What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-02-27 compared with 2024-02-22 · 248 added, 181 removed, 897 unchanged (32% of the section changed)

29 unchanged sentences

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective or complex judgments.

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

5 unchanged sentences

The implicit discount includes both an estimate of claims that will pay at an amount less than billed and an estimate of claims that will not pay within a given time horizon.

The implicit discount adjustments to the transaction price are due to concessions, not collectability concerns driven by payer credit risk.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company's process to calculate variable consideration, including the underlying assumptions about estimates of expected price concessions.

1 unchanged sentence

This included testing inputs of the calculation by reconciliation of the data between the various information systems, performing independent recalculation of the Company's estimate and evaluating the historical accuracy of management's estimates by comparing such estimates to subsequent actual results.

KOST FORER GABBAY & KASIERER

A Member of Ernst & Young Global

/s/ KOST FORER GABBAY & KASIERER

A Member of EY Global

We have served as the Company‘s auditor since 2003.

23 unchanged sentences

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

KOST FORER GABBAY & KASIERER

A Member of Ernst & Young Global

/s/ KOST FORER GABBAY & KASIERER

A Member of EY Global

Tel-Aviv, Israel

24 unchanged sentences

Current liabilities:

Convertible note

$ 558,160 $ —

Trade payables $ 105,086 $ 94,391

2 unchanged sentences

Long-term liabilities:

Long-term debt, net 568,822 565,509

Deferred revenues — 2,878

Convertible note

Senior secured credit facility, net

Long term leases 19,971 27,420

57 unchanged sentences

Issuance of shares in connection with employee stock purchase plan 86,264 5,224 — — 5,224

Cumulative effect adjustment resulting from ASU 2020-06 early adoption (see Note 2(y)) — ( 132,474 ) — 3,502 ( 128,972 )

Other comprehensive income (loss) net of tax expense of $ 0

49 unchanged sentences

Proceeds from issuance of shares, net $ 4,150 $ 4,416 $ 5,224

Repayment of long-term debt ( 10 ) ( 28 ) ( 26 )

Proceeds from senior secured credit facility, net

Repayment and redemption of long-term debt

( 12,913 ) ( 10 ) ( 28 )

Exercise of options 2,156 11,381 10,295

21 unchanged sentences

NovoCure Limited (including its consolidated subsidiaries, the "Company") was incorporated in the Bailiwick of Jersey and is principally engaged in the development, manufacture and commercialization of Tumor Treating Fields ("TTFields") devices, including Optune Gio and Optune Lua (collectively, its "Products"), for the treatment of solid tumor cancers.

The Company currently markets its Products in the United States ("U.S."), Germany, Japan and certain other countries.

The Company markets Optune Gio and Optune Lua in multiple countries around the globe with the majority of revenues coming from the use of Optune Gio in the U.S., Germany, France and Japan.

The Company also has a License and Collaboration Agreement (the "Zai Agreement") with Zai Lab (Shanghai) Co., Ltd.

("Zai") to market the Company's Products in China, Hong Kong, Macau and Taiwan ("Greater China").

During the year ended December 31, 2019, the Company implemented changes to its corporate entity operating structure, including transferring certain intellectual property to its Swiss subsidiary, primarily to align corporate entities with the Company’s evolving operations and business model.

As of January 1, 2022, the effective place of daily management and control of the Company moved to Switzerland and the Company has become a Swiss tax resident.

In November 2023, the Company announced a series of actions to strengthen and optimize its business operations to support near-term growth drivers and long-term value creation.

The plan included a reduction in headcount of approximately 200 employees or 13 % of the Company's then current workforce.

The Company expects to incur total one-time costs related to the workforce reduction of approximately $ 7,000 across the fourth quarter of 2023 and the first quarter of 2024.

Restructuring costs (including severance pay, garden leave payments, etc.) in the amount of $ 6,231 were included in the financial statements for the year ended December 31, 2023, of which $ 262 are attributable to Cost of Goods Sold, $ 2,070 to Research and Development, $ 2,404 to Sales and Marketing and $ 1,495 to General and Administrative expenses.

Of these amounts, $ 2,753 have been paid in 2023.

The $ 6,231 is offset by forfeited equity-based compensation expense and accrual reversals in the amount of $ 9,313 and $ 3,041 , respectively, which relate to the terminated employees' exits from the Company’s equity and cash incentive plans.

Basis of presentation and significant accounting policies

3 unchanged sentences

GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.

The Company evaluates on an ongoing basis its assumptions, including those related to contingencies, deferred taxes, tax liabilities, useful-life of field equipment, right-of-use assets and lease liabilities, convertible notes, pension liabilities, revenue, accrued expenses and share-based compensation costs.

The Company evaluates on an ongoing basis its assumptions, including those related to contingencies, deferred taxes, tax liabilities, useful-life of field equipment, right-of-use assets and lease liabilities, pension liabilities, revenue, accrued expenses and share-based compensation costs.

The Company’s management believes that the estimates, judgment and assumptions used are reasonable based upon information available at the time they are made.

13 unchanged sentences

dollar are re-measured into dollars in accordance with Accounting Standards Codification (ASC) No.

830-10, "Foreign Currency Matters." All transaction gains and losses of the re-

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

measurement of monetary balance sheet items are reflected in the consolidated statements of operations as financial income or expenses, as applicable.

830-10, "Foreign Currency Matters." All transaction gains and losses of the re-measurement of monetary balance sheet items are reflected in the consolidated statements of operations as financial income or expenses, as applicable.

For a subsidiary whose functional currency has been determined to be its local currency, assets and liabilities are translated at year-end exchange rates and statement of operations items are translated at average exchange rates prevailing during the year.

3 unchanged sentences

Intercompany transactions and balances, including unrealized profits from intercompany sales, have been eliminated upon consolidation.

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Cash equivalents:

2 unchanged sentences

The Company accounts for investments in debt securities in accordance with ASC 320, "Investments—Debt and Equity Securities." Management determines the appropriate classification of its investments in marketable debt securities at the time of purchase and reevaluates such determinations at each balance sheet date.

