What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-04-23 compared with 2025-10-23 · 169 added, 202 removed, 297 unchanged (56% of the section changed)

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We pioneered ADAS technology more than 25 years ago and have continuously expanded the scope of our ADAS offerings, while leading the evolution to autonomous driving solutions.

On February 3, 2026, we completed the acquisition of Mentee Robotics, a humanoid robotics company.

This acquisition combines Mobileye’s advanced artificial intelligence (“AI”) technology and global production expertise with Mentee Robotics’ breakthrough humanoid platform and deep AI talent, creating a comprehensive provider of Physical AI technology across two transformative markets:

autonomous driving and humanoid robotics.

Our portfolio of solutions is built upon a comprehensive suite of purpose-built software and hardware technologies designed to provide the capabilities needed to make the future of ADAS and autonomous driving a reality.

These technologies can be harnessed to deliver mission-critical capabilities at the edge and in the cloud, advancing the safety of road users, and revolutionizing the driving experience and the movement of people and goods globally.

As of September 27, 2025, our solutions had been installed in approximately 1,200 vehicle models (including local country, year, and other vehicle model variations), and our System-on-Chips (“SoCs”) had been deployed in approximately 230 million vehicles.

As of March 28, 2026, our solutions had been installed in approximately 1,400 vehicle models (including local country, year, and other vehicle model variations), and our System-on-Chips (“SoCs”) had been deployed in more than 248 million vehicles.

We are actively working with more than 50 Original Equipment Manufacturers (“OEMs”) worldwide on the implementation of our ADAS solutions.

In the nine months ended September 27, 2025, we shipped approximately 27.4 million of our systems, the substantial majority of which were EyeQ TM SoCs.

This represents an increase from the approximately 19.8 million of our systems that we shipped in the nine months ended September 28, 2024, primarily due to the normalization of excess inventory at our Tier 1 customers that was previously used to satisfy demand during 2024.

In the three months ended March 28, 2026, we shipped approximately 10.8 million of our systems, the substantial majority of which were EyeQ TM SoCs.

This represents an increase from the approximately 8.5 million of our systems that we shipped in the first three months of 2025.

We were founded in Israel in 1999.

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Operations in Israel.

On October 7, 2023, Hamas launched a series of attacks on civilian and military targets in Southern Israel and Central Israel, to which the Israel Defense Forces have responded.

In addition, both Hezbollah and the Houthi movement have attacked military and civilian targets in Israel, to which Israel has responded, including through increased air and ground operations in Lebanon.

In addition, the Houthi movement has attacked international shipping lanes in the Red Sea, to which both Israel and the United States have responded.

Further, on April 13, 2024 and October 1, 2024, Iran launched a series of drone and missile strikes against Israel, to which Israel has responded.

Most recently, on June 13, 2025, Israel launched a preemptive attack on Iran, to which Iran responded with ballistic missile and drone attacks.

On June 23, 2025, Israel and Iran agreed to a ceasefire, although there is no assurance that the ceasefire will continue.

On October 9, 2025, Israel, Hamas, the United States and other countries in the region agreed to a framework for a ceasefire in Gaza between Israel and Hamas.

How long and how severe the current conflicts in Gaza, Northern Israel, Lebanon, Iran or the broader region become is unknown at this time and any continued clash among Israel, Hamas, Hezbollah, Iran or other countries or militant groups in the region may escalate in the future into a greater regional conflict.

To date, our operations have not been materially affected, although as of October 15, 2025 approximately 3.8% of our employees have been called to reserve duty in the Israel Defense Forces.

We expect that the current conflict in the Gaza Strip, Lebanon, Iran and the broader region as well as the security escalation in Israel will not have a material impact on our business results in the short term.

On October 7, 2023, Hamas launched a series of attacks on civilian and military targets in Southern Israel and Central Israel, to which the Israel Defense Forces responded.

In addition, Iran, Hezbollah and the Houthi movement attacked military and civilian targets in Israel, to which Israel responded, including through increased air and/or ground operations in Lebanon, Syria, Yemen and Iran.

Following years of conflict in the region, on October 9, 2025, Israel, Hamas, the United States and other countries in the region agreed to a framework for a ceasefire in Gaza between Israel and Hamas.

On February 28, 2026, the United States and Israel launched joint combat operations in Iran to which Iran and Hezbollah responded with ballistic missile and drone attacks on Israel as well as other countries and U.S.

military bases in the region.

On April 8, 2026, the United States and Iran agreed to a two-week ceasefire.

How long and how severe the current conflicts in Gaza, Northern Israel, Lebanon, Iran or the broader region last and become is unknown at this time and any continued clash among Israel, Hamas, Hezbollah, Iran or other countries or militant groups in the region may escalate in the future into a greater regional conflict.

To date, our operations have not been materially affected, although as of April 15, 2026 approximately 7.0% of our employees have been called to reserve duty in the Israel Defense Forces.

However, since these are events beyond our control, their continuation or cessation may affect our expectations.

We continue to monitor political and military developments closely and examine the consequences for our operations and assets.

Secondary Offering, Share Repurchase, Option and Conversion

On July 9, 2025, the Company announced the pricing of a public secondary offering of 50,000,000 shares of Class A common stock (which shares were received upon the conversion of 50,000,000 shares of Class B common stock into Class A common stock) by Intel at a public offering price of $16.50 per share (the “Secondary Offering”), with Intel granting the underwriters a 30-day option to purchase up to an additional 7,500,000 shares of Class A common stock (the “Option”).

The Secondary Offering closed on July 11, 2025.

In connection with and conditional upon the closing of the Secondary Offering, on July 11, 2025 the Company purchased from Intel 6,231,985 shares of Class A common stock (which shares were received upon the conversion of 6,231,985 shares of Class B common stock into Class A common stock) at a price of $16.04625 share, which is equal to the per share purchase price paid by the underwriters in the Secondary Offering pursuant to a share repurchase agreement with Intel (the “Share Repurchase”).

The aggregate consideration paid by the Company for the Share Repurchase was $100 million.

Upon closing of the Share Repurchase, the Company cancelled and retired the 6,231,985 shares of Class A common stock acquired pursuant to the Share Repurchase.

Following the closing of the Share Repurchase, the underwriters exercised the Option (which shares were received upon the conversion of 7,500,000 shares of Class B common stock into Class A common stock), which closed on July 11, 2025.

The Company did not sell any shares of Class A common stock in the Secondary Offering or in respect of the exercise of the Option, and did not receive any proceeds from the sale of shares offered by Intel in each instance.

In addition to and conditional upon the closing of the Secondary Offering, Intel voluntarily converted pursuant to the Company’s Amended and Restated Certificate of Incorporation an additional 50,000,000 shares of Class B common stock to Class A common stock (the “Conversion”).

The shares issued to Intel pursuant to the Conversion were issued pursuant to an exemption from registration pursuant to Section 3(a)(9) of the U.S.

Securities Act of 1933.

The Company received no proceeds from issuance of shares in the Conversion.

The Company paid the costs associated with the registration of shares in connection with the Secondary Offering and the Option, other than underwriting discounts, fees and commissions.

Upon completion of the Secondary Offering, Share Repurchase, Option and Conversion and as of September 27, 2025, Intel continues to directly or indirectly hold all of the Class B common stock of Mobileye as well as 50,000,000 shares of Class A common stock, which together represent approximately 79.6% of our outstanding common stock and 97.3% of the voting power of our common stock.

