OmniAb, Inc. 10-Q

Item 1. Financial Statements OMNIAB, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share data) March 31, 2026 December 31, 2025 (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 29,046 $ 25,524 Short-term investments 20,026 28,501 Accounts receivable, net 12,639 7,390 Prepaid expenses and other current assets 3,414 3,926 Total current assets 65,125 65,341 Intangible assets, net 119,121 125,149 Goodwill 83,979 83,979 Property and equipment, net 9,021 9,428 Operating lease right-of-use assets 15,049 15,545 Restricted cash 560 560 Other long-term assets 795 912 Total assets $ 293,650 $ 300,914 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 1,652 $ 1,879 Accrued expenses and other current liabilities 4,031 6,291 Current contingent liabilities 1,002 1,044 Current deferred revenue 2,941 3,161 Current operating lease liabilities 3,940 3,879 Total current liabilities 13,566 16,254 Long-term contingent liabilities 37 315 Deferred income taxes, net 1,227 785 Long-term operating lease liabilities 15,730 16,455 Long-term deferred revenue 369 — Other long-term liabilities 75 78 Total liabilities 31,004 33,887 Stockholders' equity: Preferred stock, $ 0.0001 par value; 100,000,000 shares authorized at March 31, 2026 and December 31, 2025; no shares issued and outstanding at March 31, 2026 and December 31, 2025 — — Common stock, $ 0.0001 par value; 1,000,000,000 shares authorized at March 31, 2026 and December 31, 2025; 144,783,813 and 144,308,383 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively 14 14 Additional paid-in capital 436,520 433,180 Accumulated other comprehensive income (loss) ( 2 ) 12 Accumulated deficit ( 173,886 ) ( 166,179 ) Total stockholders’ equity 262,646 267,027 Total liabilities and stockholders’ equity $ 293,650 $ 300,914 See accompanying notes to unaudited condensed consolidated financial statements. 3 Table of Contents OMNIAB, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except per share data) Three Months Ended March 31, 2026 2025 Revenue: License and milestone revenue $ 12,025 $ 2,021 Service revenue 2,107 1,903 xPloration revenue 54 42 Royalty revenue 241 188 Total revenue 14,427 4,154 Costs and operating expenses: Cost of xPloration revenue 15 3 Research and development 9,640 12,602 General and administrative 6,619 7,915 Amortization of intangibles 6,028 3,228 Other operating income, net ( 46 ) ( 750 ) Total costs and operating expenses 22,256 22,998 Loss from operations ( 7,829 ) ( 18,844 ) Other income (expense), net: Interest income 487 537 Other income, net 77 1 Total other income, net 564 538 Loss before income taxes ( 7,265 ) ( 18,306 ) Income tax (expense) benefit ( 442 ) 106 Net loss $ ( 7,707 ) $ ( 18,200 ) Net loss per share, basic and diluted $ ( 0.06 ) $ ( 0.17 ) Weighted-average shares outstanding, basic and diluted 128,245 105,622 See accompanying notes to unaudited condensed consolidated financial statements. 4 Table of Contents OMNIAB, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) (in thousands) Three Months Ended March 31, 2026 2025 Net loss $ ( 7,707 ) $ ( 18,200 ) Unrealized net loss on available-for-sale securities ( 14 ) ( 19 ) Comprehensive loss $ ( 7,721 ) $ ( 18,219 ) See accompanying notes to unaudited condensed consolidated financial statements. 5 Table of Contents OMNIAB, INC. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) (in thousands, except share data) Common Stock Additional paid-in capital Accumulated other comprehensive income (loss) Accumulated deficit Total stockholders’ equity Shares Amount Balance at January 1, 2026 144,308,383 $ 14 $ 433,180 $ 12 $ ( 166,179 ) $ 267,027 Net loss — — — — ( 7,707 ) ( 7,707 ) Share-based compensation — — 3,340 — — 3,340 Issuance of common stock under stock compensation plans 475,430 — — — — — Unrealized net loss on available-for-sale securities — — — ( 14 ) — ( 14 ) Balance at March 31, 2026 144,783,813 $ 14 $ 436,520 $ ( 2 ) $ ( 173,886 ) $ 262,646 Balance at January 1, 2025 121,599,488 $ 12 $ 388,979 $ 27 $ ( 101,400 ) $ 287,618 Net loss — — — — ( 18,200 ) ( 18,200 ) Share-based compensation — — 4,144 — — 4,144 Issuance of common stock under stock compensation plans 535,453 — 44 — — 44 Unrealized net loss on available-for-sale securities — — — ( 19 ) — ( 19 ) ATM facility issuance costs — — ( 71 ) — — ( 71 ) Balance at March 31, 2025 122,134,941 $ 12 $ 393,096 $ 8 $ ( 119,600 ) $ 273,516 See accompanying notes to unaudited condensed consolidated financial statements. 6 Table of Contents OMNIAB, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands) Three Months Ended March 31, 2026 2025 Operating activities: Net loss $ ( 7,707 ) $ ( 18,200 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation of property and equipment 606 966 Amortization of intangible assets 6,028 3,228 Amortization of operating lease right-of-use assets 580 549 Share-based compensation 3,340 4,144 Amortization of discounts on short-term investments, net ( 199 ) ( 239 ) Deferred income taxes, net 442 ( 106 ) Change in estimated fair value of contingent liabilities ( 320 ) ( 834 ) Other 57 22 Changes in operating assets and liabilities, net: Accounts receivable, net ( 4,922 ) ( 470 ) Prepaid expenses and other current assets 512 ( 73 ) Other long-term assets 117 258 Accounts payable, accrued expenses, and other liabilities ( 2,522 ) ( 2,968 ) Operating lease liabilities ( 748 ) ( 685 ) Deferred revenue ( 178 ) ( 1,464 ) Net cash used in operating activities ( 4,914 ) ( 15,872 ) Investing activities: Purchases of short-term investments ( 9,397 ) ( 10,259 ) Proceeds from the maturity of short-term investments 18,000 9,500 Purchases of property and equipment ( 167 ) ( 209 ) Proceeds from sale of short-term investments — 90 Net cash provided by (used in) investing activities 8,436 ( 878 ) Financing activities: Proceeds from issuance of common stock from stock plans — 44 Net cash provided by financing activities — 44 Net change in cash, cash equivalents and restricted cash 3,522 ( 16,706 ) Cash, cash equivalents and restricted cash at beginning of period 26,084 28,158 Cash, cash equivalents and restricted cash at end of period $ 29,606 $ 11,452 Supplemental cash flow information: Deferred revenue recorded in accounts receivable $ 327 $ 736 See accompanying notes to unaudited condensed consolidated financial statements. 