What changed in this filing

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Item 1. Financial Statements

2026-05-08 compared with 2025-11-05 · 171 added, 232 removed, 380 unchanged (51% of the section changed)

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(in thousands, except per share amounts)

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Current Assets:

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Prepaid expenses 5,225 5,221

Income tax receivable 1,608 —

Other current assets 1,870 4,146

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Noncurrent Assets:

Property, plant and equipment, net of accumulated depreciation of $ 73,118 and $ 65,918

40,795 45,105

Property, plant and equipment, net of accumulated depreciation 37,857 39,179

Operating right-of-use assets, net 11,548 11,996

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(in thousands, except per share amounts)

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2025 2024 2025 2024

For the Three Months Ended March 31,

NET REVENUES:

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General and administrative 14,556 14,102

Loss on impairments — — — 4,392

Change in the estimated fair value of acquisition-related contingent consideration 93 478

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Loss before income taxes and equity investment ( 21,721 ) ( 15,972 )

INCOME TAX EXPENSE 47 678 1,591 1,041

INCOME TAX BENEFIT ( 432 ) ( 456 )

LOSS BEFORE EQUITY INVESTMENT ( 21,289 ) ( 15,516 )

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(in thousands)

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2025 2024 2025 2024

For the Three Months Ended March 31,

NET LOSS ( 22,377 ) ( 16,040 )

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(in thousands)

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

OPERATING ACTIVITIES:

Net loss $ ( 22,377 ) $ ( 16,040 )

Adjustments to reconcile net loss to net cash (used in) provided by operating activities

Adjustments to reconcile net loss to net cash used in operating activities

Stock-based compensation 2,768 2,687

Depreciation and amortization 2,341 2,808

Loss on impairments — 4,392

Other non-cash amortization ( 82 ) ( 37 )

Provision for credit losses 66 ( 248 )

Unrealized foreign currency loss (gain) 294 ( 154 )

Unrealized foreign currency (gain) loss ( 153 ) 194

Interest expense on finance leases 3 2

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Accrued expenses and other liabilities 577 ( 6,616 )

Net cash (used in) provided by operating activities ( 40,027 ) 27,265

Net cash used in operating activities ( 13,895 ) ( 19,733 )

INVESTING ACTIVITIES:

Purchases of short-term investments — ( 53,244 )

Purchase of equity method investee — ( 30,000 )

Proceeds from maturities and redemptions of short-term investments — 53,052

Proceeds from sale of assets — 790

Purchases of property and equipment ( 913 ) ( 420 )

Net cash used in investing activities ( 2,387 ) ( 33,533 )

Net cash (used in) provided by investing activities ( 913 ) 370

FINANCING ACTIVITIES:

Cash payments for lease liabilities ( 21 ) ( 12 )

Proceeds from exercise of stock options — 214

Repurchase of common stock ( 5,000 ) —

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SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

Cash paid for income taxes $ 2,582 $ 1,637

(Refund received) cash paid for income taxes $ ( 75 ) $ 1,796

Non-cash investing and financing activities

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(“DNAG”), Diversigen, Inc.

(“Diversigen”), Novosanis NV (“Novosanis”), and Sherlock Biosciences, Inc.

("Sherlock").

(“Diversigen”), Sherlock Biosciences, Inc.

("Sherlock"), and BioMedomics, Inc.

("BioMedomics").

Novosanis NV ("Novosanis") was a subsidiary of OraSure until it was legally dissolved in June 2025.

All intercompany transactions and balances have been eliminated.

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These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

Results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of the results of operations expected for the full year.

Results of operations for the three months ended March 31, 2026 are not necessarily indicative of the results of operations expected for the full year.

Summary of Significant Accounting Policies

There have been no changes to the Company's significant accounting policies described in its Annual Report on Form 10-K for the fiscal year ended December 31, 2025 that have had a material impact on the consolidated financial statements and related notes except as discussed herein.

Change in Accounting Principle

Effective January 1, 2025, the Company changed its methodology for valuing certain inventories to the average cost method from the first-in, first-out ("FIFO") cost method.

The change was applicable to all inventories.

The Company concluded that the average cost basis of accounting is preferable as it results in greater precision in the calculation of acquisition cost of inventory on the balance sheet.

The effect of this change in accounting principle was immaterial.

Therefore, retroactive application was not determined to be necessary and a cumulative adjustment of $ 0.1 million was recorded in the statement of operations for the nine months ended September 30, 2025.

Cash Equivalents & Short-Term Investments

The Company considers all investments in debt securities to be available-for-sale securities.

