What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-11-08 compared with 2023-08-09 · 86 added, 68 removed, 155 unchanged (50% of the section changed)

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All dollar amounts in this Management’s Discussion and Analysis of Financial Condition and Results of Operations are approximate.

Growth and percentage comparisons made herein generally refer to the three and six months ended June 30, 2023 compared with the three and six months ended June 30, 2022 unless otherwise noted.

Growth and percentage comparisons made herein generally refer to the three and nine months ended September 30, 2023 compared with the three and nine months ended September 30, 2022 unless otherwise noted.

Unless otherwise indicated or unless the context otherwise requires, all references in this document to “we,” “us,” “our,” the “Company,” “ChromaDex” and similar expressions refer to ChromaDex Corporation, and depending on the context, its subsidiaries.

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We are at the forefront of exploring effective methods to increase NAD+ levels and support healthy aging.

In 2013, we commercialized Niagen®, a proprietary form of NR, a novel form of vitamin B3, and one of the most well-studied NAD+ precursors on the market as well as the most efficient.

In 2013, we commercialized Niagen®, a proprietary form of NR, a novel form of vitamin B3, and one of the most well-studied and efficient NAD+ precursors on the market.

Data from numerous preclinical studies and human clinical trials show that NR is a highly efficient NAD+ precursor that significantly raises NAD+ levels in blood and tissue.

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During fiscal year 2022, we recognized approximately $2.1 million in Other income - Employee Retention Tax Credit in our Unaudited Condensed Consolidated Statements of Operations to reflect the ERTC.

As of June 30, 2023, the Company's Unaudited Condensed Consolidated Balance Sheets include an ERTC benefit of $0.9 million and associated commissions payable of $0.1 million recorded within prepaid expenses and other current assets and accrued expenses, respectively.

As of September 30, 2023, the Company's Unaudited Condensed Consolidated Balance Sheets include an ERTC benefit of $0.9 million and associated commissions payable of $0.1 million recorded within prepaid expenses and other current assets and accrued expenses, respectively.

On September 14, 2023, the IRS announced an immediate halt in processing new claims for the employee retention credit until at least the end of the year, citing ongoing concerns about improper claims.

The IRS guaranteed ongoing processing of existing claims, albeit at a reduced pace and with increased compliance scrutiny.

To date, we have not received communications from the IRS regarding our existing claims.

Nevertheless, we are diligently monitoring the situation to ensure continued compliance.

For further discussion, see Note 11, Employee Retention Tax Credit .

Other than the impacts to our Unaudited Condensed Consolidated Balance Sheets pertaining to the ERTC, the impact of COVID-19 did not have a material impact on our business during the three and six months ended June 30, 2023.

Any future developments and impacts of COVID-19, which are uncertain and cannot be predicted, including but not limited to impacts to our partners, can also exacerbate other risks discussed in Part II, Item 1A Risk Factors and throughout this report.

Any future developments and impacts of COVID-19, which cannot be predicted, including impacts to our partners, can also exacerbate other risks discussed in Part II, Item 1A Risk Factors and throughout this report.

Inflation and changing prices

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If customer sales diminish, we may be required to scale back production volumes which could negatively impact any economies of scale we have previously benefited from.

We have also seen changing prices due to other macroeconomic factors including rising interest rates, fluctuations in currency exchange rates and geopolitical uncertainties such as those surrounding Russia’s invasion of Ukraine.

We will continue to monitor changing prices and inflationary pressures closely as conditions may become more challenging due to ongoing and uncertain economic factors.

Recent Activities

Subsequent to September 30, 2023, we entered into a lease amendment for our Los Angeles, California office space.

Pursuant to this amendment, we received a total value of approximately $355,000 in rent abatement for approximately eight months starting in November 2023.

Effective as of November 2, 2023, we entered into a Ninth Amendment (Ninth Amendment) to the Manufacturing and Supply Agreement (such agreement as amended, the “Grace Manufacturing Agreement” or “Agreement”), originally effective in January 2016 with W.R.

In January 2019, Grace was issued patents related to the crystalline form of NR chloride which limit our ability to find alternatives for supply (Grace Patents).