7 Table of Contents OMNIAB, INC. Notes to Condensed Consolidated Financial Statements (Unaudited) 1. Organization and Basis of Presentation Description of Business OmniAb, Inc. (“OmniAb” or the “Company”, formerly known as Avista Public Acquisition Corp. II (“APAC”)) is a biotechnology company that licenses cutting-edge discovery research technology to the pharmaceutical and biotech industries and academic institutions to enable the discovery of next-generation therapeutics. The Company’s technology platform creates and screens diverse antibody repertoires and is designed to quickly identify optimal antibodies and other target-binding proteins for its partners’ drug development efforts. At the heart of the OmniAb platform is something the Company calls Biological Intelligence™, which powers the immune systems of its proprietary, engineered transgenic animals to create optimized antibody candidates for human therapeutics. The Company primarily derives revenue from license fees for technology access, milestones from partnered programs and service revenue from research programs. Business Combination On November 1, 2022 (the “Closing Date”), the Company, Ligand Pharmaceuticals Incorporated, a Delaware corporation (“Ligand”), OmniAb Operations, Inc., a Delaware corporation and wholly-owned subsidiary of Ligand (“Legacy OmniAb”, formerly known as OmniAb, Inc.), and Orwell Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of APAC (“Merger Sub”), consummated the transactions contemplated by the Agreement and Plan of Merger (the “Merger Agreement”), dated as of March 23, 2022 (the “Business Combination”). Basis of Presentation The Company’s accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as included in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”). The financial information for the three months ended March 31, 2026 and 2025, is unaudited but includes all normal and recurring adjustments unless indicated otherwise, which the Company considered necessary for fair presentation of its condensed consolidated statements of operations and comprehensive loss. Certain prior period amounts in the condensed consolidated financial statements have been reclassified to conform to the current period presentation. The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and accounts within the Company have been eliminated. Liquidity and Capital Resources The Company expects to continue to incur losses as it invests in research and development activities to improve its technology platform, market and sell its technologies to existing and new partners, add operational, financial and management information systems and personnel to support its operations and incur ongoing costs associated with operating as a public company. The Company’s ability to continue its operations is dependent upon its ability to generate cash flows from operations and potentially obtain additional capital in the future. The Company believes its existing cash, cash equivalents and short-term investments are sufficient to support operations through at least the next 12 months from the date of issuance of these financial statements. The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Emerging Growth Company OmniAb qualifies as an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended, (“Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”). Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration 8 Table of Contents statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. OmniAb has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, OmniAb, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of OmniAb’s financial statements with another public company, which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period, difficult because of the potential differences in accounting standards used. 2. Summary of Significant Accounting Policies Significant Accounting Policies The Company’s significant accounting policies are disclosed in its Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC and have not materially changed during the three months ended March 31, 2026. The Company believes that the disclosures provided here are adequate to make the information presented not misleading when these unaudited condensed consolidated financial statements are read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K. Use of Estimates The preparation of these condensed consolidated financial statements in conformity with U.S. GAAP requires the use of estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes. Actual results may differ from those estimates. Cash, Cash Equivalents, and Restricted Cash Cash and cash equivalents consist of cash and highly liquid investments with maturities of three months or less when purchased. Cash and cash equivalents generally consist of bank deposits, money market funds as well as U.S. government and agency securities. The following table provides a reconciliation of the components of cash, cash equivalents and restricted cash reported in the condensed consolidated balance sheets to the total of the amount presented in the condensed consolidated statements of cash flows: (in thousands) March 31, 2026 December 31, 2025 Cash and cash equivalents $ 29,046 $ 25,524 Restricted cash 560 560 Total cash, cash equivalents and restricted cash presented in the condensed consolidated statements of cash flows $ 29,606 $ 26,084 Restricted cash relates to deposits for the Company’s property leases. The restriction will lapse when the related leases expire. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed below, the Company believes that the impact of recently issued standards are either not applicable to the Company or will not have a material impact on its consolidated financial statements upon adoption. 