, 2024

Income tax receivable

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Accrued expenses

Income tax payable

Lessee and customer purchase deposits

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Authorized 200,000,000 shares;

issued and outstanding 53,252,563 and 52,954,430 shares as of December 31, 2024 and December 31, 2023

issued and outstanding 47,221,513 and 53,252,563 shares as of December 31, 2025 and December 31, 2024, respectively

Additional paid-in capital

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(in thousands, except share and per share data)

Years ended December 31,

Year Ended December 31,

Total revenue

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Income (loss) from operations

Other income (expense):

Other (expense) income:

Interest (expense) income, net

18 unchanged sentences

Share-based compensation

Shares issued upon exercise of warrants

Shares issued under the 2020 Employee Stock Purchase Plan

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Shares surrendered for tax withholdings on equity awards

Purchase of treasury stock

Retirement of treasury stock

( 1,500,000 )

Balance at December 31, 2023

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Shares surrendered for tax withholdings on equity awards

Purchase of treasury stock

Retirement of treasury stock

( 6,428,571 )

Balance at December 31, 2025

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(in thousands)

Years ended December 31,

Year Ended December 31,

Cash flows from operating activities:

Net income (loss)

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities

Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities

Depreciation and amortization

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Inventory reserve

Impairment of aircraft held for lease

Provision for doubtful accounts

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Share-based compensation

Gain on legal settlement

Changes in operating assets and liabilities:

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Other liabilities

Net cash provided by (used in) operating activities

Net cash (used in) provided by operating activities

Cash flows from investing activities:

Proceeds from sale of assets

Proceeds from legal settlement, net

Acquisition of aircraft and engines held for lease, including capitalized cost

Acquisition of aircraft and engines held for lease, including capitalized costs

Purchase of property and equipment

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Purchase of treasury stock

Taxes paid related to net share settlement of equity awards

Proceeds from the issuance of Employee Stock Purchase Plan shares

Net cash provided by (used in) financing activities

(Decrease) increase in cash and cash equivalents

Taxes paid related to net share settlement of equity awards

Net cash provided by financing activities

Decrease in cash and cash equivalents

Cash and cash equivalents, beginning of period

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Supplemental disclosure of noncash investing activities

Reclassification of aircraft and aircraft engines inventory to (from) aircraft and engine held for lease, net

Reclassification of customer purchase deposits to sale of assets

Reclassification of inventory to equipment held for lease, net

Reclassification of inventory to property and equipment, net

Reclassification of equipment held for lease, net from property and equipment, net

The accompanying notes are an integral part of these consolidated financial statements.

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NOTE A - DESCRIPTION OF THE BUSINESS

Monocle Acquisition Corporation (“Monocle”) was initially formed on August 20, 2018 for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar business combination with one or more businesses.

On December 22, 2020 (the “Closing Date”), Monocle consummated the previously announced business combination pursuant to that certain Amended and Restated Agreement and Plan of Merger, dated September 8, 2020 (the “Merger Agreement”) by and among Monocle, AerSale Corporation (f/k/a Monocle Holdings Inc.), a Delaware corporation (the “Company” or “we”), AerSale Aviation, Inc.

(f/k/a AerSale Corp.), a Delaware corporation (“AerSale Aviation”), Monocle Merger Sub 1 Inc., a Delaware corporation (“Merger Sub 1”), Monocle Merger Sub 2 LLC, a Delaware limited liability company (“Merger Sub 2”), and Leonard Green & Partners, L.P., a Delaware limited partnership, solely in its capacity as the initial Holder Representative (as defined in the Merger Agreement).

The transactions contemplated by the Merger Agreement are referred to herein as the “Merger” or the “Business Combination” and in connection therewith, Monocle merged with and into us, whereby we survived the merger and became the successor issuer to Monocle by operation of Rule 12g-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Upon the consummation of the Merger:

(a) Merger Sub 1 was merged with and into Monocle, with Monocle surviving the merger as a wholly-owned direct subsidiary of the Company (the “First Merger”), and (b) Merger Sub 2 was merged with and into AerSale Aviation, with AerSale Aviation surviving the merger as a wholly-owned indirect subsidiary of the Company (the “Second Merger”).

In connection with the closing of the Business Combination (the “Closing”), AerSale Aviation changed its name from “AerSale Corp.” to “AerSale Aviation, Inc.” and the Company changed its name from “Monocle Holdings Inc.” to “AerSale Corporation.” Immediately following the Merger, the Company contributed all of its ownership in Monocle to AerSale Aviation which continued as a wholly owned subsidiary of the Company.

The Company’s corporate headquarters is based in Doral, Florida, with additional offices, hangars, and warehouses located globally.

AerSale Corporation (the “Company” or “we”), a Delaware corporation, is headquartered in Doral, Florida, with additional offices, hangars, and warehouses located globally.

Description of the Business

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Asset Management Solutions activities include monetization of the assets through leasing or sale of whole asset components, or through teardown activities in support of our Used Serviceable Material (“USM”) activities.

Our monetizing services have been developed to maximize returns on mid-life commercial aircraft and engines (“Flight Equipment”) throughout their operating life, in conjunction with realizing the highest residual value of Flight Equipment at their retirement.

Our monetizing services have been developed to maximize returns on mid-life Flight Equipment throughout their operating life, in conjunction with realizing the highest residual value of Flight Equipment at their retirement.

We do this by utilizing our deep market and technical knowledge in management of Flight Equipment sales, leasing and Maintenance, Repair, and Overhaul (“MRO”) activities.

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In turn, the vast majority of assets that we acquire are ultimately disassembled into parts once the remaining green time has been utilized.

Through its TechOps segment, the Company also operates six Federal Aviation Administration (“FAA”) Title 14 Code of Federal Regulations Part 145 Certified Repair Facilities (the MROs) located in Goodyear, Arizona, Millington, Tennessee, Roswell and Albuquerque, New Mexico, as well as two facilities in Miami, Florida.

