CODEXIS, INC. 10-Q

Item 1. Financial Statements Codexis, Inc. Condensed Consolidated Balance Sheets (Unaudited) (In Thousands, Except Per Share Amounts) March 31, 2026 December 31, 2025 Assets Current assets: Cash and cash equivalents $ 36,571 $ 50,793 Restricted cash, current 425 478 Short-term investments 28,569 27,416 Financial assets: Accounts receivable 6,777 8,757 Contract assets 441 492 Unbilled receivables 852 1,480 Total financial assets 8,070 10,729 Less: allowances ( 43 ) ( 43 ) Total financial assets, net 8,027 10,686 Inventories 2,000 1,817 Prepaid expenses and other current assets 4,057 5,626 Total current assets 79,649 96,816 Restricted cash 1,612 1,612 Investment in non-marketable equity securities 2,498 2,498 Right-of-use assets - Operating leases, net 29,566 30,501 Property and equipment, net 12,588 13,024 Goodwill 2,463 2,463 Other non-current assets 994 883 Total assets $ 129,370 $ 147,797 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 2,127 $ 1,554 Accrued compensation 5,359 11,042 Other accrued liabilities 3,196 2,768 Current portion of lease obligations - Operating leases 3,302 2,944 Deferred revenue 866 7,009 Total current liabilities 14,850 25,317 Deferred revenue, net of current portion 350 360 Long-term lease obligations - Operating leases 29,118 30,159 Long-term debt 40,483 40,105 Other long-term liabilities 1,335 1,327 Total liabilities 86,136 97,268 Commitments and Contingencies (Note 10) Stockholders' equity: Preferred stock, $ 0.0001 par value per share; 5,000 shares authorized, none issued and outstanding — — Common stock, $ 0.0001 par value per share; 200,000 shares authorized; 90,894 shares and 90,478 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively 9 9 Additional paid-in capital 658,720 657,292 Accumulated other comprehensive income (loss) ( 11 ) 8 Accumulated deficit ( 615,484 ) ( 606,780 ) Total stockholders' equity 43,234 50,529 Total liabilities and stockholders' equity $ 129,370 $ 147,797 See accompanying notes to the unaudited condensed consolidated financial statements. 3 Codexis, Inc. Condensed Consolidated Statements of Operations (Unaudited) (In Thousands, Except Per Share Amounts) Three Months Ended March 31, 2026 2025 Revenues: Product revenue $ 7,191 $ 6,059 Research and development revenue 8,057 1,484 Total revenues 15,248 7,543 Costs and operating expenses: Cost of product revenue 2,064 2,732 Research and development 11,448 12,942 Selling, general and administrative 9,779 12,355 Total costs and operating expenses 23,291 28,029 Loss from operations ( 8,043 ) ( 20,486 ) Interest income 665 751 Interest and other expense, net ( 1,290 ) ( 942 ) Loss before income taxes ( 8,668 ) ( 20,677 ) Provision for income taxes ( 36 ) ( 11 ) Net loss $ ( 8,704 ) $ ( 20,688 ) Net loss per share, basic and diluted $ ( 0.10 ) $ ( 0.25 ) Weighted average common stock shares used in computing net loss per share, basic and diluted 90,768 82,410 See accompanying notes to the unaudited condensed consolidated financial statements. 4 Codexis, Inc. Condensed Consolidated Statements of Comprehensive Loss (Unaudited) (In Thousands) Three Months Ended March 31, 2026 2025 Net loss $ ( 8,704 ) $ ( 20,688 ) Other comprehensive loss: Unrealized loss on available-for-sale short-term investments, net of tax ( 19 ) ( 38 ) Comprehensive loss $ ( 8,723 ) $ ( 20,726 ) See accompanying notes to the unaudited condensed consolidated financial statements. 5 Codexis, Inc. Condensed Consolidated Statements of Stockholders' Equity (Unaudited) (In Thousands) Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Stockholders' Equity Three Months Ended March 31, 2026 Shares Amount Balance as of January 1, 2026 90,478 $ 9 $ 657,292 $ 8 $ ( 606,780 ) $ 50,529 Issuance of common stock upon release of stock awards 416 — — — — — Stock-based compensation — — 1,428 — — 1,428 Net loss — — — — ( 8,704 ) ( 8,704 ) Other comprehensive loss — — — ( 19 ) — ( 19 ) Balance as of March 31, 2026 90,894 $ 9 $ 658,720 $ ( 11 ) $ ( 615,484 ) $ 43,234 Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Stockholders' Equity Three Months Ended March 31, 2025 Shares Amount Balance as of January 1, 2025 81,850 $ 8 $ 629,673 $ 52 $ ( 562,806 ) $ 66,927 Issuance of common stock upon exercise of stock options 339 — 1,049 — — 1,049 Issuance of common stock upon release of stock awards 652 — — — — — Stock-based compensation — — 2,379 — — 2,379 Net loss — — — — ( 20,688 ) ( 20,688 ) Other comprehensive loss — — — ( 38 ) — ( 38 ) Balance as of March 31, 2025 82,841 $ 8 $ 633,101 $ 14 $ ( 583,494 ) $ 49,629 See accompanying notes to the unaudited condensed consolidated financial statements. 