9 Table of Contents The following table provides a brief description of recently issued accounting standards: Standard Description Effective Date Effect on the Financial Statements or Other Significant Matters ASU 2024-03, Income Statement (Topic 220) - Expense Disaggregation Disclosures The amendments in this ASU require a public business entity to disclose specific information about certain costs and expenses in the notes to its financial statements for interim and annual reporting periods. The objective of the disclosure requirements is to provide disaggregated information about a public business entity's expenses to help investors (a) better understand the entity's performance, (b) better assess the entity's prospects for future cash flows, and (c) compare an entity's performance over time and with that of other entities. Effective in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures. 3. Fair Value Measurement The Company measures its financial assets and liabilities at fair value, which is defined as the exit price, or the amount that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company uses the following three-level valuation hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs to value its financial assets and liabilities: • Level 1 — Observable inputs such as unadjusted quoted prices in active markets for identical instruments. • Level 2 — Quoted prices for similar instruments in active markets or inputs that are observable for the asset or liability, either directly or indirectly. • Level 3 — Significant unobservable inputs based on the Company’s assumptions. Financial Instruments Measured on a Recurring Basis The following tables provide a summary of the assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025: Fair Value Measurements as of March 31, 2026 (in thousands) Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 22,941 $ — $ — $ 22,941 Total cash equivalents $ 22,941 $ — $ — $ 22,941 Short-term investments: Government securities $ 16,049 $ — $ — $ 16,049 Corporate debt securities — 2,996 — 2,996 Commercial paper — 981 — 981 Total short-term investments $ 16,049 $ 3,977 $ — $ 20,026 Liabilities: Current contingent liabilities $ — $ — $ 1,002 $ 1,002 Long-term contingent liabilities — — 37 37 Total contingent liabilities $ — $ — $ 1,039 $ 1,039 10 Table of Contents Fair Value Measurements as of December 31, 2025 (in thousands) Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 20,080 $ — $ — $ 20,080 Total cash equivalents $ 20,080 $ — $ — $ 20,080 Short-term investments: Government securities $ 28,501 $ — $ — $ 28,501 Total short-term investments $ 28,501 $ — $ — $ 28,501 Liabilities: Current contingent liabilities $ — $ — $ 1,044 $ 1,044 Long-term contingent liabilities — — 315 315 Total contingent liabilities $ — $ — $ 1,359 $ 1,359 The carrying amounts reported in the Company’s condensed consolidated balance sheets for accounts receivable, other assets, accounts payable and accrued expenses and other current liabilities approximate fair value due to their relatively short periods to maturity. Available-for-Sale Securities The Company obtains the fair value of its Level 2 available-for-sale securities from third-party pricing services. The pricing services utilize industry standard valuation models whereby all significant inputs, including benchmark yields, reported trades, broker/dealer quotes, issuer spreads, bids, offers, or other market-related data, are observable. The Company validates the prices provided by the third-party pricing services by reviewing their pricing methods and obtaining market values from other pricing sources. The Company did not adjust or override any fair value measurements provided by these pricing services as of March 31, 2026. There were no level 2 available-for-sale securities as of December 31, 2025. The Company has not transferred any investment securities between classification levels. Contingent Liabilities Contingent liabilities are measured at fair value each reporting period by using a probability weighted income approach. Changes in the fair values of contingent liabilities are recognized in “Other operating income, net” in the condensed consolidated statements of operations and in the operating section of the statements of cash flows. Payments of contingent liabilities are disclosed in the financing section of the statements of cash flows. A reconciliation of the Level 3 financial instruments as of March 31, 2026 and December 31, 2025 is as follows: (in thousands) Icagen Balance as of January 1, 2025 $ 1,484 Payments of contingent liabilities ( 450 ) Fair value adjustments to contingent liabilities 325 Balance as of December 31, 2025 $ 1,359 Fair value adjustments to contingent liabilities ( 320 ) Balance as of March 31, 2026 $ 1,039 Contingent liabilities are classified as Level 3 liabilities as their valuation requires substantial judgment and estimation of factors that are not currently observable in the market. These subjective estimates include but are not limited to assumptions involving the achievement probability of certain developmental and commercialization milestones, discount rates, and projected years of payments. If different assumptions were used for the various inputs to the valuation approaches, the estimated fair value could be materially higher or lower than the fair value determined. 4. Short-Term Investments 11 Table of Contents The Company classified short-term investments as available-for-sale securities, as the sale of such investments may be required prior to maturity to implement management strategies. The following tables summarize short-term investments as of March 31, 2026 and December 31, 2025: As of March 31, 2026 Unrealized (in thousands) Amortized Cost Gains Losses Estimated Fair Value Government securities $ 16,050 $ — $ ( 1 ) $ 16,049 Corporate debt securities 2,997 — ( 1 ) 2,996 Commercial paper 981 — — 981 Total short-term investments $ 20,028 $ — $ ( 2 ) $ 20,026 As of December 31, 2025 Unrealized (in thousands) Amortized Cost Gains Losses Estimated Fair Value Government securities $ 28,489 $ 12 $ — $ 28,501 Total short-term investments $ 28,489 $ 12 $ — $ 28,501 The Company classified all investments with maturity dates beyond three months at the date of purchase as short-term investments in the condensed consolidated balance sheets based upon its ability and intent to use the investments to satisfy the liquidity needs of current operations. The following table summarizes available-for-sale investments by maturity as of March 31, 2026: (in thousands) Amortized Cost Estimated Fair Value Due in one year or less $ 20,028 $ 20,026 Due after one year — — Total short-term investments $ 20,028 $ 20,026 The following table summarizes the Company’s available-for-sale investments’ gross unrealized losses and fair value aggregated by investment category and the length of time that individual securities have been in a continuous loss position, as of March 31, 2026. As of March 31, 2026 Less than 12 months More than 12 months Total (in thousands) Count Fair Value Unrealized Losses Count Fair Value Unrealized Losses Count Fair Value Unrealized Losses Government securities 7 $ 12,849 $ ( 1 ) — $ — $ — 7 $ 12,849 $ ( 1 ) Corporate debt securities 4 1,981 ( 1 ) — — — 4 1,981 ( 1 ) 11 $ 14,830 $ ( 2 ) — $ — $ — 11 $ 14,830 $ ( 2 ) The Company had certain available-for-sale debt securities in an unrealized loss position without an allowance for credit loss as of March 31, 2026. Unrealized losses on these debt securities have not been recognized into income because (1) the issuers have high credit quality, (2) management does not intend to sell and it is likely that management will not be required to sell these securities prior to their anticipated recovery and (3) the decline in fair value is largely due to market conditions and/or changes in interest rates. The issuers continue to make timely interest payments on the securities, and the fair value is expected to recover as the bonds approach maturity. 12 Table of Contents 5. Balance Sheet Account Details Accounts Receivable, Unbilled Receivables and Deferred Revenue Unbilled receivables were $ 3.5 million and $ 0.8 million as of March 31, 2026 and December 31, 2025, respectively. Current deferred revenue was $ 2.9 million and $ 3.2 million as of March 31, 2026 and December 31, 2025, respectively, and long-term deferred revenue was $ 0.4 million and nil as of March 31, 2026 and December 31, 2025, respectively. During the three months ended March 31, 2026, the amount recognized as revenue that was previously deferred at December 31, 2025 was $ 1.2 million. During the three months ended March 31, 2025, and the amount recognized as revenue that was previously deferred at December 31, 2024 was $ 1.7 million. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following as of March 31, 2026 and December 31, 2025: (in thousands) March 31, 2026 December 31, 2025 Prepaid expenses $ 2,022 $ 1,991 xPloration related inventory 920 823 Other current assets 472 1,112 Total prepaid expenses and other current assets $ 3,414 $ 3,926 Property and Equipment, Net Property and equipment, net, consisted of the following as of March 31, 2026 and December 31, 2025: (in thousands) March 31, 2026 December 31, 2025 Leasehold improvements $ 17,745 $ 17,745 Lab and office equipment 10,388 10,178 Computer hardware and software 791 791 Construction in progress 35 46 Property and equipment, at cost 28,959 28,760 Less accumulated depreciation ( 19,938 ) ( 19,332 ) Total property and equipment, net $ 9,021 $ 9,428 Depreciation expense, which is included in operating expenses, was $ 0.6 million during the three months ended March 31, 2026, respectively, and $ 1.0 million during the three months ended March 31, 2025, respectively. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following as of March 31, 2026 and December 31, 2025: (in thousands) March 31, 2026 December 31, 2025 Compensation $ 3,219 $ 5,788 Professional service fees 284 262 Royalties owed to third parties 320 67 Other 208 174 Total accrued expenses and other current liabilities $ 4,031 $ 6,291 6. Goodwill and Intangible Assets, Net Goodwill and intangible assets, net consisted of the following as of March 31, 2026 and December 31, 2025: 13 Table of Contents (in thousands) March 31, 2026 December 31, 2025 Goodwill $ 83,979 $ 83,979 Finite-lived intangible assets Completed technology 233,158 233,158 Less: Accumulated amortization ( 114,037 ) ( 110,984 ) Customer relationships 11,100 11,100 Less: Accumulated amortization ( 11,100 ) ( 8,125 ) Intangible assets, net $ 119,121 $ 125,149 Total goodwill and other identifiable intangible assets, net $ 203,100 $ 209,128 Goodwill There were no changes in the carrying amount of goodwill during the three months ended March 31, 2026 and 2025. Intangible Assets Amortization of finite-lived intangible assets is computed using the straight-line method over the estimated useful life of the asset of up to 20 years and is reflected within “Amortization of intangibles” in the condensed consolidated statements of operations. Amortization expense of $ 6.0 million and $ 3.2 million was recognized during the three months ended March 31, 2026 and 2025 respectively. During the three months ended March 31, 2026, the Company identified a triggering event over its customer relationship intangible asset within the legacy small molecule ion channel asset group. The triggering event resulted from the discontinuation of certain legacy small molecule ion channel programs, which resulted in the Company having no expected future cash flows from the customer relationship. The Company did not control the timing or outcome of the decision to discontinue the legacy small molecule programs. As a result of this triggering event, the Company performed an impairment assessment under ASC 360 and recorded an impairment charge of $ 2.9 million during the first quarter of 2026 which fully impaired the customer relationship intangible asset. The impairment charge was recorded as “Amortization of intangibles” in the condensed consolidated statements of operations. For the three months ended March 31, 2025, there was no impairment of finite-lived intangible assets. The remaining weighted-average useful life of finite-lived intangible assets is 10.0 years. At March 31, 2026, future amortization expense on intangible assets is estimated to be as follows (in thousands): Dates Amount Remaining nine months ending December 31, 2026 $ 9,159 2027 12,212 2028 12,212 2029 12,212 2030 12,017 Thereafter 61,309 Total future amortization expense $ 119,121 7. Commitments and Contingencies Lease Commitments The Company’s corporate headquarters are located in Emeryville, California and its research facilities are located in Emeryville and Dixon, California, Durham, North Carolina and Tucson, Arizona. It leases approximately 70,000 square feet of space under leases expiring from 2026 to 2032. The below tables provide supplemental cash flow and other information related to operating leases (in thousands, except for lease term and discount rate): 14 Table of Contents Three Months Ended March 31, 2026 2025 Cash paid for amounts included in the measurement of lease liabilities: $ 965 $ 934 Right-of-use assets obtained in exchange for lease obligations: $ 84 $ — As of March 31, 2026 2025 Weighted average remaining lease term (in years) 5.7 6.6 Weighted average discount rate 4.4 % 4.3 % In addition to base rent, certain of the Company’s operating leases require variable payments. These variable lease costs include amounts relating to common area maintenance and are expensed when the obligation for those payments is incurred and are recognized as operating expenses in the condensed consolidated statements of operations. The following table summarizes the components of operating lease expense for the three months ended March 31, 2026 and 2025: Three Months Ended March 31, (in thousands) 2026 2025 Operating lease cost 798 799 Variable lease cost 313 250 Total lease costs 1,111 1,049 Future minimum lease commitments are as follows as of March 31, 2026 (in thousands): Dates Operating Leases Remaining nine months ending December 31, 2026 $ 2,944 2027 4,038 2028 4,107 2029 3,307 2030 3,235 Thereafter 4,756 Total lease payments 22,387 Less imputed interest ( 2,717 ) Present value of lease liabilities $ 19,670 Legal Proceedings From time to time, the Company has been and may be involved in various legal proceedings arising in its ordinary course of business. In the opinion of management, resolution of any pending claims (either individually or in the aggregate) is not expected to have a material adverse impact on the condensed consolidated financial statements, cash flows or financial position and it is not possible to provide an estimated amount of any such loss. However, the outcome of disputes is inherently uncertain. Therefore, although management considers the likelihood of such an outcome to be remote, an unfavorable resolution of one or more matters could materially affect future results of operations or cash flows, or both, in a particular period. 8. Stockholders' Equity Authorized and Outstanding Capital Stock The total number of shares of the Company’s authorized capital stock is 1,100,000,000 . The total amount of authorized capital stock consists of 1,000,000,000 shares of common stock and 100,000,000 shares of preferred stock. As of March 31, 2026, no shares of preferred stock were issued or outstanding. Common Stock Holders of the Company’s common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders, including the election of directors, and do not have cumulative voting rights. Subject to preferences that may be 15 Table of Contents applicable to any then outstanding preferred stock, holders of common stock are entitled to receive ratably those dividends, if any, as may be declared by the board of directors out of legally available funds. In the event of the Company’s liquidation, dissolution or winding up, the holders of common stock will be entitled to share ratably in the assets legally available for distribution to stockholders after the payment of or provision for all of the Company's debts and other liabilities, subject to the prior rights of any preferred stock then outstanding. Holders of common stock have no preemptive or conversion rights or other subscription rights and there are no redemption or sinking fund provisions applicable to the common stock. All outstanding shares of common stock are duly authorized, validly issued, fully paid and nonassessable. The rights, preferences and privileges of holders of common stock are subject to and may be adversely affected by the rights of the holders of shares of any series of preferred stock that the Company may designate and issue in the future. Preferred Stock Under the terms of the Company’s certificate of incorporation, its board of directors has the authority, without further action by the Company's stockholders, to issue up to 100,000,000 shares of preferred stock in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the dividend, voting and other rights, preferences and privileges of the shares of each wholly unissued series and any qualifications, limitations or restrictions thereon, and to increase or decrease the number of shares of any such series, but not below the number of shares of such series then outstanding. The Company’s board of directors may authorize the issuance of preferred stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of common stock. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deterring or preventing a change in the Company’s control and may adversely affect the market price of the common stock and the voting and other rights of the holders of common stock. The Company has no current plans to issue any shares of preferred stock. Earnout Shares Some of the Company’s shares of common stock are subject to certain price-based earnout triggers (the “Earnout Shares”). Earnout Shares vest based upon the achievement of certain volume-weighted average trading prices (“VWAP”) for shares of the Company for any 20 trading days over a consecutive 30 trading-day period during the five-year period following the Closing Date, with (i) 50 % of such Earnout Shares vesting upon achievement of a VWAP of $ 12.50 per share of common stock or upon the occurrence of a change of control transaction that will result in the holders of common stock receiving a price per share in excess of $ 12.50 , and (ii) the remaining 50 % of the Earnout Shares vesting upon achievement of a VWAP of $ 15.00 per share of common stock or upon the occurrence of a change of control transaction that will result in the holders of common stock receiving a price per share in excess of $ 15.00 . The Earnout Shares are not transferable until the vesting condition for the applicable tranche of Earnout Shares has been achieved. Prior to vesting, holders of Earnout Shares are entitled to exercise the voting rights carried by such shares and receive any dividends or other distributions in respect of such shares. As of March 31, 2026, 14,999,243 Earnout Shares were issued and outstanding. Pursuant to the Sponsor Insider Letter Agreement executed concurrently with the Merger Agreement, by and among APAC, Avista Acquisition LP II (the “Sponsor”), Legacy OmniAb and certain insiders of APAC, 1,293,299 shares of OmniAb common stock held by the Sponsor became subject to the same price-based vesting conditions as the Earnout Shares (the “Sponsor Earnout Shares”). The Sponsor Earnout Shares are accounted for as equity-classified equity instruments and recorded in additional paid-in capital as part of the Business Combination. As of March 31, 2026, 1,293,299 Sponsor Earnout Shares were issued and outstanding. The Earnout Shares and Sponsor