Pursuant to the Ninth Amendment, we committed to purchase approximately $17.1 million of total inventory between January 1, 2024 and December 31, 2024.

In addition, we have remaining purchase commitments from the Eighth Amendment totaling $4.5 million to be purchased during the three months ended December 31, 2023.

The Grace Manufacturing Agreement will expire on December 31, 2024, subject to further renewal of the Agreement to be negotiated by the parties.

If we are unable to extend the agreement on satisfactory terms, it could have a material adverse impact to our financial results and strategic position in the market.

Risk Factors, “ We rely on single supplier, W.R.

Grace, for NR and a limited number of third-party suppliers for the raw materials required to produce our products.” for more information.

Financial Condition and Results of Operations

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Actual results may differ from these estimates under different assumptions or conditions.

As of June 30, 2023, our cash and cash equivalents totaled approximately $26.4 million, of which $26.3 million was unrestricted.

As of September 30, 2023, our cash and cash equivalents totaled approximately $26.8 million, of which $26.6 million was unrestricted.

We anticipate that our current unrestricted cash and cash equivalents and cash to be generated from net sales will be sufficient to meet our financial obligations as they become due over at least the next twelve months.

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The results of these segments and our consolidated operations are detailed in the discussion that follows.

Our consolidated net sales and net loss for the three and six months ended on June 30, 2023 and 2022 are as follows:

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

Our consolidated net sales and net loss for the three and nine months ended on September 30, 2023 and 2022 are as follows:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except per share data) 2023 2022 2023 2022

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The following table sets forth our total net sales by reportable segment:

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

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2023 2022 % Change 2023 2022 % Change

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Total net sales $ 19,495 $ 17,063 14 % $ 62,374 $ 51,054 22 %

Total net sales increased by approximately $3.6 million and $8.9 million for the three and six months ended June 30, 2023, compared to the same periods in 2022, respectively.

Total net sales increased by approximately $2.4 million and $11.3 million for the three and nine months ended September 30, 2023, compared to the same periods in 2022, respectively.

Changes in net sales were driven by the following:

• Tru Niagen® sales were the largest contributor to total net sales growth, increasing $2.4 million and $5.1 million for the three and six months ended June 30, 2023 compared to the corresponding periods in 2022, respectively.

The elevated sales for both periods were primarily fueled by higher sales to A.S.

Watson, a related party, and strong performance in our e-commerce business.

For the three months ending June 30, 2023, sales to A.S.

Watson and sales from our e-commerce business accounted for approximately $1.5 million and $1.0 million in growth, respectively.

Similarly, for the six months ended June 30, 2023, sales to A.S.

Watson drove approximately $2.6 million in higher sales, while e-commerce sales added approximately $2.3 million.

Looking ahead, we expect e-commerce sales to be the primary catalyst for growth throughout 2023.

• For the three and six months ended June 30, 2023, total ingredients sales increased by approximately $1.2 million and $3.9 million compared to the same periods in 2022, respectively.

The growth in ingredients sales was largely driven by sales of our Niagen® ingredient, which experienced increased demand from existing partners and new partners, accounting for $1.0 million and $3.8 million of the growth during the three and six months ended June 30, 2023, respectively.

• Our analytical reference standards and services segment accounted for the smallest proportion of total sales, remaining relatively flat for the three months ended June 30, 2023, and experiencing a slight decline of $0.1 million for the six months ended June 30, 2023, compared to the corresponding periods in 2022.

• Tru Niagen® remained the leading contributor to total net sales growth, increasing $2.8 million and $7.9 million for the three and nine months ended September 30, 2023 compared to the corresponding periods in 2022, respectively.

During the three and nine months ended September 30, 2022, our distributor partners were negatively impacted by COVID-19 headwinds and other macroeconomic factors.

As those headwinds subsided, we observed a resurgence in sales to these partners.

For the three months ended September 30, 2023, growth was largely driven by strong performance from our e-commerce business accounting for approximately $1.4 million alongside increased sales to our distributor partners and A.S.

Watson, a related party, totaling $0.9 million and $0.5 million in growth, respectively.

Similarly, for the nine months ended September 30, 2023, e-commerce and A.S.