6 Codexis, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) (In Thousands) Three Months Ended March 31, 2026 2025 Operating activities: Net loss $ ( 8,704 ) $ ( 20,688 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 1,286 1,195 Reduction in the carrying amount of right-of-use assets 935 714 Stock-based compensation 1,428 2,379 Provision (recovery) for credit losses — ( 113 ) Non-cash interest expense 376 281 Amortization of discount on short-term investments ( 238 ) ( 330 ) Other non-cash items — ( 3 ) Changes in operating assets and liabilities: Financial assets 2,479 7,426 Inventories ( 183 ) 18 Prepaid expenses and other assets 1,701 31 Accounts payable 312 2,065 Accrued compensation and other accrued liabilities ( 5,356 ) ( 6,501 ) Other long-term liabilities ( 1,033 ) ( 750 ) Deferred revenue ( 6,153 ) 478 Net cash used in operating activities ( 13,150 ) ( 13,798 ) Investing activities: Purchase of property and equipment ( 176 ) ( 1,255 ) Purchases of short-term investments ( 20,025 ) ( 10,326 ) Proceeds from maturity of short-term investments 19,090 23,350 Net cash provided by (used in) investing activities ( 1,111 ) 11,769 Financing activities: Proceeds from exercises of stock options — 1,098 Costs incurred in connection with equity sales agreements ( 14 ) ( 13 ) Net cash provided by (used in) financing activities ( 14 ) 1,085 Net decrease in cash, cash equivalents and restricted cash ( 14,275 ) ( 944 ) Cash, cash equivalents and restricted cash at the beginning of the period 52,883 20,829 Cash, cash equivalents and restricted cash at the end of the period $ 38,608 $ 19,885 7 Supplemental disclosure of cash flow information: Interest paid $ 892 $ 432 Income taxes paid $ 36 $ — Supplemental non-cash investing and financing activities: Capital expenditures incurred but not yet paid $ 604 $ 2,073 The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the unaudited condensed consolidated balance sheets as of March 31, 2026 and 2025 to the total of the same such amounts shown above in the unaudited condensed consolidated statements of cash flows: March 31, 2026 2025 Cash and cash equivalents $ 36,571 $ 18,319 Restricted cash, current and non-current 2,037 1,566 Total cash, cash equivalents and restricted cash $ 38,608 $ 19,885 This table excludes short-term investments of $ 28.6 million and $ 41.5 million as of March 31, 2026 and 2025, respectively. Total cash, cash equivalents, and short-term investments as of March 31, 2026 and 2025 were $ 65.1 million and $ 59.8 million, respectively. See accompanying notes to the unaudited condensed consolidated financial statements. 8 Codexis, Inc. Notes to Condensed Consolidated Financial Statements (Unaudited) Note 1. Description of Business In these notes to the unaudited condensed consolidated financial statements, the “Company,” “we,” “us,” and “our” refers to Codexis, Inc. and its subsidiaries on a consolidated basis. We discover, develop, enhance, and commercialize novel, high performance enzymes and other classes of proteins leveraging our proprietary CodeEvolver directed evolution technology platform. The Company's operations are managed and reported to the Chief Executive Officer (“CEO”), our chief operating decision maker (“CODM”), on a consolidated basis as one reportable segment. Note 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the applicable rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information but does not include all the information and notes required by GAAP for complete financial statements. These interim unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2025. The condensed consolidated balance sheet at December 31, 2025 has been derived from the audited consolidated financial statements at that date, but does not include all disclosures, including notes, required by GAAP for complete financial statements. The significant accounting policies used in preparation of the unaudited condensed consolidated financial statements for the three months ended March 31, 2026 and 2025, are consistent with those discussed in Note 2 to the audited consolidated financial statements in the Company’s 2025 Annual Report on Form 10-K. There have been no significant changes in our significant accounting policies or critical accounting estimates since December 31, 2025. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments of a normal recurring nature considered necessary to present fairly our financial position as of March 31, 2026 and results of operations for the interim periods presented. The interim results are not necessarily indicative of the results for any future interim period or for the entire year. The unaudited condensed consolidated financial statements include the accounts of Codexis, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of our unaudited condensed consolidated financial statements in conformity with GAAP requires us to make estimates, judgments and assumptions that may affect the reported amounts of assets, liabilities, equity, revenues and expenses and related disclosure of contingent assets and liabilities. We regularly assess these estimates which primarily affect revenue recognition, deferred revenue, inventories, valuation of equity investments, goodwill arising out of business acquisitions, accrued liabilities, stock awards, and the valuation allowances associated with deferred tax assets. Actual results could differ from those estimates and such differences may be material to the condensed consolidated financial statements. Accounting Pronouncements Aside from the recently issued accounting pronouncements not yet adopted and described below, there were no recent accounting pronouncements or changes in accounting pronouncements during the three months ended March 31, 2026, that are of significance or potential significance to us. 9 Recently issued accounting pronouncements not yet adopted In November 2024, the FASB issued ASU No. 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The amendment in the ASU will require additional disclosures and disaggregation of certain costs and expenses presented on the face of the income statement to provide greater transparency into the nature of expense components. In January 2025, the FASB issued ASU 2025-01, “ Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40) - Clarifying the Effective Date ” to clarify the effective date for non-calendar year-end entities. As clarified, this guidance is effective for public business entities for fiscal years beginning after December 15, 2026 and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the effects of the standard on our consolidated financial statements and related disclosures. In October 2023, FASB issued ASU No. 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative . The amendments in the ASU are intended to amend certain disclosure and presentation requirements for a variety of topics within the ASC. These amendments align the requirements in the ASC to the removal of certain disclosure requirements set out in Regulation S-X and Regulation S-K, as announced by the SEC. The effective date for each amended topic in the ASC is either the date on which the SEC’s removal of the related disclosure requirement from Regulation S-X or Regulation S-K becomes effective, or on June 30, 2027, if the SEC has not removed the requirements by that date. Early adoption is prohibited. We are currently monitoring SEC rulemaking activity and evaluating the potential effects of this standard on our consolidated financial statements and related disclosures. Note 3. Revenue Recognition Disaggregation of Revenue The following table provides information about disaggregated revenue from contracts with customers by g eographic regions. The geographic regions that are tracked are the Americas (United States, Canada, and Latin America), EMEA (Europe, Middle East, and Africa), and APAC (Australia, New Zealand, Southeast Asia, and China). Disaggregated information is as follows (in thousands): Three Months Ended March 31, 2026 2025 Primary geographical markets: Americas $ 7,861 $ 2,088 APAC 5,329 1,536 EMEA 2,058 3,919 Total revenues $ 15,248 $ 7,543 Contract Balances The following table presents balances of unbilled receivables, contract assets, and contract liabilities (in thousands): March 31, 2026 December 31, 2025 Unbilled receivables $ 1,293 $ 1,741 Contract assets $ 441 $ 492 Contract liabilities: deferred revenue $ 1,216 $ 7,369 We had no asset impairment charges related to financial assets in the three months ended March 31, 2026 and 2025. As of March 31, 2026, we have $ 0.9 million of short-term unbilled receivables presented as unbilled receivables within current assets and $ 0.4 million of long-term unbilled receivables that is included within the other non-current assets line item in the condensed consolidated balance sheets. As of December 31, 2025 , we had $ 1.5 million of short-term unbilled receivables presented as unbilled receivables within current assets and $ 0.3 million of long-term unbilled receivables that is included within the other non-current assets line item in the condensed consolidated balance sheets. 