Available-for-sale debt securities are carried at fair value, with the unrealized gains and losses, net of tax, reported in accumulated other comprehensive income (loss) in shareholders’ equity.

Realized gains and losses on sale of investments are included in financial (expenses) income, net and are derived using the specific identification method for determining the cost of securities sold.

The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity.

Such amortization together with interest on securities is included in financial (expenses) income, net.

Each reporting period, the Company evaluates whether declines in fair value below amortized cost are due to expected credit losses, as well as the Company’s ability and intent to hold the investment until a forecasted recovery occurs.

Allowance for credit losses on available-for-sale debt securities are recognized in the Company’s consolidated statements of operation, and any remaining unrealized losses, net of taxes, are included in accumulated other comprehensive income (loss) in stockholders’ equity.

Held-to-maturity debt securities are stated at amortized cost of which is adjusted for amortization of premiums and accretion of discounts to maturity and any credit losses.

Held-to-maturity debt securities is stated at amortized cost, which is adjusted for amortization of premiums and accretion of discounts to maturity and any credit losses.

Such amortization, interest or credit losses are included in the consolidated statement of operations as financial income or expenses, as appropriate.

As of December 31, 2024 and 2023, all securities are classified as held-to-maturity since the Company has the intent and ability to hold the securities to maturity and, accordingly, debt securities are stated at amortized cost.

4 unchanged sentences

Trade receivables:

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

The Company’s trade receivables balance contains billed and unbilled commercial activities.

7 unchanged sentences

Inventory write-offs of $ 756 , $ 681 and $ 917 , respectively, were recorded for the years ended December 31, 2024, 2023 and 2022.

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Property and equipment:

5 unchanged sentences

Leasehold improvements Over the shorter of the term of the lease or its useful life

Land and assets held within construction in progress are not depreciated.

Assets held within construction in progress are not depreciated.

Construction in progress is related to the construction or development of property and equipment that is not yet ready for its intended use.

13 unchanged sentences

Revenue recognition:

Our Products are comprised of two main components:

The Company's Products are comprised of two main components:

(1) an electric field generator and (2) arrays and related accessories.

We retain title to the electric field generator, and the patient is provided replacement arrays and technical support for the device during the term of treatment.

The Company retains title to the electric field generator, and the patient is provided replacement arrays and technical support for the device during the term of treatment.

The electric field generator and arrays are always supplied and function together and are not sold on a standalone basis.

The Company uses the portfolio approach to apply the standard to portfolios of contracts with similar characteristics.

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

To recognize revenue under ASC 606, the Company applies the following five steps:

3 unchanged sentences

Identify the performance obligations in the contract.

Our contracts include the lease of the device, the supply obligation of disposable arrays and technical support for the term of treatment.

To the extent a contract includes multiple promised products and/or services, the Company must apply judgment to determine whether those products and/or services are capable of being distinct in the context of the contract.

The Company's contracts include the lease of the device, the supply obligation of disposable arrays and technical support for the term of treatment.

To the extent a contract includes multiple promised products and/or services, the Company must apply judgment

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

to determine whether those products and/or services are capable of being distinct in the context of the contract.

If these criteria are not met the promised products and/or services are accounted for as a combined performance obligation.

15 unchanged sentences

As discussed above, there is a combined performance obligation under the Company’s contracts and, therefore, the monthly transaction price determined for the performance obligation will be recognized over time ratably over the monthly term of the treatment.

Some of the Company's contracts include variable fees that are based on actual usage.

For these contracts the Company generally allocates the variable fees using the variable consideration allocation exception.

Recognize revenue when or as the Company satisfies a performance obligation.

2 unchanged sentences

The patient consumes the benefits of treatment on a daily basis over the monthly term.

As this criterion is met, the revenues will be recognized over the monthly term.

As this criterion is met, the revenues will be recognized ratably over the monthly term.

For more information, see Note 2(x).

The Company elected the short-term contract exemption for the remaining transaction price disclosures, as the Company's contracts have an original expected duration of less than one year.

The Company elected the short-term contract practical expedient for the remaining performance obligations, as the Company's contracts have an original expected duration of less than one year.

Revenues are presented net of indirect taxes.

1 unchanged sentence

Payment terms between the Company and its payors are typically up to twelve months, and vary by the type of payer, country of sale and the products or services offered.

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Deferred revenue represents billings to customers for which revenue has not yet been recognized.

Net revenues in the years ended December 31, 2024, 2023 and 2022 also include amounts recognized pursuant to the Zai Agreement.

3 unchanged sentences

Because the Company does not pursue collection of amounts determined to qualify as charity, they are not reported as revenue.

The Company's costs of care provided under charitable care were $ 2,692 , $ 3,009 and $ 4,204 for the years ended December 31, 2023, 2022 and 2021, respectively.

The Company's costs of care provided under charitable care were $ 4,389 , $ 2,692 and $ 3,009 for the

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

years ended December 31, 2024, 2023 and 2022, respectively.

These amounts were determined by applying charitable care as a percentage of gross billings to total cost of goods sold.

6 unchanged sentences

The Company's policy is to account for forfeitures as they occur.

The Company recognizes compensation costs for the value of awards granted using the accelerated method over the requisite service period of the award, which for restricted share units is two or three years and for option awards, which is two or four years .

The Company recognizes compensation expense for the value of awards using the accelerated method over the requisite service period of the award, which for restricted share units is two or three years and for option awards, which is two or four years .

The Company recognizes compensation costs for the value of performance stock units ("PSU") over the performance period when the vesting conditions become probable in accordance with ASC 718.

The Company applies the Black-Scholes model as it believes it is the most appropriate fair value method for all equity awards and for the Employee Share Purchase Plan (the "ESPP").

For market condition awards, the Company also applies the Monte-Carlo simulation model.

The Black-Scholes model requires a number of assumptions, of which the most significant are the share price, expected volatility and the expected award term.

