What changed in this filing

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Item 1. Financial Statements

2026-08-11 compared with 2026-05-12 · 114 added, 73 removed, 278 unchanged (40% of the section changed)

30 unchanged sentences

250,000,000 shares authorized;

188,927,224 and 187,878,790 shares issued at March 31, 2026 and December 31, 2025, respectively;

178,317,154 and 177,268,720 shares outstanding as of March 31, 2026 and December 31, 2025, respectively

189,207,288 and 187,878,790 shares issued at June 30, 2026 and December 31, 2025, respectively;

178,597,218 and 177,268,720 shares outstanding as of June 30, 2026 and December 31, 2025, respectively

Additional paid-in capital 416,317 413,122

7 unchanged sentences

(Dollar amounts in thousands, except share and per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Research and development services $ 4,944 $ 1,515 $ 7,776 $ 2,004

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(Dollar amounts in thousands, except share data)

Three Months Ended March 31, 2026

Six Months Ended June 30, 2026

Common Stock Treasury Stock Additional

7 unchanged sentences

Balance at March 31, 2026 188,927,224 $ 19 ( 10,610,070 ) $ ( 14,132 ) $ 414,574 $ ( 218,737 ) $ 181,724

Three Months Ended March 31, 2025

Exercise of common stock options and vesting of restricted stock units, net 280,064 — — — 1 — 1

Share-based compensation — — — — 1,742 — 1,742

Net loss — — — — — ( 13,928 ) ( 13,928 )

Balance at June 30, 2026 189,207,288 $ 19 ( 10,610,070 ) $ ( 14,132 ) $ 416,317 $ ( 232,665 ) $ 169,539

Six Months Ended June 30, 2025

Common Stock Treasury Stock Additional

5 unchanged sentences

Share-based compensation — — — — 1,295 — 1,295

Repurchase of treasury stock — — — — — — —

Net loss — — — — — ( 17,254 ) ( 17,254 )

Balance at March 31, 2025 185,842,864 $ 19 ( 10,610,070 ) $ ( 14,132 ) $ 409,166 $ ( 167,066 ) $ 227,987

Exercise of common stock options and vesting of restricted stock units, net 203,342 — — — ( 89 ) — ( 89 )

Share-based compensation — — — — 1,386 — 1,386

Net loss — — — — — ( 13,414 ) ( 13,414 )

Balance at June 30, 2025 186,046,206 $ 19 ( 10,610,070 ) $ ( 14,132 ) $ 410,463 $ ( 180,480 ) $ 215,870

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

2 unchanged sentences

(Dollar amounts in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities

23 unchanged sentences

Cash flows from financing activities

Proceeds from exercise of common stock options 1 —

Taxes paid related to net share settlement of equity awards — ( 532 )

Net cash used in financing activities — ( 444 )

Net cash provided by (used in) financing activities 1 ( 532 )

Net (decrease) increase in cash and cash equivalents and restricted cash ( 9,772 ) 6,364

8 unchanged sentences

Hyliion Holdings Corp.

is a Delaware corporation headquartered in Cedar Park, Texas, that designs and develops KARNO TM Power Module for stationary and mobile applications and provides research and development (“R&D”) services.

is a Delaware corporation headquartered in Cedar Park, Texas, that designs and develops the KARNO TM Power Module for stationary and mobile applications and provides research and development (“R&D”) services.

References to the “Company,” “Hyliion,” “we,” “our,” or “us” in this report refer to Hyliion Holdings Corp.

and its wholly owned subsidiary, unless expressly indicated or the context otherwise requires.

The KARNO Power Module is a complete, fully integrated, enclosed, fuel agnostic power generating solution, including balance of plant such as cooling system, controls, fuel handling, and air handling systems, that generates electricity on command in stationary power generation applications powered by KARNO Cores.

The KARNO Core is a linear generator that generates its own heat, and converts thermal energy generated from oxidization of fuels into electrical energy.