Acquisition of Mentee Robotics

On February 3, 2026, the Company and Mobileye Vision Technologies Ltd.

(a wholly-owned indirect subsidiary of the Company) acquired 100% of the issued and outstanding stock of Mentee Robotics (such transaction, the “Acquisition”), pursuant to a share purchase agreement dated as of January 5, 2026, by and among the Company, Mobileye Vision Technologies Ltd., Mentee Robotics, the shareholders of Mentee Robotics, and Shareholder Representative Services LLC, as the exclusive representative of the Mentee Robotics shareholders.

The Share Purchase Agreement provided for an aggregate purchase price of $900 million, which consisted of (i) approximately $612 million in cash (subject to certain adjustments,) and (ii) 26,279,824 shares of Class A common stock of the Company.

The entirety of such Class A common stock was allocated to the founders of Mentee Robotics, which include Prof.

Shashua, our President and CEO, and Prof.

Shai Shalev-Shwartz, our Chief Technology Officer.

Our Business Model

We currently derive substantially all of our revenue from our commercially deployed ADAS solutions, including our Premium ADAS solutions.

In the future, propelled by our next generation of EyeQ TM SoCs, including our EyeQ TM 6 SoC, our Compound AI system architecture, including True Redundancy TM , our surround computer vision Mobileye SuperVision TM solution, and our software-defined imaging radars, we believe that we will be positioned to deliver an autonomous driving solution that can enable the mass adoption of AV.

We are now approaching the start of production of an advanced set of solutions, including Mobileye Surround ADAS™, Mobileye SuperVision™, Mobileye Chauffeur™ and Mobileye Drive™.

These solutions are propelled by our EyeQ TM 6 SoC and subsequent EyeQ TM generations, our next-generation software solutions, and our software-defined imaging radars.

We expect these solutions will, over time, meaningfully contribute to changes in our mix of revenue and result in broader adoption of premium ADAS and AV products by our customers.

We generate the majority of our revenue from the sale of our EyeQ TM SoCs to OEMs through sales to Tier 1 automotive suppliers.

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We have co-developed six generations of our automotive grade SoC, EyeQ TM , with STMicroelectronics, including EyeQ TM 5 and EyeQ TM 6.

We have also established relationships with several suppliers, such as Quanta Computer, to develop and assemble our ECUs, including the design for our Mobileye SuperVision TM , which includes our EyeQ TM 5 SoCs manufactured by STMicroelectronics.

As part of an effort to establish redundancy and better control of our supply chain, we have sought additional qualified suppliers, and we have recently entered into an agreement with TSMC (Taiwan Semiconductor Manufacturing Company Ltd.) pursuant to which it will manufacture components of our imaging radar and some of our future generations of our EyeQ TM product, and potentially other future products.

We have also established relationships with several suppliers, such as Quanta Computer, to develop and assemble our ECUs, including the design for our Mobileye SuperVision™, which includes our EyeQ TM 5 SoCs manufactured by STMicroelectronics.

As part of an effort to establish redundancy and better control of our supply chain, we have sought additional qualified suppliers, and we have recently entered into an agreement with TSMC (Taiwan Semiconductor Manufacturing Company Ltd.) pursuant to which it will manufacture components of our imaging radar and some of our future generations of our EyeQ™ product, and potentially other future products.

Our close partnership with Intel exists on multiple fronts.

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While automotive production has now recovered to approximately 2019 levels, current uncertain economic conditions and inflation may contribute to a reduction in consumer demand.

In addition to economic conditions, in prior periods, including during the supply chain crisis and semi-conductor shortage of 2021 and 2022, certain Tier 1 customers increased their orders for components and parts, including our solutions, to counteract the impact of supply chain shortages for auto parts.

As a result, some demand for our solutions and the corresponding revenue from these customers were shifted to earlier time periods than otherwise would have occurred absent a general supply chain shortage and inflationary environment.

As a result of our standard planning process for 2024, including discussions with our Tier 1 customers, we became aware in late 2023 of significant excess inventory at our customers.

This as well as lower than expected production at certain OEMs during 2023 led to the decision by our Tier 1 customers to prioritize in the first quarter of 2024 the utilization of excess inventory on hand before using new shipments to meet the demand of OEMs.

We estimate our customers used the vast majority of this excess customer inventory in 2024, in accordance with our expectations, but there is no guarantee that orders will remain normalized or that customers won’t build up excess inventory in the future.

In addition to economic conditions, in prior periods we have experienced variability in customer ordering patterns and demand timing driven by supply chain disruptions, inventory management practices and changes in OEM production expectations, including customers accelerating orders during periods of constrained supply and subsequently utilizing accumulated inventory before placing new orders.

While these dynamics have largely normalized, similar fluctuations in customer ordering behavior, production estimates or inventory levels may recur in future periods and could result in variability in the timing of our revenue recognition.

Additionally, recent increased demand for semi-conductor and other components has resulted in component shortages, price increases and longer order lead times, which may increase the pricing of our solutions and/or our ability to meet our customers’ demand.

Certain Tier 1 customers may increase their orders for our solutions to counteract these component shortages and any resulting price increases or other impacts, causing some demand for our solutions and the corresponding revenue to be shifted to earlier time period than otherwise would have occurred.

ADAS volumes have grown faster in recent years than the overall automotive market as ADAS penetration rates have increased, and we believe that we will continue to benefit from that trend.

Our revenue of $1,448 million in the nine months ended September 27, 2025 was up 24% year-over-year, primarily due to the unusually low volume caused by the usage of meaningful excess inventory at our Tier 1 customers to satisfy demand in the first half of 2024.

Our revenue of $558 million in the three months ended March 28, 2026 was up 27% year-over-year.

Continued or future constraints on global automotive production resulting from the effects of economic uncertainty, both global and in specific markets in which we operate, may be a limiting factor on our ability to increase revenue.

We expect to continue to capitalize on our strong and collaborative relationships with OEMs and Tier 1s to expand our presence in key markets and capture the long-term growth opportunities in those markets.

Trade policies, sanctions and import and export controls.

Acquisition and integration of new technologies and expansion into adjacent markets.

Our results of operations may be affected by our ability to successfully integrate acquired businesses and technologies and to effectively allocate resources to new areas of development.

On February 3, 2026, we acquired Mentee Robotics, a privately held Israeli company focused on humanoid robotics.

The integration of Mentee Robotics’ personnel, technology and operations may require significant management attention, capital investment and operating expenses, and we may not realize the anticipated benefits of the acquisition on the expected timeline or at all.

Humanoid robotics is a nascent and rapidly evolving area characterized by significant technical complexity, long development timelines, potentially high capital requirements, uncertain customer demand and evolving regulatory and safety frameworks.

Our investment in this area may result in increased research and development and operating expenses and may divert resources from our core ADAS and autonomous driving initiatives.

In addition, the timing and extent of commercialization of humanoid robotics solutions remains uncertain with respect to scalability, economic viability and regulatory approval.

As a result, our expansion into adjacent markets, including through the acquisition of Mentee Robotics, may adversely affect our results of operations, margins and cash flows, particularly in the near to medium term.

Trade policies, sanctions and import and export controls.

