What changed in this filing

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Item 1. Financial Statements

2025-04-30 compared with 2024-10-30 · 99 added, 186 removed, 351 unchanged (45% of the section changed)

4 unchanged sentences

(In Thousands, Except Per Share Amounts)

September 30,

2025 December 31,

1 unchanged sentence

Cash and cash equivalents $ 99,885 $ 122,721

Short-term investments — 52,975

Accounts receivable, less allowance for credit losses of $ 400 and $ 500

Accounts receivable, less allowance for credit losses of $ 550

63,323 60,339

33 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Revenue $ 123,620 $ 108,851

10 unchanged sentences

Loss on debt extinguishment

— — ( 1,362 ) —

Other income (expense)

260 ( 62 ) 206 ( 40 )

Other expense ( 180 ) ( 82 )

Loss before income tax expense ( 6,508 ) ( 13,086 )

14 unchanged sentences

(In Thousands)

Three-Month Period Ended September 30, 2023

Deficit Accumulated

Comprehensive

Income (Loss)

Stockholders’

Balance—June 30, 2023

47,352 $ 47 $ 803,197 $ ( 338,213 ) $ ( 2,609 ) $ 462,422

Impact of equity compensation plans 40 — 9,041 — — 9,041

Other comprehensive income — — — — 425 425

Net loss — — — ( 9,055 ) — ( 9,055 )

Balance—September 30, 2023

47,392 $ 47 $ 812,238 $ ( 347,268 ) $ ( 2,184 ) $ 462,833

Three-Month Period Ended September 30, 2024

Deficit Accumulated

Comprehensive

Income (Loss)

Stockholders’

Balance—June 30, 2024

48,686 $ 49 $ 840,939 $ ( 378,334 ) $ ( 569 ) $ 462,085

Impact of equity compensation plans 62 — 10,367 — — 10,367

Other comprehensive income — — — — 422 422

Net loss — — — ( 7,853 ) — ( 7,853 )

Balance—September 30, 2024

48,748 $ 49 $ 851,306 $ ( 386,187 ) $ ( 147 ) $ 465,021

Nine-Month Period Ended September 30, 2023

Three-Month Period Ended March 31, 2024

Deficit Accumulated

7 unchanged sentences

Net loss — — — ( 13,269 ) — ( 13,269 )

Balance—September 30, 2023

Balance—March 31, 2024

48,381 $ 48 $ 827,288 $ ( 370,326 ) $ ( 697 ) $ 456,313

Nine-Month Period Ended September 30, 2024

Three-Month Period Ended March 31, 2025

Deficit Accumulated

7 unchanged sentences

Net loss — — — ( 6,747 ) — ( 6,747 )

Balance—September 30, 2024

Balance—March 31, 2025

49,493 $ 49 $ 863,302 $ ( 408,502 ) $ ( 230 ) $ 454,619

4 unchanged sentences

(In Thousands)

Nine Months Ended

September 30,

Three Months Ended

Cash flows from operating activities:

Net loss $ ( 6,747 ) $ ( 13,269 )

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

Adjustments to reconcile net loss to net cash used in operating activities:

Share-based compensation expense 9,630 9,265

12 unchanged sentences

Other noncurrent assets and liabilities ( 504 ) ( 112 )

Net cash provided by operating activities 6,368 454

Net cash used in operating activities ( 11,026 ) ( 21,016 )

Cash flows from investing activities:

1 unchanged sentence

Purchases of property and equipment ( 2,181 ) ( 2,774 )

Proceeds from sale of property and equipment 25 —

Acquisition of intellectual property — ( 30,000 )

Net cash provided by investing activities 44,927 24,603

Proceeds from capital grant 500 —

Net cash (used in) provided by investing activities ( 1,681 ) 9,644

Cash flows from financing activities:

2 unchanged sentences

Payment of financing costs and bank fees

( 1,069 ) ( 60 )

Proceeds from stock option exercises and employee stock purchase plan

Proceeds from stock option exercises

Shares repurchased for payment of taxes on stock awards ( 10,172 ) ( 6,537 )

1 unchanged sentence

Effect of exchange rate changes on cash and cash equivalents 196 ( 109 )

Net increase in cash and cash equivalents

Net decrease in cash and cash equivalents

( 22,836 ) ( 19,343 )

3 unchanged sentences

Cash paid for interest $ 1,246 $ 726

Net cash paid for income taxes 576 228

Cash paid for taxes, net of refunds 116 17

Non-cash investing and financing activities:

16 unchanged sentences

The accompanying interim financial statements should be read in conjunction with the Company’s audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC.