Through its Technical Operations (“TechOps”) segment, the Company also operates six Federal Aviation Administration (“FAA”) Title 14 Code of Federal Regulations Part 145 Certified Repair Facilities (the MROs) located in Goodyear, Arizona, Millington, Tennessee, Roswell and Rio Rancho, New Mexico, as well as two facilities in Miami, Florida.

These facilities provide the Company flexibility and control to quickly prepare Company aircraft, engines, and inventory for market, as their selective refurbishment is frequently required to meet customers’ unique demand.

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dollars as evidenced by the cash flows in or out from revenue, operating expenses, investing, and financings.

Only general office expenses and payroll transactions are denominated in local currency of our foreign subsidiaries.

Only general office expenses and payroll transactions are denominated in local currency for our foreign subsidiaries.

Accounts Receivable

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Balance at end of year

On June 9, 2014, an aircraft leased to Air Indus suffered significant damage as the result of a terrorist attack.

At that time, the Company recorded an impairment to the asset of $ 2.5 million to adjust the carrying amount to the estimated residual value of $ 1.1 million.

The Company filed an insurance claim and recorded an insurance receivable of $ 2.5 million, offsetting the impairment loss, which was recorded in accounts receivable in the Company’s Consolidated Balance Sheet as of December 31, 2021.

In accordance with accounting principles generally accepted in the United States (“U.S.

GAAP”), the probable amount of the insurance recovery, limited to the amount of the loss recognized, was recorded as the insurance receivable.

Effective November 30, 2022, a final settlement was reached and insurance proceeds net of expenses of $ 4.2 million were received, of which $ 1.7 million was classified as other income, net on the Consolidated Statements of Operations.

Inventory, which consists of complete Flight Equipment held for sale, as well as related parts, is valued at the Lower of Cost or Net Realizable Value (“NRV”) value.

Inventory, which consists of whole Flight Equipment held for sale, as well as related parts, is valued at the lower of cost or net realizable value (“NRV”).

For purchases of whole aircraft and engines for sale or lease, cost is determined using the specific identification method whereby total cost is the cost paid, including certain capitalizable asset acquisition costs, to acquire such assets as a whole.

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The Company evaluates this ratio periodically, and if necessary, updates sales value estimates and makes prospective adjustments to this ratio on a product line basis.

Any amounts identified with an estimated sales value lower than the carrying value is reduced to the estimated net realizable value at the time of the review.

Any amounts identified with an estimated sales value lower than the carrying value is reduced to the estimated NRV at the time of the review.

The Company recorded additional inventory reserves due to this NRV valuation, which is reflected as a component of cost of products in the Consolidated Statements of Operations.

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Expenditures required for the repair of engine and airframe parts are capitalized as inventory and are expensed as cost of products when associated parts are sold.

The Company periodically evaluates its complete aircraft and engines in inventory and Flight Equipment held for lease to determine if events or market circumstances indicate that the assets’ most likely disposition has changed.

Should conditions prevail at the time of the Company’s Consolidated Balance Sheets that would suggest a more likely use as an asset held for lease rather than sale or disassembly for parts inventory or vice versa, it will be reclassified at its then-current book value between inventory and fixed assets - aircraft and engines held for lease, net.

The Company periodically evaluates its whole aircraft and engines in inventory and Flight Equipment held for lease to determine if events or market circumstances indicate that the assets’ most likely disposition has changed.

Should conditions exist at the time of the Company’s Consolidated Balance Sheets that would suggest a more likely use as an asset held for lease rather than sale or disassembly for parts inventory or vice versa, it will be reclassified at its then-current book value between inventory – aircraft, airframes, engines, and parts, net and fixed assets - aircraft and engines held for lease, net.

This transaction is a noncash item and if it occurs, is reflected in the schedule of supplemental cash flows.

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Such inventory may be held for periods beyond one year.

The Company recorded

inventory scrap losses which are reflected as a component of cost of products in the accompanying Consolidated Statements of Operations.

The Company recorded inventory scrap losses which are reflected as a component of cost of products in the Consolidated Statements of Operations.

These scrap losses are as follows (in thousands):

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Subsequent to placing Flight Equipment into service, the cost of maintenance and improvements to Flight Equipment is normally expensed unless the improvements materially increase the long-term value of the Flight Equipment or extend the useful life of the Flight Equipment.

The capitalized cost is depreciated over the lesser of the remaining useful life of the Flight Equipment or the estimated useful life of the capitalized improvements.

The capitalized costs are depreciated over the lesser of the remaining useful life of the Flight Equipment or the estimated useful life of the capitalized improvements.

Aircraft airframe components are depreciated over the assets’ useful life using the straight-line method to the estimated residual value based on the total remaining life before disassembly or outright scrap metal value.

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Depreciation is recognized over the estimated useful lives of the respective assets on a straight-line basis, ranging from 2 to 15 years .

Leasehold improvements are amortized on a straight-line basis over the shorter of the terms of the respective leases and the estimated useful lives of the respective assets.

Leasehold improvements are amortized on a straight-line basis over the shorter of the terms of the respective leases and the estimated useful lives

of the respective assets.

Property and equipment held under capital leases are amortized on a straight-line basis over the shorter of the lease term or estimated useful life of the asset.

Repairs and maintenance expenditures are expensed as incurred, unless such expenses extend the useful life of the asset, in which case they are capitalized.

In accordance with Accounting Standards Codification (“ASC”) 350, “Intangibles — Goodwill and Other,” goodwill is tested at least annually for impairment, or when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable, by assessing qualitative factors or performing a quantitative analysis in determining whether it is more likely than not that its fair value exceeds the carrying value.

In accordance with Accounting Standards Codification (“ASC”) 350, Intangibles — Goodwill and Other, (“ASC 350”), goodwill is tested at least annually for impairment, or when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable, by assessing qualitative factors or performing a quantitative analysis in determining whether it is more likely than not that its fair value exceeds the carrying value.

