What changed in this filing

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Item 1. Financial Statements

2026-05-07 compared with 2026-02-12 · 304 added, 141 removed, 427 unchanged (51% of the section changed)

8 unchanged sentences

Financing receivables, net of allowances of $ 41 and $ 34

Refundable income taxes

Other current assets

34 unchanged sentences

Three months ended

Six Months Ended

Cost of sales:

6 unchanged sentences

Other income (expense):

Foreign exchange (loss) gain

Foreign exchange gain (loss)

Interest expense

Interest income

Other income, net

Other income (expense), net

Total other income, net

Income before income taxes

Income tax expense (benefit)

Net income attributable to common shareholders

Net income per common share - basic

(Loss) income before income taxes

Income tax benefit

Net income (loss)

Net income (loss) attributable to common shareholders

Net income (loss) per common share - basic

Weighted average common shares outstanding - basic

Net income per common share - diluted

Net income (loss) per common share - diluted

Weighted average common shares outstanding - diluted

1 unchanged sentence

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Amounts in thousands)

Three months ended

Other comprehensive income (loss):

Foreign currency translation gain (loss) adjustments, net of tax effect

Other comprehensive income (loss)

Total comprehensive income (loss)

Six Months Ended

Net income (loss)

Other comprehensive (loss) income:

Foreign currency translation (loss) gain adjustments, net of tax effect

Other comprehensive (loss) income

Total comprehensive income

See accompanying notes to unaudited condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

For the three months ended December 31, 2025 and 2024:

For the three months ended March 31, 2026 and 2025

(Amounts in thousands, except per share data)

1 unchanged sentence

Shareholders’

Three months ended December 31, 2025:

Balance as of September 30, 2025

Three months ended March 31, 2026

Balance as of December 31, 2025

Other comprehensive loss

Stock-based compensation

Restricted stock issuance

Issuance of shares under employee stock purchase plan

Repurchase of common stock

Cash dividends paid on common stock ($ 0.03 per share)

Balance as of March 31, 2026

comprehensive

Shareholders’

Three months ended March 31, 2025

Balance as of December 31, 2024

Other comprehensive income

Stock-based compensation

Restricted stock issuance

Issuance of shares under employee stock purchase plan

Repurchase of common stock

Cash dividends paid on common stock ($ 0.03 per share)

Balance as of March 31, 2025

See accompanying notes to unaudited condensed consolidated financial statements.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

For the six months ended March 31, 2026 and 2025

(Amounts in thousands, except per share data)

comprehensive

Shareholders’

Six months ended March 31, 2026:

Balance as of September 30, 2025

Other comprehensive loss

Stock-based compensation

Restricted stock cancellation

Cash dividends declared on common stock ($ 0.03 per share)

Balance as of December 31, 2025

Restricted stock issuance

Issuance of shares under employee stock purchase plan

Repurchase of common stock

Cash dividends paid on common stock ($ 0.06 per share)

Balance as of March 31, 2026

comprehensive

Shareholders’

Three months ended December 31, 2024:

Six months ended March 31, 2025:

Balance as of September 30, 2024

2 unchanged sentences

Restricted stock issuance

Cash dividends declared on common stock ($ 0.03 per share)

Balance as of December 31, 2024

Issuance of shares under employee stock purchase plan

Repurchase of common stock

Cash dividends paid on common stock ($ 0.06 per share)

Balance as of March 31, 2025

See accompanying notes to unaudited condensed consolidated financial statements.

2 unchanged sentences

(Amounts in thousands)

Three Months Ended

Six Months Ended

Operating activities

2 unchanged sentences

Loss on disposal of fixed assets, net

Foreign exchange loss (gain)

Provision (benefit) for credit losses - financing receivables

(Benefit) provision for credit losses - accounts receivable

Foreign exchange gain

Provision for credit losses - financing receivables

Provision (benefit) for credit losses - accounts receivable

Provision for obsolete inventory

Amortization of lease right-of-use assets

14 unchanged sentences

Investing activities

Life insurance premiums paid

Purchases of property, equipment and improvements

1 unchanged sentence

Financing activities

Net borrowing (repayment) under line-of-credit agreement

Net cash provided by (used in) financing activities

Dividends paid

Net repayment under line-of-credit agreement

Repurchases of common stock

Proceeds from issuance of shares under equity compensation plans

Net cash used in financing activities

Effects of exchange rate on cash, net

Net (decrease) increase in Cash and cash equivalents

Net decrease in Cash and cash equivalents

Cash and cash equivalents beginning of period

5 unchanged sentences

Supplementary non-cash financing activities:

Dividend declared during period

Obtaining a right-of-use asset in exchange for a lease liability

Customer financing for inventory sold (see Note 5 Financing receivables, net for details)

7 unchanged sentences

The Company operates in two segments, its Technology Solutions (“TS”) segment and High Performance Products (“HPP”) segment.