10 We recognized the following revenues (in thousands): Three Months Ended March 31, Revenue recognized in the period for: 2026 2025 Amounts included in contract liabilities at the beginning of the period: Performance obligations satisfied $ 6,367 $ 250 Changes in the period: Changes in the estimated transaction price allocated to performance obligations satisfied in prior periods ( 219 ) 387 Performance obligations satisfied from new activities in the period - contract revenue 9,100 6,906 Total revenues $ 15,248 $ 7,543 Performance Obligations The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied or partially unsatisfied at the end of the reporting periods. The estimated revenue does not include contracts with original durations of one year or less, amounts of variable consideration attributable to royalties, or contract renewals that are unexercised as of March 31, 2026. The balances in the table below are partially based on judgments involved in estimating future orders from customers subject to the exercise of material rights pursuant to respective contracts as of March 31, 2026 (in thousands): Remainder of 2026 2027 2028 2029 and Thereafter Total Product revenue $ 422 $ 40 $ 40 $ 270 $ 772 Research and development revenue 444 — — — 444 Total revenues $ 866 $ 40 $ 40 $ 270 $ 1,216 Note 4. N et Loss per S hare Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding, less restricted stock awards (“RSAs”) subject to forfeiture. Diluted net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock outstanding, less RSAs subject to forfeiture, plus all additional common shares that would have been outstanding, assuming dilutive potential common stock shares had been issued for other dilutive securities. For all periods presented, diluted and basic net loss per share are identical since potential common stock shares are excluded from the calculation, as their effect was anti-dilutive. Anti-Dilutive Securities In periods of net loss, the weighted average number of shares outstanding, prior to the application of the treasury stock method, excludes potentially dilutive securities from the computation of diluted net loss per common share because including such shares would have an anti-dilutive effect. The following shares were not considered in the computation of diluted net loss per share because their effect was anti-dilutive (in thousands): Three Months Ended March 31, 2026 2025 Shares issuable under the Equity Incentive Plan and ESPP (1) 14,983 13,800 Warrants (2) 424 424 Total potentially dilutive securities 15,407 14,224 ( 1) Included anti-dilutive potential common shares from ESPP of 509,446 and 386,635 for the three months ended March 31, 2026 and 2025, respectively (actual shares). (2) Pertains to the warrants issued in connection with the Innovatus Loan. For additional information, see Note 11, “Debt.” 11 Note 5. Investments in Non-Marketable Securities Non-Marketable Equity Securities Our non-marketable equity securities are investments in privately held companies without readily determinable market value and primarily relate to our investments in seqWell Inc. (“seqWell”) and other investments in non-marketable equity securities. These investments are accounted for under the measurement alternative and are measured at cost minus impairment, if any, plus or minus changes resulting from observable price changes for identical or similar securities of the same issuer. Non-marketable equity securities are measured at fair value on a non-recurring basis and classified within Level 2 in the fair value hierarchy when we estimate the fair value of these investments using the observable transaction price paid by third party investors for the same or similar security of the same issuers. The