A quantitative assessment involves determining the fair value of each reporting unit using market participant assumptions.

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For purposes of reviewing impairment and the recoverability of goodwill, we must make various assumptions regarding estimated future cash flows and other factors in determining the fair values of the reporting unit, including market multiples, discount rates, etc.

In the first quarter of 2024, the Company identified a triggering event that may indicate the fair value of one or more of the Company’s reporting units more likely than not did not exceed their carrying values.

The triggering event was due to the significant decline in the market price of the Company’s common stock.

As a result and due to the lack of recovery of the Company’s stock price during the year ended December 31, 2024, the Company performed a quantitative goodwill impairment test for the Asset Management Solutions and ACT reporting units for each of the quarters ended March 31, 2024, June 30, 2024, September 30, 2024, and December 31, 2024, and determined that the fair values exceeded the carrying values for each reporting unit of as the end of each quarter tested.

The Company performed a qualitative impairment assessment as of the Company’s annual impairment testing date of October 1, 2025 and concluded there were no triggering events that may have indicated the fair value of one or more of the Company’s reporting units more likely than not did not exceed their carrying values.

During the quarter ended December 31, 2025, the Company’s stock price decreased significantly and had not recovered by December 31, 2025, which management considered a triggering event.

As a result, management decided that one or more of the Company’s reporting units more likely than not did not exceed their carrying values.

Therefore, the Company performed a quantitative goodwill impairment assessment for the Asset Management Solutions and ACT reporting units as of December 31, 2025, and determined that the fair values exceeded the carrying values for each reporting unit as of December 31, 2025.

As such, the quantitative tests did not result in a goodwill impairment for the Company’s reporting units.

The Company performed a quantitative impairment analysis as of October 1, 2023 on the goodwill for the Asset Management Solutions and TechOps segments (see Note P – Business Segments for a discussion about our business segments), and updated through December 31, 2023, concluding that the fair value of each reporting unit exceeded its carrying value, and thus no impairment was recorded.

The Company performed a quantitative impairment analysis for each of the quarters ended March 31, 2024, June 30, 2024, September 30, 2024 and December 31, 2024 due to a triggering event that may indicate the fair value of one or more of the Company’s reporting units more likely than not did not exceed their carrying value.

The triggering event was due to the significant decline in the market price of the Company’s common stock.

The Company concluded that the fair value of each reporting unit exceeded its carrying value as of the end of each quarter tested, and thus no impairment was recorded during the year ended December 31, 2024 (see Note P – Business Segments for a discussion about our business segments).

Other Intangible Assets

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Our annual assessment date for indefinite lived intangible assets is July 1st.

The Company performed a qualitative impairment analysis as of July 1, 2024, and a quantitative impairment analysis as of July 1, 2023 on the indefinite lived intangible assets and concluded there were no impairments, respectively.

The Company performed a qualitative impairment analysis as of July 1, 2025, and July 1, 2024, on the indefinite lived intangible assets and concluded there were no impairments, respectively.

Other intangible assets are reviewed for impairment if any event or change in circumstance indicates that an impairment may have occurred.

The Company annually reviews the estimated lives and methods used to amortize other intangible assets.

The Company annually reviews the estimated lives and methods used to amortize other

intangible assets.

The actual amounts of amortization expense may differ materially from our estimates, depending on the results of our annual review.

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Revenue from whole asset sales is measured based on consideration specified in the contract with the customer.

The Company and customer enter into an agreement which outlines the place and date of sale, purchase price, condition of the whole asset, bill of sale and the assignment of rights and warranties from the Company to the customer.

The Company and customer enter into an agreement which outlines the place and date of sale, purchase price, condition

of the whole asset, bill of sale and the assignment of rights and warranties from the Company to the customer.

The Company has identified the transfer of the whole asset as the performance obligation.

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Upon the lessee’s presentation of invoices evidencing the completion of qualifying maintenance, the Company will reimburse the lessee for the cost of the maintenance, up to the amount of the maintenance reserve payments that have been received by the Company.

Unless otherwise provided in the contract, the Company

records such maintenance reserve payments paid by the lessees as maintenance deposit payments and other liabilities in the accompanying Consolidated Balance Sheets to record the Company’s contractual commitment to reimburse such qualifying maintenance.

Unless otherwise provided in the contract, the Company records such maintenance reserve payments paid by the lessees as maintenance deposit payments and other liabilities in the Consolidated Balance Sheets to record the Company’s contractual commitment to reimburse such qualifying maintenance.

Reimbursements to the lessees upon receipt of evidence for qualifying maintenance work are charged against the existing maintenance deposit payments and other liabilities.

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Achievement of the milestones must be probable before the Company begins recording share-based compensation expense.

When the performance-based vesting criteria is considered probable, the Company begins to recognize compensation expense at that time.

In the period that achievement of the performance-based criteria is deemed probable, US GAAP requires the immediate recognition of all previously unrecognized compensation since the original grant date.

performance-based vesting criteria is considered probable, the Company begins to recognize compensation expense at that time.

In the period that achievement of the performance-based criteria is deemed probable, U.S.

GAAP requires the immediate recognition of all previously unrecognized compensation since the original grant date.

As a result, compensation expense recorded in the period that achievement is deemed probable could include a substantial amount of previously unrecorded compensation expense related to the prior periods.

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Basic earnings (loss) per share is computed by dividing net earnings (loss) attributable to the Company’s common stockholders by the weighted average number of common shares outstanding during the periods.

Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were

exercised or converted into common stock and is calculated using the treasury stock method for stock options and unvested shares.

Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock and is calculated using the treasury stock method for stock options and unvested shares.

Deferred Insurance Proceeds

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The Company carries insurance covering these parts, with a limit of $ 100 million and a $ 10,000 deductible.

The Company filed a claim for the replacement value of the inventory that was destroyed or rendered not sellable by the fire in the amount of $ 67.6 million.