Summary of Significant Accounting Policies

Basis of Presentation and Significant Accounting Policies

Basis of Presentation

6 unchanged sentences

There have been no significant changes to the Company's significant accounting policies described in PART II, Item 8, Note 1 Basis of Presentation and Summary of Significant Accounting Policies , of the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2025.

Accounting Pronouncement Not Yet Adopted as of December 31, 2025

Accounting Pronouncement Not Yet Adopted as of March 31, 2026

In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326):

12 unchanged sentences

prospective basis, but retrospective application is permitted.

The Company plans to adopt this ASU on a prospective basis in the fourth quarter of fiscal year 2026.

The Company is currently evaluating the impact this ASU will have on its disclosures.

Revenue, Deferred revenue and contract liabilities, and Contract balances

See details of timing of revenue recognition, whether CSPi acted as the principal or agent, and geography below.

Geographic areas are based on which the products were shipped or services rendered.

Geographic areas are based on where the products were shipped or services rendered.

Technology Solutions Segment

Three months ended December 31,

Three months ended March 31,

(Amounts in thousands)

17 unchanged sentences

Total Revenue

Technology Solutions Segment

Six months ended March 31,

(Amounts in thousands)

Timing of Revenue Recognition

Transferred at a point in time where CSPi is principal

Transferred at a point in time where CSPi is agent

Transferred over time where CSPi is principal

Total Revenue

United States

Americas (excluding United States)

APAC and Africa

Total Revenue

Timing of Revenue Recognition

Transferred at a point in time where CSPi is principal

Transferred at a point in time where CSPi is agent

Transferred over time where CSPi is principal

Total Revenue

United States

Americas (excluding United States)

APAC and Africa

Total Revenue

In the TS US division, financing of goods and services is offered to certain customers.

1 unchanged sentence

See Note 5 Financing Receivables, net for more details.

Revenue from these agreements in the three months ended December 31, 2025 was $ 655 thousand and CSPi acted as the agent.

Revenue from these agreements in the three months ended December 31, 2024 was $ 23 thousand and CSPi acted as the agent.

Revenue from these agreements in the three months ended March 31, 2026 was $ 417 thousand in which the Company acted as the agent.

Revenue from these agreements in the three months ended March 31, 2025 was $ 142 thousand in which the Company acted as the agent.

Revenue from these agreements in the six months ended March 31, 2026 was $ 1,072 thousand in which the Company acted as the agent.

Revenue from these agreements in the six months ended March 31, 2025 was $ 165 thousand in which the Company acted as the agent.

Contract Assets and Liabilities

1 unchanged sentence

When we have the right to bill a customer, accounts receivable is recorded as an unconditional right exists.

Current contract assets were $ 0.5 million and $ 0.8 million as of December 31, 2025 and September 30, 2025, respectively.

Current contract assets were $ 0.7 million and $ 0.8 million as of March 31, 2026 and September 30, 2025, respectively.

Current contract assets were $ 1.7 million as of September 30, 2024.

The current portion is recorded in Other current assets on the condensed consolidated balance sheets.

There were no noncurrent contract assets as of December 31, 2025 and September 30, 2025.

There were no noncurrent contract assets as of March 31, 2026 and September 30, 2025.

There were no noncurrent contract assets as of September 30, 2024.

1 unchanged sentence

Contract liabilities arise when payment is received before we transfer a good or service to the customer.

Current contract liabilities were $ 1.6 million and $ 1.5 million as of December 31, 2025 and September 30, 2025, respectively.

Current contract liabilities were $ 1.7 million and $ 1.5 million as of March 31, 2026 and September 30, 2025, respectively.

Current contract liabilities were $ 2.2 million as of September 30, 2024.

The current portion of contract liabilities is recorded in Deferred revenue and contract liabilities on the condensed consolidated balance sheets.

There were $ 50 thousand and $ 33 thousand of long-term contract liabilities as of December 31, 2025 and September 30, 2025, respectively.

There were $ 42 thousand and $ 37 thousand of long-term contract liabilities as of March 31, 2026 and September 30, 2025, respectively.

There were no long-term contract liabilities as of September 30, 2024.