There have been no changes in the Company's significant accounting policies for the nine months ended September 30, 2024 as compared to the significant accounting policies described in the Company's Annual Report on Form 10-K for the year ended December 31, 2023.

Use of Estimates —The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including inventories, intangible assets, valuation allowance for deferred income tax assets, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense, including share-based compensation expense.

Estimates are based on historical experience, where applicable, and other reasonable assumptions.

There have been no changes in the Company's significant accounting policies for the three months ended March 31, 2025 as compared to the significant accounting policies described in the Company's Annual Report on Form 10-K for the year ended December 31, 2024.

Use of Estimates —The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense.

Actual results could differ from those estimates.

Segments —The Company's chief operating decision maker is its Chief Executive Officer, who reviews financial information presented on a consolidated basis, accompanied only by revenue information by product type and geographic area, for purposes of allocating resources and evaluating financial performance.

Accordingly, the Company has determined that it has a single operating segment.

The Company’s long-lived assets are located in the United States, except for $ 4,278 as of September 30, 2024 and $ 3,432 as of December 31, 2023 located primarily in Europe.

Segments —The Company evaluates reporting segments in accordance with the Financial Accounting Standards Board's (FASB) Accounting Standards Codification (ASC) 280, "Segment Reporting".

The chief operating decision maker is its Chief Executive Officer.

The Company has one business activity and operates as one operating segment:

the development, manufacture and sale of devices used by cardiothoracic and thoracic surgeons in surgical procedures, designed primarily for the ablation of cardiac tissue, the exclusion of the left atrial appendage and the ablation of peripheral nerves.

These devices are developed and marketed to a broad base of medical centers globally.

Management considers all such sales to be part of the single operating segment.

The Chief Executive Officer is regularly provided with consolidated expenses consistent with the presented consolidated statements of operations, accompanied by revenue information by product type and geographic area, for purposes of allocating resources and evaluating financial performance.

Revenue by product type and geographic area is included at Note 9 – Revenue.

The Company’s long-lived assets are located in the United States, except for $ 5,670 as of March 31, 2025 and $ 4,021 as of December 31, 2024 located primarily in Europe.

Earnings Per Share —Basic and diluted net loss per share are computed by dividing the net loss by the weighted average number of common shares outstanding during the period.

Since the Company has experienced net losses for all periods presented, net loss per share excludes the effect of 2,724 and 1,776 shares as of September 30, 2024 and 2023 because they are anti-dilutive.

Since the Company has experienced net losses for all periods presented, net loss per share excludes the effect of 3,008 and 2,615 shares as of March 31, 2025 and 2024 because they are anti-dilutive.

Therefore, the number of shares used for basic and diluted net loss per share are the same.

The Financial Accounting Standards Board’s (FASB) Accounting Standards Codification (ASC) 820, “Fair Value Measurements and Disclosures” (ASC 820), defines fair value as the exchange price that would be received for an asset or paid to settle a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs.

The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value:

• Level 1—Quoted prices in active markets for identical assets or liabilities.

Fair value is defined as the exchange price that would be received for an asset or paid to settle a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

To measure fair value of assets and liabilities, the Company uses the following fair value hierarchy based on three levels of inputs:

• Level 1—Observable inputs, such as quoted prices in active markets for identical assets or liabilities.

• Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities;

1 unchanged sentence

or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

• Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

ATRICURE, INC.

2 unchanged sentences

(In Thousands, except per share amounts)

The following table represents the Company’s fair value hierarchy for its financial assets measured at fair value on a recurring basis as of September 30, 2024:

• Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The following table represents the Company’s fair value hierarchy for its financial assets measured at fair value on a recurring basis as of March 31, 2025:

Quoted Prices in

7 unchanged sentences

Total assets $ 83,368 $ — $ — $ 83,368

There were no changes in the levels or methodology of measurement of financial assets and liabilities during the three and nine months ended September 30, 2024.

There were no changes in the levels or methodology of measurement of financial assets and liabilities during the three months ended March 31, 2025.