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In addition, tariffs could lead to higher prices for finished automobiles, which would reduce demand for automobiles and thus the market for our products.

On March 26, 2025, the United States imposed an additional 25% tariff on all imports of passenger vehicles, light vehicles, and certain automotive parts, such as engines, transmissions, powertrain parts and electrical components.

The tariff on finished vehicles went into effect on April 3, 2025 and the tariffs on automobile parts entered into effect on May 3, 2025.

Further, on April 2, 2025, the United States announced a 10% tariff on all countries effective on April 5, 2025 as well as individualized higher tariff rates on countries with which the United States has proportionately large trade deficits in goods.

The United States paused these “reciprocal tariffs” on certain countries as individual bilateral trade deals were negotiated, and increased reciprocal tariff rates and other restrictions on countries that responded with increased tariffs of their own.

Subsequently, the United States announced trade deals with certain countries, such as Indonesia, and interim trade deals with others, including China, as negotiations with such countries for definitive trade deals continued.

In July 2025, the United States announced tariffs on certain countries and other entities, including Mexico, Canada and the European Union, that failed to make substantial progress on trade negotiations with the United States following the pause on reciprocal tariffs;

such tariffs are scheduled to become effective on August 1, 2025.

Further, the United States announced on July 8, 2025 additional sector tariffs, including on copper imports.

In response to export controls imposed by China, the United States announced on October 10, 2025 the possible resumption of significant tariffs and other export controls on China.

During 2025, the United States implemented a series of broad-based and sector-specific tariffs affecting passenger vehicles, automotive components and other industrial inputs, as well as country-specific tariff regimes and reciprocal trade measures.

These actions were accompanied by ongoing bilateral and multilateral negotiations, interim trade agreements, pauses, delays and retaliatory measures by certain countries, resulting in significant uncertainty regarding the scope, timing and duration of applicable tariffs and export controls.

In addition, sector-specific measures announced during 2025, including tariffs on certain raw materials, and export controls affecting the semiconductor supply chain, have increased complexity and risk across global automotive and technology markets.

As of the date of this report, there remains a high degree of uncertainty surrounding U.S.

trade policy, how it will be implemented, how other countries will react, and how it will ultimately impact our industry and business.

For example, our customers may have shifted or will shift orders for components and parts, including our solutions, prior to the automotive tariffs going into effect on May 3, 2025 or certain country or regional tariffs going into effect on August 1, 2025, thereby shifting demand for our solutions and corresponding revenue to earlier periods.

For example, our customers may have shifted or will shift orders for components and parts, including our solutions, adjust sourcing strategies or modify productions schedules, which could shift demand for our solutions and corresponding revenue between periods.

While we continually evaluate changes in U.S.

trade policy and global reactions thereto, as well as our ability to mitigate their impact, these recent changes may negatively impact our customers and our business.

For additional information, see “Item IA - Risk Factors - We are subject to risk related to trade policies, sanctions, and import and export controls” in our 2024 Form 10-K, as filed with the SEC on February 13, 2025 (the “2024 Form 10-K”).

trade policy and global reactions thereto, as well as our ability to mitigate their impact, these developments may negatively impact our customers, our results of operations and our business.

For additional information, see “Item IA - Risk Factors - We are subject to risk related to trade policies, sanctions, and import and export controls” in our 2025 Form 10-K.

Design wins with new and existing customers.

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Together with Tier 1 automotive suppliers, we work closely with OEMs to understand their solution requirements and have built close long-term relationships with them extending across multiple generations of EyeQ TM products, though there is no guarantee that our customers will purchase our solutions in any certain quantity or at any certain price even after we achieve design wins.

For example, in the third quarter of 2024 Zeekr announced their decision to utilize their in-house system instead of SuperVision TM for at least a major portion of production for their 001 model going forward.

Investment in technology leadership and product development.

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While we were largely successful in increasing our ASPs to reflect these cost increases, we experienced a reduction in percentage gross margin as a result of these cost increases.

More recently, the AI industry has generated increased demand for components necessary for the production of our solutions, including EyeQ™ SoCs and ECUs for our SuperVision™, Mobileye Chauffeur™ and Mobileye Drive™ solutions.

This new demand has resulted in and may continue to result in increased competition for and shortages of components necessary for our solutions and substantial increases in prices for such components.

Our gross margin has been and may continue to be affected by our ability to offset these and any future cost increases through realizing pricing increases on our solutions and achieving decreases in other production costs.

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Supply chain disruptions, shortages of raw material, such as wafers and substrates, and manufacturing limitations could limit our ability to meet customer demand and result in delayed, reduced, or canceled orders.

During 2021 and 2022, the semiconductor industry experienced widespread shortages of substrates and other components and available foundry manufacturing capacity.

We entered 2022 with significantly lower inventories of our EyeQ TM SoCs on our balance sheet as a result of the limited supply during 2021.

Further, STMicroelectronics, our sole supplier of EyeQ TM SoCs, was not able to meet our demand for EyeQ TM SoCs during 2022, causing a further significant reduction in our company-owned inventory level.

Starting in late 2022 and early 2023, such supply chain disruptions, raw material shortages, and manufacturing limitations abated and during 2023, we successfully increased levels of EyeQ TM SoC inventory on hand, mitigating the potential for future supply constraints to cause a shortfall of chips.

However, in the event of a reoccurrence of supply chain constraints, and subject to the duration and severity thereof, we may be required to operate with minimal or no inventory of EyeQ TM SoCs or SuperVision TM ECUs on hand.

In prior periods, we experienced supply chain disruptions, raw material shortages and manufacturing capacity constraints that reduced the availability of key components, including EyeQ™ SoCs, and resulted in lower inventory levels and limitations on our ability to meet customer demand.

As supply conditions improved, we increased inventory levels to help mitigate potential future constraints.

However, if similar disruptions were to recur, depending on their duration and severity, we may again be required to operate with reduced inventory levels, which could limit our ability to meet customer demand.

As a result, we are substantially reliant on timely shipments of EyeQ TM SoCs from STMicroelectronics and ECUs from Quanta Computer (or other suppliers) and may in the future become reliant on additional suppliers such as TSMC, to fulfill customer orders and if such a shortfall of chips or ECUs were to occur, we may be unable to offset future supply constraints through the use of inventory on hand.

Further, in 2025 and in 2026 the AI industry has generated increased demand for components necessary for the production of our solutions, including EyeQ™ SoCs and ECUs for our SuperVision™, Mobileye Chauffeur™ and Mobileye Drive™ solutions.

This new demand has resulted in and may continue to result in incrased competition for and shortages of components necessary for our solutions, substantial increases in prices for such components and suppliers requiring us to increase lead times and purchase greater quantities of such components in advance in order to ensure we secure sufficient supply.

Such shortages of components, as well as the increases in pricing, order requirements and lead times, has and may continue to impact our ability to supply solutions to our customers in order to meet demand as well as impact OEMs’ ability to purchase our solutions.

Our reliance on single or limited suppliers and vendors for certain components, equipment, and services and the aforementioned shortages of substrates and other components have led to increased supply chain risks and continue to stress our ability to meet the supply demands of our customers.

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Because of the complex nature of our products and the need to customize and validate a product and to integrate it into the OEM’s overall ADAS system, we also have strong direct relationships with the OEMs.