Long-term contract liabilities are in Other noncurrent liabilities on the condensed consolidated balance sheets.

Revenue recognized for the three months ended December 31, 2025 that was included in contract liabilities as of September 30, 2025 was $ 0.6 million.

Revenue recognized for the three months ended December 31, 2024 that was included in contract liabilities as of September 30, 2024 was $ 0.7 million.

Revenue recognized for the six months ended March 31, 2026 that was included in contract liabilities as of September 30, 2025 was $ 0.9 million.

Contract Costs

2 unchanged sentences

The costs are amortized over the contract term and expected renewal periods.

The period of amortization is generally one to three years .

Incremental costs in fiscal year 2026 are related to commissions in the HPP segment and in fiscal year 2025 incremental costs were related to commissions in both segments.

The period of amortization is generally three years .

Incremental costs are related to commissions in the TS portion of the business.

In fiscal year 2026 the TS segment paid commissions on a monthly basis for contracts over one year.

Current capitalized contract costs are within Other current assets on the condensed consolidated balance sheets as of December 31, 2025 and September 30, 2025.

The portion of current capitalized costs was $ 31 thousand and $ 33 thousand as of December 31, 2025 and September 30, 2025, respectively.

Current capitalized contract costs are within the Other current assets on the condensed consolidated balance sheets as of March 31, 2026 and September 30, 2025.

The portion of current capitalized costs were $ 25 thousand and $ 33 thousand as of March 31, 2026 and September 30, 2025, respectively.

There are no noncurrent capitalized costs on the condensed consolidated balance sheets.

The amount of incremental costs amortized for the three months ended December 31, 2025 and 2024 were $ 10 thousand and $ 104 thousand, respectively.

This is recorded in Selling, general, and administrative expenses.

There was no impairment related to incremental costs capitalized during the three months ended December 31, 2025 and 2024.

The amount of incremental costs amortized for the three months ended March 31, 2026 and 2025 were $ 14 thousand and $ 50 thousand, respectively.

The amount of incremental costs amortized for the six months ended March 31, 2026 and 2025 were $ 24 thousand and $ 154 thousand, respectively and is recorded in selling, general, and administrative expenses.

There was no impairment related to incremental costs capitalized during the six months ended March 31, 2026 and 2025.

Projects are typically billed upon completion or at certain milestones.

Product and services are typically billed when shipped or as services are being performed.

Products and services are typically billed when shipped or as services are being performed.

Payment terms are typically 30 days to pay in full except in Europe where it could be up to 90 days .

Most of our contracts’ term are for less than one year.

Most of our contracts are less than one year.

There are certain contracts that contain a financing component.

See Note 5 Financing receivables to the condensed consolidated financial statements for additional information.

We elected to use the optional exemption to not disclose the aggregate amount of the transaction price allocated to performance obligations that have an original expected contract term duration of one year or less.

See Note 5 Financing receivables, net to the condensed consolidated financial statements for additional information.

We elected to use the optional exemption to not disclose the aggregate amount of the transaction price allocated to performance obligations that have an original expected duration of one year or less.

This is due to a low number of performance obligations, which are less than one year from being unsatisfied at each period end.

2 unchanged sentences

The royalty agreement is longer than one year, but not included in the table below as the royalties are sales-based.

Managed service contracts are generally longer than one year.

For these contracts the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied or partially unsatisfied as of December 31, 2025 is set forth in the table below:

Managed service contracts are generally longer than one year and revenue is recognized ratably over the contract term.

For these contracts the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied or partially unsatisfied as of March 31, 2026 is set forth in the table below:

(Amounts in thousands)

2 unchanged sentences

We are required to present earnings per share ("EPS") utilizing the two-class method because we had outstanding, non-vested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents, which are considered participating securities.

Basic net income per common share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding for the period.

Basic net income (loss) per common share is computed by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding for the period.

Diluted net income per share includes the dilutive effect of restricted stock awards (RSA’s), if any, calculated using the treasury stock method.

2 unchanged sentences

RSA’s with assumed proceeds per unit above the Company’s average share price for the periods presented are excluded from the diluted EPS calculation because the effect is anti-dilutive.

Basic and diluted earnings per share computations for the Company’s reported net income attributable to common stockholders are as follows:

Basic and diluted EPS computations for the Company’s reported net income attributable to common stockholders are as follows:

Three months ended

Six Months Ended

(Amounts in thousands except per share data)

Net income (loss)

net income attributable to nonvested common stock

Net income attributable to common shareholders

Net income (loss) attributable to common shareholders

Weighted average total shares outstanding - basic

3 unchanged sentences

Weighted average common shares outstanding - diluted

Net income per common share - basic

Net income per common share - diluted

All anti-dilutive securities (RSA’s) are excluded from the diluted net income per share computation.