These securities consist of guaranteed investment certificates purchased with maturities greater than ninety days.

These securities consist of guaranteed investment certificates purchased with maturities greater than ninety days and are considered short-term investments.

Securities with maturities ninety days or less are considered cash equivalents.

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When evaluating an investment for impairment, the Company reviews factors such as the severity of the impairment, changes in underlying credit ratings, forecasted recovery, the Company’s intent to sell or the likelihood that it would be required to sell the investment before its anticipated recovery in market value, and the probability that the scheduled cash payments will continue to be made.

The Company had no available-for-sale securities as of September 30, 2025 and December 31, 2024.

The Company maintains cash balances in the United States in excess of the federally insured limits.

The Company periodically evaluates financial institutions and believe the risk of loss to be remote due to this evaluation.

The Company periodically evaluates financial institutions and believes the risk of loss to be remote due to this evaluation.

Fair Value of Financial Instruments

As of September 30, 2025 and December 31, 2024, the carrying values of cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate their respective fair values based on their short-term nature.

As of March 31, 2026 and December 31, 2025, the carrying values of cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate their respective fair values based on their short-term nature.

Fair value measurements of all financial assets and liabilities that are being measured and reported on a fair value basis are required to be classified and disclosed in one of the following three categories:

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Therefore, the degree of judgment exercised in determining fair value is greatest for assets or liabilities categorized in Level 3.

September 30, December 31,

The following table provides a summary of the recognized assets and liabilities that are measured at fair value on a recurring basis:

March 31, December 31,

Level 2026 2025

Guaranteed investment certificates 1 $ 12,985 $ 13,114

Trading securities 1 466 543

Contingent consideration:

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$ 27,806 $ 27,713

Included in cash and cash equivalents at September 30, 2025 and December 31, 2024 was $ 66.9 million and $ 66.6 million, respectively, invested in guaranteed investment certificates.

Included in cash and cash equivalents at September 30, 2025 and December 31, 2024, was $ 122.4 million and $ 118.5 million, respectively, invested in government money market funds.

Included in cash and cash equivalents at March 31, 2026 and December 31, 2025 was $ 13.0 million and $ 13.1 million, respectively, invested in guaranteed investment certificates.

Included in cash and cash equivalents at March 31, 2026 and December 31, 2025, was $ 69.0 million and $ 68.4 million, respectively, invested in government money market funds.

These funds have investments in U.S.

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The assets of the plan are held in the name of the Company at a third-party financial institution.

The Company paused the plan in January 2026 and is no longer allowing new participants to enter the plan.

Separate accounts are maintained for each participant to reflect the amounts deferred by the participant and all earnings and losses on those deferred amounts.

The assets of the plan are held in mutual funds and Company stock.

The fair value of the plan assets as of September 30, 2025 and December 31, 2024 was $ 0.6 million and $ 0.7 million, respectively, and was calculated using the quoted market prices of the assets as of those dates.

The fair value of the plan assets as of March 31, 2026 and December 31, 2025 was $ 0.5 million, and was calculated using the quoted market prices of the assets as of those dates.

All investments in the plan are classified as trading securities and measured as Level 1 instruments.

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Contingent Consideration

As further discussed in Note 11, Business Combinations, the Company has identified its contingent consideration obligations as Level 3 liabilities due to significant inputs that are required to measure the fair value of these obligations.

The contingent consideration is comprised of two different tranches:

milestone payments and royalty payments.

The significant quantitative unobservable inputs for the milestone payments are the discount rate and probability achievement of a milestone of a regulatory approval.

The Company has identified its contingent consideration obligations as Level 3 liabilities due to significant inputs that are required to measure the fair value of these obligations.

The contingent consideration is comprised of three different tranches:

milestone payments, royalty payments, and earnout payments.

The significant quantitative unobservable inputs for the milestone payments are the discount rate and probability of achieving regulatory approval milestones.

The fair value methodology for royalty payments is based on a discounted cash flow model.

Significant quantitative unobservable inputs are internally developed future expected cash flows, discount rate and probability achievement of a milestone of a regulatory approval.

The royalty payments represent a mid-single digit percentage of the net sales through 2034 associated with the acquired in-process and research developed intangible asset.

There was an increase of $ 1.6 million in the fair value of the Company's contingent consideration from date of acquisition to September 30, 2025.

The royalty payments represent a mid-single digit percentage of the net sales through 2034 associated with the acquired in-process and research and development intangible asset.

The fair value methodology for earnout payments is based on a Monte Carlo model.