EyeQ TM SoC sales represented approximately 89% and 86% of our revenue for the three months ended September 27, 2025 and September 28, 2024, respectively, and 91% and 83% of our revenue in the nine months ended September 27, 2025 and September 28, 2024, respectively.

Sales of our SuperVision™ product represented more than half of the remainder of our revenue for the three months ended September 27, 2025, less than half of the remainder of our revenue for the nine months ended September 27, 2025 and the majority of the remainder of our revenue for the three and nine months ended September 28, 2024.

Revenue from the sale of our EyeQ TM products and SuperVision™ products is recognized at the time of product shipment from our facilities, as determined by the agreed-upon shipping terms.

EyeQ TM SoC sales represented approximately 92% and 94% of our revenue for the three months ended March 28, 2026 and March 29, 2025, respectively.

Sales of our SuperVision™ product represented half of the reminder of our revenue for the three months ended March 28, 2026 and less than half of the remainder of our revenue for the three months ended March 29, 2025.

Revenue from the sale of our EyeQ TM products is recognized at the time of product shipment from our facilities, as determined by the agreed-upon shipping terms.

Our sales to any single Tier 1 automotive supplier typically cover more than one OEM and more than one production program from any OEM.

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Research and Development Expenses, net

Research and development expenses primarily consist of expenses associated with personnel related expenses, facilities, equipment and supplies for research and development activities, materials, parts and other prototype development, cloud computing services, consulting, and other professional services, quality assurance within the development programs, and allocated overhead costs.

Research and development expenses primarily consist of expenses associated with personnel related expenses, facilities, equipment and supplies for research and development activities, materials, parts and other prototype development, cloud computing services, consulting and other professional services, amortization of acquired intangible asset related to developed IP, quality assurance within the development programs, and allocated overhead costs.

We enter into best-efforts nonrefundable non-recurring engineering (“NRE”) arrangements pursuant to which we are reimbursed for a portion of the research and development expenses attributable to specific development programs.

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We expect our general and administrative expenses to moderately increase in absolute dollars but to decrease as a percentage of total revenue as our business grows.

The expected increase is mainly associated with the costs related to being a public company, as well as increased premiums for directors’ and officers’ insurance and the increased use of share-based compensation for general and administrative personnel.

The expected increase is mainly associated with the costs related to being a public company, as well as the increased use of share-based compensation for general and administrative personnel.

Goodwill Impairment

Goodwill impairment expenses consist of a non-cash impairment loss recognized for the goodwill of the “Mobileye” reporting unit in the three and nine months ended September 28, 2024, as a result of the impairment analysis the Company performed during the third quarter of 2024.

Goodwill impairment expenses consist of a non-cash impairment loss recognized for the goodwill of the “Mobileye” reporting unit in the three months ended March 28, 2026, as a result of the impairment analysis the Company performed during the first quarter of 2026.

Financial Income (Expense), net

Financial income (expense), net, consists primarily of income related to investments in money market funds, as well as income from short term deposits and fluctuations in value due to foreign exchange differences between our monetary assets and liabilities denominated in New Israeli Shekels and to a much lesser extent, the Euro, the Chinese Yuan, the Japanese Yen, and other currencies.

Financial income (expense), net, consists primarily of income related to investments in money market funds, short term deposits as well as income from marketable securities, and fluctuations in value due to foreign exchange differences between our monetary assets and liabilities denominated in New Israeli Shekels and to a much lesser extent, the Euro, the Chinese Yuan, the Japanese Yen, and other currencies.

Benefit (provision) for income taxes

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We are eligible for certain tax benefits in Israel under the Investment Law, at a reduced tax rate, subject to specified terms.

In 2021, the OECD announced an Inclusive Framework on Base Erosion and Profit Shifting including Pillar Two Model Rules defining the global minimum tax, which calls for the taxation of large multinational corporations at a minimum rate of 15%.

In addition, in 2021, the OECD announced an Inclusive Framework on Base Erosion and Profit Shifting including Pillar Two Model Rules defining the global minimum tax, which calls for the taxation of large multinational corporations at a minimum rate of 15%.

Subsequently, multiple sets of administrative guidance have been issued.

Many non-U.S.

tax jurisdictions have either recently enacted legislation to adopt certain components of the Pillar Two Model Rules beginning in 2024 (including the European Union Member States), with the adoption of additional components in later years, or announced their plans to enact legislation in future years.

We are continuing to evaluate the impacts of enacted legislation and pending legislation to enact Pillar Two Model Rules in the non-U.S.

tax jurisdictions in which we operate.

The Company is a constituent entity of its Parent for Pillar Two purposes.

In July 2025, the United States enacted tax reform through the One Big Beautiful Bill Act (“OBBBA”).

Included in this legislation are provisions that allow for the immediate expensing of research and development costs conducted in the United States, immediate expensing of certain capital expenditures, and other changes to the U.S.

taxation of profits derived from foreign operations.

The Company is monitoring developments related to the implementation of the OBBBA and any additional guidance issued by the U.S.

Department of the Treasury, the Internal Revenue Service, or other standard-setting bodies that may affect the Company’s accounting for income taxes.

Based on information available at the end of the reporting period and management’s assessment of that information, the OBBBA does not have and is not expected to have a material impact on the Company’s consolidated financial statements.

During the periods presented in our condensed consolidated financial statements, certain components of our business operations were included in the consolidated U.S.

federal tax return filed by Intel.

We also file certain foreign income tax returns on a separate basis, distinct from Intel.

Following the Secondary Offering, which resulted in the Tax Deconsolidation (see Note 1 to the condensed consolidated financial statements), the Company is no longer included in Intel’s U.S.

federal consolidated income tax return and will be filing its own U.S.

federal income tax returns for periods beginning July 12, 2025 onwards.

Since prior to the Tax Deconsolidation, the Company’s income tax provision was calculated using the separate return method, as if the Company had filed its own U.S.

federal income tax returns, the Tax Deconsolidation event does not have a material impact on the Company’s tax provision for the nine months ended September 27, 2025.

Additionally, the Tax Deconsolidation results in an adjustment to the Company’s deferred income tax assets and liabilities, primarily with respect to its net operating losses, reflecting attributes that the Company will not retain as a result of its status as a standalone taxpayer.

These changes are offset with a change in valuation allowance.

In 2021, Mobileye’s Israeli operations became taxable in the United States as a branch entity.

In 2022, Moovit’s Israeli operations became taxable in the United States as a branch entity.

Many non-US tax jurisdictions have either recently enacted legislation to adopt certain components of the Pillar Two Model Rules beginning in 2024 (including the European Union Member States), with the adoption of additional components in later years, or announced their plans to enact legislation in future years.

In Israel, the regulations of Pillar Two Model Rules became effective for tax years beginning after January 1, 2026.

The Pillar Two Model Rules does not have a material effect on our income tax provision for the 2026 fiscal year.

We are continuing to evaluate the impacts of enacted legislation and pending legislation to enact Pillar Two Model Rules in the non-US tax jurisdictions in which we operate.

The Company is a constituent entity of its Parent for Pillar Two Model Rules purposes.

On March 29, 2026, the Israeli Knesset approved the Law for the Encouragement and Promotion of Research and Development, 2026 (the “Incentive Law”).