Non-vested restricted stock awards of 87 thousand were excluded from net income per share for the three months ended December 31, 2025 because their inclusion would have been anti-dilutive.

Net income (loss) per common share - basic

Net income (loss) per common share - diluted

Anti-dilutive securities include restricted stock awards, which are excluded from the diluted income per share computation.

Non-vested restricted stock awards of 141 thousand shares and 269 thousand shares were excluded from net income (loss) per common share - diluted for the three months ended March 31, 2026 and 2025 because their inclusion would have been anti-dilutive.

Non-vested restricted stock awards of 114 thousand shares were excluded from net income per share - diluted for the six months ended March 31, 2026 because their inclusion would have been anti-dilutive.

Accounts receivable, net

2 unchanged sentences

This results in a general reserve and a specific reserve.

The Company assesses collectability by pooling receivables where similar characteristics exist and evaluates receivables individually when specific customer balances no longer share those risk characteristics and are considered at risk or uncollectible.

The expense associated with the allowance for expected credit losses is recognized in Selling, general, and administrative expenses in the Condensed Consolidated Statements of Operations.

The following table presents the components of the Company’s accounts receivable for the periods indicated.

The Company assesses collectability by pooling receivables where similar characteristics exist and evaluates receivables individually when specific customer balances no longer share

those risk characteristics and are considered at risk or uncollectible.

The expense associated with the allowance for expected credit losses is recognized in Selling, general, and administrative expenses in the Consolidated Statements of Operations.

The following tables present the changes in the allowance for accounts receivable for the periods indicated.

Three months ended

December 31, 2025

December 31, 2024

March 31, 2026

March 31, 2025

(Amounts in thousands)

1 unchanged sentence

Balances at beginning of the period

(Benefit) provision for credit losses

Provision (benefit) for credit losses

Balances at end of the period

Six months ended

March 31, 2026

March 31, 2025

(Amounts in thousands)

Allowance for credit losses for accounts receivable:

Balances at beginning of the period

Provision (benefit) for credit losses

Balances at end of the period

Financing receivables, net

4 unchanged sentences

Determining whether to offer financing involves looking at the customer’s payment history, economic conditions, and capacity to pay.

These financing arrangements do not contain collateral.

The Company assigns an internal risk rating to each customer at inception, which groups customers into a portfolio based off this risk rating.

11 unchanged sentences

Financing receivables, net, carry an average weighted interest rate of 8.6 %, which reflects the approximate interest rate consistent with a separate financing transaction with the customer at the inception of the agreement.

The amount of interest income earned from sales whose payment terms exceed one year for the three months ended December 31, 2025 and 2024 was $ 342 thousand and $ 141 thousand, respectively.

Interest income from these agreements is recorded in Interest income on the Condensed Consolidated Statements of Operations.

The amount of interest income earned from sales whose payment terms exceed one year for the three months ended March 31, 2026 and 2025 was $ 320 thousand and $ 113 thousand, respectively.

The amount of interest income earned from sales whose payment terms exceed one year for the six months ended March 31, 2026 and 2025 was $ 662 thousand and $ 254 thousand, respectively.

Interest income from these agreements is recorded in Other (expense) income, net on the Condensed Consolidated Statements of Operations.

The following table presents the components of the Company’s Financing receivables, net segregated by portfolio (risk rating) for the periods indicated:

As of December 31, 2025

As of March 31, 2026

As of September 30, 2025

7 unchanged sentences

Three months ended

December 31, 2025

December 31, 2024

March 31, 2026

March 31, 2025

(Amounts in thousands)

Allowance for credit losses for financing receivables:

Balances at beginning of the period

(Benefit) provision charged to Consolidated Statements of Operations

Balances at end of the period

Six months ended

March 31, 2026

March 31, 2025

(Amounts in thousands)

Allowance for credit losses for financing receivables:

Balances at beginning of the period

Provision (benefit) charged to Consolidated Statements of Operations

4 unchanged sentences

Macroeconomic conditions include the level of gross domestic product (“GDP”) growth and unemployment rates, which directly correlate with our historical credit losses.

The expense associated with the allowance for expected credit losses is recognized in Selling, general, and administrative expenses in the Condensed Consolidated Statements of Operations.

The expense associated with the allowance for expected credit losses is recognized in Selling, general, and administrative expenses in the Consolidated Statements of Operations.