The following table represents the Company’s fair value hierarchy for its financial assets measured at fair value on a recurring basis as of December 31, 2024:

7 unchanged sentences

Money market funds $ 101,147 $ — $ — $ 101,147

Government and agency obligations 12,711 — — 12,711

Corporate bonds — 38,033 — 38,033

Asset-backed securities — 2,231 — 2,231

Total assets $ 101,147 $ — $ — $ 101,147

2 unchanged sentences

The PMA approval milestone expired December 31, 2023, while the achievement period for the reimbursement milestone expires on December 31, 2026.

The Company assessed the projected probability of payment during the contractual achievement periods to be remote, resulting in no reported fair value as of September 30, 2024 and December 31, 2023.

The Company had no investments as of September 30, 2024.

Investments as of December 31, 2023 consisted of the following:

Cost Basis Unrealized

Losses Fair Value

Corporate bonds $ 38,514 $ ( 481 ) $ 38,033

Government and agency obligations 12,998 ( 287 ) 12,711

Asset-backed securities 2,263 ( 32 ) 2,231

Total $ 53,775 $ ( 800 ) $ 52,975

The gross realized gains or losses from sales of available-for-sale investments were not significant in the three and nine months ended September 30, 2024 and 2023.

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

The Company assessed the projected probability of payment during the contractual achievement periods to be remote, resulting in no reported fair value as of March 31, 2025 and December 31, 2024.

Inventories consist of the following:

September 30,

2025 December 31,

3 unchanged sentences

Total $ 74,911 $ 75,335

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

INTANGIBLE ASSETS

The following table provides a summary of the Company’s intangible assets:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Cost Accumulated

5 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Cost of revenues $ 1,350 $ 1,125

Research and development expenses

761 739 2,259 2,215

Total $ 2,110 $ 1,863

Future amortization expense is projected as follows:

2024 (excluding the nine months ended September 30, 2024)

2025 (excluding the three months ended March 31, 2025)

2030 and thereafter

2 unchanged sentences

Accrued liabilities consist of the following:

September 30,

2025 December 31,

3 unchanged sentences

Total $ 33,205 $ 45,587

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

On January 5, 2024, the Company entered into a credit agreement (Credit Agreement) with JPMorgan Chase Bank, N.A., as administrative agent, and JPMorgan Chase Bank, N.A., as bookrunner and lead arranger (JPMCB), and Silicon Valley Bank, a Division of First-Citizens Bank & Trust Company, as Joint Lead Arrangers and Joint Bookrunners, and the lenders party thereto (Lenders).

The Company has a credit agreement (Credit Agreement) with JPMorgan Chase Bank, N.A., as administrative agent, and JPMorgan Chase Bank, N.A., as bookrunner and lead arranger (JPMCB), and Silicon Valley Bank, a Division of First-Citizens Bank & Trust Company, as Joint Lead Arrangers and Joint Bookrunners, and the lenders party thereto (Lenders) effective January 5, 2024.

The Credit Agreement provides for an asset based revolving credit facility (ABL Facility) in an amount of up to $ 125,000 .

4 unchanged sentences

Any such swingline loans will reduce availability under the ABL Facility on a dollar-for-dollar basis.

At closing, the Company borrowed $ 61,865 .

The proceeds of the ABL Facility were used to terminate the Company’s outstanding indebtedness and final fee under the Loan and Security Agreement with Silicon Valley Bank (SVB Loan Agreement).

Certain prepayment and early termination fees under the SVB Loan Agreement were waived at termination.

The termination of the SVB Loan Agreement was treated as a debt extinguishment and the resulting loss on debt extinguishment is $ 1,362 .

As of September 30, 2024, the Company had borrowings of $ 61,865 and had borrowing capacity of $ 61,885 under the ABL facility.

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

The Credit Agreement has a three-year term, and all outstanding borrowings are due upon maturity of the Credit Agreement on January 5, 2027.

Through January 2025, the Company's required minimum utilization of the ABL facility is 40 % of the aggregate revolving commitment or $ 50,000 .

Subject to customary exceptions and restrictions, the Company may voluntarily prepay outstanding amounts under the ABL Facility at any time thereafter without premium or penalty.

1 unchanged sentence

The Credit Agreement contains mandatory prepayment provisions which require prepayment of amounts outstanding under the ABL Facility upon specified events or Availability shortfall.

As of March 31, 2025, the Company had borrowings of $ 61,865 and had borrowing capacity of $ 61,885 under the ABL facility.