The Incentive Law introduces a framework of incentives for research and development activities, to be provided either as a tax credit or as a cash grant in lieu thereof, and is intended to align with the OECD Pillar Two framework.

As of the date of approval of these financial statements, the Company is assessing the potential impact of the Incentive Law on its operations, including its effect on the Company’s results of operations and eligibility for incentives.

The Israeli operations of Mobileye, Moovit and Mentee Robotics are taxable in the United States as a branch entity.

As a result, these operations are taxed both in the United States and Israel.

tax purposes, there are favorable future tax deductions that we have not benefited from due to a valuation allowance position.

tax purposes, there are favorable future tax deductions that we have not benefited due to a valuation allowance position.

If warranted, based on the assessment of verifiable evidence in support of the realization of deferred tax assets, the valuation allowances may be released, resulting in a tax benefit.

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The valuation allowance for the periods presented in our condensed consolidated financial statements primarily relates to U.S.

branch deferred tax assets not currently expected to be realized given that we have sustained recent losses based on the separate return method.

branch deferred tax assets not currently expected to be realized given that we have sustained recent losses.

Results of Operations

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Three months Ended

Nine Months Ended

September 27, 2025

September 28, 2024

September 27, 2025

September 28, 2024

March 28, 2026

March 29, 2025

dollars in millions

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Three months Ended

Nine Months Ended

dollars in millions

September 27, 2025

September 28, 2024

September 27, 2025

September 28, 2024

March 28, 2026

March 29, 2025

Cost of revenue

Research and development, net

Sales and marketing

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Three months Ended

Nine Months Ended

dollars in millions

September 27, 2025

September 28, 2024

September 27, 2025

September 28, 2024

Cost of revenue

March 28, 2026

March 29, 2025

Research and development, net

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Total share-based compensation

Comparison of the three and nine months ended September 27, 2025 and September 28, 2024

In the three months ended September 27, 2025, revenue increased by $18 million, or 4%, compared to the three months ended September 28, 2024.

This increase in revenue was primarily due to an increase of $29 million or 7% in EyeQ TM SoC revenue mostly attributable to a 8% increase in volume, resulting from higher customer demand.

This was partially offset by a decrease of $8 million in SuperVision TM related revenue resulting from a decrease in volume.

Average System Price, calculated as the sum of revenue related to EyeQ TM and SuperVision TM systems divided by the number of systems delivered, decreased by approximately 3%, primarily due to the lower percentage of SuperVision TM related revenue as compared to the third quarter of 2024.

In the nine months ended September 27, 2025, revenue increased by $284 million, or 24%, compared to the nine months ended September 28, 2024.

This increase was primarily due to an increase of $359 million, or 37%, in EyeQ TM SoC revenue attributable mainly to a 39% increase in volume, resulting mainly from the normalization of excess inventory by our Tier 1 customers that was previously used to satisfy demand during the first half of 2024.

This was partially offset by a decrease of $74 million in SuperVision TM related revenue resulting from a decrease in volume.

Average System Price, calculated as the sum of revenue related to EyeQ TM and SuperVision TM systems divided by the number of systems delivered, decreased by 9%, mainly due to lower percentage of SuperVision TM related revenue as compared to the nine months ended September 28, 2024.

Comparison of the Three Months ended March 28, 2026 and March 29, 2025

In the three months ended March 28, 2026, revenue increased by $120 million, or 27%, compared to the three months ended March 29, 2025, mainly due to an increase of $100 million, or 24%, in EyeQ TM SoC revenue, primarily attributable to a 28% increase in volume attributable to higher EyeQ demand, as well as to the normalization of safety stock levels at our Tier 1 customers, as a result of a certain draw down which took place in the fourth quarter of 2025.

Cost of Revenue

In the three months ended September 27, 2025, our cost of revenue increased by $12 million, or 5% compared to the three months ended September 28, 2024.

In the nine months ended September 27, 2025, our cost of revenue increased by $82 million, or 12%, compared to the nine months ended September 28, 2024.

In both periods, the increase is attributed to manufacturing costs, mainly resulting from the growth in sales of EyeQ TM SoC, which was partially offset by the decrease in sales of SuperVision TM systems.

In the three months ended March 28, 2026, our cost of revenue increased by $52 million, or 23%, compared to the three months ended March 29, 2025, due to an increase of $52 million in manufacturing costs, mainly resulting from the increase in sales of EyeQ TM systems, in addition to an increase in sales of SuperVision TM systems.

Gross Profit and margin

In the three months ended September 27 2025, our gross profit increased by $6 million, or 3% compared to the three months ended September 28, 2024.

In the nine months ended September 27 2025, our gross profit increased by $202 million, or 40%, compared to the nine months ended September 28, 2024.

The increase in both periods was primarily due to the increase in sales of EyeQ TM systems, which was slightly offset by the decrease in sales of SuperVision TM systems.

In the three months ended September 27 2025, our gross margin decreased to 48% compared to 49% in the three months ended September 28, 2024.

This decrease was due to a modest reduction in EyeQ TM ASP mainly due to higher volumes in China which carry lower ASP, and a higher EyeQ TM -related cost per unit given a different mix of EyeQ TM products sold.

In the nine months ended September 27, 2025, our gross margin increased to 48% compared to 43% in the nine months ended September 28, 2024.

This increase was primarily due to the lower impact of amortization of intangible assets as a percentage of revenue as well as an increase in the percentage of revenue attributable to EyeQ TM SoCs.

In the three months ended March 28, 2026, our gross profit increased by $68 million, or 33%, compared to the three months ended March 29, 2025.

This increase was mainly driven by the increase in sales of EyeQ TM systems.

Our gross margin increased from 47% for the three months ended March 29, 2025, to 49% for the three months ended March 28, 2026.

This increase was primarily due to the lower impact of amortization of intangible assets as a percentage of revenue, partially offset by a higher EyeQ-related cost per unit given the different mix of EyeQ products sold.

Research and Development Expenses, net

Research and development expenses, net, in the three months ended September 27, 2025, increased by $1 million, or 0%, compared to the three months ended September 28, 2024.

This increase was primarily due to an increase in payroll and related expenses, resulting mainly from an increase in average research and development headcount of 140 employees and a decrease in NRE reimbursements influenced by projects progress and timing.

This was partially offset by a decrease in R&D direct expenses including professional services mostly related to the wind-down of the Lidar division that took place during 2024, as well as lower share-based compensation expenses.

Research and development expenses, net, in the nine months ended September 27, 2025 increased by $59 million, or 7%, compared to the nine months ended September 28, 2024.

This increase was mainly due to an increase in payroll and related expenses, resulting from an increase in average research and development headcount of 137 employees, a decrease in NRE reimbursements influenced by projects progress and timing and higher depreciation expenses.

This was partially offset by a decrease in R&D direct expenses including professional services mostly related to the wind-down of the Lidar division that took place during 2024.

Research and development expenses, net, in the three months ended March 28, 2026, increased by $48 million, or 17%, compared to the three months ended March 29, 2025.

This increase was primarily due to an increase in payroll and related expenses, resulting from an increase in salary expenses and unfavorable fluctuation of New Israeli Shekels against U.S dollars.

In addition, stock based compensation expense increased, mainly given the additional equity awards granted as part of the acquisition of Mentee Robotics.