Financing receivables whose payment terms exceed one year are placed on non-accrual status, meaning interest income stops being recorded, when the customer has a past due amount in excess of 30 days or reasonable doubt exists in collecting all interest and principal.

1 unchanged sentence

If a payment is received for a receivable on non-accrual status the payment is first applied to interest and then principal.

Recording interest income

resumes once no reasonable doubt exists regarding collecting all interest and principal.

There were no financing receivables placed on non-accrual status as of December 31, 2025 or September 30, 2025.

The following table presents Financing receivables, gross, including accrued interest, by credit quality indicator segregated by risk rating and year of origination as of December 31, 2025:

December 31, 2025

Recording interest income resumes once no reasonable doubt exists regarding collecting all interest and principal.

There were no financing receivables placed on non-accrual status as of March 31, 2026 or September 30, 2025.

The following table presents Financing receivables, gross, including accrued interest and excluding any allowance, by credit quality indicator segregated by risk rating and year of origination as of March 31, 2026:

March 31, 2026

Fiscal year of origination

13 unchanged sentences

Information related to both lessee and lessor

The components of lease costs for the three months ended December 31, 2025 and 2024 are as follows:

The components of lease costs for the three months ended March 31, 2026 and 2025 are as follows:

Three months ended

Consolidated Statements of Operations Location

December 31, 2025

December 31, 2024

March 31, 2026

March 31, 2025

(Amounts in thousands)

7 unchanged sentences

Total lease costs, net of lessor interest income

Supplemental cash flow information related to leases for three months ended December 31, 2025 and 2024 is below:

Three months ended

December 31, 2025

December 31, 2024

The components of lease costs for the six months ended March 31, 2026 and 2025 are as follows:

Six months ended

Consolidated Statements of Operations Location

March 31, 2026

March 31, 2025

(Amounts in thousands)

Operating Lease:

Operating lease cost

Selling, general, and administrative

Short-term lease cost

Selling, general, and administrative

Total lease costs

Less lessor interest income

Total lease costs, net of lessor interest income

Supplemental cash flow information related to leases for the six months ended March 31, 2026 and 2025 is below:

Six months ended

March 31, 2026

March 31, 2025

(Amounts in thousands)

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

2 unchanged sentences

Cash received from lessor agreements

Lease assets obtained in exchange for new lease liabilities

Operating leases

Accounts payable and accrued expenses, and Other noncurrent liabilities

1 unchanged sentence

See Note 5 Financing receivables, net for further information related to the multi-year agreements with customers.

There was not an interest rate stated in the agreements and therefore interest was imputed under ASC 835 Interest as the payments in the exchange represented two elements:

There was no interest rate stated in the agreements and therefore interest was imputed under ASC 835 Interest as the payments in the exchange represented two elements:

principal and interest.

The average imputed interest rate for the agreements was determined to be 8.6 % as of December 31, 2025.

The average imputed interest rate for the agreements was determined to be 8.6 % as of March 31, 2026.

The rate was determined primarily based on the rate the Company could obtain by financing from other sources at the date of the transaction.

Interest expense related to these agreements for the three months ended December 31, 2025 and 2024 was $ 125 thousand and $ 75 thousand, respectively.

The amounts owed for these agreements are in Accounts payable and Other noncurrent liabilities because they are owed to vendors rather than banks or financial institutions for borrowings.

Interest expense related to these agreements for the three months ended March 31, 2026 and 2025 was $ 164 thousand and $ 75 thousand, respectively.

Interest expense related to these agreements for the six months ended March 31, 2026 and 2025 was $ 289 thousand and $ 150 thousand, respectively.

These amounts are within “Interest expense” within the Condensed Consolidated Statements of Operations.

The amounts owed for these agreements are in Accounts payable and accrued expenses and Other noncurrent liabilities because they are owed to vendors rather than banks or financial institutions for borrowings.

See Note 9 Line of Credit for amounts due to financial institutions for borrowings.

Below are details of the agreements with the vendors that contain imputed interest:

December 31, 2025

March 31, 2026

September 30, 2025

2 unchanged sentences

Total within Other noncurrent liabilities

The TS segment has many vendors it transacts with and does not have any specific agreement with these vendors that it must purchase certain products.

The TS segment has many vendors it transacts with and does not have any specific agreement with these vendors that it must purchase certain products from the vendor.

Management believes other suppliers could provide similar products on comparable terms.

Line of Credit

As of December 31, 2025 and September 30, 2025, the Company maintained an inventory line of credit with a borrowing capacity of $ 15.0 million.