It uses linear electric motors in a four-shaft system to generate electricity via a flameless oxidation process, achieving near zero emissions without emissions treatment systems.

On November 7, 2023, the Board of the Company approved a strategic plan to wind down its powertrain business and preserve the related intellectual property (the “Plan”).

As part of the Plan, the Company will continue to focus on commercialization of its KARNO Power Module technology.

We have not accounted for the impacts of the Plan as a discontinued operation through March 31, 2026 as we have not abandoned or sold the underlying intellectual property.

Costs paid or settled associated with the Plan during the three months ended March 31, 2026 and 2025 were nil and $ 0.6 million, respectively.

We reclassified assets previously recorded as held for sale totaling $ 1.0 million to property and equipment, net, on the condensed consolidated balance sheets, and recognized charges of $ 1.6 million using fair value hierarchy Level III inputs including comparable assets, adjusted for condition, included in exit and termination costs in the condensed consolidated statements of operations f or the three months ended March 31, 2025.

During the fourth quarter of 2025, we reclassified $ 1.2 million in assets from property and equipment, net to assets held for sale on the condensed consolidated balance sheets.

These assets were subsequently sold in the three months ended March 31, 2026.

We recorded net benefits for recoveries related to asset sales of $ 0.4 million and $ 0.3 million included in exit and termination (benefits) costs in the condensed consolidated statements of operations and in gain on disposal of assets in the condensed consolidated statements of cash flows for the three months ended March 31, 2026 and 2025, respectively.

The KARNO Power Module is a complete, fully integrated, enclosed, fuel agnostic power generating solution, including balance of plant systems such as cooling, controls, fuel, and air handling, that generates electricity on command in stationary power generation applications powered by KARNO Cores.

The KARNO Core is a heat-powered generator that uses linear motors in a four-shaft system to generate electricity.

Heat is generated through the flameless oxidation of fuels while achieving near zero emissions without aftertreatment systems.

In November 2023, the Company initiated the wind-down of its powertrain business (the “Plan”), the majority of which activities were completed in 2025.

See Note 2 to the consolidated financial statements in our 2025 Annual Report for additional information.

The Company has not accounted for the impacts of the Plan as a discontinued operation as the underlying intellectual property has not been abandoned or sold.

The Company recognized net (benefits) costs related to the Plan, consisting primarily of recoveries from sales of assets, of $( 0.3 ) million and $( 0.3 ) million during the three months ended June 30, 2026 and 2025, respectively, and $( 0.7 ) million and $ 1.1 million during the six months ended June 30, 2026 and 2025, respectively, which are included in exit and termination (benefits) costs in the condensed consolidated statements of operations.

Remaining accrued liabilities associated with the Plan were immaterial at June 30, 2026.

Summary of Significant Accounting Policies

10 unchanged sentences

The Company is an early-stage growth company and has generated negative cash flows from operating activities since inception.

At March 31, 2026, the Company had total equity of $ 181.7 million, inclusive of cash and cash equivalents of $ 20.3 million and total investments of $ 119.1 million.

At June 30, 2026, the Company had total equity of $ 169.5 million, inclusive of cash and cash equivalents of $ 13.2 million and total investments of $ 119.2 million.

Based on this, the Company has sufficient funds to continue to execute its business strategy for the next twelve months from the issuance date of the financial statements included in this Quarterly Report on Form 10-Q.

Use of Estimates

The preparation of financial statements in conformity with GAAP require s management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the

balance sheet date, as well as reported amounts of expenses during the reporting period.

The Company’s most significant estimates and judgments involve revenue, inventory, income taxes and valuation of share-based compensation.

3 unchanged sentences

ASC 280, Segment Reporting , defines operating segments as components of an enterprise where discrete financial information is available that is evaluated regularly by the chief operating decision-maker ("CODM") in deciding how to allocate resources and in assessing performance.