fair value of non-marketable equity securities are classified within Level 3 when we estimate fair value using unobservable inputs such as when we remeasure due to impairment and we use discount rates, market data of comparable companies, and rights and obligations of the securities the Company holds, among others. We adjust the carrying value of non-marketable equity securities which have been remeasured during the period and recognize resulting gains or losses as a component of interest and other expense, net in the unaudited condensed consolidated statements of operations. There was no remeasurement event for our investments in non-marketable equity securities that occurred during the three months ended March 31, 2026 and 2025. We recognized no realized gains or losses during the three months ended March 31, 2026 and 2025. The following table presents the carrying value of our non-marketable equity securities (in thousands): March 31, 2026 December 31, 2025 seqWell $ 2,416 $ 2,416 Other investments in non-marketable equity securities 82 82 Total non-marketable equity securities $ 2,498 $ 2,498 Note 6. Fair Value Measurement The following tables show the Company’s cash, cash equivalents, and short-term investments by significant investment category as of March 31, 2026 and December 31, 2025 (in thousands): March 31, 2026 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents Short-term Investments Cash $ 17,181 $ — $ — $ 17,181 $ 17,181 $ — Level 1: Money market funds 9,923 — — 9,923 9,923 — Level 2 (1) : Commercial paper 21,129 — ( 11 ) 21,118 9,467 11,651 Corporate debt 1,113 — ( 1 ) 1,112 — 1,112 U.S. treasury securities 15,805 3 ( 2 ) 15,806 — 15,806 Subtotal 38,047 3 ( 14 ) 38,036 9,467 28,569 Total $ 65,151 $ 3 $ ( 14 ) $ 65,140 $ 36,571 $ 28,569 12 December 31, 2025 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents Short-term Investments Cash $ 30,648 $ — $ — $ 30,648 $ 30,648 $ — Level 1: Money market funds 17,156 — — 17,156 17,156 — Level 2 (1) : Commercial paper 13,035 2 — 13,037 2,989 10,048 Corporate debt 499 — — 499 — 499 U.S. agency securities — — — — — — U.S. treasury securities 16,863 6 — 16,869 — 16,869 Subtotal 30,397 8 — 30,405 2,989 27,416 Total $ 78,201 $ 8 $ — $ 78,209 $ 50,793 $ 27,416 (1) The valuation techniques used to measure the fair values of the Company’s Level 2 financial instruments uses inputs that are either directly or indirectly observable for the asset through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. We limit the credit risk associated with our cash equivalents and short-term investments by placing them with banks and institutions we believe are highly credit-worthy and investing in highly-rated investments. As of March 31, 2026 and December 31, 2025, the contractual maturity of all investments held was less than one year. During the three months ended March 31, 2026 and 2025, we did no t recognize any significant credit losses no r other-than-temporary impairment losses on our short-term investments. Note 7. Balance Sheet Details Inventories Inventories consisted of the following (in thousands): March 31, 2026 December 31, 2025 Work in process $ 13 $ — Finished goods 1,987 1,817 Total inventories $ 2,000 $ 1,817 Prepaid expenses and other current assets As of March 31, 2026, prepaid expenses and other current assets consisted of prepaid expenses of $ 3.7 million and other current assets of $ 0.4 million. As of December 31, 2025, prepaid expenses and other current assets consisted of prepaid expenses of $ 5.2 million and other current assets of $ 0.5 million. 13 Property and Equipment, net Property and equipment, net consisted of the following (in thousands): March 31, 2026 December 31, 2025 Laboratory equipment $ 38,471 $ 38,943 Leasehold improvements 15,480 15,229 Computer equipment and software 2,577 2,556 Office equipment and furniture 1,134 1,133 Construction in progress 849 405 Property and equipment 58,511 58,266 Less: accumulated depreciation and amortization ( 45,923 ) ( 45,242 ) Property and equipment, net $ 12,588 $ 13,024 Depreciation expense included in both research and development expenses and selling, general and administrative expenses in the unaudited condensed consolidated statements of operations was as follows (in thousands): Three Months Ended March 31, 2026 2025 Research and development $ 1,138 $ 946 Selling, general and administrative 