As of March 31, 2026 and September 30, 2025, the Company maintained an inventory line of credit with a borrowing capacity of $ 15.0 million.

It may be used by the TS and HPP segments in the U.S.

to purchase inventory from approved vendors with payment terms which exceed those offered by the vendors.

No interest accrues under the inventory line of credit when advances are paid within terms, however, late payments are subject to an interest charge of the rate published in the Wall Street Journal as the “ prime rate ” plus 1 %, which was 7.75 % as of December 31, 2025.

The line of credit automatically renews for one year periods unless terminated by the Company with at least 60 days’ notice or immediate termination by the lender.

The collateral is a blanket UCC filing on Modcomp, Inc., a wholly-ownwed subsidiary, and CSPi assets.

The collateral is a blanket UCC filing on Modcomp, Inc., a wholly-owned subsidiary, and CSPi assets.

The credit agreement for the inventory line of credit contains financial covenants which require the Company to maintain the following TS segment-specific financial ratios:

(1) a minimum current ratio of 1.2 , (2) tangible net worth of no less than $ 4.0 million, and (3) a maximum ratio of total liabilities to total net worth of less than 5 :1.

As of December 31, 2025 and September 30, 2025, Company borrowings, all from the TS segment, under the inventory line of credit were $ 1.4 million and $ 0.9 million, respectively, and the Company was in compliance with all financial covenants.

As of December 31, 2025 and September 30, 2025, this line of credit also included availability of a limited cash withdrawal of up to $ 1.0 million.

As of December 31, 2025 and September 30, 2025 there were no cash withdrawals outstanding.

As of March 31, 2026 and September 30, 2025, Company borrowings, all from the TS segment, under the inventory line of credit were $ 0.9 million and $ 0.9 million, respectively, and the Company was in compliance with all financial covenants.

As of March 31, 2026 and September 30, 2025, this line of credit also included availability of a limited cash withdrawal of up to $ 1.0 million.

As of March 31, 2026 and September 30, 2025 there were no cash withdrawals outstanding.

Pension and Retirement Plans

12 unchanged sentences

This payment is subject to adjustment as a result of subsequent data cleansing activities.

Under the terms of this buy-in contract, the insurer is liable to pay the benefits of the plan, but the Company still retains full legal responsibility to pay the benefits to members using the insurance payments.

Under the terms of this buy-in contract, the insurer is liable to pay the benefits

of the plan, but the Company still retains full legal responsibility to pay the benefits to members using the insurance payments.

The buy-in contract is treated as a plan asset.

When the buy-in contract transitions to a buy-out contract the Company will no longer have legal responsibility to pay the benefits to the members.

This transition is a significant event and the pension assets and liabilities will be remeasured at this time.

The components of net periodic benefit costs related to the U.S.

plans are as follows:

Three Months Ended December 31,

When the buy-in contract transitions to a buy-out contract the Company will be relieved of primary responsibility for the pension benefit obligation and settlement will be recognized.

The components of net periodic benefit costs related to the US and UK plans are as follows:

Three Months Ended March 31,

(Amounts in thousands)

3 unchanged sentences

Amortization of net gain

Net periodic (benefit) cost

Post Retirement:

Interest cost

Amortization of net gain

Net periodic benefit

Six Months Ended March 31,

(Amounts in thousands)

Interest cost

Expected return on plan assets

Amortization of past service costs

Amortization of net gain

Net periodic cost (benefit)

3 unchanged sentences

Net periodic benefit

The fair value of the assets held by the U.K.

pension plan by asset category are as follows:

The fair value of the assets held by the UK pension plan by asset category are as follows:

Fair Values as of

December 31, 2025

March 31, 2026

September 30, 2025

6 unchanged sentences

Total plan assets

*This fair value as of December 31, 2025 is based on the latest information available, which is as of September 30, 2025.

The slight difference from September 30, 2025 is due to the Great British Pounds being converted into U.S.

*This fair value is based on the latest information available, which is as of September 30, 2025 not March 31, 2026 as the table is labeled.

The difference from September 30, 2025 is due to the Great British Pounds being converted into U.S.

dollars at a different exchange rate.

Income tax expense of $ 280 thousand was recorded for the three months ended December 31, 2025 compared to an income tax benefit of $ 115 thousand in the same period of 2024.

For the three months ended December 31, 2025, the difference between our effective income tax rate and the U.S.

federal statutory rate are the impact of tax credits that we expect to be able to utilize against federal and state taxes, the change in valuation allowance maintained against certain state tax credits, and non-deductible executive compensation.