The Company operates as a single operating segment from which all revenue and net income (loss) is derived and for which all assets are attributed.

The Company operates as a single operating segment from which all revenue and net income (loss) are derived and for which all assets are attributed.

The Company's CODM is the chief executive officer, who has ultimate responsibility for the operating performance of the Company and the allocation of resources.

The CODM uses net income (loss) to manage the business and does not segment the business for internal reporting or decision making.

The significant expense categories and amounts that are regularly provided to the CODM and included in the reported measure of segment loss for the three months ended March 31, 2026 and 2025 are summarized as follows (in millions):

Three Months Ended March 31,

The CODM assesses performance for the single operating segment and decides how to allocate resources based on consolidated net income (loss), which is reported on the condensed consolidated statements of operations, and does not segment the business for internal reporting or decision making.

The CODM uses net income (loss), including the significant expense categories presented below, in the annual budgeting and forecasting process and monitors actual results against the budget and forecast on a quarterly basis.

The CODM considers budget-to-actual variances in net income (loss) when making decisions about the allocation of operating and capital resources, including the level of investment in research and development activities related to the KARNO Power Module, spending on commercialization efforts, and resources devoted to performance under the Company's government contracts.

The CODM also uses net income (loss) to monitor the Company's operating cash requirements and to evaluate the sufficiency of the Company's liquidity to fund planned operations.

The significant expense categories and amounts that are regularly provided to the CODM and included in the reported measure of segment loss for the three and six months ended June 30, 2026 and 2025 are summarized as follows (in millions):

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Total revenues $ 4.9 $ 1.5 $ 7.8 $ 2.0

22 unchanged sentences

Total cash and cash equivalents and restricted cash as presented in the condensed consolidated statements of cash flows is summarized as follows:

March 31, 2026 December 31, 2025 March 31, 2025 December 31, 2024

June 30, 2026 December 31, 2025 June 30, 2025 December 31, 2024

Cash and cash equivalents $ 13,166 $ 22,938 $ 15,591 $ 9,227

2 unchanged sentences

Accounts Receivable, Net

Accounts receivable are stated at a gross invoice amount, net of an allowance for doubtful accounts.

The allowance for doubtful accounts is maintained at a level considered adequate to provide for potential account losses on the balance based on the Company’s evaluation of current economic conditions without expectation of future changes, changes in the character and size of the balance, past and expected future loss experience, and other pertinent factors.

At March 31, 2026 and December 31, 2025, accounts receivable included amounts receivable from a single customer of $ 3.0 million and $ 0.5 million, respectively.

At March 31, 2026 and December 31, 2025, there was no allowance for doubtful accounts on customer receivables.

We adopted ASU 2025-05, Financial Instruments—Credit Losses (Topic 326)-Measurement of Credit Losses for Accounts Receivable and Contract Assets during the quarter ended March 31, 2026, applying the practical expedient policy election that assumes that current conditions as of the balance sheet date do not change for the remaining life of the current accounts receivable asset expected credit losses estimate on a prospective basis.

There was no material impact as the result of the adoption of this ASU.

Accounts receivable are stated at the invoiced amount, net of an allowance for credit losses.

The Company estimates expected credit losses on its receivables and maintains an allowance at a level considered adequate to provide for those losses based on its evaluation of current conditions as of the balance sheet date, changes in the character and size of the receivable balance, historical loss experience, and other pertinent factors.

At June 30, 2026 and December 31, 2025, accounts receivable included amounts receivable from a single customer of $ 2.5 million and $ 0.5 million, respectively.

At June 30, 2026 and December 31, 2025, there was no allowance for credit losses on customer receivables.

The Company adopted ASU 2025-05, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets, during the quarter ended March 31, 2026, applying the practical expedient under which the Company assumes that current conditions as of the balance sheet date do not change for the remaining life of its current accounts receivable in estimating expected credit losses.