110 212 Total depreciation expense $ 1,248 $ 1,158 Other Accrued Liabilities Other accrued liabilities consisted of the following (in thousands): March 31, 2026 December 31, 2025 Accrued purchases $ 1,420 $ 938 Accrued professional and outside service fees 1,776 1,384 Other — 446 Total other accrued liabilities $ 3,196 $ 2,768 Note 8. Stock-based Compensation Employee Stock Purchase Plan During the three months ended March 31, 2026 and 2025, no shares of our common stock were purchased under the ESPP. As of March 31, 2026, 1,459,266 shares of common stock were available for future issuance under the ESPP. We recognized $ 0.1 million of stock-based compensation expenses related to the ESPP for each of the three months ended March 31, 2026 and 2025. As of March 31, 2026, the total unrecognized stock-based compensation expense, net of expected forfeitures, related to the ESPP was $ 0.5 million and is expected to be recognized over the remaining offering period. Stock-Based Compensation Expense Stock-based compensation expense is included in the unaudited condensed consolidated statements of operations as follows (in thousands): Three Months Ended March 31, 2026 2025 Cost of product revenue $ 70 $ 61 Research and development 486 665 Selling, general and administrative 872 1,653 Total $ 1,428 $ 2,379 14 The following table presents total stock-based compensation expense by security type included in the unaudited condensed consolidated statements of operations (in thousands): Three Months Ended March 31, 2026 2025 Stock options $ 742 $ 1,355 Restricted stock units (“RSUs”) and RSAs 618 919 ESPP 68 105 Total $ 1,428 $ 2,379 As of March 31, 2026, unrecognized stock-based compensation expense, net of expected forfeitures, was $ 7.5 million related to unvested stock options and $ 2.3 million related to unvested RSUs. Stock-based compensation expense for these awards will be recognized through 2030. Note 9. Capital Stock Exercise of Options For the three months ended March 31, 2026, there were no options exercised. For the three months ended March 31, 2025, we issued 339,142 shares upon option exercises at a weighted-average exercise price of $ 3.09 per share, with net cash proceeds of $ 1.0 million. Sales Agreements On May 2, 2024, we entered into a Controlled Equity Offering℠ Sales Agreement (the “Cantor Sales Agreement”) with Cantor Fitzgerald & Co., as sales agent (“Cantor”), under which Cantor, at our discretion and at such times that we may determine from time to time, may sell up to a maximum of $ 75.0 million of shares of our common stock. Under the terms of the Cantor Sales Agreement, Cantor may sell the shares at market prices by any method that is deemed to be an “at the market offering” as defined in Rule 415 under the Securities Act. On May 2, 2024, we filed a registration statement on Form S-3 registering the offer and sale of these shares under the Securities Act which became effective on May 14, 2024. We will pay a commission of up to 3.0 % of gross sales proceeds of any common stock sold under the Cantor Sales Agreement. In the third quarter of 2024, 10,440,000 shares of our common stock were issued and sold pursuant to the Cantor Sales Agreement and we received net proceeds of $ 29.7 million after Cantor’s commissions and direct offering expenses. In the second quarter of 2025, 7,244,966 shares of our common stock were issued and sold under the same agreement and we received $ 16.4 million in net proceeds after Cantor’s commissions and direct offering expenses. During the three months ended March 31, 2026, no shares of our common stock were issued and sold pursuant to the Cantor Sales Agreement. As of March 31, 2026, $ 26.4 million remained available for sale under the Cantor Sales Agreement. Note 10. Commitments and Contingencies Lease and other information The Company has entered into operating leases primarily for office and laboratory space. Lease cost amounts included in the measurement of lease obligations and other information related to non-cancellable operating leases were as follows (in thousands): Three Months Ended March 31, 2026 2025 Operating lease cost (1) $ 1,495 $ 1,243 (1) The Company had no variable lease costs. Other information: Operating Leases Weighted-average remaining lease term (in years) 6.6 Weighted-average discount rate 6.9 % 15 Three Months Ended March 31, Cash paid (in thousands): 