Sales and Marketing Expenses

Sales and marketing expenses in the three months ended September 27, 2025, increased by $1 million or 4% compared to the three months ended September 28, 2024, mainly due to higher marketing expenses.

Sales and marketing expenses in the nine months ended September 27, 2025, decreased by $5 million or 6% compared to the nine months ended September 28, 2024.

This decrease is mainly associated with a decrease in payroll and related expenses due to the wind down of the after market division that took place in 2024.

Sales and marketing expenses in the three months ended March 28, 2026, decreased by $2 million, or 6%, compared to the three months ended March 29, 2025, mainly given lower marketing expenses.

General and Administrative Expenses

General and administrative expenses in the three months ended September 27, 2025 increased by $1 million or 6% compared to the three months ended September 28, 2024 due to higher share-based compensation expenses.

General and administrative expenses in the nine months ended September 27, 2025 increased by $4 million or 8%, compared to the nine months ended September 28, 2024, primarily due to an increase in share-based compensation expenses as well as legal and corporate expenses.

General and administrative expenses in the three months ended March 28, 2026, increased by $13 million, or 72%, compared to the three months ended March 29, 2025.

This increase was primarily related to transaction costs associated with the acquisition of Mentee Robotics, as well as to higher stock based compensation, resulting mainly from the acquisition of Mentee Robotics.

Goodwill Impairment

Goodwill impairment expenses were zero in the three and nine months ended September 27, 2025 and $2,695 million in the three and nine months ended September 28, 2024.

During the third quarter of 2024, the Company performed an interim quantitative goodwill impairment analysis for the “Mobileye” reporting unit, resulting in a non-cash impairment loss.

For further details, refer to Note 10 to the audited consolidated financial statements for the fiscal year ended December 28, 2024.

Goodwill impairment expenses were $3,788 million in the three months ended March 28, 2026 and zero in the three months ended March 29, 2025.

During the first quarter of 2026, the Company performed an interim quantitative goodwill impairment analysis for the “Mobileye” reporting unit, resulting in a non-cash impairment loss.

For further details, refer to Note 12 to the Condensed Consolidated Financial Statements included in this report.

Financial Income (expense), net

Financial income, net, in the three months ended September 27, 2025 increased by $3 million, or 21%, compared to the three months ended September 28, 2024, mainly due to an increase in interest income and the impact of fluctuations in foreign exchange rates.

Financial income, net, in the nine months ended September 27, 2025 increased by $4 million, or 9%, compared to the nine months ended September 28, 2024, due to an increase in interest income, which was partially offset by the impact of fluctuations in foreign exchange rates.

Financial income, net, in the three months ended March 28, 2026, was $14 million compared to $18 million in the three months ended March 29, 2025.

This decrease was mainly due to a decrease in interest earned on investment in money market funds due to cash used for the acquisition of Mentee Robotics and a decrease derived from the impact of fluctuations in foreign exchange rates, partially offset by an increase in interest earned on short term bank deposits.

Benefit (Provision) for Income Tax

In the three months ended September 27, 2025 provision for income tax was $4 million, compared to a benefit for income tax of $78 million in the three months ended September 28, 2024.

In the nine months ended September 27, 2025, provision for income tax was $13 million, compared to a benefit for income tax of $76 million in the nine months ended September 28, 2024.

In both periods, the change is mainly due to the deferred tax effect of $82 million attributed to goodwill impairment of the Mobileye reporting unit which was recognised in the prior year period.

Benefit for income tax in the three months ended March 28, 2026, was $64 million compared to a provision for income tax of $(3) million in the three months ended March 29, 2025.

This $67 million change is mainly due to the deferred tax effect of goodwill impairment to the Mobileye reporting unit.

Liquidity and Capital Resources

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Cash generated by operations is our primary source of liquidity for funding our strategic business requirements.

Our primary uses of funds have been for funding increases in headcount in our research and development departments, investments attributable to new product development, as well as for funding our capital expenditures.

Our capital expenditures have related mainly to data storage and other computer related equipment, expenditure related to research and development projects and to the construction of new sites, and were $52 million and $68 million for the nine months ended September 27, 2025 and September 28, 2024, respectively.

Our capital expenditures for purchase of property and equipment have related mainly to data storage and other computer related equipment, expenditure related to research and development projects including data farming and cloud compute and to leasehold improvements, and were $30 million and $14 million for the three months ended March 28, 2026 and March 29, 2025, respectively.

Cash paid for the acquisition of Mentee Robotics, net of cash acquired, was $591 million.

To fund our cash requirements in the ordinary course of business, we anticipate that we will continue to primarily rely on operating cash flows, supplemented by our total cash and cash equivalents.

We expect our total capital expenditures for 2025 to be similar compared to our total capital expenditures in 2024.

We expect our total capital expenditures for 2026 to be higher compared to our total capital expenditures in 2025.

We continue to invest in equipment related to the development of our next generation products.

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The following table sets forth certain consolidated statements of cash flow data:

Nine Months Ended

Three months Ended

dollars in millions

September 27, 2025

September 28, 2024

March 28, 2026

March 29, 2025

Net cash provided by operating activities

Net cash used in investing activities

Net cash used in financing activities

Net cash provided by financing activities

Effect of foreign exchange rate changes on cash and cash equivalents

Increase in cash, cash equivalents and restricted cash

Increase (decrease) in cash, cash equivalents and restricted cash

Operating activities

For the nine months ended September 27, 2025 compared to the nine months ended September 28, 2024, the $293 million increase in cash provided by operating activities was mainly due to a decrease of $2,754 million in net loss, partially offset by $2,695 million ($2,613 million, net of tax) of non-cash goodwill impairment loss recognized in the nine months ended September 28, 2024, as well as a decrease in inventories compared to an increase in prior year period.

For the three months ended March 28, 2026 compared to the three months ended March 29, 2025, the $34 million decrease in cash provided by operating activities was mainly due to a higher increase in trade accounts receivable and a lower decrease in inventory compared to prior year period, due to the increase in sales and the relatively low accounts receivable balance as of the end of 2025.

This was partially offset by an increase in accounts payable, accrued expenses and related party payable compared to a decrease in prior year period.

Investing activities

Net cash used in investing activities in the nine months ended September 27, 2025 and September 28, 2024 was $64 million and $98 million, respectively, consisting of capital expenditures and debt investments.

Net cash used in investing activities in the three months ended March 28, 2026 and the three months ended March 29, 2025 was $699 million and $25 million, respectively.

The three months ended March 28, 2026 include $591 million net cash paid for the acquisition of Mentee Robotics.

In both periods net cash used in investing activities include capital expenditures and debt investments.

Financing activities

Net cash used in financing activities in the nine months ended September 27, 2025 was $102 million consisting of $100 million repurchase of common stock from Intel and share-based compensation recharge payments made to Intel.

Net cash used in financing activities in the nine months ended September 28, 2024 was $16 million consisting of share-based compensation recharge payments made to Intel.

Net cash provided by financing activities in the three months ended March 28, 2026 and the three months ended March 29, 2025 was $0 million and $3 million, respectively, consisting of share-based compensation recharge with Intel.

Liability in respect of employee rights upon retirement

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As a result, we do not recognize any liability for severance pay due to these employees and the deposits under Section 14 are not recorded as assets on the consolidated balance sheets.