For the three months ended December 31, 2024, the difference between our effective income tax rate and the U.S.

federal statutory rate are the impact of tax credits that we expect to be able to utilize against federal and state taxes and the change in valuation allowance maintained against certain state tax credits.

On July 4, 2025, President Donald Trump signed the One Big Beautiful Bill Act (“OBBBA”) into law.

Key corporate tax provisions include the restoration of 100% bonus depreciation, immediate expensing for domestic research and experimental expenditures, changes to Section 163(j) interest limitations, and expanded Section 162(m) aggregation requirements.

In accordance with ASC 740, the effects of the new tax law will be recognized in the period of enactment.

The legislation has multiple effective dates, with certain provisions effective in 2025 and others to be implemented through

We have evaluated the impact of the OBBBA and determined that it did not have a material effect on the Company’s financial statements for the three months ended December 31, 2025.

We will continue to assess the implications of the OBBBA as further guidance becomes available but do not expect the legislation to have a material impact on the effective tax rate in future periods.

The Company recorded an income tax benefit of $ 568 thousand and $ 683 thousand for the three months ended March 31, 2026 and 2025, respectively.

An income tax benefit of $ 288 thousand and $ 798 thousand was recorded for the six months ended March 31, 2026 and 2025, respectively.

For all of these periods, the difference between our effective income tax rate and the U.S.

federal statutory rate was the impact of tax credits that we expect to be able to utilize against federal and state taxes, the change in valuation allowance maintained against certain state tax credits, and the excess tax benefits on restricted stock awards that vested during the period.

Accumulated Other Comprehensive Loss

12 unchanged sentences

unobservable inputs (e.g., a reporting entity’s or other entity’s own data)

The Company had no assets or liabilities measured at fair value on a recurring (except our pension plan assets and whole life insurance policies, see Note 10 Pension and retirement plans for pension plan assets) or non-recurring basis as of December 31, 2025 or September 30, 2025.

To estimate the fair value of the financial instruments below, quoted market prices are used when available and classified within Level 1.

The Company had no assets or liabilities measured at fair value on a recurring basis (except our pension plan assets and whole life insurance policies, see Note 10 Pension and Retirement Plans for pension plan assets) or non-recurring basis as of March 31, 2026 or September 30, 2025.

To estimate fair value of the financial instruments below, quoted market prices are used when available and classified within Level 1.

If this data is not available, we use observable market-based inputs to estimate fair value, which are classified within Level 2.

If the preceding information is unavailable, we use internally generated data to estimate fair value which is classified within Level 3.

As of December 31, 2025

As of March 31, 2026

As of September 30, 2025

9 unchanged sentences

Condensed Consolidated Balance Sheets and Note 5

Accounts payable and accrued expenses and other long-term liabilities**

Accounts payable and accrued expenses and other noncurrent liabilities**

Line of Credit

Condensed Consolidated Balance Sheets and Note 9

*Includes original maturity over one year

**Vendor financing agreements with original maturity over one year included within Accounts payable and accrued expenses and Other long-term liabilities

*Original maturity over one year

** Vendor financing agreements with original maturity over one year included within Accounts payable and accrued expenses and Other noncurrent liabilities

Cash and cash equivalents

Carrying amount approximated fair value.

Accounts receivable

Fair value was not materially different from carrying values.

Accounts receivable and Accounts payable and accrued expenses with original maturity of less than one year

Fair value was not materially different from their carrying values as of March 31, 2026, and September 30, 2025

Financing receivables, net

Fair value was estimated by discounting future cash flows based on the current rate with similar terms.

Vendor financing agreements within Accounts payable and accrued expenses and other long-term liabilities with original maturity over one year

Vendor financing agreements within Accounts payable and accrued expenses and other noncurrent liabilities with original maturity over one year

Fair value was estimated by discounting future cash flows based on the current rate with similar terms.

4 unchanged sentences

Segment Information

The following tables present certain operating segment information for the three months ended December 31, 2025 and 2024.

We have two reporting segments, High Performance Products and Technology Solutions, discussed below.

The Company’s country of domicile is the United States.

High Performance Products (HPP) – The HPP segment consists of primarily of the following product lines:

ARIA, Multicomputer, and Myricom.

Most of the revenue is from US customers for all product lines, but the segment has expanded into APAC and Africa regions with its ARIA product line.

The segment’s operations are based in Lowell, Massachusetts.

Technology Solutions (TS) – The TS segment generates revenue by reselling third-party computer hardware, software, and related support/maintenance/warranty as a value-added reseller (“VAR”).