Significant quantitative unobservable inputs are future expected cash flows, discount rate and volatility rate.

There was an increase of $ 4.7 million in the fair value of the Company's contingent consideration from date of acquisition to March 31, 2026 due to the milestone and royalty payments.

Balance at December 31, 2025 $ 27,713

Change in fair value 93

Balance at March 31, 2026 $ 27,806

Equity Method Investee

In January 2024, the Company lead the Series B financing and entered into wide-ranging strategic distribution agreements with KKR Sapphiros L.P.

In January 2024, the Company led the Series B financing and entered into wide-ranging strategic distribution agreements with KKR Sapphiros L.P.

("Sapphiros"), a privately held consumer diagnostic portfolio company, and certain of its related entities.

Through this relationship, the Company expects to be able to offer a more comprehensive range of low-cost diagnostic tests and molecular sample management solutions to the Company's customers globally.

As of September 30, 2025, the Company had funded $ 30.0 million for its interest in Sapphiros.

As of March 31, 2026, the Company had funded $ 30.0 million for its interest in Sapphiros.

The Company recorded the investment using the equity method in accordance with Accounting Standards Codification ("ASC") Topic 323, Investments—Equity Method and Joint Ventures—Overall.

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The Company has elected as its accounting policy to recognize its share of any income or loss in Sapphiros on a three-month lag.

The investment in Sapphiros of $ 26.6 million as of September 30, 2025 is included in the investment in equity method investee line of the Company's balance sheet and is measured as a Level 3 investment.

The value of the investment in Sapphiros of $ 24.9 million as of March 31, 2026 is included in the investment in equity method investee line of the Company's balance sheet.

The Company has no unconditional obligations or guarantees to, or in support of, its equity method investee and its operations.

In conjunction with the preparation of the Company's September 30, 2025 financial statements, the Company considered whether there were any triggering events that may indicate impairment in the investment in Sapphiros and concluded that no such triggers existed.

In conjunction with the preparation of the Company's March 31, 2026 financial statements, the Company evaluated the investment in Sapphiros for impairment and concluded there was no such impairment.

The Company's investment in Sapphiros was valued at $ 26.0 million as of December 31, 2025.

Related Party

The Company loaned Sapphiros $ 0.3 million during the year ended December 31, 2025.

The loan plus interest is due in December 2026.

During the year ended December 31, 2025, the Company entered into an agreement with Sapphiros to develop certain products for Sapphiros.

A total of $ 0.1 million of revenue was recognized from this agreement for the three months ended March 31, 2026.

No equivalent amount was recognized for the three months ended March 31, 2025.

Uncertain Tax Positions

Assets and liabilities are established for uncertain tax positions taken or positions expected to be taken in income tax returns when such positions fail to meet the "more likely than not" threshold based on the technical merits of the positions.

The Company assesses whether previously unrecognized tax benefits may be recognized when tax positions are (1) more likely than not of being sustained based on their technical merits, (2) effectively settled through examination, negotiation or litigation, or (3) settled through actual expiration of the relevant tax statutes.

The assessment of an uncertain tax position requires significant judgment.

Foreign Currency Transactions

Net foreign exchange gains (losses) resulting from foreign currency transactions that are included in other income in the Company's consolidated statements of operations were $ 0.6 million and $( 0.2 ) million for the three months ended September 30, 2025 and 2024, respectively.

Net foreign exchange gains (losses) resulting from foreign currency transactions for the nine months ended September 30, 2025 and 2024 were $( 0.7 ) million and $ 0.1 million respectively.

Net foreign exchange gains (losses) resulting from foreign currency transactions that are included in other income in the Company's consolidated statements of operations were $ 0.2 million and $( 0.4 ) million for the three months ended March 31, 2026 and 2025, respectively.

Accumulated Other Comprehensive Loss

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Balance at December 31, 2025 $ ( 18,404 ) $ ( 18,404 )

Other comprehensive gain 4,187 4,187

Balance at September 30, 2025 $ ( 20,173 ) $ ( 20,173 )

Uncertain Tax Positions

We assess whether previously unrecognized tax benefits may be recognized when tax positions are (1) more likely than not of being sustained based on their technical merits, (2) effectively settled through examination, negotiation or litigation, or (3) settled through actual expiration of the relevant tax statures.

The assessment of an uncertain tax position requires significant judgment.

Other comprehensive loss ( 1,633 ) ( 1,633 )

Balance at March 31, 2026 $ ( 20,037 ) $ ( 20,037 )

Recent Accounting Pronouncements

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures .

The purpose of the update was to address investor requests for more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information.