Watson sales drove $3.7 million and $3.1 million in growth, respectively, with other distributor partners contributing approximately $1.0 million in higher sales.

Looking ahead, we anticipate that e-commerce sales will remain the primary driver of growth throughout 2023.

• For the three months ended September 30, 2023, total ingredients sales experienced a decline of approximately $0.4 million compared to the corresponding period in 2022, primarily due to the timing of Niagen® ingredient orders from our partners.

Conversely, for the nine months ended September 30, 2023, total ingredients sales increased $3.5 million compared to the same period in 2022, driven by increased demand for our Niagen® ingredient from both existing and new partners.

• Our analytical reference standards and services segment constituted the smallest proportion of total sales, maintaining relative stability for the three months ended September 30, 2023, and experiencing a slight decline of $0.1 million for the nine months ended September 30, 2023, compared to the corresponding periods in 2022.

Cost of Sales

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The following table sets forth our total cost of sales by reportable segment:

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

Three Months Ended September 30, Nine Months Ended September 30,

Amount % of net sales Amount % of net sales

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Total cost of sales $ 7,526 $ 6,856 39 % 40 % $ 24,531 $ 20,273 39 % 40 %

Overall, cost of sales, as a percentage of net sales, remained relatively stable for the three and six months ended June 30, 2023 compared to the same periods in 2022.

During the three months ended June 30, 2023, all segments experienced substantially similar cost of sales, as a percentage of net sales, compared to the corresponding periods in 2022.

This can be attributed to our continuous efforts to optimize our supply chain amid the prevailing inflationary environment.

For the six months ended June 30, 2023, the ingredients segment saw a 3% decrease in cost of sales, as a percentage of net sales, while the analytical reference standards and services segment increased by 6% each compared to the same periods in 2022.

Cost of sales for each of these segments is primarily influenced by fixed supply chain overhead costs, which do not fluctuate with sales.

Consequently, with higher sales in the ingredients segment, we benefited from improved labor and overhead utilization rates.

Conversely, in the analytical reference standards and services segment, with lower sales, we experienced lower labor and overhead utilization rates.

Gross profit is net sales less the cost of sales and is affected by a number of factors, including business and product mix, competitive pricing and costs of products, labor, overhead, services and delivery.

The following table sets forth our total gross profit by reportable segment:

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

Overall, cost of sales, as a percentage of net sales, remained relatively stable for the three and nine months ended September 30, 2023 compared to the same periods in 2022.

Changes in cost of sales were primarily driven by the following:

• Cost of sales, as a percentage of net sales, for our consumer products segment can fluctuate due to business mix, product mix, inflationary costs, and optimization efforts in our supply chain, among other factors.

For the three and nine ended September 30, 2023, our consumer products segment maintained relatively stable cost of sales, as a percentage of net sales, compared to the same periods in 2022, improving approximately 1% for each period.

• Cost of sales, as a percentage of net sales, in our ingredients segment and our analytical reference standards and services segment are predominantly influenced by fixed supply chain overhead costs, which remain constant regardless of sales fluctuations.

Consequently, increased sales result in improved labor and overhead utilization rates, while decreased sales lead to lower utilization rates.

In the ingredients segment, lower sales during the three months ended September 30, 2023, and higher sales for the nine months ended September 30, 2023, contributed to a 3% increase and a 2% decline in cost of sales as a percentage of net sales, respectively.

For the analytical reference standards and services segment, which experienced lower sales for both the three and nine months ended September 30, 2023, compared to the same periods in 2022, there was an observed increase of 7% and 6%, respectively, in cost of sales as a percentage of net sales.

Gross Profit (loss)

Gross profit (loss) is net sales less the cost of sales and is affected by a number of factors, including business and product mix, competitive pricing and costs of products, labor, overhead, services and delivery.

The following table sets forth our total gross profit (loss) by reportable segment:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2023 2022 % Change 2023 2022 % Change

Gross profit:

Gross profit (loss):

Consumer Products $ 11,376 $ 9,337 22 % $ 33,537 $ 28,324 18 %

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Analytical reference standards and services (92) (50) (84) (94) 49 (292)

Total gross profit $ 12,356 $ 10,042 23 % $ 25,874 $ 20,574 26 %

For details supporting the changes in gross profit, refer to the preceding discussions regarding changes in both our net sales and cost of sales for each respective segment.

Total gross profit (loss) $ 11,969 $ 10,207 17 % $ 37,843 $ 30,781 23 %

For details supporting the changes in gross profit (loss), refer to the preceding discussions outlining the changes in both our net sales and cost of sales for each respective segment.

Operating Expenses-Sales and Marketing

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Sales and marketing expenses by reportable segment were as follows:

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

Three Months Ended September 30, Nine Months Ended September 30,

Amount % of net sales Amount % of net sales

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Total sales and marketing expenses $ 6,035 $ 5,868 31 % 34 % $ 19,918 $ 22,126 32 % 43 %

• For our consumer products segment, sales and marketing expense, as a percentage of net sales, improved 1,928 basis points and 1,452 basis points for the three and six months ended June 30, 2023, respectively, compared to the same periods in 2022.

This significant improvement can be attributed to a strategic shift in our marketing approach.

In the three and six months ended June 30, 2022, we launched an extensive direct marketing campaign across multiple platforms, including televised commercials.

However, during the three and six months ended June 30, 2023, we pivoted our marketing efforts towards what we believe to be more efficient distribution channels and marketing campaigns, while investing in a brand building event to boost awareness and drive sales of Tru Niagen® on our largest e-commerce channel.

• Sales and marketing expense for our ingredients segment remained nominal during each of the three and six months ended June 30, 2023 and 2022.

• For our analytical reference standards and services segment, sales and marketing expense, as a percentage of net sales, improved by 8% and 6% for the three and six months ended June 30, 2023, respectively, compared to the same periods in 2022.

This favorable change can be mainly attributed to a reduction in marketing spend as we strategically manage expenses and retain our marketing focus on our consumer products segment.

• For our consumer products segment, sales and marketing expense, as a percentage of net sales, improved 501 basis points and 1,140 basis points for the three and nine months ended September 30, 2023, respectively, compared to the same periods in 2022.

This significant improvement can be attributed to a strategic shift in our marketing approach, beginning in the third quarter of 2022.

For the three months ended September 30, 2023, we continued to focus our marketing efforts on what we believe to be more efficient distribution channels and marketing campaigns, while beginning to scale up our investments compared to the prior year period.

For the nine months ended September 30, 2022, we launched an extensive direct marketing campaign across multiple platforms, including televised commercials.

During the nine months ended September 30, 2023, we did not invest in a campaign of this magnitude, but did invest in a brand building event to boost awareness and drive sales of Tru Niagen in our largest e-commerce channel, leading to efficiencies.

• Sales and marketing expense for our ingredients segment remained minimal throughout both of the three and nine months ended September 30, 2023 and 2022.

• For our analytical reference standards and services segment, sales and marketing expense, as a percentage of net sales, improved by 837 basis points and 677 basis points for the three and nine months ended September 30, 2023, respectively, compared to the same periods in 2022.

This favorable change can be primarily attributed to a reduction in marketing spend as we strategically manage expenses and maintain our marketing focus on our consumer products segment.

Operating Expenses-Research and Development

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Research and development expenses by reportable segment were as follows:

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

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2023 2022 % Change 2023 2022 % Change

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Total R&D expenses $ 1,241 $ 1,224 1 % $ 3,799 $ 3,547 7 %

We allocate R&D expenses related to our Niagen® branded ingredient to the consumer products and ingredients segment, based on revenues recorded.

In total, we had slightly higher R&D expenses for the three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022, primarily driven by inflationary pressures, such as overall wage inflation, as well as professional services and the timing of projects.

We allocate R&D expenses related to our Niagen® branded ingredient to the consumer products and ingredients segment, based on recorded revenues.

In total, we experienced slightly higher R&D expenses for the three and nine months ended September 30, 2023 compared to the three and nine months ended September 30, 2022.

This increase was primarily driven by inflationary pressures, such as overall wage inflation, as well as professional services and the timing of projects.

In addition, during the three months ended September 30, 2023, we ramped up our R&D efforts surrounding important R&D initiatives, incurring an associated increased expense of approximately $0.4 million, partially offset by a refund of $0.3 million related to a discontinued R&D project.

Operating Expenses-General and Administrative

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General and administrative expense for the periods indicated were as follows:

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

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2023 2022 % Change 2023 2022 % Change

General and administrative $ 5,840 $ 6,180 (6) % $ 19,557 $ 22,292 (12) %

Total general and administrative expense remained relatively flat increasing only $0.1 million for the three months ended June 30, 2023 compared to the same period in 2022, with the substantial drivers being an increase in severance and restructuring costs of $0.8 million largely offset by a decrease in legal expense of $0.6 million.

For the six months ended June 30, 2023, general and administrative expense declined by approximately $2.4 million compared to the same period in 2022.

The lower expense for the six month period was driven by a decrease in legal expense of $2.0 million, lower share-based compensation expense of $0.6 million and a decrease of $0.5 million related to lower executive headcount, partially offset by an increase of $0.8 million due to provisions for doubtful trade receivables.

Total general and administrative expense decreased by $0.3 million and $2.7 million during the three and nine months ended September 30, 2023, respectively, compared to the corresponding periods in 2022.

The reduction in expense for the three months ended September 30, 2023 was primarily attributable to lower legal expense and severance and restructuring expense of $0.2 million and $0.1 million, respectively.

The lower general and administrative expense for the nine months ended September 30, 2023 was driven by a decrease in legal expense of $2.3 million, a reduction in executive and other administrative headcount of $1.0 million, lower share-based compensation expense of $0.5 million, partially offset by an increase of $0.9 million due to provisions for doubtful trade receivables.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

At June 30, 2023 and June 30, 2022, we maintained a full valuation allowance against the entire deferred income tax balance which resulted in an effective tax rate of approximately 0% for the three and six months ended June 30, 2023 and 2022.

At September 30, 2023 and September 30, 2022, we maintained a full valuation allowance against the entire deferred income tax balance which resulted in an effective tax rate of approximately 0% for the three and nine months ended September 30, 2023 and 2022.

As defined in ASC 740, Income Taxes, future realization of the tax benefit will depend on the existence of sufficient taxable income, including the expectation of continued future taxable income.

Depreciation and Amortization (in thousands)

Depreciation expense was approximately $460 and $413 for the six months ended June 30, 2023 and 2022, respectively.

Depreciation expense was approximately $693 and $648 for the nine months ended September 30, 2023 and 2022, respectively.

We depreciate our assets on a straight-line basis, based on the estimated useful lives of the respective assets.

Amortization expense of intangible assets was approximately $80 and $99 for the six months ended June 30, 2023 and 2022, respectively.

Amortization expense of intangible assets was approximately $119 and $143 for the nine months ended September 30, 2023 and 2022, respectively.

We amortize intangible assets using a straight-line method, generally over 10 years.

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The useful lives of subsequent milestone payments that are capitalized are the remaining useful life of the initial licensing payment that was capitalized.

Amortization expense of right of use assets for the six months ended June 30, 2023 was approximately $344 compared to $468 for the six months ended June 30, 2022.

Amortization expense of right of use assets for the nine months ended September 30, 2023 was approximately $520 compared to $638 for the nine months ended September 30, 2022.

Liquidity and Capital Resources

From inception through June 30, 2023, we have incurred aggregate losses of approximately $189.6 million.

From inception through September 30, 2023, we have incurred aggregate losses of approximately $190.6 million.

These losses are primarily due to expenses associated with the development and expansion of our operations and investments to protect our intellectual property, including litigation-related expenses.

Historically, these operations have been financed through capital contributions, the issuance of common stock and warrants through private placements and the issuance of debt.

Historically, these operations have been financed through capital contributions, cash generated from sales, the issuance of common stock and warrants through private placements and the issuance of debt.

Our board of directors periodically reviews our capital requirements in light of our proposed business plan.

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Any inability to raise additional financing would have a material adverse effect on us.