The TS segment generates service revenues by the delivery of professional services for complex IT solutions, including advanced security;

unified communications and collaboration;

wireless and mobility;

data center solutions;

and network solutions as well as managed IT services that primarily serve the small and mid-sized business market.

TS has two divisions – United Kingdom and U.S.

which are displayed separately and in total below.

division, located in Boca Raton, Florida, primarily has U.S.

customers and the United Kingdom division, located in Wokingham, Berkshire, primarily has U.K.

customers as well as other European countries.

The factors used in identifying the Company’s reportable segments include geographical location of operations and the types of products and services.

The accounting policies of the Company's segments are consistent with those described in Note 1 Basis of presentation and Summary of Significant Accounting Policies of the company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2025.

All intercompany revenues are eliminated in consolidation and are not reviewed when evaluating segment performance.

The Company's Chief Operating Decision Maker (“CODM”) Victor Dellovo, Chief Executive Officer , assesses segment performance and allocates resources based upon revenues and operating income before certain other nonroutine items, if any.

Asset information utilized by the CODM for purposes of assessing performance and allocating resources includes Cash and cash equivalents, Accounts receivable, and Financing receivables.

Cash and cash equivalents are utilized due to the HPP segment incurring losses and receiving cash from the TS-US division.

Accounts and Financing receivables are regularly provided to the CODM to assess customer trends, credit policies, and operational efficiency.

The following tables presents certain operating segment information.

Technology Solutions Segment

Three months ended December 31,

Three months ended March 31,

(Amounts in thousands)

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Capital expenditures

Operating income (loss) from operations consists of sales less Cost of sales, Research and development expenses, and Selling, general and administrative expenses but is not affected by either other income/expense or by income taxes expense (benefit).

Non-operating expenses/income consists principally of interest income from transactions with payment terms exceeding one year (see Note 5, Financing receivables, net for details), interest income from cash and cash equivalents, and interest expense.

All intercompany transactions have been eliminated.

Technology Solutions Segment

Six months ended March 31,

(Amounts in thousands)

Cost of sales:

Total cost of sales

Research and development

Selling, general and administrative

Total operating expenses

Operating (loss) income

Interest expense

Interest income

Depreciation and amortization

Cash and cash equivalents

Accounts receivable, net of allowance

Financing receivables, net of allowance

Capital expenditures

Cost of sales:

Total cost of sales

Research and development

Selling, general and administrative

Total operating expenses

Operating (loss) income

Interest expense

Interest income

Depreciation and amortization

Cash and cash equivalents

Accounts receivable, net of allowance

Financing receivables, net of allowance

Capital expenditures

Depreciation and amortization are included in Selling, general, and administrative expenses.

Operating (loss) income is not affected by either non-operating charges/income or by income taxes.

Non-operating charges/income consists principally of foreign exchange gain (loss), interest income, and interest expense.

Our long-lived assets are located in the United States.

Concentrations of Credit Risk

2 unchanged sentences

Each customer’s letter (e.g.

“Customer B”) does not change meaning if Customer B is in multiple tables it is the same customer.

Below are customers with 10% or more of accounts receivables as of December 31, 2025 or September 30, 2025.

As of December 31, 2025

“Customer A”) does not change meaning if Customer A is in multiple tables, it is the same customer.

Below are customers with 10% or more of accounts receivable as of March 31, 2026 or September 30, 2025.

As of March 31, 2026

As of September 30, 2025

4 unchanged sentences

Accounts receivable

Below are customers with 10% or more of financing receivables as of December 31, 2025 or September 30, 2025.

As of December 31, 2025

Below are customers with 10% or more of financing receivables as of March 31, 2026 or September 30, 2025.

As of March 31, 2026

As of September 30, 2025

4 unchanged sentences

Financing Receivables

The following table lists customers from which the Company derived revenues of 10% or more of total revenues for the three months ended December 31, 2025 or 2024.

Three months ended December 31,

The following table lists customers from which the Company derived revenues of 10% or more of total revenues for the three and six months ended March 31, 2026 and 2025.

Three months ended March 31,

Six months ended March 31,

(Amounts in millions)

On December 16, 2025 , the Company’s board of directors declared a dividend of $ 0.03 per share payable January 15, 2026 , to shareholders of record on the close of business on December 26, 2025 .

On February 12, 2026 , the Company’s board of directors declared a dividend of $ 0.03 per share payable March 12, 2026 , to shareholders of record on the close of business on February 26, 2026 .

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