2026 2025 Operating cash flows from operating leases $ 1,244 $ 1,208 As of March 31, 2026, our maturity analysis of annual undiscounted cash flows of the non-cancellable operating leases are as follows (in thousands): Years Ending December 31, Operating Leases 2026 (remaining 9 months) $ 3,866 2027 5,222 2028 6,604 2029 6,605 2030 7,020 Thereafter 11,156 Total minimum lease payments 40,473 Less: imputed interest 8,053 Lease obligations $ 32,420 Reconciliation of operating lease liabilities as shown within the unaudited condensed consolidated balance sheets (in thousands): Current portion of lease obligations - Operating leases $ 3,302 Long-term lease obligations - Operating leases 29,118 Total operating lease liabilities $ 32,420 Legal Proceedings We may be involved in legal actions in the ordinary course of business, including inquiries and proceedings concerning business practices and intellectual property infringement, employee relations and other claims. We will recognize a loss contingency in the consolidated financial statements when it is probable a liability has been incurred and the amount of the loss can be reasonably estimated. We will disclose any loss contingencies that do not meet both conditions if there is a reasonable possibility that a material loss may have been incurred. Gain contingencies are not recorded until they are realized. We are currently not a party to any material pending litigation or other material legal proceedings that management believes could have a material adverse effect on our financial statements. Indemnifications We are required to recognize a liability for the fair value of any obligations we assume upon the issuance of a guarantee. We have certain agreements with licensors, licensees and collaborators that contain indemnification provisions. In such provisions, we typically agree to indemnify the licensor, licensee and collaborator against certain types of third-party claims. The maximum amount of the indemnifications is not limited. We accrue for known indemnification issues when a loss is probable and can be reasonably estimated. There were no accruals for expenses related to indemnification issues for any periods presented. Note 11. Debt Innovatus Loan Agreement On February 13, 2024 (the “Closing Date”), we entered into a five -year term loan and security agreement (the “Loan Agreement”) with Innovatus Life Sciences Lending Fund I, LP (“Innovatus”), an affiliate of Innovatus Capital Partners, LLC, for an aggregate principal amount of up to $ 40.0 million funded in two tranches with a maturity date of February 13, 2029 (the “Innovatus Loan”). The first tranche of $ 30.0 million was funded on February 13, 2024 and the second tranche of $ 10.0 million was funded on June 27, 2025 upon achievement of certain milestones including certain pre-specified revenue thresholds. Both tranches were subject to a payment of a facility fee equal to 1.00 % of the amount of such term loan. 16 The floating per annum interest rate of the Innovatus Loan is equal to the sum of (a) the greater of (i) prime rate published in the Money Rates section of the Wall Street Journal and (ii) 7.50 % , plus (b) 3.25 %; provided that, at the election of the Company, up to 2.0 % of such rate shall be payable in-kind until the third anniversary of the Closing Date. The Company is required to make monthly interest-only payments through February 1, 2027, with the ability to extend the interest-only period through February 1, 2028 upon the achievement of certain pre-specified financial milestones. Following the interest-only period, the Company is required to make monthly amortizing payments, with the remaining balance of the principal plus accrued and unpaid interest due at maturity. For the first three years of the term, 2.0 % of the interest is payable in-kind by increasing the principal balance. Prepayments of the loan, in whole or in part, will be subject to an early prepayment fee which ranges between 3.0 % and 1.0 % and declines each year until the third anniversary date of the Closing Date, after which no prepayment fee is required. The Company is also required to pay an exit fee upon any payment or prepayment equal to 3.0 % of the aggregate principal amount of the tranches funded under the Innovatus Loan. The Innovatus Loan contains customary representations and warranties and covenants, subject to customary