Beginning with the first quarter of 2022, the computation of expected volatility is based on the historical volatility the Company's shares, beginning with the first quarter of 2021 and prior to the first quarter of 2022, the computation of expected volatility is based on a combination of actual historical share price volatility of comparable publicly-traded companies and the historical volatility the Company's shares.

Prior to the first quarter of 2021, due to the lack of sufficient historical information for the Company, the computation was based on actual historical volatility of comparable publicly-traded companies.

Beginning with the first quarter of 2021, the expected term of options granted is calculated using the Company's historical and future exercise behavior.

Prior to the first quarter of 2021, it was calculated using the average between the vesting period and the contractual term to the expected term of the options in effect at the time of grant.

The Company has selected the Black-Scholes-Merton option-pricing model as the most appropriate fair value method for its option awards and Employee Share Purchase Plan ("ESPP").

The fair value of Restricted Share Units ("RSUs") and Performance Share Units ("PSUs ") without market conditions, is based on the closing market value of the underlying shares at the date of grant.

For PSUs subject to market conditions, the Company uses a Monte Carlo simulation model, which utilizes multiple inputs to estimate payout level and the probability that market conditions will be achieved.

The Black-Scholes-Merton and Monte Carlo models require a number of assumptions, of which the most significant are the expected share price volatility and the expected option term.

The computation of expected volatility is based on the historical volatility the Company's shares.

The expected term of options granted is calculated using the Company's historical and future exercise behavior.

The Company has historically not paid dividends and has no foreseeable plans to pay dividends and, therefore, uses an expected dividend yield of zero in the option pricing model.

5 unchanged sentences

As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability.

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market.

2 unchanged sentences

Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets;

Level 2 - Includes other inputs that are directly or indirectly observable in the marketplace, other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets with insufficient volume or infrequent transactions, or other inputs that are observable (model-derived valuations in which significant inputs are observable), or can be derived principally from or corroborated by observable market data;

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

or similar assets or liabilities in markets with insufficient volume or infrequent transactions, or other inputs that are observable (model-derived valuations in which significant inputs are observable), or can be derived principally from or corroborated by observable market data;

Level 3 - Unobservable inputs which are supported by little or no market activity.

3 unchanged sentences

Basic net income (loss) per share is computed based on the weighted average number of ordinary shares outstanding during each period.

Diluted net income per share is computed based on the weighted average number of ordinary shares outstanding during the period, plus potential dilutive shares considered outstanding during the period, in accordance with ASC 260-10, as determined under the treasury stock method.

Income taxes:

4 unchanged sentences

Concentration of risks:

Our cash, cash equivalents, short-term investments and trade receivables are potentially subject to a concentration of risk.

Cash, cash equivalents and short-term investments are invested at top tier financial institutions globally.

As such, these investments may be in excess of insured limitations or not insured in certain jurisdictions.

Generally, these investments may be redeemed upon demand and therefore, bear minimal risk.

Our trade receivables are due from numerous governments and federal and state agencies that are paid from their respective budgets, and from hundreds of health insurance companies.

The Company does not believe that there are significant default risks associated with these governments, agencies and health insurance companies based upon the Company's historical experience with them.

The Company's cash, cash equivalents, short-term investments and trade receivables are potentially subject to a concentration of risk.

Cash, cash equivalents and short-term investments are invested at top tier financial institutions globally and the total value invested at any one institution is limited pursuant to the Company's investment policy .

These investments may be in excess of insured limitations or not insured in certain jurisdictions.

Generally, these investments may be redeemed upon demand according to the terms of the securities and therefore bear minimal risk.

The Company's trade receivables are due from numerous governments and federal and state agencies that are paid from their respective budgets, and from hundreds of health insurance companies.

The Company does not believe that there are significant default risks associated with these governments, agencies and health insurance companies based upon the Company's historical experience.

The Company has no off-balance sheet concentrations of credit risk such as foreign exchange contracts, option contracts or other foreign hedging arrangements.

Retirement, pension and severance plans:

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

The Company has a 401(k) retirement savings plan for its U.S.

6 unchanged sentences

The Swiss Plan is part of a collective pension foundation “AXA Foundation for Occupational Benefits”.

This is a semi-autonomous pension foundation, meaning that the underlying investment risk and the longevity are born by the pension foundation itself.

This is a semi-autonomous pension foundation, meaning that the underlying

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

investment risk and the longevity are born by the pension foundation itself.

Disability and death risks are reinsured with AXA insurance.

20 unchanged sentences

ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make minimum lease payments arising from the lease.

ROU assets are initially measured at amounts, which represents the discounted present value of the lease payments over the lease, plus any initial direct costs

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

ROU assets are initially measured at amounts, which represents the discounted present value of the lease payments over the lease, plus any initial direct costs incurred.

The ROU assets are reviewed for impairment.

6 unchanged sentences

An option to terminate is considered unless it is reasonably certain that the Company will not exercise the option.

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Lessor accounting - Operating leases:

8 unchanged sentences

Convertible note:

Prior to January 1, 2021, the Company accounted for its convertible senior notes in accordance with ASC 470-20 "Debt with Conversion and Other Options".

Pursuant to ASC Subtopic 470-20, issuers of certain convertible debt instruments, such as the convertible senior notes, that have a net settlement feature and may be settled wholly or partially in cash upon conversion are required to separately account for the liability (debt) and equity (conversion option) components of the instrument.

The Company allocated the proceeds from issuance between the liability component and the embedded conversion option, or equity component.

The liability component at issuance is recognized at fair value, based on the fair value of a similar instrument of similar credit rating and maturity that does not have a conversion feature.

The equity component is based on the excess of the principal amount of the convertible senior notes over the fair value of the liability component and is recorded in additional paid-in capital.

The equity component, net of issuance costs is presented within additional paid-in-capital and is not remeasured as long as it continues to meet the conditions for equity classification.

The Company allocated the total issuance costs incurred to the liability and equity components of the convertible senior notes based on the same proportions as the proceeds from the notes.

In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No.

2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (ASU 2020-06), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity.