The Company filed a claim for the replacement value of the inventory that was destroyed or rendered not sellable by the fire in the amount of $ 67.6 million, which was revised to $ 104.5 million.

The cost basis of the destroyed inventory was $ 6.0 million.

During the year ended December 31, 2024, the Company collected interim funding from the insurance companies associated with this claim in the amount of $ 30.9 million and collected $ 3.7 million subsequent to the balance sheet date.

As of December 31, 2025, the Company collected approximately $ 34.6 million from the insurance companies associated with this claim, of which $ 3.7 million was collected during the year ended December 31, 2025.

The Company has deferred the recognition of a gain on insurance proceeds collected under this claim in excess of the loss amount until a full settlement of the claim is reached with our insurers.

The deferred gain in the amount of $ 24.9 million as of December 31, 2024 is presented under deferred insurance proceeds in the Consolidated Balance Sheets.

The deferred gain in the amount of $ 28.6 million and $ 24.9 million as of December 31, 2025 and December 31, 2024, respectively, is presented under deferred insurance proceeds in the Consolidated Balance Sheets.

Income taxes are accounted for under the asset and liability method.

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The Company records interest and penalties related to unrecognized tax benefits in the income tax provision.

Revision of Prior Period Financial Statements

Certain balances in the Consolidated Balance Sheet as of December 31, 2023 and the Consolidated Statements of Cash Flows for the years ended December 31, 2023 and 2022 have been reclassified to conform to the presentation in the consolidated financial statements as of and for the year ended December 31, 2024, primarily including the reclassification of deposits for Flight Equipment purchases from deposits, prepaid expenses, and other current assets to advance vendor payments.

Such reclassification did not impact net income (loss), stockholders’ equity or total cash flows from operating activities, and did not have a material impact on the consolidated financial statements.

New Accounting Pronouncements Adopted

In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-07 Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (“ASU 2023-07”).

The amendments in ASU 2023-07 are intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss.

In addition, the amendments enhance interim disclosure requirements, clarify circumstances in which an entity can disclose multiple segment measures of profit or loss, provide new segment disclosure requirements for entities with a single reportable segment, and contain other disclosure requirements.

The amendments in ASU 2023-07 were adopted by the Company as of January 1, 2024 and retrospectively applied.

Refer to Note P – Business Segments, for disclosures resulting from the adoption of ASU 2023-07.

The Company’s results of operations, cash flows, and financial condition were not impacted by the adoption of this ASU.

New Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures, which requires public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction.

ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted.

This guidance is required to be adopted by us in the first quarter of 2025.

We are currently evaluating the impact of this guidance on our consolidated financial statements and disclosure.

In November 2024, the FASB issued ASU 2024-03, Reporting Comprehensive Income—Expense Disaggregation Disclosures, which requires public entities to disclose, in a tabular presentation, the following expense items (1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, (5) depreciation, depletion, and amortization recognized as part of oil- and gas-producing activities or other types of depletion expenses, as well as other types of expenses when applicable.

This guidance was adopted by us in the first quarter of 2025.

Refer to Note M – Income Taxes for disclosures resulting from the adoption of ASU 2023-09.

New Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Reporting Comprehensive Income—Expense Disaggregation Disclosures (“ASU” 2024-03”), which requires public entities to disclose, in a tabular presentation, the following expense items (1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5) depreciation, depletion, and amortization recognized as part of oil- and gas-producing activities or other types of depletion expenses, as well as other types of expenses when applicable.

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted.

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The Company is also subject to regulation by various governmental agencies with responsibilities over civil aviation.

Increased regulations imposed by organizations such as the FAA may significantly affect industry operations.

Increased regulations imposed by organizations such as the FAA may significantly affect industry operations and costs.

The Company conducts business in certain foreign countries, some of which are politically unstable or subject to military or civil conflicts.

less developed business practices, difficulty in repossessing Flight Equipment when a lessee defaults, cultural considerations, restriction on fund transfers, and exposure to the FCPA and other anti-bribery laws.

The Company periodically reviews the carrying values of accounts receivable, inventory, goodwill, intangible assets, and long-lived assets;

Consequently, the Company is subject to a variety of risks such as civil strife, political instability, import and export regulations, compliance with foreign laws, treaties, regulations, uncertainties arising from foreign local less developed business practices, difficulty in repossessing Flight Equipment when a lessee defaults, cultural considerations, restriction on fund transfers, and exposure to the Foreign Corrupt Practices Act and other anti-bribery laws.

The Company periodically reviews the carrying values of accounts receivable, inventory, goodwill, other intangible assets, and long-lived assets;

the recoverable value of deferred income tax assets, and the sufficiency of accruals and provisions, substantially all of which are sensitive to the above risks and uncertainties.

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Financial instruments that potentially subject the Company to credit risk principally consist of cash and cash equivalents and accounts receivable.

During the year ended December 31, 2025, no customer accounted more than 10% of total revenue.

During the year ended December 31, 2024, one customer accounted for 15 % of total revenue.

During the year ended December 31, 2023, two customers accounted for 25 % of total revenue.

During the year ended December 31, 2022, one customer accounted for 19 % of total revenue.

No customer made up more than 10% of our trade receivable balance as of December 31, 2024.

One customer made up 20 % of our trade receivable balance as of December 31, 2023.

No customer made up more than 10% of our trade receivable balance as of December 31, 2025 and 2024.

The Company maintains cash and cash equivalent balances with high-quality financial institutions, which at times exceed the Federal Deposit Insurance Corporation insurance limits.

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Contract assets are reported within deposits, prepaid expenses, and other current assets on our Consolidated Balance Sheets.

Changes in contract assets primarily result from the timing difference between the performance of services.

Changes in contract assets primarily result from the timing difference between the performance of

Contract liabilities are reported as deferred revenue on our Consolidated Balance Sheets and amounted to $ 1.8 million as of December 31, 2024, of which $ 0.7 million was related to contract liabilities for services to be performed.