Severance pay liability increased from $62 million as of December 28, 2024, to $74 million as of September 27, 2025, reflecting the impact of annual salary increases and fluctuations in foreign exchange rates.

Severance pay liability was $78 million as of March 28, 2026 and December 27, 2025.

Lease liabilities

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All leases are operating leases with fixed payment terms where some of the leases include annual increases to lease payments based on an index or a rate.

Lease liabilities, representing the present value of future lease payments, have increased from $50 million as of December 28, 2024 to $61 million as of September 27, 2025, reflecting mainly new lease contracts and foreign currency exchange effects, partially offset by the progress in lease payments for existing arrangements.

We have several bank guarantees aggregating approximately $19 million as of September 27, 2025 (denominated in New Israeli Shekels) mainly in connection with lease agreements and import of vehicles.

Lease liabilities, representing the present value of future lease payments, have increased from $62 million as of December 27, 2025 to $63 million as of March 28, 2026, reflecting mainly new lease contracts, partially offset by the progress in lease payments for existing arrangements.

We have several bank guarantees aggregating approximately $22 million as of March 28, 2026 (denominated in New Israeli Shekels) mainly in connection with lease agreements and import of vehicles.

Non-GAAP Financial Measures

Our management uses Adjusted Gross Profit and Margin, Adjusted Operating Income and Margin and Adjusted Net Income, collectively, as key measures in operating our business.

Our management uses Adjusted Gross Profit and Margin, Adjusted Operating Income (Loss) and Margin and Adjusted Net Income (Loss), collectively, as key measures in operating our business.

We use such non-GAAP financial measures to make strategic decisions, establish business plans and forecasts, identify trends affecting our business, and evaluate performance.

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In addition, we also believe these adjustments enhance comparability of our financial performance against those of other technology companies.

Our non-GAAP financial measures reflect adjustments for amortization charges for our acquisition-related intangible assets, share-based compensation expense, impairment of goodwill as well as the related income tax effects where applicable.

Our non-GAAP financial measures reflect adjustments for amortization charges for our acquisition-related intangible assets, share-based compensation expenses, acquisition-related expenses, impairment of goodwill and the related income tax effects where applicable.

We exclude amortization charges for our acquisition-related intangible assets for purposes of calculating certain non-GAAP measures, although revenue is generated, in part, by these intangible assets, to eliminate the impact of these non-cash charges that are inconsistent in size and are significantly impacted by the timing and valuation of our acquisitions.

These amortization charges relate to intangible assets consisting of developed technology, customer relationships, and brands as a result of Intel’s acquisition of Mobileye in 2017 and the acquisition of Moovit in 2020.

We believe that the exclusion of share-based compensation expense is appropriate because it eliminates the impact of non-cash expenses for equity-based compensation costs that are based upon valuation methodologies and assumptions that vary over time, and the amount of the expense can vary significantly between companies due to factors that are unrelated to their core operating performance and that can be outside of their control.

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We believe that the exclusion of goodwill impairment is appropriate because it does not reflect our core operating performance, and excluding such non-cash impairment loss facilitates a useful evaluation of our performance and comparisons to past operating results.

acquisition-related expenses include professional fees and other costs incurred in connection with business combinations.

We believe exclusion of acquisition-related expenses is appropriate because they are transaction-specific costs and not reflective of our ongoing operating results.

Adjusted Gross Profit and Margin

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Three months Ended

Nine Months Ended

September 27, 2025

September 28, 2024

September 27, 2025

September 28, 2024

March 28, 2026

March 29, 2025

dollars in millions

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However, as a result of a higher expected selling price for such systems, we expect our gross profit per unit will increase on a dollar basis.

Our Adjusted Gross Margin decreased from 68% in the three months ended September 28, 2024 to 67% for to the three months ended September 27, 2025.

Our Adjusted Gross Margin increased from 67% for the nine months ended September 28, 2024 to 68% for the nine months ended September 27, 2025.

This increase was primarily due to an increase in the percentage of revenue attributable to EyeQ TM SoCs.

Our Adjusted Gross Margin decreased from 69% for the three months ended March 29, 2025 to 66% for the three months ended March 28, 2026.

This was mainly due to a higher EyeQ™-related cost per unit given the different mix of EyeQ™ products sold.

The decrease was also related to higher percentage of revenue attributable to Supervision TM .

Adjusted Operating Income (Loss) and Margin

We define Adjusted Operating Income (Loss) as operating income (loss) presented in accordance with GAAP, adjusted to exclude amortization of acquisition related intangibles and share-based compensation expenses.

Operating Margin is calculated as operating income (loss) divided by total revenue, and Adjusted Operating Margin is calculated as Adjusted Operating Income (Loss) divided by total revenue.

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Three months Ended

Nine Months Ended

September 27, 2025

September 28, 2024

September 27, 2025

September 28, 2024

March 28, 2026

March 29, 2025

dollars in millions

Operating Income (Loss) and Operating Margin

Operating Income (Loss) and Margin

Amortization of acquired intangible assets

Share-based compensation expense

Acquisition related expenses

Goodwill impairment

Adjusted Operating Income and Margin

Our operating loss decreased from $(2,807) million in the three months ended September 28, 2024 to $(109) million in three months ended September 27, 2025, mainly due to a goodwill impairment loss recognized during the three months ended September 28, 2024.

Our operating loss decreased from $(3,139) million in the nine months ended September 28, 2024 to $(300) million in the nine months ended September 27, 2025, mainly due to a goodwill impairment loss recognized during the three months ended September 28, 2024.

Our Adjusted Operating Income decreased by $4 million in the three months ended September 27, 2025 compared to the three months ended September 28, 2024 mainly due to an increase in operating expenses partially offset by an increase in adjusted gross profit.

Our Adjusted Operating Income increased by $147 million in the nine months ended September 27, 2025 compared to the nine months ended September 28, 2024, mainly due to an increase in adjusted gross profit partially offset by an increase in operating expenses.

Our Adjusted Operating Margin decreased from 16% for the three months ended September 28, 2024 to 15% for the three months ended September 27, 2025, mainly due to a decrease in adjusted gross margin.

Our Adjusted Operating Margin increased from 8% for the nine months ended September 28, 2024 to 17% for the nine months ended September 27, 2025, mainly due to lower operating expenses as a percentage of revenue.

Adjusted Operating Income (Loss) and Margin

Our Operating Loss increased by $3,779 million in the three months ended March 28, 2026 compared to the three months ended March 29, 2025, mainly due to the goodwill impairment loss recognized this quarter.

Our Adjusted Operating Income increased by $36 million in the three months ended March 28, 2026 compared to the three months ended March 29, 2025, mainly due to higher Adjusted Gross Profit, partially offset by an increase in operating expenses.

Our Adjusted Operating Margin increased from 13% for the three months ended March 29, 2025 to 17% for the three months ended March 28, 2026, due to lower operating expenses as a percentage of revenue, partially offset by lower Adjusted Gross Margin.

Adjusted Net Income (Loss)

We define Adjusted Net Income (Loss) as net income (loss) presented in accordance with GAAP, adjusted to exclude amortization of acquisition related intangibles and share-based compensation expense as well as the related income tax effects.

Income tax effects have been calculated using the applicable statutory tax rate for each adjustment taking into consideration the associated valuation allowance impacts.