carve outs, and includes financial covenants related to liquidity and net product revenue, with the latter beginning with the period ended September 30, 2024. The Innovatus Loan is secured by perfected first priority liens on the Company's assets, and the Loan Agreement includes a negative pledge by the Company which prohibits the Company from permitting liens to be placed upon the Company's intellectual property in favor of any party other than Innovatus. In connection with the funding of the first tranche of the Innovatus Loan in February 2024, we recorded a debt discount of $ 1.3 million and capitalized debt issuance costs of $ 0.6 million during the first quarter of 2024 . Additionally, in connection with the funding of the second tranche of the Innovatus Loan in June 2025, we recorded a debt discount of $ 0.1 million during the second quarter of 2025 . The discount and issuance costs will be amortized over the life of the Innovatus Loan. Interest expense for the Innovatus Loan for the three months ended March 31, 2026 and 2025 was $ 1.3 million and $ 0.9 million , respectively, and is inclusive of non-cash amortization of the debt discount, debt issuance costs, payable in-kind interest, and accretion of final payment. The carrying amount of the Innovatus Loan approximates fair value given the interest rate is based on the current prime rate. The effective interest rate for the Innovatus Loan was 12.7 % as of March 31, 2026 . Additionally, in connection with entering into the Innovatus Loan, we entered into a Warrant Agreement with Innovatus on February 13, 2024 and issued to Innovatus a warrant to purchase an aggregate of 424,028 shares of the Company’s common stock at an exercise price of $ 2.83 per share. The warrants may be exercised on a cashless basis, and are immediately exercisable through the tenth anniversary of the issuance date. At the time of issuance, the Company determined the estimated fair value of the warrants of $ 0.9 million using the Black-Scholes model. As the warrants represent a freestanding equity instrument, the Company recorded the fair value of the warrants in additional paid-in capital during the first quarter of 2024 . The Company accounts for the amortization of the debt discount and issuance costs utilizing the effective interest method. Long-term debt consisted of the following at March 31, 2026 (in thousands): March 31, 2026 Face value of debt $ 40,000 Add: payment in-kind interest 1,389 Add: amortized exit fee 399 Less: unamortized debt discount ( 907 ) Less: unamortized debt issuance cost ( 398 ) Total long-term debt $ 40,483 17 The future principal payments under the Innovatus Loan are as follows (in thousands): Years Ending December 31, 2026 (remaining 9 months) $ — 2027 17,566 2028 21,080 2029 3,513 Total principal payments 42,159 Add: amortized exit fee 399 Less: uncapitalized payment in-kind interest ( 770 ) Less: unamortized debt discount ( 907 ) Less: unamortized debt issuance cost ( 398 ) Total long-term debt $ 40,483 Note 12. Segment, Geographical and Other Revenue Information Segment Information We manage our business as one reportable segment. The Company's operations are managed and reported to the CODM on a consolidated basis. The CODM uses consolidated income (loss) from operations and net income (loss) to assess financial performance and make resource allocation decisions. These financial measures are used by the CODM to balance short-term financial results with long-term strategic goals, guiding the allocation of budget between product costs, research and development expenses, and general, selling and administrative expenses. Significant Customers Customers that each accounted for 10% or more of our total revenues were as follows: Percentage of Total Revenues for the Three Months Ended March 31, 2026 2025 Customer A 44 % 15 % Customer B 20 % * Customer C * 17 % Customer D * 34 % * Percentage was less than 10% Customers that each accounted for 10% or more of accounts receivable balances as of the periods presented were as follows: Percentage of Accounts Receivables as of March 31, 2026 December 31, 2025 Customer B 44 % 40 % Customer C 13 % * Customer E 10 % * Customer F * 14 % Customer G * 13 % * Percentage was less than 10% Identifiable long-lived assets by location were as follows (in thousands): March 31, 2026 December 31, 2025 United States $ 42,167 $ 43,575 18