Future maturities of long-term debt are projected as follows:

2024 (excluding the nine months ended September 30, 2024) $ —

2025 (excluding the three months ended March 31, 2025) $ —

Total long-term debt, of which $ 61,865 is noncurrent

6 unchanged sentences

Participation and fronting fees are accrued and paid on a quarterly basis.

As of March 31, 2025, the effective interest rate on the ABL Facility was 6.92 %.

The ABL Facility is secured by the assets of the Company, consisting of personal, tangible or intangible property, including certain outstanding equity interests of the Company’s direct subsidiaries, subject to limitations specified in the Credit Agreement.

The Credit Agreement contains customary representations and warranties, events of default and financial, affirmative and negative covenants for facilities of this type, including but not limited to financial covenants relating to a fixed charge coverage ratio, a minimum liquidity requirement and a minimum excess availability requirement, and restrictions on indebtedness, liens, investments and acquisitions, asset dispositions, specified agreements, restricted payments and prepayment of certain indebtedness.

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

The Company has operating and finance leases for office, manufacturing and warehouse facilities and automobiles.

The Company’s leases have remaining lease terms of less than one year to nine years .

The Company’s leases have remaining lease terms of less than one year to eleven years .

Options to renew or extend leases beyond their initial term have been excluded from measurement of the right-of-use (ROU) assets and lease liabilities as exercise is not reasonably certain.

The weighted average remaining lease term and the discount rate for the reporting periods are as follows:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Operating Leases

4 unchanged sentences

Weighted average discount rate 7.0 % 7.0 %

A letter of credit for $ 1,250 issued to the lessor of the Company's corporate headquarters building is renewed annually and remains outstanding as of September 30, 2024.

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

A letter of credit for $ 1,250 issued to the lessor of the Company's corporate headquarters building is renewed annually and remains outstanding as of March 31, 2025.

The components of lease expense are as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Operating lease cost $ 466 $ 380

3 unchanged sentences

Total finance lease cost $ 409 $ 412

Short-term lease expense was not significant for the three and nine months ended September 30, 2024 and 2023.

Short-term lease expense was not significant for the three months ended March 31, 2025 and 2024.

Supplemental cash flow information related to leases is as follows:

Nine Months Ended

September 30, 2024 Nine Months Ended

September 30, 2023

Three Months Ended

March 31, 2025 Three Months Ended

March 31, 2024

Cash paid for amounts included in the measurement of lease liabilities:

10 unchanged sentences

Supplemental balance sheet information related to leases is as follows:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Operating Leases

12 unchanged sentences

Total finance lease liabilities $ 8,180 $ 8,467

Future maturities of lease liabilities as of September 30, 2024 are as follows:

Future maturities of lease liabilities as of March 31, 2025 are as follows:

Operating Leases Finance Leases

2024 (excluding the nine months ended September 30, 2024)

2025 (excluding the three months ended March 31, 2025)

$ 1,417 $ 1,309

2 unchanged sentences

2028 1,237 1,842

2029 883 1,818

2030 and thereafter

3 unchanged sentences

COMMITMENTS AND CONTINGENCIES

License Agreement.

The Company had been a party to a license agreement that required royalty payments of 5 % of specified product sales.

In May 2023, the Company entered into an agreement that terminated the license agreement and the Company's obligations to make royalty payments under the license agreement.

See Legal section below for additional information.

Cooperation Agreement.

The Company holds an exclusive licensing agreement (Cooperation Agreement) to co-develop and commercialize equipment incorporating pulsed field ablation (PFA) technology.

The Cooperation Agreement requires the Company to pay contingent consideration, settled in cash, with a maximum payout of $ 28,000 if all milestones are achieved successfully through the agreement term ending 2034.

The contingent consideration will be expensed when each milestone is paid or becomes payable as a result of achievement.

As of March 31, 2025, the milestones were not yet achieved and therefore, there is no financial impact during the period.

The agreement also contains provisions requiring future royalty payments on devices incorporating co-developed technology upon commercialization.

Purchase Agreements.

The Company enters into standard purchase agreements with suppliers in the ordinary course of business, generally with terms that allow cancellation.

The Company may, from time to time, become a party to legal proceedings.

Such matters are subject to many uncertainties and to outcomes of which the financial impacts are not predictable with assurance and that may not be known for extended periods of time.

A liability is established once management determines a loss is probable and an amount can be reasonably estimated.

The Company recognizes income from a favorable resolution of legal proceedings when the associated cash or assets are received.

In 2022, the Company entered into a clinical trial management agreement for the LeAAPS clinical trial.