The adjustment for income tax effects consists primarily of the deferred tax impact of the amortization of acquired intangible assets.

The adjustment for income tax effects consist primarily of the deferred tax impact of the amortization of acquired intangible assets and impairment of goodwill.

Set forth below is the reconciliation of net income (loss) to Adjusted Net Income (Loss):

Three months Ended

Nine Months Ended

September 27, 2025

September 28, 2024

September 27, 2025

September 28, 2024

March 28, 2026

March 29, 2025

dollars in millions

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Share-based compensation expense

Acquisition related expenses

Goodwill impairment

Income tax effects

Adjusted Net Income

The three months ended September 27, 2025 ended with a net loss of $(96) million compared to a $(2,715) million net loss in the three months ended September 28, 2024.

Our net loss decreased by $2,754 million in the nine months ended September 27, 2025, compared to the nine months ended September 28, 2024.

The decrease in net loss in both periods is mainly due to a goodwill impairment loss recognized during the three months ended September 28, 2024.

Our Adjusted Net Income decreased by $1 million in the three months ended September 27, 2025, compared to the three months ended September 28, 2024 mainly due to a decrease in adjusted operating income partially offset by higher financial income.

Our Adjusted Net Income increased by $143 million in the nine months ended September 27, 2025, compared to the nine months ended September 28, 2024.

The increase is primarily due to the increase in Adjusted Gross Profit, partially offset by an increase in operating expenses.

Adjusted Net Income (Loss)

Our net loss increased by $3,716 million in the three months ended March 28, 2026, compared the three months ended March 29, 2025, primarily due to the goodwill impairment loss recognized this quarter.

We had an Adjusted Net Income of $96 million in the three months ended March 28, 2026 compared to an Adjusted Net Income of $63 million in the three months ended March 29, 2025, primarily due to the increase in Adjusted Gross Profit, partially offset by an increase in operating expenses.

Critical Accounting Policies and Estimates

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We base our assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant at the time the estimate was made.

Note 2, “Significant Accounting Policies” of the Notes to the condensed consolidated Financial Statements in Part I, Item 1 of this Form 10-Q and in the Notes to the Consolidated Financial Statements in Part II, Item 8 of the 2024 Form 10-K describe the significant accounting policies and methods used in the preparation of the Company’s condensed consolidated financial statements.

Note 2, “Significant Accounting Policies” of the Notes to the condensed consolidated Financial Statements in Part I, Item 1 of this Form 10-Q and in the Notes to the Consolidated Financial Statements in Part II, Item 8 of the 2025 Annual Report on Form 10-K, as filed with the SEC on February 12, 2026 (the “2025 Form 10-K”) describe the significant accounting policies and methods used in the preparation of the Company’s condensed consolidated financial statements.

There have been no material changes to the Company’s critical accounting estimates since the 2025 Form 10-K.

As noted in the 2025 Form 10-K critical accounting policies, we regularly test our goodwill and intangible assets to make a judgment on whether facts and circumstances indicate that the carrying amount may not be recoverable and an impairment may be required.

These reviews can be affected by various factors, including external factors such as industry and economic trends, and internal factors such as changes in our business strategy and our forecasts for specific product lines.

During the fourth quarter of 2025, we completed our annual impairment assessment.

For the “Mobileye” reporting unit, the assessment was performed using a quantitative test.

The quantitative impairment test estimated the fair value of the reporting unit using an income approach.

The Company also assessed the reasonableness of the estimated fair value of the reporting unit by comparison to its market capitalization, including consideration of expected acquirer synergies, control premium, and the current market.

Based on the assessment, no impairment was recorded.

During the first quarter of 2026, we performed an interim quantitative goodwill impairment analysis for the “Mobileye” reporting unit due to a 35% decline in the share price of the Company’s Class A common stock and the corresponding decline in market capitalization since the most recent assessment date, as well as increased uncertainty in the macroeconomic and geopolitical environment.

The quantitative impairment test estimates the fair value of the reporting unit using an income approach.

Significant inputs and assumptions incorporated in the valuation include business projections, estimated costs, terminal growth rate, and discount rate based on the reporting unit’s weighted average cost of capital.

When using the income approach, we tested the reasonableness of the inputs and outcomes of our discounted cash flow analysis against available market data.

As part of this analysis, we determined that a significant increase in the discount rate was required relative to the discount rate used in our most recent assessment.

This increase resulted from higher market‑based and Mobileye-specific risk premiums associated with changes in global macroeconomic conditions in 2026, including heightened geopolitical risks related to operations in the Middle East, particularly the conflict between Israel and Iran, as well as increased uncertainty related to the evolving competitive landscape.

We also assessed the reasonableness of the estimated fair value of the reporting unit by comparison to its market capitalization, including consideration of expected acquirer synergies, control premium, and the current market.

The results of the impairment analysis indicate that the fair value of the Mobileye reporting unit is below its carrying amount and therefore a non-cash impairment loss of $3,788 million, was recognized in the Condensed Consolidated Statements of Operations.

A 1% increase in the discount rate and a 0.5% decrease in terminal growth rate would result in an additional impairment of $682 million and $141 million, respectively.

Our impairment conclusion is sensitive to the market capitalization in that a further sustained decline in the Company’s market capitalization may require additional analysis to support the reasonability of our implied control premium, and may require further adjustments to certain key assumptions underlying our valuation.

Cautionary Note Regarding Forward-Looking Statements

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Forward-looking statements contained in this report may include, but are not limited to, statements about:

● further deterioration of macroeconomic conditions due to ongoing global economic and political uncertainty (as our current guidance assumes the estimated production and/or demand impact of current tariff conditions);

● future business, social and environmental performance, goals and measures;

● further deterioration of macroeconomic conditions due to ongoing global economic and political uncertainty;

● future business, strategic and financial performance, goals and measures;

● our anticipated growth prospects and trends in markets and industries relevant to our business;

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● our ability to effectively compete in the markets in which we operate;

● increased competition from emerging chip manufacturers and OEMs;

● future products and technology, and the expected availability and benefits of such products and technology;

● the humanoid robotics industry and its accompanying technology may not develop as expected;

● development of regulatory frameworks for current and future technology;

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● uncertain events or assumptions, including statements relating to our estimated vehicle production and market opportunity, potential production volumes associated with design wins and other characterizations of future events or circumstances;

● adverse conditions in Israel, including as a result of war and geopolitical conflict, which may affect our operations and may limit our ability to produce and sell our solutions;

● any disruption in our operations by the obligations of our personnel to perform military service as a result of current or future military actions involving Israel;

● availability, uses, sufficiency and cost of capital and capital resources, including expected returns to stockholders such as dividends, and the expected timing of future dividends;

● tax- and accounting-related expectations;

● adverse conditions in Israel, including in connection with the Israeli military operations in response to the October 7, 2023 terrorist attacks or the conflict between Israel and Iran, which may affect our operations and may limit our ability to produce and sell our solutions;

● any disruption in our operations by the obligations of our personnel to perform military service as a result of current or future military actions involving Israel;

● sustained low levels of our share price and market capitalization as well as other factors may require further testing of our Mobileye reporting unit, which may result in an impairment of goodwill;

● the ability to meet our social and environmental goals and projections;

● other statements described in this report and under the sections entitled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business,” in our 2025 Form 10-K.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis