MESA LABORATORIES INC /CO/ 10-Q

Item 1 . Financial Statements M esa Laboratories, Inc. Condensed Consolidated Balance Sheets (unaudited) (in thousands, except share amounts) June 30, March 31, 2026 2026 ASSETS Current assets: Cash and cash equivalents $ 30,695 $ 26,928 Accounts receivable, less allowance for credit losses of $ 1,852 and $ 2,569 , respectively 34,409 44,099 Inventories 27,229 26,373 Prepaid expenses and other current assets 10,515 8,868 Total current assets 102,848 106,268 Noncurrent assets: Property, plant and equipment, net of accumulated depreciation of $ 31,113 and $ 30,115 , respectively 30,088 30,613 Deferred tax asset 1,488 1,501 Other assets 20,360 19,155 Customer relationships, net 59,594 63,211 Other intangibles, net 18,808 20,136 Goodwill 186,038 186,863 Total assets $ 419,224 $ 427,747 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 7,459 $ 4,928 Accrued payroll and benefits 13,179 19,006 Unearned revenue 14,523 14,723 Other accrued expenses 16,536 17,616 Term loan, current portion 5,625 5,625 Total current liabilities 57,322 61,898 Noncurrent liabilities: Deferred tax liability 20,046 20,085 Non-current operating lease liabilities 15,852 13,662 Term loan, noncurrent portion, net of debt issuance costs 59,994 61,357 Revolving line of credit 77,250 84,500 Total liabilities 230,464 241,502 Stockholders’ equity: Common stock, no par value; authorized 25,000,000 shares; issued and outstanding, 5,595,780 and 5,524,931 shares, respectively 376,749 375,348 (Accumulated deficit) ( 183,801 ) ( 185,747 ) Accumulated other comprehensive (loss) ( 4,188 ) ( 3,356 ) Total stockholders’ equity 188,760 186,245 Total liabilities and stockholders’ equity $ 419,224 $ 427,747 See accompanying notes to Condensed C onsolidated Fi nancial Statements. Page 1 Table of Contents Mesa Laboratories, Inc. Condensed Consolidated Statements of Income (unaudited) (in thousands, except per share data) Three Months Ended June 30, 2026 2025 Revenue $ 60,138 $ 59,543 Cost of revenue 21,126 22,604 Gross profit 39,012 36,939 Operating expense: Selling 9,872 10,933 General and administrative 17,384 17,958 Research and development 4,725 4,984 Total operating expense 31,981 33,875 Operating income 7,031 3,064 Non-operating expense (income): Interest expense and amortization of debt issuance costs 2,363 2,198 Other expense (income), net 315 ( 6,146 ) Total non-operating expense (income), net 2,678 ( 3,948 ) Earnings before income taxes 4,353 7,012 Income tax expense 1,523 2,270 Net income $ 2,830 $ 4,742 Earnings per share: Basic $ 0.50 $ 0.87 Diluted $ 0.49 $ 0.85 Weighted-average common shares outstanding: Basic 5,657 5,465 Diluted 5,757 5,553 See accompanying notes to Condensed Consolidated Financial Statements. Page 2 Table of Contents Mesa Laboratories, Inc. Condensed Consolidated Statements of Comprehensive Income (unaudited) (in thousands) Three Months Ended June 30, 2026 2025 Net income $ 2,830 $ 4,742 Other comprehensive (loss) income: Foreign currency translation adjustments ( 832 ) 5,977 Comprehensive income $ 1,998 $ 10,719 See accompanying notes to Condensed Consolidated Financial Statements. Page 3 Table of Contents Mesa Laboratories, Inc. Condensed Consolidated Statements of Stockholders’ Equity (unaudited) (dollars in thousands, except per share data) Common Stock Number of Shares Amount (Accumulated Deficit) AOCI* Total March 31, 2026 5,524,931 $ 375,348 $ ( 185,747 ) $ ( 3,356 ) $ 186,245 Vesting of restricted stock units 80,974 - - - - Tax withholding on vesting of net restricted stock units ( 10,125 ) ( 958 ) - - ( 958 ) Dividends paid, $ 0.16 per share - - ( 884 ) - ( 884 ) Stock-based compensation expense - 2,359 - - 2,359 Foreign currency translation - - - ( 832 ) ( 832 ) Net income - - 2,830 - 2,830 June 30, 2026 5,595,780 $ 376,749 $ ( 183,801 ) $ ( 4,188 ) $ 188,760 Common Stock Number of Shares Amount (Accumulated Deficit) AOCI* Total March 31, 2025 5,455,421 $ 358,541 $ ( 188,936 ) $ ( 9,775 ) $ 159,830 Vesting of restricted stock units 57,348 - - - - Tax withholding on vesting of net restricted stock units ( 11,315 ) ( 1,061 ) - - ( 1,061 ) Dividends paid, $ 0.16 per share - - ( 873 ) - ( 873 ) Stock-based compensation expense - 3,881 - - 3,881 Foreign currency translation - - - 5,977 5,977 Net income - - 4,742 - 4,742 June 30, 2025 5,501,454 $ 361,361 $ ( 185,067 ) $ ( 3,798 ) $ 172,496 *Accumulated Other Comprehensive (Loss) Income See accompanying notes to Condensed Consolidated Financial Statements. Page 4 Table of Contents M esa Laboratories, Inc. Condensed Consolidated Statements of Cash Flows (unaudited) (in thousands) Three Months Ended June 30, 2026 2025 Cash flows from operating activities: Net income $ 2,830 $ 4,742 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation of property, plant and equipment 1,253 1,404 Amortization of intangible assets 4,392 4,553 Stock-based compensation expense 2,359 3,881 Foreign currency adjustments 354 ( 5,986 ) Other 623 1,250 Cash from changes in operating assets and liabilities: Accounts receivable, net 9,778 3,436 Inventories ( 1,533 ) ( 3,290 ) Prepaid expenses and other assets ( 2,276 ) ( 2,436 ) Accounts payable 2,424 212 Accrued liabilities and taxes payable ( 5,297 ) ( 5,928 ) Unearned revenue ( 171 ) 55 Net cash provided by operating activities 14,736 1,893 Cash flows from investing activities: Purchases of property, plant and equipment ( 559 ) ( 1,009 ) Net cash (used in) investing activities ( 559 ) ( 1,009 ) Cash flows from financing activities: Proceeds from debt borrowings 10,000 10,500 Debt repayments ( 18,656 ) ( 7,438 ) GKE acquisition-related holdback payment - ( 9,555 ) Dividends paid ( 884 ) ( 873 ) Tax withholding on vesting of net restricted stock units ( 958 ) ( 1,061 ) Net cash (used in) financing activities ( 10,498 ) ( 8,427 ) Effect of exchange rate changes on cash and cash equivalents 88 1,501 Net increase (decrease) in cash and cash equivalents 3,767 ( 6,042 ) Cash and cash equivalents at beginning of period 26,928 27,321 Cash and cash equivalents at end of period $ 30,695 $ 21,279 Supplemental non-cash activity: Right of use assets obtained in exchange for lease liabilities $ 1,062 $ 511 See accompanying notes to Condensed C onsolidated Fin ancial Statements. Page 5 Table of Contents Mesa Laboratories, Inc. Notes to Condensed Consolidated Financial Statements (unaudited) (dollar and share amounts in thousands, unless otherwise specified) Note 1 . Description of Business and Summary of Significant Accounting Policies Description of Business In this Quarterly Report on Form 10 -Q, Mesa Laboratories, Inc., a Colorado corporation, together with its subsidiaries, is collectively referred to as “we,” “us,” “our,” the “Company,” or “Mesa.” We are a global leader in the design and manufacture of life sciences tools and critical quality control solutions for regulated applications in the pharmaceutical, healthcare and medical device industries. We offer products and services to help our customers ensure product integrity, increase patient and worker safety, and improve the quality of life throughout the world. We have manufacturing operations in the United States and Europe, and our products are marketed by our sales personnel in North America, Europe and the Asia Pacific region, and by independent distributors throughout the world. As of June 30, 2026 , we managed our operations in four reportable segments, or divisions: ● Sterilization and Disinfection Control - manufactures and sells biological, chemical and cleaning indicators used to assess the effectiveness of sterilization, decontamination, disinfection and cleaning processes in the pharmaceutical, medical device and healthcare industries. The division also provides sterility assurance testing and laboratory services, primarily to dental and pharmaceutical customers. ● Biopharmaceutical Development - develops, manufactures, sells and services automated systems for protein analysis (immunoassays) and peptide synthesis solutions. Immunoassays and peptide synthesis solutions accelerate the discovery, development and manufacture of biologic therapies, among other applications. ● Calibration Solutions - develops, manufactures, sells and services quality control products using principles of advanced metrology to enable customers to measure and calibrate critical parameters in applications such as renal care, gas flow, and environmental and process monitoring. ● Clinical Genomics - develops, manufactures and sells highly sensitive high-throughput genetic analysis instruments, consumables and related services that enable clinical research labs and contract research organizations to perform genomic testing across a broad range of applications in several therapeutic areas, including hereditary disease screenings, pharmacogenetics, oncology related applications and toxicology research. Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information. In the opinion of management, such unaudited information includes all adjustments, consisting of normal recurring adjustments, necessary for the fair statement of our financial position and results of operations. The results of operations for interim periods are not necessarily indicative of results that may be achieved for the entire year. The year-end Condensed Consolidated Balance Sheet data was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. The Condensed Consolidated Financial Statements include the accounts of Mesa and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. We have made no material changes to the application of significant accounting policies disclosed in our Annual Report on Form 10 -K for the fiscal year ended March 31, 2026 . This report should be read in conjunction with the consolidated financial statements included in that report. Our fiscal year ends on March 31. References in this report to a particular “year” or “quarter” refer to our fiscal year or fiscal quarters, respectively. Unless otherwise indicated, amounts shown in this report are in thousands. Page 6 Table of Contents Risks and Uncertainties The preparation of financial statements requires the use of estimates and assumptions that affect reported amounts of assets and liabilities at the reporting date and revenue and expenses during the reporting periods. These estimates represent management's judgment about the outcome of future events. The global business environment continues to be impacted by cost pressures, economic uncertainties, regulatory changes and other factors. Changes in, and the resulting effects of, potential government trade, stimulus or fiscal and monetary policies, interest rates, foreign currency values, supply chains, demand for goods and services, global or regional recession, or other circumstances cannot be reliably predicted. Actual results could differ from our estimates. Refer to Item 1A. Risk Factors in our Annual Report on Form 10 -K for the fiscal year ended March 31, 2026 . Recent Accounting Pronouncements We have reviewed all recently issued accounting pronouncements and have concluded that, other than as described below, they are not applicable to us or are not expected to have a material impact on our consolidated financial statements. Recently Adopted Accounting Pronouncements In July 2025, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2025 - 05, Financial Instruments — Credit Losses (Topic 326 ): Improvements to the Measurement of Credit Losses for Receivables and Contract Assets . ASU 2025 - 05 introduces a practical expedient that removes the requirement to incorporate macroeconomic forecasts into the estimation of expected credit losses. The guidance is effective for fiscal years beginning after December 15, 2025, including interim periods within those fiscal years. We adopted the ASU effective April 1, 2026 on a prospective basis and elected the practical expedient allowing us to assume conditions as of the balance sheet date will remain unchanged for the remaining life of the asset. This adoption did not have a material impact on our consolidated financial statements, allowance for credit losses or related disclosures. In September 2025, the FASB issued ASU 2025 - 06, Intangibles — Goodwill and Other (Topic 350 ): Internal-Use Software . ASU 2025 - 06 modernizes accounting for costs incurred in the development of internal-use software by eliminating the requirement to evaluate distinct development stages. The guidance is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years. ASU 2025 - 06 permits prospective, retrospective or modified retrospective adoption. Early adoption is permitted as of the beginning of an entity's annual reporting period. We early adopted the ASU effective April 1, 2026, on a prospective basis. This adoption did not have a material impact on our consolidated financial statements or related disclosures. Recently Issued Accounting Pronouncements In November 2024, the FASB issued ASU 2024 - 03, Expense Disaggregation Disclosures (Subtopic 220 - 40 ): Disaggregation of Income Statement Expenses. ASU 2024 - 03 requires that public business entities disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. The ASU is effective for fiscal years beginning after December 15, 2026 ( our fiscal year 2028 for annual periods) and interim periods within fiscal years beginning after December 15, 2027 ( our fiscal year 2029 for interim periods), with early adoption and prospective or retrospective application permitted. We intend to adopt ASU 2024 - 03 prospectively, and we expect to disclose additional detail regarding the nature and classification of certain categories of expense once adopted. Note 2. Revenue We develop, manufacture, market, sell and maintain life sciences tools and quality control instruments and related consumables. Hardware sales include physical products such as instruments used for molecular and genetic analysis, protein synthesizers, medical meters, wireless sensor systems, data loggers, and process challenge devices. Hardware may be offered with accompanying perpetual or annual software licenses, which in some cases are required for the hardware to function. Consumables are single-use products requiring frequent replacement in our customers' operating cycles. Consumables sold by our Clinical Genomics and Biopharmaceutical Development divisions, such as reagents used for molecular and genetic analysis or solutions used for protein synthesis, are critical to the ongoing use of our instruments. Consumables such as biological and chemical indicator test strips sold by our Sterilization and Disinfection Control division are used on a standalone basis. Revenue from hardware and consumables are recognized upon transfer of control to the customer. Control of hardware and consumables sold in the U.S. and Asia Pacific typically transfers at the point of shipment, whereas control of products sold in Europe more typically occurs upon delivery to the customer site. Page 7 Table of Contents We also offer maintenance, calibration and testing services. Services result in revenue recognized either over time, for example, when we are contractually obligated to perform labor and replace parts on an as-needed basis throughout a specified service period, or at a point in time, upon completion of a specific, discrete service. We disclose revenue consistently with how management evaluates the business, i.e., based on business unit and the nature of goods and services provided. The following tables present disaggregated revenue for the quarters ended June 30, 2026 and 2025, respectively: Three Months Ended June 30, 2026 Sterilization and Disinfection Control Biopharmaceutical Development Calibration Solutions Clinical Genomics Total Consumables $ 21,925 $ 4,303 $ 810 $ 7,739 $ 34,777 Hardware and software 96 4,898 7,681 1,450 14,125 Services 2,484 2,858 4,794 1,100 11,236 Total revenue $ 24,505 $ 12,059 $ 13,285 $ 10,289 $ 60,138 Three Months Ended June 30, 2025 Sterilization and Disinfection Control Biopharmaceutical Development Calibration Solutions Clinical Genomics Total Consumables $ 23,011 $ 3,836 $ 841 $ 8,085 $ 35,773 Hardware and software 89 4,288 6,975 1,217 12,569 Services 2,310 3,362 4,534 995 11,201 Total revenue $ 25,410 $ 11,486 $ 12,350 $ 10,297 $ 59,543 Revenue from external customers are attributed to individual countries based on the locations to which the products are shipped or exported, or locations where services are performed, as follows: Three Months Ended June 30, 2026 2025 United States $ 29,743 $ 27,646 China 5,437 5,429 Other 24,958 26,468 Total revenue $ 60,138 $ 59,543 No foreign country exceeded 10% of total revenue for the quarter ended June 30, 2026 . Contract Liabilities Our contracts have varying payment terms and conditions. Some customers prepay for products and services, resulting in contract liabilities recorded as unearned revenue or within other noncurrent liabilities in our unaudited Condensed Consolidated Balance Sheets. The significant majority of our revenue, related receivables and contract liabilities arise from contracts with original durations of twelve months or less. Contract liabilities are recognized as revenue as we satisfy our obligations under the terms of the contracts. A summary of contract liabilities is as follows: Contract liabilities as of March 31, 2026 $ 14,723 Prior year liabilities recognized in revenue during the three months ended June 30, 2026 ( 3,917 ) Contract liabilities added during the three months ended June 30, 2026, net of revenue recognized 3,717 Contract liabilities as of June 30, 2026 $ 14,523 Page 8 Table of Contents Note 3. Fair Value Measurements and Concentrations of Credit Risk Our financial instruments consist primarily of cash and cash equivalents, trade accounts receivable, obligations under trade accounts payable, and debt. Due to their short-term nature, the carrying values of cash and cash equivalents, trade accounts receivable and trade accounts payable approximate fair value and are classified within Level 1 of the fair value hierarchy. The carrying amounts of our term loan and revolving line of credit (together, the "Credit Facility") approximate fair value due to variable interest rate pricing, with the balances bearing interest rates approximating current market rates. There were no nonrecurring fair value adjustments or transfers between the levels of the fair value hierarchy during the quarter ended June 30, 2026 . The financial instruments that subject us to the highest concentrations of credit risk are cash and accounts receivable. We maintain relationships and cash deposits at multiple banking institutions across the world in an effort to diversify cash holdings and reduce risk of loss. Concentration of credit risk with respect to accounts receivable is limited to customers to whom we make significant sales. No customers accounted for more than 10% of total trade receivables as of June 30, 2026 . Note 4. Supplemental Information Inventories consisted of the following: June 30, 2026 March 31, 2026 Raw materials $ 15,721 $ 14,873 Work in process 765 925 Finished goods 10,743 10,575 Total inventories $ 27,229 $ 26,373 Prepaid expenses and other current assets consisted of the following: June 30, 2026 March 31, 2026 Prepaid expenses $ 4,353 $ 2,785 Deposits 1,542 1,644 Prepaid income taxes 142 819 Other current assets 4,478 3,620 Total prepaid expenses and other current assets $ 10,515 $ 8,868 Accrued payroll and benefits consisted of the following: June 30, 2026 March 31, 2026 Wages and paid-time-off payable $ 4,258 $ 3,333 Bonus payable 3,101 10,509 Payroll related taxes 2,942 2,317 Severance 2,273 2,294 Other benefits payable 605 553 Total accrued payroll and benefits $ 13,179 $ 19,006 Other accrued expenses consisted of the following: June 30, 2026 March 31, 2026 Accrued business taxes $ 6,663 $ 6,950 Current operating lease liabilities 2,630 3,687 Income taxes payable 4,975 4,745 Other 2,268 2,234 Total other accrued expenses $ 16,536 $ 17,616 Page 9 Table of Contents Depreciation expense was as follows: Three Months Ended June 30, 2026 2025 Depreciation expense in cost of revenue $ 745 $ 810 Depreciation expense in operating expense 508 594 Total depreciation expense $ 1,253 $ 1,404 Note 5. Goodwill and Intangible Assets Intangible assets other than goodwill consisted of the following: June 30, 2026 March 31, 2026 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 186,827 $ ( 127,233 ) $ 59,594 $ 188,192 $ ( 124,981 ) $ 63,211 Other intangibles 59,975 ( 41,167 ) 18,808 60,308 ( 40,172 ) 20,136 Total finite-lived intangible assets $ 246,802 $ ( 168,400 ) $ 78,402 $ 248,500 $ ( 165,153 ) $ 83,347 Amortization expense for intangible assets was as follows: Three Months Ended June 30, 2026 2025 Amortization in cost of revenue $ 691 $ 702 Amortization in general and administrative 3,701 3,851 Total $ 4,392 $ 4,553 Estimated future amortization expense for the following fiscal years ending March 31 is presented below, based on foreign currency exchange rates in effect as of June 30, 2026: Fiscal Year Amortization Expense Remainder of 2027 $ 12,726 2028 16,389 2029 15,832 2030 11,217 2031 4,829 The change in the carrying amount of goodwill was as follows: Sterilization and Disinfection Control Biopharmaceutical Development Calibration Solutions Clinical Genomics Total March 31, 2026 $ 82,810 $ 49,666 $ 37,266 $ 17,121 $ 186,863 Effect of foreign currency translation ( 273 ) ( 585 ) ( 6 ) 39 ( 825 ) June 30, 2026 $ 82,537 $ 49,081 $ 37,260 $ 17,160 $ 186,038 Page 10 Table of Contents Note 6 . Indebtedness Credit Facility Our secured credit agreement matures in April 2029 and includes: (i) A revolving credit facility with an aggregate principal amount of up to $ 125,000 (the "Revolver"), (ii) A term loan with a maximum principal amount of $ 75,000 , which is subject to escalating quarterly principal payments (the "Term Loan"), (iii) A swingline loan with an aggregate principal amount not exceeding $ 5,000 , and (iv) Letters of credit with an aggregate stated amount not exceeding $ 2,500 at any time. Borrowings under our Credit Facility bear interest at a Secured Overnight Financing Rate ("SOFR") rate or a base rate, plus an applicable spread that varies with our total net leverage ratio. The weighted average interest rate on borrowings under the Credit Facility was 5.6 % as of June 30, 2026 and 5.9 % as of March 31, 2026. The financial covenants in the Credit Facility include a maximum total net leverage ratio of 3.5 to 1.0 on each quarterly testing date after March 31, 2026. The Credit Facility also stipulates a minimum fixed charge coverage ratio of 1.25 to 1.0. Other covenants include restrictions on our ability to incur debt, grant liens, make fundamental changes to our business as defined in the contract, engage in certain transactions with affiliates, or conduct asset sales. As of June 30, 2026 , we were in compliance with all covenants under the Credit Facility. Term Loan We are required to make quarterly principal payments on the Term Loan. During the quarter ended June 30, 2026, we made a required payment of $ 1,406 . For fiscal years ending March 31, required future debt payments on the Term Loan are as follows: Fiscal Year Amount Remainder of 2027 $ 4,219 2028 5,625 2029 7,500 2030 48,750 Total principal remaining $ 66,094 Unamortized debt issuance costs related to the Term Loan are reflected as a discount to the debt’s carrying value in our unaudited Condensed Consolidated Balance Sheets and are being amortized to interest expense through maturity. The net carrying amount of the Term Loan was as follows: June 30, 2026 March 31, 2026 Term Loan ( 5.6 % and 5.9 % as of June 30, 2026 and March 31, 2026, respectively) $ 66,094 $ 67,500 Less: debt issuance costs ( 475 ) ( 518 ) Less: current portion ( 5,625 ) ( 5,625 ) Noncurrent portion $ 59,994 $ 61,357 We recognized interest expense on the Term Loan as follows: Three Months Ended June 30, 2026 2025 Interest expense ( 5.6 % and 7.2 % as of June 30, 2026 and 2025, respectively) $ 995 $ 1,292 Amortization of debt issuance costs 43 37 Total interest and amortization of debt issuance costs $ 1,038 $ 1,329 Page 11 Table of Contents Revolver As of June 30, 2026 , the outstanding balance under the Revolver was $ 77,250 , and $ 47,750 was available for borrowing. Subsequent to June 30, 2026 , we repaid an additional $4,000 on the Revolver. We are obligated to pay quarterly unused commitment fees of between 0.20 % and 0.35 % of the Revolver’s aggregate principal amount, based on our leverage ratio. The balance of unamortized customary lender fees related to the Revolver was $ 934 and $ 1,018 as of June 30, 2026 and March 31, 2026, respectively. Convert ible Notes On August 15, 2025, our previously outstanding 1.375 % convertible notes (the "Notes") matured. We settled the aggregate principal balance of $ 97,500 and accrued interest using borrowings under our Revolver and cash on hand. As of June 30, 2025, the Notes had a net carrying value of $ 97,432 . Interest expense recognized in connection with the Notes during the three months ended June 30, 2025 was $ 470 , consisting of coupon interest expense of $ 335 and amortization of debt issuance costs of $ 135 . Note 7. Stock Transactions and Stock-Based Compensation Stock-Based Compensation During the three months ended June 30, 2026 , we issued time-based restricted stock units ("RSUs") and performance-based restricted stock units ("PSUs") pursuant to the Amended and Restated Mesa Laboratories, Inc. 2021 Equity Incentive Plan (the "2021 Equity Plan"), which authorizes the issuance of 1,156 shares of common stock to eligible participants. The following is a summary of RSU and PSU award activity for the three months ended June 30, 2026 : Time-Based Restricted Stock Units Performance-Based Restricted Stock Units Number of Shares Weighted- Average Grant Date Fair Value per Share Number of Shares Weighted- Average Grant Date Fair Value per Share Nonvested as of March 31, 2026 187 $ 93.39 110 $ 126.18 Awards granted (1) 99 100.47 48 105.38 Awards forfeited ( 10 ) 96.36 ( 16 ) 99.56 Awards distributed ( 68 ) 99.50 ( 13 ) 132.29 Nonvested as of June 30, 2026 208 $ 94.66 129 $ 120.81 ( 1 ) Balances for PSUs granted are reflected at target. In the three months ended June 30, 2026, the Compensation Committee of the Board of Directors (the "Compensation Committee") awarded our CEO a sign-on equity award consisting of 35 RSUs. These RSUs vest in equal installments on April 13, 2027, 2028 and 2029. Time-based RSUs vest and settle in shares of our common stock on a one -for- one basis. The significant majority of other RSUs granted to employees during the three months ended June 30, 2026 vest in equal installments on June 13, 2027, June 8, 2028 and June 8, 2029. During the three months ended June 30, 2026 , the Compensation Committee awarded 48 PSUs at target (the "FY27 PSUs") to eligible employees. The FY27 PSUs are subject to market-based performance conditions measured relative to a selected peer index and service conditions. The market performance measurement period and service period are from June 15, 2026 through June 14, 2029, followed by a mandatory two -year holding period. The number of shares that may be earned will range from 0 % to 200 % of the target number of shares, based on Mesa's relative total shareholder return compared to the selected peer group. If defined minimum targets are not met, no shares will vest. As of June 30, 2026 , there were 105 shares subject to outstanding options, with a weighted average exercise price per share of $ 183.18 , an intrinsic value of $ 0 and a remaining contractual life of 1.8 years. Our Compensation Committee has not granted options to any plan participants in the current or prior fiscal year. Page 12 Table of Contents Liability Classified PSUs During the three months ended June 30, 2026, liability-classified PSUs were granted to certain key employees. The awards may vest based on our over-achievement against a challenging threshold for revenue and adjusted operating income targets; the value of shares awarded will range from $ 0 to approximately $ 3,000 , depending on Company performance. The awards represent a fixed monetary value that will be settled in a variable number of shares and are therefore classified as liabilities. As of June 30, 2026, achievement of performance conditions was not considered probable; as such, no compensation expense or corresponding liability has been recognized in our Condensed Consolidated Financial Statements. Performance is measured from April 1, 2026 to March 31, 2027. Any awards earned will vest in June 2027 and be subject to a mandatory one -year holding period. Note 8 . Earnings per Share The following table presents a reconciliation of the denominators used in the computation of basic and diluted earnings per share ("EPS"): Three Months Ended June 30, 2026 2025 Net income available for shareholders $ 2,830 $ 4,742 Weighted average outstanding shares of common stock (1) 5,657 5,465 Dilutive effect of unvested stock awards 100 88 Fully diluted shares 5,757 5,553 Basic earnings per share $ 0.50 $ 0.87 Diluted earnings per share $ 0.49 $ 0.85 ( 1 ) Weighted average outstanding shares of common stock includes awards that have not yet vested and are not yet legally outstanding, but for which no vesting criteria other than the passage of time remain. For example, this includes RSUs granted to retirement-eligible employees and certain awards granted to our former CEO that are not subject to continued service requirements but have not yet vested. The following contingently issuable securities were excluded from the calculation of diluted EPS as their inclusion would be anti-dilutive: Three Months Ended June 30, 2026 2025 Assumed conversion of the Notes - 344 Stock awards that were anti-dilutive 136 161 Total stock awards excluded from diluted EPS 136 505 Stock awards are potentially dilutive securities and as such are excluded from the calculation of diluted EPS if their inclusion would be anti-dilutive, or if achievement of performance-based thresholds as of our reporting date would not result in the awards vesting. Note 9 . Income Taxes We reported an income tax provision as follows: Three Months Ended June 30, 2026 2025 Income tax expense $ 1,523 $ 2,270 Effective tax rate 35.0 % 32.4 % Page 13 Table of Contents For interim income tax reporting, we estimate our annual effective tax rate and apply this effective tax rate to our year-to-date pre-tax income. Each quarter, our estimate of the annual effective tax rate is updated, and if the estimated effective tax rate changes, a cumulative adjustment is made. Additionally, the tax effects of significant unusual or infrequently occurring items are recognized as discrete items in the interim period in which the events occur. There is a potential for volatility in the effective tax rate due to several factors, including changes in the mix of the pre-tax income and the jurisdictions to which they relate, changes in tax laws and foreign tax holidays, settlement with taxing authorities, and foreign currency fluctuations. The effective tax rate for the three months ended June 30, 2026 differed from the statutory federal rate of 21 % primarily due to the impact of the valuation allowance on U.S. deferred taxes. Given our current earnings and anticipated future earnings, we believe that there is a reasonable possibility that within the next 12 months, sufficient positive evidence may become available to allow us to reach a conclusion that a significant portion of the valuation allowance will no longer be needed. However, the exact timing and amount of the valuation allowance release are subject to change on the basis of the level of profitability that we are able to achieve. Note 10 . Commitments and Contingencies As of June 30, 2026 , we are not party to any legal proceeding that management believes could have a material adverse effect on our unaudited consolidated financial position, results of operations, or cash flows. During the three months ended June 30, 2026, we entered into a settlement agreement that resolved previously disclosed litigation involving True Indicating, LLC. Under the terms of the settlement agreement, we paid an insignificant amount to resolve all outstanding matters between the parties, which was recorded in general and administrative expense in our Condensed Consolidated Statements of Income. We have no remaining obligations under the agreement. Note 11 . S egment Information Segment information is prepared on the same basis our chief operating decision maker ("CODM"), our CEO, uses to assess segment performance, allocate resources, evaluate financial results, and make key operating decisions. Our four reportable segments are organized primarily by the nature of the goods and services they sell. Our CODM regularly reviews segment-level U.S. GAAP revenue and gross profit relative to forecasted and prior period amounts, as well as non-GAAP adjusted operating expense compared to budgeted amounts. Our CODM also regularly reviews non-GAAP organic revenue growth to support strategic planning and resource deployment. The following tables set forth our segment information: Three months ended June 30, 2026 Sterilization and Disinfection Control Biopharmaceutical Development Calibration Solutions Clinical Genomics Total Revenue (a): $ 24,505 $ 12,059 $ 13,285 $ 10,289 $ 60,138 Less Depreciation in cost of revenue 437 78 111 119 745 Amortization in cost of revenue 121 379 - 191 691 Other cost of revenue (b) 6,788 4,020 5,143 3,739 19,690 Total segment cost of revenue 7,346 4,477 5,254 4,049 21,126 Gross Profit (c) $ 17,159 $ 7,582 $ 8,031 $ 6,240 $ 39,012 Reconciling items: Operating expense $ 31,981 Operating income 7,031 Non-operating expense, net 2,678 Earnings before income taxes $ 4,353 Page 14 Table of Contents Three months ended June 30, 2025 Sterilization and Disinfection Control Biopharmaceutical Development Calibration Solutions Clinical Genomics Total Revenue (a): $ 25,410 $ 11,486 $ 12,350 $ 10,297 $ 59,543 Less Depreciation in cost of revenue 450 89 105 166 810 Amortization in cost of revenue 139 372 - 191 702 Other cost of revenue (b) 6,655 4,719 5,203 4,515 21,092 Total segment cost of revenue 7,244 5,180 5,308 4,872 22,604 Gross Profit (c) $ 18,166 $ 6,306 $ 7,042 $ 5,425 $ 36,939 Reconciling items: Operating expense $ 33,875 Operating income 3,064 Non-operating expense, net ( 3,948 ) Earnings before income taxes $ 7,012 (a) Intersegment revenue are eliminated to arrive at consolidated totals. Revenue as presented are consistent with U.S. GAAP measurement principles and our CODM's review of segment information. (b) Other segment cost of revenue for each reportable segment includes product costs, personnel costs (including stock-based compensation), and other manufacturing and overhead costs necessary to produce and sell our products and services, excluding depreciation and amortization. (c) Gross profit as presented is consistent with U.S. GAAP measurement principles and our CODM's review of segment information. The following table sets forth inventories by reportable segment. Our CODM is not provided with and does not regularly review any other segment asset information. June 30, March 31, 2026 2026 Sterilization and Disinfection Control $ 5,516 $ 5,943 Biopharmaceutical Development 6,528 6,512 Calibration Solutions 5,928 5,603 Clinical Genomics 9,257 8,315 Total inventories $ 27,229 $ 26,373 Page 15 Table of Contents