As of June 30, 2023, we had cash and cash equivalents of $26.4 million, including $152 thousand of restricted cash, no material off-balance sheet arrangements and no outstanding borrowings under our line of credit with Western Alliance Bank.

Additionally, as of June 30, 2023, we had purchase obligations of $8.2 million related to inventory purchase commitments and future minimum lease obligations of $4.5 million to be paid over approximately 6 months and six years, respectively.

As of September 30, 2023, we had cash and cash equivalents of $26.8 million, including $152 thousand of restricted cash, no material off-balance sheet arrangements and no outstanding borrowings under our line of credit with Western Alliance Bank.

Our cash and cash equivalents as of September 30, 2023 consisted of bank deposits and short-term investments, including low-risk, fixed-income investments and highly liquid investment-grade debt instruments with an original maturity of three months or less.

Additionally, as of September 30, 2023, we had purchase obligations of $21.6 million related to inventory purchase commitments and future minimum lease obligations of $4.2 million to be paid over approximately fifteen months and six years, respectively.

We anticipate that our current unrestricted cash and cash equivalents of $26.6 million and cash to be generated from net sales will be sufficient to meet our financial obligations as they become due over at least the next twelve months and beyond.

However, we may seek additional funds to support both our short-term and long-term operating objectives, either through additional equity or debt financings or collaborative agreements or from other sources.

Furthermore, in June 2023, we filed a new $125.0 million registration statement on Form S-3 with the Commission, utilizing a “shelf” registration process.

Under this shelf registration process, we may sell securities from time to time, including up to approximately $47.8 million, pursuant to the ATM Facility, of which the full amount remains available as of June 30, 2023.

Our potential use of the ATM facility is subject to the satisfaction of various conditions in the ATM Facility agreement as well market conditions.

As a result, our ability to rely on the ATM Facility to raise liquidity is limited to a material extent.

As a result of various macroeconomic factors such as rising interest rates, inflation, bank failures and geopolitical uncertainties, the global credit and financial markets have experienced extreme volatility, including diminished liquidity and credit availability.

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Cash provided by and used in operating activities is net loss adjusted for certain non-cash items and changes in operating assets and liabilities.

Net cash provided by operating activities was approximately $6.1 million for the six months ended June 30, 2023 compared to net cash use of $11.0 million for the six months ended June 30, 2022.

The $17.1 million positive change was primarily driven by a $10.0 million improvement in net loss paired with improved cash flow management related to inventory.

Specifically, inventory management resulted in a positive impact of $4.9 million, with a net cash inflow of $2.7 million for the six months ended June 30, 2023 compared to a net cash outflow of $2.2 million for the six months ended June 30, 2022.

Net cash provided by operating activities was approximately $6.5 million for the nine months ended September 30, 2023 compared to a net cash use of $14.8 million for the nine months ended September 30, 2022.

The $21.2 million positive change was primarily driven by a $10.1 million improvement in net loss coupled with enhanced cash flow management related to inventory, resulting in a positive impact of $4.1 million.

Furthermore, lower prepaid expenses and other assets, along with reduced trade receivables, contributed $3.0 million and $1.5 million, respectively, to the positive cash improvement.

Additionally, higher accrued expenses and increased provisions for doubtful trade receivables had a positive cash impact of $1.6 million and $0.9 million, respectively.

We expect our operating cash flows to fluctuate significantly in future periods as a result of fluctuations in our operating results, shipment timetables, trade receivable collections, inventory management and the timing of our payments, among other factors.

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Investing cash flows consist primarily of capital expenditures and investment activities.

Cash used in investing activities was approximately $0.1 million for each of the six months ended June 30, 2023 and 2022.

Cash used in investing activities was approximately $0.1 million and $0.2 million for the nine months ended September 30, 2023 and 2022, respectively.

Net cash used in financing activities:

Financing cash flows consist primarily of the repayment of short-term and long-term debt.

Cash used in financing activities was nominal during each of the six months ended June 30, 2023 and June 30, 2022 consisting entirely of repayments for finance leases.

Cash used in financing activities was nominal during each of the nine months ended September 30, 2023 and September 30, 2022 consisting entirely of repayments for finance leases.

Critical Account Estimates

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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