There was no material impact as a result of the adoption of this ASU.

The Company’s investments consist of corporate bonds, U.S.

4 unchanged sentences

Such amortization, along with interest, is included in interest income.

The Company estimates expected credits losses for held-to-maturity investments by considering relevant available information and assessing the risk of loss over the assets’ contractual life.

The Company’s portfolio of held-to-maturity investments are of a high credit quality with minimal expected credit losses.

The Company estimates expected credit losses for held-to-maturity investments by considering relevant available information and assessing the risk of loss over the assets’ contractual life.

The Company’s portfolio of held-to-maturity investments is of a high credit quality with minimal expected credit losses.

The Company uses the specific identification method to determine the cost basis of securities sold.

8 unchanged sentences

Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.

The Company believes its valuation methods are appropriate and consistent with other market participants, however the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

The Company believes its valuation methods are appropriate and consistent with other market participants.

However, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

The Company’s financial instruments consist of cash and cash equivalents and restricted cash, accounts receivable, investments, accounts payable and accrued expenses.

2 unchanged sentences

As a result, investments are classified within Level II of the fair value hierarchy.

As of March 31, 2026, we have not yet commercialized the KARNO Power Module.

As of June 30, 2026, we have not yet commercialized the KARNO Power Module.

Unless such components are capitalizable, costs incurred for components acquired prior to our determination of reaching a commercial stage are expensed as R&D costs, resulting in zero cost basis for those components.

As a result, moving-average prices for inventory that is capitalized in future periods may be significantly affected by those zero cost items.

As a result, certain components on hand have a zero cost basis, and inventory capitalized in future periods that incorporates these components will reflect carrying amounts, and related cost of revenue upon sale, that are lower than would result had those components been initially capitalized.

When inventory may be utilized in performance of our contracts with the United States Department of the Navy’s Office of Naval Research (“ONR”), we capitalize that inventory including certain allocations of overhead, labor, and other direct costs and classify it as work-in-process inventory.

When this inventory is designated to and utilized in an activity, we record either an R&D or a cost of sale charge in the period in which the utilization occurs.

All inventory at March 31, 2026 is classified as work-in-process.

When this inventory is designated to and utilized in an activity, we record either an R&D or a cost of revenue charge in the period in which the utilization occurs.

All inventory recorded on the balance sheet at June 30, 2026 is classified as work-in-process.

Inventory is valued using the specific identification cost method and is stated at the lower of cost or net realizable value.

We review our inventory to determine whether its carrying value exceeds the net amount realizable we expect to receive upon the ultimate sale of the inventory.

We review our inventory to determine whether its carrying value exceeds the net amount we expect to realize upon the ultimate sale of the inventory.

The Company follows five steps to recognize revenue from contracts with customers under ASC 606, Revenue from Contracts with Customers, which are:

5 unchanged sentences

Government Contracts

In September 2024, the Company was awarded a best effort cost-plus-fixed fee contract up to $ 16.0 million by the ONR to research the suitability of its KARNO Power Module for Navy ships and stationary power generation applications.

In September 2024, the Company was awarded a best effort cost-plus-fixed-fee contract of up to $ 16.0 million by the ONR to research the suitability of its KARNO Power Module for Navy ships and stationary power generation applications.

Under the agreement, the Company will provide R&D services through February 2027, including delivery of up to seven KARNO Cores and testing of power module systems.

The ONR contract represented a significant change in business strategy toward providing R&D activities in the ordinary course of business in addition to developing Power Modules for stationary and mobile applications.

In July 2025, the Company was awarded a Phase II best effort cost-plus-fixed fee contract up to $ 1.5 million by the ONR to demonstrate the conceptual feasibility of the Phase I effort contract awarded in July 2024 for up to $ 0.2 million and to show development progress towards successful application.

Under the Phase II agreement, the Company will provide R&D services through July 2026 with an option to extend through July 2027, including design reviews, simulations, and reporting.

The ONR contract represented a significant change in business strategy toward providing R&D activities in the ord inary course of business in addition to developing Power Modules for stationary and mobile applications.

In July 2025, the Company was awarded a Phase II best effort cost-plus-fixed-fee contract of up to $ 1.5 million by the ONR to demonstrate the conceptual feasibility of the Phase I effort contract awarded in July 2024 for up to $ 0.2 million and to show development progress towards successful application.

Under the Phase II agreement, including the exercised option, the Company will provide R&D services through July 2027, including design reviews, simulations, and reporting.

There is a single research and development services performance obligation in each of these contracts that is measured over time as the services are performed.

The Company generally invoices monthly, which corresponds directly with the value to the customers of the performance completed to date based on the cost of labor and materials utilized, and recognizes revenue in the amount that it has a right to invoice.

amount that it has a right to invoice.

Payment is ordinarily due within 90 days of invoice submission.

Cost of R&D services revenue includes labor, allocated fringe and overhead, and inventory.

All revenue during the three months ended March 31, 2026 and 2025 was recognized over time.

The portion of our revenues from significant customers is summarized as follows and is attributable to the U.S.:

Three Months Ended March 31,

All revenue during the three and six months ended June 30, 2026 and 2025 was recognized over time.

The portion of our revenues from significant customers is summarized as follows and is attributable to customers located in the U.S.:

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Customer A 100 % 87 % 100 % 77 %

Customer B — 13 — 23

100 % 100 % 100 % 100 %

In July 2026, the Company was awarded a best effort cost-plus-fixed-fee contract of up to $ 41.7 million by the ONR.

This contract provides for the design, development, construction, testing and delivery of 2-megawatt and 3-megawatt KARNO power generation systems at locations identified by ONR.

The Company expects to begin performance on this contract in the fourth quarter of 2026, increasing performance in the second and third quarters of 2027, and continuing through mid-2029.

Research and Development Expense

2 unchanged sentences

Recent Accounting Pronouncements

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270)-Narrow-Scope Improvements , to improve the guidance in Topic 270, Interim Reporting, by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable, including additional guidance on what disclosures should be provided in interim reporting periods.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270):

Narrow-Scope Improvements , to improve the guidance in Topic 270, Interim Reporting, by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable, including additional guidance on what disclosures should be provided in interim reporting periods.

The pronouncement is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027.

We are currently evaluating the impact of adoption.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40)-Targeted Improvements to the Accounting for Internal-Use Software , to modernize the accounting for software costs that are accounted for under Subtopic 350-40, Intangibles—Goodwill and Other—Internal-Use Software.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software , to modernize the accounting for software costs that are accounted for under Subtopic 350-40, Intangibles—Goodwill and Other—Internal-Use Software.

The pronouncement is effective for fiscal years beginning after December 15, 2027 and interim periods within that fiscal year.

2 unchanged sentences

The pronouncement is effective for fiscal years beginning after December 15, 2026 and interim periods beginning after December 15, 2027, and we expect a material impact to our disclosures as a result of adoption.

The amortized cost, unrealized gains and losses, fair value and maturities of our held-to-maturity investments at March 31, 2026 and December 31, 2025 are summarized as follows:

Fair Value Measurements at March 31, 2026

The amortized cost, unrealized gains and losses, fair value and maturities of our held-to-maturity investments at June 30, 2026 and December 31, 2025 are summarized as follows:

June 30, 2026

Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value

2 unchanged sentences

$ 119,219 $ 196 $ ( 181 ) $ 119,234

Fair Value Measurements at December 31, 2025

December 31, 2025

Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value

4 unchanged sentences

$ 129,421 $ 493 $ ( 17 ) $ 129,897

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Amortized Cost Fair Value Amortized Cost Fair Value

3 unchanged sentences

Fair Value Measurements

The fair value measurements of our financial assets at March 31, 2026 and December 31, 2025 are summarized as follows:

Fair Value Measurements at March 31, 2026

The fair value measurements of our financial assets at June 30, 2026 and December 31, 2025 are summarized as follows:

Fair Value Measurements at June 30, 2026

Level I Level II Level III Total

15 unchanged sentences

$ 23,603 $ 129,897 $ — $ 153,500

Subsequent to June 30, 2026, the Company entered into an amendment to the lease of its Cedar Park, Texas headquarters facilities.

The amendment extends the lease term for the Company's approximately 125,000 square foot facility by 63 months, through July 2032, and provides for total base rent of approximately $ 9.8 million over the extension period, inclusive of a three-month rent abatement, and a tenant improvement allowance of up to $ 0.6 million.

The Company retains two options to further extend the lease term by five years each.

The lease term for the subleased approximately 27,000 square foot facility was not extended and will expire in April 2027.

The Company will remeasure the related operating lease right-of-use asset and lease liability as of the amendment date in the third quarter of 2026.

In February 2025, the Company executed a sublease for a portion of its corporate office through April 2027.

Sublease operating income which is included as reductions to R&D and selling, general and administrative expense in the condensed consolidated statements of operations for the three months ended March 31, 2026 and 2025 was $ 0.1 million and $ 0.1 million, respectively.

Sublease operating income which is included as reductions to R&D and selling, general and administrative expense in the condensed consolidated statements of operations for the three months ended June 30, 2026 and 2025 was $ 0.1 million and $ 0.1 million, respectively, and $ 0.2 million and $ 0.1 million, respectively, for the six months ended June 30, 2026 and 2025.

Property and Equipment, Net

Property and equipment, net at March 31, 2026 and December 31, 2025 is summarized as follows:

March 31, 2026 December 31, 2025

Property and equipment, net at June 30, 2026 and December 31, 2025 is summarized as follows:

June 30, 2026 December 31, 2025

Production machinery and equipment $ 46,797 $ 46,905

7 unchanged sentences

Share-Based Compensation

During the three months ended March 31, 2026 and 2025, the Company granted 4.0 million and 4.3 million restricted stock units, respectively, which will vest over a period of one to three years , inclusive of the units described below with underlying closing stock price thresholds.

During the three months ended March 31, 2026 and 2025, 0.6 million and 0.1 million restricted stock units, respectively, were forfeited.

Share-based compensation expense for the three months ended March 31, 2026 and 2025 was $ 1.5 million and $ 1.3 million, respectively.

The Company granted 2.3 million restricted stock units in the three months ended March 31, 2026 that are subject to vest between February 11, 2026 and December 31, 2028 contingent upon achieving underlying closing stock price thresholds.

Through March 31, 2026, there was no achievement of underlying closing stock price thresholds on these awards.

During the six months ended June 30, 2026 and 2025, the Company granted 4.0 million and 4.3 million restricted stock units, respectively, which will vest over a period of one to three years , inclusive of the units described below with underlying closing stock price thresholds.

During the six months ended June 30, 2026 and 2025, 0.6 million and 0.1 million restricted stock units, respectively, were forfeited.

Share-based compensation expense for the three months ended June 30, 2026 and 2025 was $ 1.7 million and $ 1.4 million, respectively.

Share-based compensation expense for the six months ended June 30, 2026 and 2025 was $ 3.2 million and $ 2.7 million, respectively.

The Company granted 2.3 million restricted stock units in the six months ended June 30, 2026 that are subject to vest between February 11, 2026 and December 31, 2028 contingent upon achieving underlying closing stock price thresholds.

Through June 30, 2026, there was no achievement of underlying closing stock price thresholds on these awards.

These awards were valued at $ 1.57 per unit using a Monte Carlo simulation including a blend of historical and implied share volatility of 105 % and a risk-free rate of 3.48 %.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities at March 31, 2026 and December 31, 2025 are summarized as follows:

March 31, 2026 December 31, 2025

Accrued expenses and other current liabilities at June 30, 2026 and December 31, 2025 are summarized as follows:

June 30, 2026 December 31, 2025

Accrued professional services and other $ 2,118 $ 1,342

6 unchanged sentences

The requirements must be met on or be fore specific measurement dates and maintained throughout the term of the agreement, which expires effective December 31, 2029.

The Company has received payments to date of $ 0.4 million which are refundable as applicable performance requirements were not met and are included within accrued expenses and other current liabilities at March 31, 2026.

Under the agreement, th e EDC has the right to file a security interest to all assets of the Company.

3 unchanged sentences

Net Loss Per Share

The computation of basic and diluted net loss per share for the three months ended March 31, 2026 and 2025 is summarized as follows (in thousands, except share and per share data):

Three Months Ended March 31,

The computation of basic and diluted net loss per share for the three and six months ended June 30, 2026 and 2025 is summarized as follows (in thousands, except share and per share data):

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Net loss attributable to common stockholders $ ( 13,928 ) $ ( 13,414 ) $ ( 25,665 ) $ ( 30,668 )

1 unchanged sentence

Net loss per share, basic and diluted $ ( 0.08 ) $ ( 0.08 ) $ ( 0.14 ) $ ( 0.18 )

Potential common shares excluded from the computation of diluted net loss per share because including them would have had an anti-dilutive effect for the three months ended March 31, 2026 and 2025 are summarized as follows:

Three Months Ended March 31,

Potential common shares excluded from the computation of diluted net loss per share because including them would have had an anti-dilutive effect for the three and six months ended June 30, 2026 and 2025 are summarized as follows:

Three and Six Months Ended June 30,

Unexercised stock options 169,495 183,975

1 unchanged sentence

10,007,007 8,855,119

Subsequent Events

At-the-Market Offering Program

On August 11, 2026, the Company entered into an at-the-market sales agreement (the “Sales Agreement”) with Needham & Company, LLC and Northland Securities, Inc.

(each, a “Sales Agent” and collectively, the “Sales Agents”).

Under the terms of the Sales Agreement, the Company may offer and sell, from time to time at its sole discretion, shares of its common stock, par value $ 0.0001 per share (the “Common Stock”), having an aggregate offering price of up to $ 100 million (the “Shares”) through the Sales Agents.

Pursuant to the Sales Agreement, the Shares may be offered and sold through the Sales Agents in transactions deemed to be an “at the market offering” as defined in Rule 415(a)(4) under the Securities Act, including sales made directly on or through the NYSE American or any other existing trading market for the Common Stock, in negotiated transactions (including block trades) at market prices prevailing at the time of sale or at prices related to such prevailing market prices and/or any other method permitted by law.

Under the terms of the Sales Agreement, the Company may also sell the Shares to a Sales Agent as principal for its own account at a price agreed upon at the time of sale.

Pursuant to the Sales Agreement, the Company has agreed to pay the applicable Sales Agent a commission of up to 3.0 % of the aggregate gross proceeds from each sale of the Shares and has agreed to provide the Sales Agents with customary expense reimbursement.

The Sales Agreement contains customary representations, warranties and agreements of the Company, and customary conditions to completing future sale transactions, indemnification rights and obligations of the parties and termination provisions.

The Company has no obligation to sell, and the Sales Agents have no obligation to buy or sell, any of the Shares under the Sales Agreement and the Company or the Sales Agents may at any time suspend sales under the Sales Agreement.

Through the date of this filing, no shares had been sold.

Government Contract Award

As discussed in Note 3, in July 2026 the Company was awarded a best effort cost-plus-fixed fee contract of up to $ 41.7 million by the ONR.

Lease Amendment

As discussed in Note 6, in July 2026 the Company entered into an amendment extending the lease of its Cedar Park, Texas facilities.

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