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Less short term

In December 2025, one of our leased warehouses in Roswell, New Mexico was destroyed by a fire;

however, the incident did not cause a significant disruption to the Company’s operations as the Company’s owned and leased Flight Equipment, heavy and component MRO operations, and the vast majority of its USM inventory were located at other facilities not affected by the fire.

The Company filed a claim for the replacement value of the inventory that was destroyed or rendered not sellable by the fire in the amount of $ 1.5 million.

NOTE F - INTANGIBLE ASSETS

In accordance with ASC 350, Intangibles—Goodwill and Other, goodwill and other intangible assets deemed to have indefinite lives are not amortized, but are subject to annual impairment tests.

In accordance with ASC 350, goodwill and other intangible assets deemed to have indefinite lives are not amortized, but are subject to annual impairment tests.

The Company reviews and evaluates its goodwill and indefinite life intangible assets for potential impairment at a minimum annually or more frequently if circumstances indicate that impairment is possible.

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December 31, 2024

Asset Management:

FAA Certifications

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Total intangible assets with indefinite lives

In the first quarter of 2024, the Company identified a triggering event indicating the fair value of one or more of the Company’s reporting units more likely than not did not exceed their carrying values.

The Company performed a qualitative impairment analysis as of October 1, 2025 on the goodwill for the Asset Management Solutions and TechOps segment, and concluded there was no impairment.

In addition, the Company performed a qualitative impairment analysis as of July 1, 2025 on the intangible assets with indefinite lives and concluded there were no impairments.

During the quarter ended December 31, 2025, the Company’s stock price decreased significantly and had not recovered by December 31, 2025, which management considered a triggering event.

As a result, management decided that one or more of the Company’s reporting units more likely than not did not exceed their carrying values.

As such, the quantitative tests did not result in a goodwill impairment for the Company’s reporting units.

The triggering event was due to the significant decline in the market price of the Company’s common stock.

As a result and due to the lack of recovery of the Company’s stock price during the year ended December 31, 2024, the Company performed a quantitative goodwill

impairment test for the Asset Management Solutions and ACT reporting units for each of the quarters ended March 31, 2024, June 30, 2024, September 30, 2024, and December 31, 2024, and determined that the fair values exceeded the carrying values for each reporting unit of as the end of each quarter tested.

As such, the quantitative tests did not result in a goodwill impairment for the Company’s reporting units.

In addition, the Company performed a qualitative assessment as of July 1, 2024 of other intangible assets with indefinite lives and concluded it was unlikely that they were impaired.

The Company performed a quantitative impairment analysis as of October 1, 2023 on the goodwill for the Asset Management Solutions and TechOps segment, and concluded there was no impairment.

The Company performed a qualitative impairment analysis as of July 1, 2024, and a quantitative impairment analysis as of July 1, 2023 on the intangible assets with indefinite lives and concluded there were no impairments, respectively.

Intangible assets with definite useful lives are amortized on a straight-line basis over their estimated useful lives.

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December 31, 2024

Asset Management:

Customer relationships

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Amortization expense

The estimated aggregate amount of amortization expense for intangible assets as follows (in thousands):

The estimated aggregate amount of amortization expense for intangible assets is as follows (in thousands):

Year ending December 31:

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Leasehold improvements

Equipment under capital lease

Flight equipment held for R&D

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Depreciation expense

NOTE H - AIRCRAFT AND ENGINES HELD FOR LEASE AND LEASE, NET

Aircraft and engines held for operating leases, net, consists of the following (in thousands):

NOTE H - AIRCRAFT AND ENGINES HELD FOR LEASE, NET

Aircraft and engines held for operating leases, net, consisted of the following (in thousands):

December 31, 2025

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Less accumulated depreciation

The Company did no t record an impairment of leased assets during the years ended December 31, 2024 and 2023, respectively.

The Company recorded an impairment $ 0.9 million for the year ended December 31, 2022, and is included in cost of leasing in the Consolidated Statements of Operations.

Total depreciation expense included in cost of leasing in the Consolidated Statements of Operations is as follows (in thousands):

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Inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities or market corroborated inputs.

Unobservable inputs for which there is little or no market data and which require the Company to develop our own assumptions about how market participants price the asset or liability.

Unobservable inputs for which there is little or no market data and which require the Company to develop its own assumptions about how market participants price the asset or liability.

The valuation techniques that may be used to measure fair value are as follows:

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The Company’s borrowings under the Revolving Credit Agreement are carried at historical cost and adjusted for principal payments.

Borrowings under the CIBC Equipment Loan (as defined in Note L – Financing Arrangements) approximate fair value due to the variable interest rate on the loan and its origination during the year ended December 31, 2024.

Borrowings under the CIBC Equipment Loan (as defined in Note L – Financing Arrangements) approximate fair value due to the variable interest rate on the loan.

The Company’s borrowings under the Equipment Loan are carried at historical cost and adjusted for principal payments.

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NOTE K - WARRANT LIABILITY

As of December 31, 2024 and 2023, warrants to purchase a total of 623,834 shares of the Company’s common stock were outstanding (the “Private Warrants”).

Each of the Private Warrants entitles the registered holder to purchase one share of the Company’s common stock at a price of $ 11.50 per share, subject to adjustment.

During 2022, a private warrant holder initiated a cashless exercise of 126,166 warrants for the purchase of shares of common stock at an exercise price of $ 11.50 per share and we issued 47,867 shares of common stock based on the fair value at the date of exercise of $ 18.5306 per share.

The remaining Private Warrants will expire at 5:00 p.m., New York City time, on December 22, 2025, or earlier upon redemption or liquidation, as applicable.

The Private Warrants include provisions that affect the settlement amount.

Such variables are outside of those used to determine the fair value of a fixed-for-fixed instrument, and as such, the Private Warrants do not meet the criteria for equity treatment under guidance contained in ASC 815.

The Company classifies the Private Warrants as a liability at their fair value subject to re-measurement at each balance sheet date and adjusted at each reporting period until exercised or expired, and any change in fair value is recognized in the Company's Consolidated Statements of Operations.

The fair value of the Private Warrants was determined using the Black-Scholes option pricing model.

The following table represents the assumptions for the Black-Scholes option-pricing model used in determining the fair value of the Private Warrants as of December 31, 2024 and 2023:

December 31, 2024

As of December 31, 2024, warrants to purchase a total of 623,834 shares of the Company’s common stock were outstanding (the “Private Warrants”).

The Private Warrants expired unexercised during the year ended December 31, 2025.

Each of the Private Warrants entitled the registered holder to purchase one share of the Company’s common stock at a price of $ 11.50 per share, subject to adjustment.

The Private Warrants expired at 5:00 p.m., New York City time, on December 22, 2025.

The Private Warrants included provisions that affected the settlement amount.

Such variables are outside of those used to determine the fair value of a fixed-for-fixed instrument, and as such, the Private Warrants did not meet the criteria for equity treatment under guidance contained in ASC 815.

The Company classified the Private Warrants as a liability at their fair value subject to re-measurement at each balance sheet date and adjusted at each reporting period until exercised or expired, and any change in fair value is recognized in the Company's Consolidated Statements of Operations.

The fair value of the of the Private Warrant as of December 31, 2025 was zero as they expired.

Prior to their expiration, the fair value of the Private Warrants was determined using the Black-Scholes option pricing model.

The following table represents the assumptions for the Black-Scholes option-pricing model used in determining the fair value of the Private Warrants as of December 31, 2024:

December 31, 2024

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Outstanding debt obligations as of December 31, 2025 and 2024 consisted of the following (in thousands):

$ 180.0 million Wells Fargo Senior Secured Revolving Credit Agreement

$ 180.0 million Wells Fargo senior secured revolving credit facility

$ 10.0 million CIBC property and equipment revolving term loan

$ 10.0 million Synovus Property and Equipment Revolving Term Loan

Less current portion

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$ 180.0 million Wells Fargo Senior Secured Revolving Credit Facility

On July 20, 2018, AerSale Inc.

On July 20, 2018, our subsidiary, AerSale, Inc.

and other subsidiary borrowers entered in a secured amended and restated Revolving Credit Agreement (as amended, the “Revolving Credit Agreement”).

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Extensions of credit under the Revolving Credit Agreement are available for working capital and general corporate purposes.

On March 9, 2023, we amended the Revolving Credit Agreement to replace the benchmark rate from LIBOR to Secured Overnight Financing Rate (“SOFR”).

On March 9, 2023, we amended the Revolving Credit Agreement to replace the benchmark rate from the London Interbank Offered Rate (“LIBOR”) to the Secured Overnight Financing Rate (“SOFR”).

On July 25, 2023, the Revolving Credit Agreement was amended to increase the maximum commitments thereunder to $ 180.0 million aggregate amount, expandable to $ 200.0 million, subject to conditions and the availability of lender commitments and borrowing base limitations, and the maturity date was extended to July 24, 2028.

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Such obligations are also secured by substantially all of the assets of the Company.

The interest rate applicable to loans outstanding on the Revolving Credit Agreement is a floating rate of interest per annum of SOFR plus a margin of 2.75 %.

The interest rate applicable to loans outstanding on the Revolving Credit Agreement is a floating rate of interest per annum of SOFR plus a margin of 2.25 % to 2.75 %.

The applicable interest rate as of December 31, 2025 and 2024, was 6.62 % and 7.52 %, respectively.

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The Company was in compliance with these covenants as of December 31, 2025 and 2024.

$ 10.0 million Synovus Property and Equipment Revolving Term Loan

On June 30, 2023, the Company entered into a property and equipment revolving term loan (“Synovus Equipment Loan”) with a total advance commitment of $ 10.0 million for the purpose of financing capital expenditures on property and equipment.

This facility became a term loan during quarter ended June 30, 2024, with a maturity date of June 30, 2027.

This loan is collateralized by the property and equipment it finances and requires principal and interest payments.

The Synovus Equipment Loan bears interest at a rate per annum equal to 7.96 %.

As of December 31, 2024, there was no outstanding balance on the Synovus Equipment Loan.

The Synovus Equipment Loan bore interest at a rate per annum equal to one-month SOFR plus 3.50 %, which was adjusted monthly.

The effective rate on this facility was 8.84 % as of December 31, 2023.

Interest expense on the Equipment Loan was $ 0.2 million for the year ended December 31, 2024, compared to $ 0.4 million for the year ended December 31, 2023.

The Synovus Equipment Loan is subject to ongoing compliance by the Company in the form of various customary affirmative and negative covenants, as well as certain financial covenants.

The Company was in compliance with these covenants as of December 31, 2023.

$ 10.0 million CIBC Property and Equipment Revolving Term Loan

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Advances under this loan are collateralized by the property and equipment it finances and require interest only payment until converted to a term loan, at which point, principal and interest payments are required.

Effective November 30, 2025, we amended the CIBC Equipment Loan to extend the term of the advance commitment until November 30, 2026 and reduce the total advance commitment to $ 2.5 million.

During the year ended December 31, 2025, the Company borrowed an additional $ 1.2 million under this facility, which was converted to a term loan maturing on September 25, 2028.

As of December 31, 2024, borrowings under this facility were converted to a term loan maturing on December 23, 2027.

The effective rate on this facility as of December 31, 2024 was 7.37 %.

For the year ended December 31, 2024, there was no interest expense on the CIBC Equipment Loan.

The effective rate on this facility as of December 31, 2025 and 2024 was 6.84 % and 7.37 %, respectively.

Maturities of the Equipment Loan as of December 31, 2025 are as follows (in thousands):

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The Equipment Loan is subject to ongoing compliance by the Company in the form of various customary affirmative and negative covenants, as well as certain financial covenants.

The Company was in compliance with these covenants as of December 31, 2024.

The Company was in compliance with these covenants as of December 31, 2025 and 2024.

NOTE M - INCOME TAXES

Income tax (benefit) expense consists of (in thousands):

Income tax expense (benefit) consisted of (in thousands):

Year ended December 31, 2025:

Total income tax (benefit) expense

Total income tax expense

Year ended December 31, 2024:

Total income tax expense (benefit)

Total income tax (benefit) expense

Year ended December 31, 2023:

Total income tax expense (benefit)

Total income tax benefit

Tax Rate Reconciliation

The provision for income taxes on pre-tax income differs from the amount computed by applying the U.S.

The provision (benefit) for income taxes on pre-tax income differs from the amount computed by applying the U.S.

federal statutory income tax rate of 21.0 % for the years ended December 31, 2025, 2024 and 2023 due to the following (in thousands):

Year Ended December 31,

federal statutory tax rate

State and local income taxes, net of federal income tax effect (1)

Current state tax provision

Deferred state tax provision

Foreign tax effects

Effects of cross border tax laws

Research and development tax credits

Foreign tax credit

Nontaxable or nondeductible items

Share-based payment awards

Other adjustments

Effective tax rate

(1) States taxes in Florida and Arizona made up the majority (greater than 50 percent) of the tax effect in this category.

(2) Ireland standard corporation tax rate is 12.5 % for the years ended December 31, 2025, 2024, and 2023.

Year Ended December 31,

Provision for income tax at the federal statutory rate

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Stock-based compensation

Total income tax (benefit) expense

Total income tax benefit

Income taxes paid (net of refunds received) were as follows (in thousands):

Year ended December 31,

Total net income taxes refunded

The following jurisdictions individually exceeded 5% of total state income taxes paid (net of refunds received) (in thousands):

Year ended December 31,

All other states

Significant Components of Deferred Taxes

Deferred tax assets and liabilities reflect the net effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

effects of temporary differences that give rise to deferred tax assets and deferred tax liabilities as of December 31, 2024 and 2023 are as follows (in thousands):

The tax effects of temporary differences that give rise to deferred tax assets and deferred tax liabilities as of December 31, 2025 and 2024 are as follows (in thousands):

Year Ended December 31,

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Accrued expenses

Section 174 capitalization

Lease obligations

Section 174 capitalization

Total deferred tax assets

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At December 31, 2025 and December 31, 2024, the Company had net operating losses available for carry-forward for Federal income tax purposes of approximately $ 26.1 million and $ 13.8 million, respectively.

At December 31, 2025, the Company had net operating losses available for carry-forward for State income tax purposes of approximately $ 9.8 million.

These net operating loss carryforwards acquired prior to 2025 will expire on various dates through 2035.

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Additional shares from assumed stock-settled restricted stock units

Additional shares issued under the Employee Stock Purchase Plan

Weighted-average number of shares outstanding - diluted

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Anti-dilutive shares/units excluded from earnings per share - diluted:

Additional shares from assumed exercise of Private Warrants

Additional shares from assumed stock-settled restricted stock units

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The Company’s common stock consist of $ 0.0001 par value, 200,000,000 shares authorized, of which 47,221,513 and 53,252,563 shares were issued and outstanding as of December 31, 2025 and 2024, respectively.

On March 18, 2025, the Company repurchased, directly from a selling stockholder, 6,428,571 shares of the Company’s common stock, par value $ 0.0001 per share, at a price of $ 7.00 per share for total consideration of $ 45.0 million.

The purchased shares were retired.

Effective November 8, 2022, the Board of Directors approved to repurchase, directly from selling stockholders, 1,500,000 shares of the Company’s common stock, par value $ 0.0001 per share, at a price of $ 14.8025 per share for a total of $ 22,203,750 .

2020 Equity Incentive Plan

The Company maintains a 2020 Equity Incentive Plan (the “2020 Plan”) and has registered 6,200,000 shares of common stock issuable under the Plan.

The Company maintains the 2020 Equity Incentive Plan (the “2020 Plan”) and has registered 10,200,000 shares of common stock issuable under the Plan.

The 2020 Plan authorizes discretionary grants of incentive stock options to employees of the Company and its qualifying subsidiaries.

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interpret and administer the 2020 Plans and any agreements and awards thereunder.

Approximately 1,294,229 shares of common stock remain available for future grants.

As of December 31, 2025, 3,185,260 shares of common stock remain available for future grants.

Restricted stock unit activity under the 2020 Plan for the year ended December 31, 2025 and 2024 was as follows:

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Outstanding at December 31, 2023

Outstanding December 31, 2024

Weighted Average

Grant Date Fair Value

Outstanding at December 31, 2024

( 1,192,355 )

Outstanding December 31, 2023

(1) Includes 1,063,333 performance units that vested at the 200 % vesting target effective December 22, 2023, for which 526,888 shares of common stock underlying vested RSUs were withheld to cover tax obligations.

The shares withheld are again available for issuance under the plan.

Outstanding at December 31, 2025

For the restricted stock unit awards granted under the 2020 Plan containing both service and performance conditions, the Company recognizes compensation expense when the awards are considered probable of vesting.

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As of December 31, 2025, the Company’s restricted stock units include 1,536,258 performance-based awards that have vesting provisions subject to both time vesting and the achievement of certain performance milestones ranging from 80 % to 200 % vesting targets, while the remaining 939,089 awards vest over a period ranging from one to three years .

For the year ended December 31, 2024, the Company did not recognize share-based compensation expense for the performance-based awards given that the achievement of the performance milestones have been deemed not probable for accounting purposes.

For the years ended December 31, 2023 and 2022, the Company recognized share-based compensation expense for certain performance-based awards of $ 7.9 million and $ 14.2 million, respectively, given that the achievement of the performance milestones at the 200 % vesting target was deemed probable for accounting purposes.

For the year ended December 31, 2025 and 2023, the Company recognized share-based compensation expense of $ 0.3 million and $ 7.9 million, respectively, for certain performance-based awards given that the achievement of the performance milestones was deemed probable for accounting purposes.

For the year ended December 31, 2024, the

Company did not recognize share-based compensation expense for the performance-based awards given that the achievement of the performance milestones have been deemed not probable for accounting purposes.

Stock Options

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Treasury yield curve in effect at the time of grant, based on the options’ expected term.

The assumptions used in the Black-Scholes option-pricing model for options granted in 2024 are as follows:

The assumptions used in the Black-Scholes option-pricing model for options during the year ended December 31, 2025 and 2024 as follows:

August 6, 2025

August 1, 2025

Risk-free interest rate

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Grant-date fair value (per share)

Stock option activity under the 2020 Plan for the year ended December 31, 2024 was as follows:

Stock option activity under the 2020 Plan for the years ended December 31, 2025 was as follows:

Weighted Average Exercise Price per Share

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Aggregate Intrinsic Value

(in thousands) (1)

Outstanding at December 31, 2023

Outstanding December 31, 2024

Outstanding at December 31, 2024

Outstanding at December 31, 2025

Exercisable at December 31, 2025

Exercisable at December 31, 2024

(1) Total shares valued at the market price of the underlying stock as of December 31, 2025 less the exercise price.

As of December 31, 2024, the unrecognized compensation costs related to these awards was $ 1.6 million.

As of December 31, 2025 and 2024, the unrecognized compensation costs related to these awards was $ 2.1 million and $ 1.6 million, respectively.

The Company expects to recognize those costs over a weighted average period of 1.5 years.

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2020 Employee Stock Purchase Plan

The Company also maintains a 2020 Employee Stock Purchase Plan (the “ESPP”) and has registered 500,000 shares of common stock issuable under the ESPP.

The Company also maintains the 2020 Employee Stock Purchase Plan (the “ESPP”) and has registered 500,000 shares of common stock issuable under the ESPP.

For the years ended December 31, 2025 and 2024, the Company issued 76,256 and 89,923 shares, respectively, pursuant to the ESPP and 235,406 shares remain available for future issuance.

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The Chairman and Chief Executive Officer is our Chief Operating Decision Maker (“CODM”).

We report operational data to our CODM at the segment level, which he uses to evaluate performance and allocate resources based on gross profit and income from operations by segment.

We report operational data to our CODM at the segment level, which he uses to evaluate performance and allocate resources based on gross profit and income (loss) from operations by segment.

While the Company believes there are synergies between the two business segments, they are managed separately because they have different risks and opportunities.

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Cost of sales consists principally of the cost of product, direct labor, and overhead.

Our engineered solutions revenue consist of sales of products internally developed as permitted by Supplemental Type Certificates issued by the FAA.

Our engineered solutions revenue consists of sales of products internally developed as permitted by Supplemental Type Certificates issued by the FAA.

These products are proprietary in nature and function as non-original equipment manufacturer solutions to airworthiness directives and other technical challenges for operators.

In order to develop these products, we engage in research and development activities.

Our TechOps division will engage in the repair and sale of used serviceable materials through their ability to overhaul existing inventory.

The accounting policies for the segments are the same as those described in Note B.

Our TechOps segment will engage in the repair and sale of used serviceable materials through their ability to overhaul existing inventory.

The accounting policies for the segments are the same as those described in Note B – Summary of Significant Accounting Policies.

Our reportable segments are aligned principally around the differences in products and services.

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The assets and certain expenses related to corporate activities are not allocated to the segments.

The segment reporting excludes the allocation of interest expense, interest income, other income (expense), net, change in fair value of warrant liability and income tax expense (benefit).

The segment reporting excludes the allocation of interest (expense) income, net, other income, net, change in fair value of warrant liability, and income tax expense (benefit).

Selected financial information for each segment is as follows (in thousands):

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Year Ended December 31,

Cost of sales and operating expenses

Cost of sales

Asset Management Solutions

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Whole asset sales

The following table reconciles segment gross profit to income (loss) before income tax provision:

The following table reconciles segment gross profit to income (loss) before income tax provision (in thousands):

Year Ended December 31,

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Income (loss) from operations

Other (expenses) income:

Other (expense) income:

Interest (expense) income, net

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Year Ended December 31,

(in thousands)

Asset Management Solutions

Year Ended December 31,

(in thousands)

Total depreciation and amortization expense

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Asset Management Solutions

The following table presents revenue based on the customers’ geographic location and long-lived assets located in the United States, our country of domicile, for the years ended December 31 (in thousands):

The following table presents revenue based on the customers’ geographic location and long-lived assets located in the United States, our country of domicile, as follows (in thousands):

Year Ended December 31,

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Total long-lived assets

For the year ended December 31, 2025, the Company had no customer from which revenue generated exceeded 10% of total sales.

For the year ended December 31, 2024, the Company had one customer from which revenue generated exceeded 10 % of total sales.

Total sales to this customer amounted to $ 50.9 million, of which $ 33.5 million was included in TechOps segment and $ 17.4 million was included in the Asset Management Solutions segment.

As of December 31, 2023, the Company had two customers from which revenue generated exceeded 10 % of total sales.

Total sales to these customers amounted to $ 82.2 million, of which $ 35.7 million was included in TechOps segment and $ 46.5 million was included in the Asset Management Solutions segment.

Intersegment sales includes amounts invoiced by a segment for work performed for another segment.

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ROU assets are evaluated for impairment in a manner consistent with the treatment of other long-lived assets.

The Company made an accounting policy election to not recognize lease assets or liabilities for leases with a term of 12 months or less.

The Company made an accounting policy election to not recognize lease assets or liabilities for leases with a term of twelve months or less.

The components of lease expense for the years ended December 31, 2025, 2024, and 2023 were as follows (in thousands):

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Our weighted-average remaining lease term and weighted-average discount rate are as follows:

Year Ended December 31,

Remaining lease term (years)

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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 8. Financial Statements and Supplementary Data