Earnout Shares will be automatically forfeited for no consideration if an applicable triggering event has not occurred from the Closing Date to and including the fifth anniversary of the Closing Date. Public, Private Placement, Forward Purchase and Backstop Warrants The Company assumed 7,666,667 warrants originally issued in APAC’s initial public offering (the “Public Warrants”) and 8,233,333 warrants issued in a private placement that closed concurrently with APAC’s initial public offering, (the “Private Placement Warrants”) in the Business Combination. Additionally, pursuant to the Amended and Restated Forward Purchase Agreement, dated as of March 23, 2022 (the “A&R FPA”), on the Closing Date, the Company issued 1,666,667 warrants in the Forward Purchase (the “Forward Purchase Warrants”) and 1,445,489 warrants in the Redemption Backstop (the “Backstop Warrants”). The Public, Private Placement, Forward Purchase and Backstop Warrants entitle the holder to purchase one share of the Company’s common stock at an exercise price of $ 11.50 per share. 16 Table of Contents The Public Warrants are publicly traded and are exercisable for cash unless certain conditions occur, such as the failure to have an effective registration statement related to the shares issuable upon exercise or redemption by the Company under certain conditions, at which time the warrants may be cashless exercised at the option of the Company. The Public Warrants are only exercisable for a whole number of shares of common stock. No fractional shares are to be issued upon exercise of the warrants. The Public Warrants will expire on November 1, 2027 (which is five years after the completion of the Business Combination), at 5:00 p.m., New York City time, or earlier upon redemption or liquidation. The Public Warrants are listed on the Nasdaq Capital Market under the symbol “OABIW”. Additionally, the Company can redeem the outstanding Public Warrants: • in whole and not in part; • at a price of $ 0.01 per warrant; • upon not less than 30 days’ prior written notice of redemption to each warrant holder; and • if, and only if, the closing price of the common stock equals or exceeds $ 18.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 -trading day period ending three trading days before the Company sends the notice of redemption to the warrant holders provided there was an effective registration statement covering the shares of common stock issuable upon exercise of the warrants. If the Company calls the Public Warrants for redemption as previously described, the Company has the option to require all holders that wish to exercise the Public Warrants to do so on a cashless basis. The Private Placement Warrants have terms and provisions that are identical to the Public Warrants except that the Private Placement Warrants were not transferable, assignable or salable until 30 days after the completion of the Business Combination. The Private Placement Warrants will be redeemable by the Company in all redemption scenarios and exercisable by the holders on the same basis as the Public Warrants. The Forward Purchase Warrants and the Backstop Warrants have the same terms as the Private Placement Warrants. The Company evaluated the Public, Private Placement, Forward Purchase and Backstop Warrants under ASC 815-40, Derivatives and Hedging-Contracts in Entity’s Own Equity (“ASC 815-40”), and concluded they meet the criteria for equity classification as they are considered to be indexed to the Company’s own stock. Upon consummation of the Business Combination, the Public, Private Placement, Forward Purchase and Backstop Warrants were recorded in additional paid-in capital. Equity Compensation Plans 2022 Incentive Award Plan The Company’s board of directors and stockholders adopted the 2022 Incentive Award Plan (the “2022 Plan”), which became effective upon the Closing of the Business Combination. Under the 2022 Plan, the Company may grant cash and equity incentive awards to eligible employees, directors and consultants. As of March 31, 2026, the aggregate number of shares of our common stock that may be issued under the 2022 Plan is 44,350,069 shares. In addition, the number of shares of our common stock available for issuance under the 2022 Plan will be annually increased on January 1 of each calendar year beginning in 2023 and ending in 2032 by an amount equal to the lesser of (i) a number equal to 5 % of the fully-diluted shares on the final day of the immediately preceding calendar year or (ii) such smaller number of shares as is determined by the Company's board of directors. The 2022 Plan provides for the grant of stock options, including incentive stock options and nonqualified stock options, stock appreciation rights, restricted stock, dividend equivalents, restricted stock units (“RSUs”) and other stock or cash-based awards. OmniAb Prior Plans In connection with the Business Combination, Legacy OmniAb adopted the OmniAb, Inc. 2022 Ligand Service Provider Assumed Award Plan and the OmniAb, Inc. 2022 OmniAb Service Provider Assumed Award Plan (collectively, the “OmniAb Prior Plans”), which govern the OmniAb equity awards issued upon adjustment of outstanding Ligand equity awards in connection with Ligand’s distribution of Legacy OmniAb common stock to Ligand stockholders. All awards under the OmniAb Prior Plans that were outstanding as of the closing of the Business Combination continued to be governed by the terms, conditions and procedures set forth in the OmniAb Prior Plans and any applicable award agreements, as those terms may be 17 Table of Contents equitably adjusted in connection with the Business Combination. The Company assumed the OmniAb Prior Plans in connection with the closing of the Business Combination, and each of the awards thereunder. At the Market Offering In December 2023, the Company entered into an Open Market Sale Agreement SM (the “Sales Agreement”), with Jefferies LLC (the “Sales Agent”) under which it may, from time to time, sell shares of its common stock having an aggregate offering price of up to $ 100.0 million in “at the market” (“ATM”) offerings through the Sales Agent. Sales of the shares of common stock, if any, will be made at prevailing market prices at the time of sale, or as otherwise agreed with the Sales Agent. The Sales Agent will receive a commission from the Company of up to 3.0 % of the gross proceeds of any shares of common stock sold under the Sales Agreement. Sales of its common stock made pursuant to the Sales Agreement are made under its shelf registration statement on Form S‐3 which was filed on December 8, 2023 and declared effective by the SEC on December 18, 2023. The Company is not obligated to sell, and the Sales Agent is not obligated to buy or sell, any shares of common stock under the Sales Agreement. No shares of common stock in the ATM offering were issued during the three months ended March 31, 2026. PIPE Offering On August 24, 2025, the Company entered into a securities purchase agreement with the purchasers named therein for the private placement (“August 2025 PIPE”) of 21,254,106 shares of the Company’s common stock at a price of $ 1.40 per share or, with respect to any purchaser that was an officer, director, employee or consultant of the Company, $ 1.85 per share. The aggregate gross proceeds from the August 2025 PIPE were approximately $ 30.0 million, before deducting placement agent fees and offering expenses. The closing of the August 2025 PIPE occurred on August 26, 2025. On September 12, 2025, the Company filed a registration statement on Form S-3 with the SEC registering the resale of the shares of common stock issued in the August 2025 PIPE, which registration statement was declared effective by the SEC on September 19, 2025. 9. Share-Based Compensation Share-Based Compensation Expense The Company recognized share-based compensation expense by function as follows: Three Months Ended March 31, (in thousands) 2026 2025 General and administrative $ 2,070 $ 2,588 Research and development 1,270 1,556 Total share-based compensation expense $ 3,340 $ 4,144 The Company recognized share-based compensation expense by award type as follows: Three Months Ended March 31, (in thousands) 2026 2025 Stock options $ 2,371 $ 3,133 Restricted stock units 828 833 Employee share purchase plan 141 178 Total share-based compensation expense $ 3,340 $ 4,144 Stock Options Stock options granted under the 2022 Plan typically vest 1/8 on the six-month anniversary of the date of grant, and 1/48 each month thereafter for 42 months. All option awards generally expire 10 years from the date of grant. The Company uses the Black-Scholes option-pricing model to estimate the fair value of stock options granted. The model assumptions include expected volatility, expected term, dividend yield, and the risk-free interest rate. • Expected volatility : Due to the Company’s limited trading history for its common stock, the Company lacks sufficient historical data to support its expected stock price volatility. As such, the Company utilized a weighted approach by 18 Table of Contents blending its own limited historical data with the volatilities of publicly traded biotechnology peers. The Company will continue to apply this approach until it has enough historical data to solely support its expected volatility. • Expected term : The expected term represents the period of time that options are expected to be outstanding. Because the Company has limited historical exercise behavior, it determines the expected life assumption using the simplified method which is an average of the contractual term of the option and its vesting period. • Dividend yield : The Company bases the expected dividend yield assumption on the fact that it has never paid cash dividends and has no present intention to pay cash dividends and, therefore, used an expected dividend yield of zero. • Risk-free interest rate : The risk-free interest rate is based upon U.S. Treasury securities with remaining terms similar to the expected term of the share-based awards. The fair value of each option issued was estimated on the grant date using the Black-Scholes option pricing model with the following weighted-average assumptions: Three Months Ended March 31, 2026 2025 Risk-free interest rate 3.8 % 4.4 % Expected volatility 58.2 % 52.4 % Expected term (years) 6.0 6.0 Dividend yield — % — % The following table summarizes stock option activity under the Company’s equity award plans: Shares Weighted-Average Exercise Price per Share Weighted-Average Remaining Contractual Life (in years) Aggregate Intrinsic Value (in thousands) (1) Outstanding at January 1, 2026 17,951,124 $ 5.70 Granted 6,040,750 $ 1.71 Exercised — $ — Cancelled/Expired ( 842,730 ) $ 6.47 Outstanding at March 31, 2026 23,149,144 $ 4.63 7.8 $ 18 Exercisable at March 31, 2026 11,344,475 $ 6.53 6.6 $ 3 _____________ (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the estimated fair value of the common stock for in the money options as of March 31, 2026. As of March 31, 2026, unrecognized share-based compensation expense related to OmniAb options was $ 17.5 million, which is expected to be recognized over a remaining weighted-average period of approximately 1.38 years. There were no OmniAb options exercised by OmniAb service providers during the three months ended March 31, 2026. There were no OmniAb options exercised by Ligand service providers during the three months ended March 31, 2026. Restricted Stock Units RSUs generally represent the right to receive a certain number of shares of common stock subject to certain vesting conditions and other restrictions. RSUs generally vest over three years . The fair value of RSUs is determined by the closing market price on the grant date. The following table summarizes RSU activity during the three months ended March 31, 2026 under the Company’s equity awards plans: 19 Table of Contents Shares Weighted-Average Grant Date Fair Value Unvested balance at January 1, 2026 1,629,394 $ 3.91 Granted 1,032,313 $ 1.71 Vested ( 475,430 ) $ 4.47 Forfeited — $ — Unvested balance at March 31, 2026 2,186,277 $ 2.75 As of March 31, 2026, unrecognized share-based compensation expense related to OmniAb RSUs was $ 4.8 million, which is expected to be recognized over a remaining weighted-average period of approximately 1.47 years. The aggregate intrinsic value of OmniAb RSUs vested for OmniAb service providers during the three months ended March 31, 2026 was $ 0.8 million. Employee Stock Purchase Plan Under the Company’s 2022 Employee Stock Purchase Plan (the “ESPP”), eligible employees are entitled to purchase shares of common stock at a discount with accumulated payroll deductions. The ESPP provides for a series of overlapping 24 -month offering periods comprising four six-month purchase periods. The purchase price for shares of common stock purchased under the ESPP is equal to 85 % of the lesser of the fair market value of the Company’s common stock on (i) the first trading day of the applicable offering period or (ii) the last trading day of each six month purchase period in the applicable offering period. As of March 31, 2026, the aggregate number of shares of the Company’s common stock that may be issued pursuant to rights granted under the ESPP equals 5,087,532 shares of the Company’s common stock. In addition, on the first day of each calendar year beginning on January 1, 2023 and ending on (and including) January 1, 2032, the number of shares available for issuance under the ESPP will be increased by a number of shares equal to the lesser of (i) 1 % of the fully diluted shares outstanding on the final day of the immediately preceding calendar year, and (ii) such smaller number of shares as determined by the Company’s board of directors. As of March 31, 2026, there was $ 0.3 million of unrecognized share-based compensation expense associated with the ESPP, which is expected to be recognized over a remaining weighted-average period of 0.86 years. During the three months ended March 31, 2026, there were no shares issued pursuant to the ESPP. 10. Income Taxes The Company’s effective tax rate may vary from the U.S. federal statutory tax rate due to the valuation allowance placed on deferred tax assets, change in the mix of earnings in various state jurisdictions with different statutory rates, benefits related to tax credits, and the tax impact of non-deductible expenses, stock award activities and other permanent differences between income before income taxes and taxable income. The Company’s effective tax rate for the three months ended March 31, 2026 and 2025 was ( 6.1 )% and 0.6 %, respectively. The variance from the U.S. federal statutory tax rate of 21.0% for each of the three months ended March 31, 2026 and 2025 was primarily due to the valuation allowance established on federal and state attributes and the tax impact of stock award activities that was partially offset with the benefit related to research and development tax credits. The Company considered the realizability of the deferred tax assets and recorded a valuation allowance as necessary for the amount of deferred tax assets which are not more likely than not to be realized as of March 31, 2026. 11. Net Loss Per Share Loss Per Share Basic loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted loss per share is computed based on the sum of the weighted average number of common shares and dilutive common shares outstanding during the period. As described in Note 8 – Stockholders' Equity, Earnout Shares issued in connection with the Business Combination are subject to vesting based on the VWAP of common shares during the earnout period. The Earnout Shares are excluded from the calculation of basic and diluted weighted-average number of common shares outstanding until vested. 20 Table of Contents The following table outlines the basic and diluted net loss per share for the three months ended March 31, 2026 and 2025: Three Months Ended March 31, (in thousands, except per share data) 2026 2025 Net loss $ ( 7,707 ) $ ( 18,200 ) Weighted-average shares outstanding, basic and diluted 128,245 105,622 Net loss per share, basic and diluted $ ( 0.06 ) $ ( 0.17 ) The following table outlines common share equivalents which were excluded from the computation of diluted net loss per share, as the effect of their inclusion would be anti-dilutive or the share equivalents were contingently issuable as of each period presented: March 31, 2026 2025 Options to purchase common stock issued and outstanding (1) 26,442,166 24,383,034 Earnout shares 16,292,542 16,292,542 Private placement warrants 8,233,333 8,233,333 Public warrants 7,666,667 7,666,667 Restricted stock units issued and outstanding 2,186,277 2,149,217 Forward purchase warrants 1,666,667 1,666,667 Backstop warrants 1,445,489 1,445,489 Shares expected to be purchased under employee stock purchase plan 467,279 736,760 Total anti-dilutive shares 64,400,420 62,573,709 _____________ (1) Outstanding stock options include awards outstanding to employees of Ligand. 12. Segment Information The Company operates under one reportable business segment, providing discovery research technology to enable the discovery of next-generation therapeutics. The determination of a single reportable business segment is consistent with the consolidated financial information regularly provided to the Company’s chief operating decision maker (“CODM”). The Company’s CODM is its Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance. In addition to the significant expense categories included within the consolidated statements of operations, certain other disaggregated amounts that comprise research and development expenses and general and administrative expenses are reviewed by the CODM. These expenses consist of (1) personnel related expenses, including salaries, benefits and share-based compensation, (2) external expenses, including third-party costs for goods and services such as lab supplies and contract research, and (3) facility and other overhead expenses, including depreciation and occupancy costs. The following table outlines information about segment revenues, significant segment expenses, and segment net loss for the three months ended March 31, 2026 and 2025: 21 Table of Contents Three Months Ended March 31, (in thousands) 2026 2025 Revenue $ 14,427 $ 4,154 Cost of xPloration revenue 15 3 Research and development expenses Personnel related expenses 4,795 6,849 External expenses 3,140 3,723 Facility and other overhead expenses 1,705 2,030 Total research and development expenses 9,640 12,602 General and administrative expenses Personnel related expenses 4,619 5,600 External expenses 1,794 2,050 Facility and other overhead expenses 206 265 Total general and administrative expenses 6,619 7,915 Amortization of intangibles 6,028 3,228 Other operating income, net ( 46 ) ( 750 ) Total costs and operating expenses 22,256 22,998 Total other income, net 564 538 Income tax (expense) benefit ( 442 ) 106 Net loss $ ( 7,707 ) $ ( 18,200 ) All long-term assets are maintained in, and all net losses are attributable to, the United States of America. 22 Table of Contents