The terms of the agreement require payments upon achievement of various enrollment and project milestones over the estimated ten-year term, yet the agreement may be terminated early for any reason.

Furthermore, we incur additional variable costs, including pass through costs from clinical trial sites.

Payments made under this agreement were $ 4,112 and $ 2,787 for the three months ended March 31, 2025 and 2024.

ATRICURE, INC.

2 unchanged sentences

(In Thousands, except per share amounts)

The Company received a Civil Investigative Demand from the U.S.

Department of Justice (USDOJ) in December 2017 stating that it was investigating the Company to determine whether the Company has violated the False Claims Act, relating to the promotion of certain medical devices related to the treatment of atrial fibrillation for off-label use and submitted or caused to be submitted false claims to certain federal and state health care programs for medically unnecessary healthcare services.

In March 2021, USDOJ informed the Company that its investigation was based on a lawsuit brought on behalf of the United States and various state and local governments under the qui tam provisions of federal and certain state and local False Claims Acts.

Although the USDOJ and all of the state and local governments declined to intervene, the relator continued to pursue the case.

During the third quarter of 2022, the relator filed a Fourth Amended Complaint, which alleged that the Company paid illegal kickbacks.

In September 2024, the District Court granted the Company's motion to dismiss the Fourth Amended Complaint and denied the relator's request for leave to further amend the complaint.

On August 23, 2022, the Cleveland Clinic Foundation (“CCF”) and IDx Medical, Ltd.

(“IDx”) filed a Demand for Arbitration against the Company with the American Arbitration Association (“AAA”), alleging that the Company breached certain provisions of the License Agreement dated December 9, 2003 among the Company, Clinic and IDx (“License Agreement”).

Clinic and IDx alleged that the Company did not include the revenues from sales of certain products in its royalty payments due under the License Agreement, and the Company did not provide related notices required under the License Agreement.

The Company filed its Answering Statement and Counterclaims to the allegations in September 2022, denying each claim and counterclaiming for breach of contract, correction of inventorship, declaratory judgment, patent prosecution and legal fees.

In May 2023, the Company entered into an Assignment and Agreement Regarding IDx and CCF Intellectual property (“Assignment Agreement”) with Clinic and IDx.

Pursuant to the Assignment Agreement, during the second quarter of 2023, the Company made a one-time payment of $ 33,400 to Clinic and IDx for the acquisition of patents and other intellectual property.

The Assignment Agreement also requires dismissal of the arbitration and release of payment for royalty obligations due to Clinic and IDx under the License Agreement after March 31, 2023.

The amount paid, together with transaction costs, was allocated between the acquired intangible asset, the release of payment for royalty obligations and the settlement of the dispute.

The intangible asset was assigned a value of $ 30,000 and is being amortized over an estimated useful life of 5 years.

The release of the royalty obligations was valued at $ 432 .

The remaining $ 3,088 was allocated to the settlement and was included in selling, general and administrative expenses for the nine months ended September 30, 2023.

During the first quarter of 2023, the Company entered into a legal settlement for $ 7,500 in connection with the settlement of claims filed against a competitor.

The Company recorded a $ 7,500 gain for the nine months ended September 30, 2023 for the proceeds received as a reduction to selling, general and administrative expenses.

The Company may, from time to time, become a party to legal proceedings which are subject to many uncertainties.

Litigation and administrative proceedings over patent and other intellectual property rights are common in our industry, as are requests for information related to interactions with medical professionals.

Accordingly, the financial impact of ultimate resolutions from legal proceedings may not be known for extended periods of time and are not predictable with assurance.

A liability is established once management determines a loss is probable and an amount can be reasonably estimated.

The Company recognizes income from a favorable resolution of legal proceedings when the associated cash or assets are received.

On February 7, 2025, representatives for former securityholders of SentreHEART, Inc.

filed a complaint in the Delaware Court of Chancery naming the Company as a defendant.

The Company acquired SentreHEART, Inc.

pursuant to a merger agreement dated August 11, 2019.

The merger agreement provides for contingent consideration to be paid upon achievement of specified PMA and CPT reimbursement milestones by specified dates.

The complaint alleges breach of contract and a related claim for breach of the implied covenant of good faith and fair dealing resulting from the Company's alleged failure to use commercially reasonable efforts to obtain premarket approval from FDA for the LARIAT System.

The complaint seeks damages in the amount of the original PMA and CPT reimbursement milestones of up to $ 260,000 plus interest.

The Company intends to vigorously defend this claim.

A liability has not been recognized related to this matter because any potential loss is not currently probable or reasonably estimable.

The Company develops, manufactures and sells devices designed for surgical ablation of cardiac tissue, exclusion of the left atrial appendage, and temporarily blocking pain by ablating peripheral nerves.

3 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Open ablation $ 33,308 $ 29,300

1 unchanged sentence

Pain management 17,270 12,739

Total ablation $ 58,032 $ 49,328 $ 169,983 $ 146,137

Appendage management 42,091 35,892

Total United States $ 101,149 $ 90,249

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

International revenue by product type is as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Open ablation $ 8,995 $ 7,902

1 unchanged sentence

Pain management 1,789 937

Total ablation $ 11,878 $ 10,132 $ 35,006 $ 29,049

Appendage management 9,674 7,649

Total International $ 22,471 $ 18,602

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

Revenue attributed to customer geographic locations is as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

United States $ 101,149 $ 90,249

10 unchanged sentences

The Company is unable to estimate the annual effective tax rate with sufficient precision to use the effective tax rate method, which requires a full-year projection of income.

The effective tax rate for the three months ended September 30, 2024 and 2023 was ( 4.3 %) and ( 0.5 %).

The effective tax rate for the nine months ended September 30, 2024 and 2023 was ( 2.7 %) and ( 1.1 %).

The effective tax rate for the three months ended March 31, 2025 and 2024 was ( 3.7 %) and ( 1.4 %).

The Company’s worldwide effective tax rate differs from the US statutory rate of 21% primarily due to valuation allowances.

6 unchanged sentences

Stock Incentive Plan

Under the 2023 Plan, the Board of Directors may grant restricted stock awards or restricted stock units (collectively RSAs), nonstatutory stock options, performance share awards (PSAs) or stock appreciation rights to Company employees, directors and consultants, and may grant incentive stock options to Company employees.

Under the 2023 Plan, the Board of Directors may grant restricted stock awards or restricted stock units (collectively RSAs), nonstatutory stock options, performance share awards, performance share units or stock appreciation rights to Company employees, directors and consultants, and may grant incentive stock options to Company employees.

The Compensation Committee of the Board of Directors, as the administrator of the 2023 Plan, has the authority to determine the terms of any awards, including the number of shares subject to each award, the exercisability of the awards and the form of consideration.

As of September 30,

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

2024, 4,087 shares of common stock have been reserved for issuance under the 2023 Plan, and 2,482 shares were available for future grants.

As of March 31, 2025, 4,087 shares of common stock have been reserved for issuance under the 2023 Plan, and 1,486 shares were available for future grants.

The Company issues registered shares of common stock for stock option exercises, restricted stock grants and performance share award payments.

3 unchanged sentences

Participants may not purchase more than $ 25 of the Company’s common stock in a calendar year or more than 3 shares during an offering period.

As of September 30, 2024, there were 621 shares available for future issuance under the ESPP.

As of March 31, 2025, there were 519 shares available for future issuance under the ESPP.

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

Share-Based Compensation Expense Information

1 unchanged sentence

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Cost of revenue $ 669 $ 530

6 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Total accumulated other comprehensive loss at beginning of period $ ( 1,035 ) $ ( 993 )

6 unchanged sentences

Other comprehensive income (loss) before reclassifications

586 ( 286 ) 199 ( 133 )

Amounts reclassified to other (expense) income

( 179 ) 10 ( 153 ) ( 124 )

Amounts reclassified to other income 88 19

Balance at end of period $ ( 230 ) $ ( 436 )

Total accumulated other comprehensive loss at end of period $ ( 230 ) $ ( 697 )

ATRICURE, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In Thousands, except per share amounts)

SUBSEQUENT EVENT

During October 2024, the Company entered into an exclusive licensing agreement with a third-party to co-develop and commercialize equipment incorporating pulsed field ablation (PFA) technology.

The agreement requires upfront payment of $ 12,000 during the fourth quarter of 2024 and obligates the Company to pay up to $ 28,000 in additional consideration if defined milestones are met during specified periods concluding ten years from the effective date.

The agreement also contains provisions requiring future royalty payments on devices incorporating co-developed technology upon commercialization.

There was no financial impact during the third quarter of 2024 related to the agreement.

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-Q

Item 1. Financial Statements