Among other changes, ASU 2020-06 removes from GAAP the liability and equity separation model for convertible instruments with a cash conversion feature, and as a result, after adoption, entities will no longer separately present in equity an embedded conversion feature for such debt.

Similarly, the embedded conversion feature will no longer be amortized into income as interest expense over the life of the instrument.

Instead, entities will account for a convertible debt instrument wholly as debt unless (1) a convertible instrument contains features that require bifurcation as a derivative under Accounting Standards Codification ("ASC Topic 815"), Derivatives and Hedging, or (2) a convertible debt instrument was issued at a

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

substantial premium.

On January 1, 2022, the Company adopted ASU 2020-06, “Debt - Debt with Conversion and Other Options (subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (subtopic 815-40),, which simplified the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity.

In accordance with ASU 2020-06, entities account for a convertible debt instrument wholly as debt unless (1) a convertible instrument contains features that require bifurcation as a derivative under Accounting Standards Codification ("ASC Topic 815"), Derivatives and Hedging, or (2) a convertible debt instrument was issued at a substantial premium.

Additionally, ASU 2020-06 requires the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share (EPS), which is consistent with the Company’s accounting treatment under the current standard.

ASU 2020-06 is effective for fiscal years beginning after December 15, 2021, with early adoption permitted for fiscal years beginning after December 15, 2020, and can be adopted on either a fully retrospective or modified retrospective basis.

The Company early adopted ASU 2020-06, effective January 1, 2021 on a modified retrospective basis.

The impact of the Company’s adoption of ASU 2020-06 on the balance sheet as of January 1, 2021 was an increase in long term debt, net of $ 128,972 , a decrease in additional paid-in capital of $ 132,474 , and a decrease in accumulated deficit of $ 3,502 .

Interest expense recognized in future periods will be reduced as a result of accounting for the convertible debt instrument as a single liability measured at its amortized cost.

For additional information see Note 10 of these audited consolidated financial statements.

Recently Issued Accounting Pronouncements:

Recently Adopted Accounting Pronouncement - Segment reporting:

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280):

2 unchanged sentences

ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company is currently evaluating the impact of adopting ASU 2023-07.

The Company adopted ASU 2023-07 during the year ended December 31, 2024, on a retrospective basis.

See note 11 in the accompanying notes to the consolidated financial statements for further detail

Recently Issued Accounting Pronouncements:

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

2 unchanged sentences

The Company is currently evaluating the impact of adopting ASU 2023-09.

Cash and Cash equivalents and Short-term investments

Cash equivalents include items almost as liquid as cash with maturity periods of three months or less when purchased, and short-term investments include items with maturity dates between three months and one year when purchased.

As of December 31, 2023 and 2022, the Company’s cash and cash equivalents and short-term investments were composed of:

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis.

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and

NovoCure Limited and subsidiaries

1 unchanged sentence

dollars in thousands (except share and per share data)

for interim periods beginning after December 15, 2027, with early adoption permitted.

The Company is currently evaluating the impact of adopting ASU 2024-03.

Cash and Cash equivalents and Short-term investments

As of December 31, 2024 and 2023, the Company’s cash and cash equivalents and short-term investments were composed of:

December 31, 2024

5 unchanged sentences

Treasury bills Level 1 $ 118,618 $ 93 $ ( 1 ) $ 118,710 $ 118,618 $ — $ 118,618

Government and governmental agencies Level 2 $ 24,940 $ 13 $ — $ 24,953 $ 24,940 $ — $ 24,940

Corporate debt securities Level 2 $ 507,368 $ 920 $ ( 119 ) $ 508,169 $ 507,368 $ — $ 507,368

1 unchanged sentence

Total $ 959,873 $ 1,013 $ ( 120 ) $ 960,766 $ 959,873 $ 163,767 $ 796,106

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

December 31, 2023

11 unchanged sentences

(2) Pursuant to a bank guaranty, $ 15,581 of short-term investments are pledged.

In November 2022, the Company transferred all of its AFS portfolio to HTM as part of the Company's investment strategy.

Such transfers are made at fair value at the date of transfer, The net unrealized loss on these securities at the date of transfer was $ 911 .

These securities continue to be reported in accumulated comprehensive income (loss) and are amortized over the remaining lives of the securities as an adjustment to the yield.

As of December 31, 2023 and 2022, the balance was fully amortized and $ 445 , respectively.

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

In accordance with ASC No.

12 unchanged sentences

$ 35,063 $ 22,677

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Inventories are stated at the lower of cost or net realizable value.

5 unchanged sentences

$ 35,086 $ 38,152

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Property and equipment, net

The following table sets forth the Company’s property and equipment, net:

Computers and laboratory equipment $ 31,383 $ 24,804

Computers, peripheral equipment, software and laboratory equipment

$ 41,977 $ 31,383

Office furniture 4,873 4,023

5 unchanged sentences

Depreciated cost $ 77,660 $ 51,479

The Company capitalized software costs according to FASB's ASC 350-40, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use." Cumulative capitalization as of December 31, 2023 and 2022 was $ 18,241 and $ 13,192 , respectively.

The Company capitalized software costs according to FASB's ASC 350-40, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use.

Amortization of capitalized software costs for the years ended December 31, 2024, 2023 and 2022 was $ 1,369 , $ 1,274 and $ 1,056 , respectively.

8 unchanged sentences

Write downs of $ 954 , $ 483 and $ 611 were identified for the years ended December 31, 2024, 2023 and 2022, respectively.

Other payables, lease liabilities and accrued expenses

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Trade payables and other payables, lease liabilities and accrued expenses

a.Trade payables

As of December 31, 2024 and 2023, trade payables include payer overpayments in the amount of $ 40,575 and $ 23,421 , respectively.

b.Other payables, lease liabilities and accrued expenses

The following table sets forth the Company’s other payables and accrued expenses:

2 unchanged sentences

Government authorities 22,811 9,134

Other 8,322 6,114

Lease liabilities and Other

$ 93,130 $ 84,724

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Employee benefit obligations

74 unchanged sentences

$ — $ 568,822

Credit facility (b)

Senior secured credit facility, net (b)

$ 97,300 $ 568,822

23 unchanged sentences

In addition, following certain corporate events that occur prior to the maturity date or if the Company delivers a notice of redemption, the Company will, in certain circumstances, increase the conversion rate for a holder who elects to convert its Notes in connection with such a corporate event or notice of redemption, as the case may be.

The Notes mature on November 1, 2025, unless earlier repurchased, redeemed or converted as set forth in the Notes.

As of December 31, 2024, the conditions allowing holders of the Notes to convert were not met.

The Notes are therefore not convertible as of December 31, 2023 and are classified as long-term liability.

In June 2024 the Company redeemed $ 14,055 of Notes in consideration of $ 12,913 .

The gain from redemption was reported as finance income in accordance with ASC 470 "Debt with Conversion and Other Options".

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

The net carrying amount of the liability of the Convertible Notes (see note 2(y) for additional information) as of December 31, 2024 and 2023 are as follows:

Liability component, net:

Principal amount $ 560,945 $ 575,000

1 unchanged sentence

Net carrying amount of liability component (1) $ 558,160 $ 568,822

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

carrying amount of liability component of the Notes as of December 31, 2023 and 2022 were $ 515,962 and $ 455,091 , respectively.

Presented as:

Short-term liability (2)

$ 558,160 $ —

Long-term liability

$ — $ 568,822

(1) An effective interest rate determines the fair value of the Notes, therefore they are categorized as Level 3 in accordance with ASC 820, "Fair Value Measurements and Disclosures." The estimated fair value of the Net carrying amount of liability component of the Notes as of December 31, 2024 and 2023 were $ 526,434 and $ 515,962 , respectively.

The net carrying amount of the liability is represented by the principal amount of the Notes, less total issuance costs plus any amortization of issuance costs.

1 unchanged sentence

Interest expense is recognized at an annual effective interest rate of 0.59 % over the contractual term of the Notes.

Amortization of debt issuance costs, included in finance expenses, for the years ended December 31, 2023, 2022 and 2021 was $ 3,313 , $ 3,293 , and $ 3,339 , respectively.

2020 Credit Facility

On November 6, 2020, the Company entered into a three-year $ 150.0 million senior secured revolving credit facility with a syndicate of relationship banks (the "2020 Credit Facility").

On February 17, 2023, the Company gave irrevocable notice to the administrative agent under the 2020 Credit Facility that the Company terminated all commitments, effective February 22, 2023.

This effectively terminated the 2020 Credit Facility, as the Company's ability to borrow and the Company's obligations to comply with all covenants ended on such date.

The liens and guaranties in favor of the lenders are released.

There were no early termination fees payable and as of February 22, 2023 the Company had no outstanding balance borrowed under the 2020 Credit Facility.

On November 6, 2023, the 2020 Credit Facility expired pursuant to its terms.

As of December 31, 2023, the Company had no outstanding balance borrowed or any other liability outstanding under the 2020 Credit Facility.

Other long-term liabilities

Leasehold improvements financing and other $ — $ 72

Unrecognized tax benefits (Note 14(e))

Amortization of debt issuance costs, included in finance expenses.

(2) In January 2021, the Company elected to settle all conversions of Notes by a combination of cash and its ordinary shares and the cash portion per $ 1,000 principal amount of Notes for all conversion settlements shall be $ 1,000 .

Holders have the right to convert Notes beginning in August 2025.

Since any conversion will result in the payment of cash as described above, the liability has been reclassified as current.

Finance expense related to the Notes was as follows:

Year ended December 31,

2024 2023 2022

Gain from redemption of Notes

$ ( 1,142 ) $ — $ —

Amortization of debt issuance costs

3,393 3,313 3,293

Total finance expenses (income) recognized

$ 2,251 $2,251 $ 3,313 $ 3,293

Senior secured credit facility, net

On May 1, 2024 Novocure Luxembourg S.a.r.l.

("Borrower"), a wholly-owned subsidiary of the Company, entered into a new five -year senior secured credit facility of up to $ 400.0 million (the "Facility") with BPCR Limited Partnership and BioPharma Credit Investments V (Master) LP (collectively, the "Lenders"), BioPharma Credit PLC, as collateral agent for the Lenders, and the guarantors party to such agreement (the "Loan Agreement").

The Facility may be drawn in up to four drawings.

The Loan Agreement provides for an initial term loan in the principal amount of $ 100.0 million (the "Tranche A Loan"), which was funded to the Borrower on May 1, 2024 (the "Tranche A Funding Date").

Under the Loan Agreement, the Borrower is required to draw $ 100.0 million on the Facility on or before September 30, 2025 (the "Tranche B Loan"), subject to customary conditions precedent as set forth in the Loan Agreement.

Not later than December 31, 2025, the Borrower has the option to draw an additional $ 100.0 million of the Facility (the "Tranche C Loan") if (i) (A) the Company has received positive results from its PANOVA-3 phase 3 clinical trial or (B) the Company's trailing net revenues for the most recently completed four quarters as reported by the Company in its financial statements filed with the U.S.

Securities and Exchange Commission ("Trailing Four Quarters of Net Revenue") are greater than $ 575.0 million and (ii) the Notes are extinguished in full and are no longer outstanding.

Not later than March 31, 2026, the Borrower has the option to draw an additional $ 100.0 million of the Facility (the "Tranche D Loan") if (i) the Company receives an approval or clearance from the U.S.

Food and Drug Administration for the Company's Tumor Treating Fields device for a

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

pancreatic cancer indication or (ii) Trailing Four Quarters of Net Revenue is greater than $ 625.0 million.

The obligations under the Loan Agreement are guaranteed by certain of the Company's subsidiaries and secured by a first lien on the Borrower's and certain of the Company's other subsidiaries’ assets.

Outstanding term loans under the Loan Agreement will bear interest at an annual rate equal to 6.25 % plus the three-months SOFR (subject to a 3.25 % floor), payable quarterly in arrears and calculated on the basis of actual days elapsed in a 360-day year.

The Borrower must pay 2.5 % of additional consideration on each principal draw, with payment for the Tranche A Loan and the Tranche B Loan paid on the Tranche A Funding Date, and payments for the Tranche C Loan and the Tranche D Loan on their respective funding dates.

Principal under the Facility will be repaid in eight equal quarterly repayments commencing with the third quarter of 2027 and continuing each quarter thereafter, with the final payment of outstanding principal due on the fifth anniversary of the Tranche A Funding Date.

Voluntary prepayment of all, but not less than all, of the term loans outstanding is permitted at any time, subject to make-whole and prepayment premiums as set forth in the Loan Agreement.

Prepayment of all term loans outstanding, subject to make-whole and prepayment premiums, is due and payable upon a change-in-control as defined in the Loan Agreement.

Make-whole and prepayment premiums are due and payable for the Tranche B Loans for any voluntary prepayment of the term loans outstanding, upon a change-in-control (as defined in the Loan Agreement), and upon any acceleration of the maturity date, in each case regardless of whether the Tranche B Loan is drawn.

The Loan Agreement contains a financial covenant only if the Tranche C Loan and/or Tranche D Loan are funded, in which case the Company is required to maintain at least Trailing Four Quarters of Net Revenue of at least $ 500.0 million, calculated on a trailing twelve-month basis as of the end of each fiscal quarter, beginning with the first quarter of 2027 based on year-end 2026 audited financial statements.

As of December 31, 2024 the Company had borrowed the Tranche A Loan in the principal amount of $ 100,000 .

The net carrying amount of the liability of the Facility as of December 31, 2024 and 2023 is as follows:

Principal amount $ 100,000 $ —

Unamortized issuance costs ( 2,700 ) —

Net carrying amount of liability component (1) $ 97,300 $ —

(1) An effective interest rate determines the fair value of the Facility, therefore they are categorized as Level 3 in accordance with ASC 820.

The estimated fair value of the net carrying amount of liability component of the Facility as of December 31, 2024 and December 31, 2023 were $ 112,836 and $ 0 , respectively.

The net carrying amount of the liability is represented by the principal amount of the Facility, less total issuance costs plus any amortization of issuance costs.

The total issuance costs upon issuance of the Facility were $ 3,078 and are amortized to interest expense using the effective interest rate method over the contractual term of the Facility.

For purposes of calculating the net carrying amount, the annual effective interest rate is assumed to be 12.5 % over the remaining contractual term of the Facility.

Finance expense related to the Facility was as follows:

Year ended December 31,

2024 2023 2022

$ 7,693 $ — $ —

Amortization of debt issuance costs

Total finance expenses (income) recognized

$ 8,071 $ — $ —

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Segment reporting

The Company engages in the development, manufacture and commercialization of Tumor Treating Fields ("TTFields") as treatment for solid tumor cancers and has a single reportable segment, the TTFields Segment.

The TTFields Segment derives revenues from monthly treatments rendered to patients with the Company's Products.

The Company markets its Products in multiple countries around the globe.

The Company operates as one operating segment.

Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated by the Company's Chief Operating Decision Maker ("CODM"), which is the Company’s chief executive officer, in deciding how to allocate resources and assess performance.

The Company’s CODM evaluates the Company’s financial information and resources and assesses the performance of these resources on a consolidated basis.

There is no expense or asset information that are supplemental to those disclosed in these consolidated financial statements that are regularly provided to the CODM.

The allocation of resources and assessment of performance of the operating segment is based on consolidated net income (loss) as shown in our consolidated statements of operations.

The CODM considers net income in the annual forecasting process and reviews actual results when making decisions about allocating resources.

Since the Company operates as one operating segment, financial segment information, including profit or loss and asset information, can be found in the consolidated financial statements.

Commitments and contingent liabilities

1 unchanged sentence

The facilities of the Company are leased under various operating lease agreements for periods ending no later than 2039.

As of December 31, 2024, the Company has additional commitments for an operating lease that will commence in 2025, with lease terms of approximately 20 years.

The Company also has the option to extend the term of certain facility lease agreements and these are included in the calculation of right-of-use assets.

5 unchanged sentences

Thereafter 7,050

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Total future minimum lease payments $ 32,688

5 unchanged sentences

Net present value of future minimum lease payments $ 27,880

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Weighted average of remaining operating lease term (years) 6.18

29 unchanged sentences

Germany 65,263 60,210 46,120

55,730 11,736 —

Japan 32,569 31,668 32,781

18 unchanged sentences

Deferred revenues (short-term contract liabilities) $ ( 14,225 ) $ ( 16,224 )

Deferred revenues (long-term contract liabilities) $ — $ ( 2,878 )

During the years ended December 31, 2024, 2023and 2022, the Company recognized $ 16,224 , $ 18,028 and $ 17,762 , respectively, which were included in the deferred revenues (short-term contract liability) balance at January 1, 2024 , 2023 and 2022.

6 unchanged sentences

such probability is achieved.

Revenue from royalty payments are recognized in accordance with ASC 606 in the period accrued.

Revenue from royalty payments are estimated and recognized in accordance with ASC 606.

Revenues from sales of product or rendering services are recognized upon shipping the products or rendering the services and satisfying the performance obligation.

During the year ended December 31, 2020, the Company triggered milestone payments of $ 10,000 in the aggregate, which, along with the License Fee, are deferred and recognized over the remainder of the Zai Performance Period on a straight-line basis.

During the year ended December 31, 2020, the Company triggered milestone payments of $ 10,000 in the aggregate, which, along with the License Fee, were deferred and recognized over the remainder of the Zai Performance Period on a straight-line basis.

For the three years ended December 31, 2024, no additional milestones were included in the transaction price.

30 unchanged sentences

Income (loss) before income taxes $ ( 131,162 ) $ ( 191,740 ) $ ( 81,846 )

Swiss federal statutory rate 8.5 % 8.5 % 8.5 %

Income tax at federal Swiss rate $ ( 16,298 ) $ ( 6,957 ) $ ( 4,426 )

Swiss federal statutory tax rate 8.5 % 8.5 % 8.5 %

Income taxes at Swiss rate $ ( 11,149 ) $ ( 16,298 ) $ ( 6,957 )

Change in valuation allowance 1,261,855 13,427 ( 14,238 )

Unamortized intangible assets ( 1,240,745 ) — —

Foreign taxes rate differential 16,077 10,620 25,716

Return to provision true-ups 10,854 ( 1,020 ) 2,416

Research and development credits ( 6,483 ) ( 4,898 ) ( 2,216 )

Share based compensation 13,551 2,332 5,318

Withholding Taxes 435 548 273

Research and development credits ( 3,130 ) ( 6,483 ) ( 4,898 )

Effect of tax law change 647 6 5,681

Withholding Taxes 350 435 548

Return to provision true-ups ( 31 ) 10,854 ( 1,020 )

Other 40 410 538

Income tax $ 15,303 $ 10,688 $ 6,276

Income tax expenses $ 37,465 $ 15,303 $ 10,688

Effective tax rate ( 28.6 ) % ( 8.0 ) % ( 13.1 ) %

20 unchanged sentences

Net deferred taxes assets (liability) $ — $ —

Carryforward loss:

In Switzerland, the Company had $ 821,963 of net operating carryforwards (NOLs) available at the Federal level, of which $ 794,203 are also available at the cantonal and communal level.

These NOLs expire from 2026 through

NovoCure Limited and subsidiaries

1 unchanged sentence

dollars in thousands (except share and per share data)

(1) The Company recorded an increase in the deferred tax asset related to unamortized intangible assets in the amount of $ 1,240,745 .

As of December 31, 2024, the balance of this deferred tax asset was offset by a full valuation allowance.

A valuation allowance is provided when it is more likely than not that the deferred tax assets will not be realized.

The Company has established a full valuation allowance to offset the deferred tax assets at December 31, 2024 and 2023 due to the uncertainty of realizing future tax benefits.

The net change in the total valuation allowance for the years ended December 31, 2024 and 2023 were 1,261,855 and 13,427 , respectively.

Carryforward loss:

In Switzerland, the Company had $ 1,061,639 of net operating carryforwards (NOLs) available at the Federal level, of which $ 1,033,880 are also available at the cantonal and communal level.

These NOLs expire from 2026 through 2031.

Additionally, the Company had $ 23,936 of non-Swiss NOLs as of December 31, 2024, of which $ 2,342 carry forward indefinitely,and the remainder expire from 2026 through 2041.

9 unchanged sentences

Currently, the Company is under examination by the tax authorities in Israel for the tax years 2019 and 2021 and is not under examination by any other tax authority.

Additional tax years within the period from 2019 to 2022 remain subject to examination by Swiss, U.S.

and other tax authorities.

Additional tax years within the period from 2019 to 2023 remain subject to examination by the various tax authorities.

Share capital

5 unchanged sentences

Stock option plan

Until the IPO in October 2015, the Company maintained and granted option awards under the 2003 Share Option Plan (the "2003 Plan") and the 2013 Equity Incentive Share Option Plan (the "2013 Plan") for the Company’s officers, directors, employees and advisors.

The 2003 Plan and the 2013 Plan terminated as of the IPO as to future awards, but they continue to govern option awards previously granted thereunder.

In September 2015, the Company adopted the 2015 Omnibus Incentive Plan (the "2015 Plan").

The Company’s shareholders approved the 2015 Plan in September 2015.

Under the 2015 Plan, the Company can issue various types of equity compensation awards such as restricted shares, performance shares, restricted stock units ("RSUs"), performance share units ("PSUs"), long-term cash award and other share-based awards.

3 unchanged sentences

Options, RSUs and PSUs granted under the 2015 Plan that are canceled before expiration become available for future grants.

On December 31, 2023, in accordance with the terms of the 2015 Plan, the number of shares available for issuance under the 2015 Plan automatically increased by 4 % of the Company’s outstanding ordinary shares as of December 30, 2023.

As a result, the number of shares available for issuance under the 2015 Plan increased from 43,465,227 shares to 47,743,427 shares.

As of December 31, 2023, 22,896,258 ordinary shares are available for grant under the 2015 Plan.

Employee Stock Purchase Plan

In September 2015, the Company adopted an ESPP to encourage and enable eligible employees to acquire ownership of the Company’s ordinary shares purchased through accumulated payroll deductions on an after-tax

As of December 31, 2024, no ordinary shares were available for grant under the 2015 Plan (see below).

NovoCure Limited and subsidiaries

1 unchanged sentence

dollars in thousands (except share and per share data)

In April 2024, the Company adopted the 2024 Omnibus Incentive Plan (the "2024 Plan"), which replaced the 2015 Plan, effective June 5, 2024 (the "Effective Date") following approval from the Company's shareholders.

Under the 2024 Plan, the Company can issue various types of equity compensation awards such as share options, restricted shares, performance shares, restricted share units (“RSUs”), performance-based share units (“PSUs”), long-term cash awards and other share-based awards.

The total number of shares of the Company’s ordinary shares that may be granted under the 2024 Plan consists of (i) up to 9,000,000 ordinary shares (reduced by 433,018 shares subject to awards granted under the 2015 Plan after April 2, 2024), all of which were available under the 2015 Plan and which ceased to be available for future awards under the 2015 Plan as of the Effective Date and (ii) the number of undelivered shares subject to outstanding awards under the 2015 Plan that become available for future awards under the 2024 Plan as provided for in the 2024 Plan.

Options granted under the 2024 Plan generally will have a two-year or four-year vesting period and expire ten years after the date of grant.

Options granted under the 2015 Plan and 2024 Plan that are canceled or forfeited before expiration become available for future grants under the 2024 Plan.

RSUs granted under the 2024 Plan generally will vest over a three-year period.

PSUs granted under the 2024 Plan generally will vest between a three and six-year period as performance targets are attained.

RSUs and PSUs granted under the 2015 Plan and 2024 Plan that are canceled before expiration become available for future grants under the 2024 Plan.

As of December 31, 2024, 10,702,818 ordinary shares were available for grant under the 2024 Plan.

Employee Stock Purchase Plan

The ESPP is intended to be an "employee stock purchase plan" within the meaning of Section 423 of the Code and the provisions of the ESPP will be construed in a manner consistent with the requirements of such section.

2 unchanged sentences

The terms of the ESPP provide that on December 31 of each year, the number of shares available for purchase by eligible employees who participate in the ESPP automatically increases by 1 % of the Company’s outstanding ordinary shares outstanding, unless the Company determines that such an increase is not necessary.

The Company determined that an such increase was not necessary and no such increase took place.

As of December 31, 2024, 6,507,843 ordinary shares are available for offering under the ESPP.

The fair value of share-based awards was estimated using the Black-Scholes model for all equity grants and for market condition awards.

The Company also applied the Monte-Carlo simulation model, with the following underlying assumptions:

The following tables sets forth the parameters used in computation of the options and ESPP compensation to employees for the years ended December 31, 2024, 2023 and 2022:

Year ended December 31,

14 unchanged sentences

A summary of the status of the Company’s options to purchase ordinary shares as of December 31, 2024 and changes during the year ended on that date is presented below:

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Year ended December 31, 2024

6 unchanged sentences

A summary of the status of the Company’s RSUs and PSUs as of December 31, 2024 and changes during the year ended on that date is presented below:

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Year ended December 31, 2024

17 unchanged sentences

The total equity-based compensation expense related to all of the Company’s equity incentive plans recognized for the years ended December 31, 2024, 2023 and 2022, was comprised as follows:

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Year ended December 31,

8 unchanged sentences

The weighted average grant date fair value of the Company’s options granted during the years ended December 31, 2024, 2023 and 2022 were $ 10.40 , $ 33.77 and $ 44.70 per share, respectively.

The weighted average grant date fair value of the Company’s RSU granted during the years ended December 31, 2024, 2023 and 2022 were $ 15.43 , $ 57.60 and $ 79.45 per share, respectively.

The weighted average grant date fair values of the Company’s options forfeited and cancelled during the years ended December 31, 2024, 2023 and 2022 were $ 29.01 , $ 36.54 and $ 86.79 , respectively.

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

The fair values of the Company’s RSUs and PSUs vested during the years ended December 31, 2024, 2023 and 2022 were $ 66,933 , $ 83,968 and $ 44,818 , respectively.

1 unchanged sentence

The aggregate intrinsic value is calculated as the difference between the per share exercise price and the deemed fair value of the Company’s ordinary shares for each share subject to an option multiplied by the number of shares subject to options at the date of exercise.

The Company deemed the fair value of the Company’s ordinary shares to be $ 14.93 , $ 73.35 and $ 75.08 per share as of December 31, 2023, 2022, and 2021, respectively.

Options outstanding as of December 31, 2024 are as follows:

17 unchanged sentences

11,315,468 5.62 6,739,295 3.38

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Financial (expenses) income, net

5 unchanged sentences

Revolving credit facility fee — ( 58 ) ( 558 )

Amortization of discount and issuance costs ( 3,313 ) ( 3,293 ) ( 3,339 )

Amortization of discount, issuance costs and Gain from redemption of Notes

( 2,629 ) ( 3,313 ) ( 3,293 )

Foreign currency translation losses ( 717 ) ( 797 ) ( 3,523 )

9 unchanged sentences

Basic net income (loss) per share is computed based on the weighted average number of ordinary shares outstanding during each period.

Diluted net income per share is computed based on the weighted average number of ordinary shares outstanding during the period, plus potential dilutive shares (deriving from options, RSUs, PSUs,

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

convertible notes and the ESPP) considered outstanding during the period, in accordance with ASC 260-10, as determined under the treasury stock method.

Diluted net income per share is computed based on the weighted average number of ordinary shares outstanding during the period, plus potential dilutive shares (deriving from options, RSUs, PSUs, convertible notes and the ESPP) considered outstanding during the period, in accordance with ASC 260-10, as determined under the treasury stock method.

The following table sets forth the computation of the Company’s basic and diluted net loss per ordinary share:

11 unchanged sentences

4,560,415 1,423,377 822,421

Conversion of convertible note

ESPP 222,451 161,627 62,910

2 unchanged sentences

$ ( 1.56 ) $ ( 1.95 ) $ ( 0.88 )

NovoCure Limited and subsidiaries

Notes to consolidated financial statements

dollars in thousands (except share and per share data)

Supplemental information

6 unchanged sentences

Total long-lived assets $ 92,471 $ 62,863

Restructuring

In November 2023, the Company announced a series of actions to strengthen and optimize its business operations to support near-term growth drivers and long-term value creation.

The plan included a reduction in headcount of approximately 200 employees or 13 % of the Company's then current workforce.

The Company incurred restructuring costs (including severance pay, garden leave payments, etc.) for the years ended December 31, 2024, 2023 and 2022, as follows:

Year ended December 31,

2024 2023 2022

Cost of revenues $ 52 $ 262 $ —

Research, development and clinical studies 275 2,070 —

Sales and marketing 1,512 2,404 —

General and administrative 164 1,495 —

Total restructuring cost

$ 2,003 $ 6,231 $ —

Restructuring costs paid during the period

$ 5,455 $ 2,753 $ —

These restructuring costs were offset by accrual reversals for the years ended December 31, 2024, 2023 and 2022 in the amount of $ 369 , $ 3,041 and $ 0 , respectively, which relate to the terminated employees' exits from the Company’s cash incentive plans.

These restructuring costs were further offset by forfeited equity-based compensation expense reversals for the years ended December 31, 2024, 2023 and 2022 in the amount of $ 1,991 , $ 9,313 and $ 0 , respectively, which relate to the terminated employees' exits from the Company’s equity incentive plan.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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-K

Item 8. Financial Statements and Supplementary Data