The amendments in this ASU are effective for annual periods beginning after December 15, 2024.

The amendments may be applied prospectively or retrospectively, and early adoption is permitted.

Management determined the annual disclosures required under the new guidance will have a significant impact on the Company's consolidated financial statements.

In November 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No.

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Management is evaluating the impact on the Company's consolidated financial statements.

In March 2024, the FASB issued ASU No.

2024-01, Compensation—Stock Compensation (Topic 718), Measurement of Credit Losses for Accounts Receivable and Contract Assets .

The purpose of this update was to provide illustrative examples to demonstrate how an entity should apply guidance to determine whether profits interests and similar awards should be accounted for in accordance with Topic 718.

For public business entities, the amendments in this ASU are effective for fiscal years beginning after December 15, 2024, and interim periods within those fiscal periods.

The amendments may be applied prospectively or retrospectively, and early adoption is permitted.

Management does not expect an impact on the Company's consolidated financial statements.

In July 2025, the FASB issued ASU No.

2025-05, Financial Instruments—Credit Losses (Topic 326), Scope Application of Profits Interest and Similar Awards .

The purpose of this update was to address challenges encountered when applying the guidance in Topic 326, Financial Instruments—Credit Losses, to current accounts receivable and current contract assets arising from transactions accounted for under Topic 606, Revenue from Contracts with Customers illustrative examples to demonstrate how an entity should apply guidance to determine whether profits interests and similar awards should be accounted for in accordance with Topic 718.

2025-05, Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses for Accounts Receivable and Contract Assets .

For all business entities, the amendments in this ASU are effective for fiscal years beginning after December 15, 2025, and interim periods within those fiscal periods.

The amendments are applied prospectively, and early adoption is permitted.

Management does not expect an impact on the Company's consolidated financial statements.

Management does not expect a material impact on the Company's consolidated financial statements.

In September 2025, the FASB issued ASU No.

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Early adoption is permitted as of the beginning of an annual reporting period.

Management does not expect an impact on the Company's consolidated financial statements.

September 30, December 31,

Management does not expect a material impact on the Company's consolidated financial statements.

In December 2025, the FASB issued ASU No.

2025-10, Government Grants (Topic 832), Accounting for Government Grants Received by Business Entities .

The purpose of this update was to improve US GAAP by establishing authoritative guidance on the accounting for government grants received by business entities.

For public business entities, the amendments in this ASU are effective for annual reporting periods beginning after December 15, 2028, and interim reporting periods within those annual reporting periods.

Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance.

The amendments can be applied under a modified prospective approach, a modified retrospective approach, or a retrospective approach.

Management is evaluating the impact on the Company's consolidated financial statements.

In December 2025, the FASB issued ASU No.

2025-11, Interim Reporting (Topic 270), Narrow-Scope Improvements .

The purpose of this update was to improve the navigability of the required interim disclosures and clarifying when that guidance is applicable.

The update also provides additional guidance on what disclosures should be provided in interim periods and adds a principal that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity.

For public business entities, the amendments in this ASU are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027.

Early adoption is permitted.

The amendments in this update can be applied either prospectively or retrospectively to any or all prior periods presented in the financial statements.

Management is evaluating the impact on the Company's consolidated financial statements.

March 31, December 31,

Raw materials $ 15,534 $ 14,831

Work in process 1,042 56

Semi-finished goods 2,581 1,965

Finished goods 11,150 14,208

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PROPERTY, PLANT, AND EQUIPMENT, NET:

September 30, December 31,

March 31, December 31,

Land $ 1,118 $ 1,118

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ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES:

September 30, December 31,

March 31, December 31,

Payroll and related benefits $ 5,541 $ 5,255

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Q2 2024 Reduction in Workforce

During the first quarter of 2024, the Company executed a reduction in workforce largely affecting its COVID-19 manufacturing workforce.

This was accounted for pursuant to ASC 420, Exit or Disposal Cost Obligations .

The charges for termination benefits included in the Company's consolidated statement of operations are as follows:

For the Nine Months Ended September 30,

Cost of products and services sold $ 231

Research and development 87

Sales and marketing 69

General and administrative 17

As of September 30, 2025, the Company had fully paid the $ 0.4 million related to the reduction in workforce.

This reduction in workforce was completed by December 31, 2024.

Q2 2024 Reduction in Workforce

During the second quarter of 2024, the Company executed an additional reduction in workforce as the Company notified employees of its intention to consolidate its Novosanis site in Belgium into other locations by the end of December 31, 2024, discontinue the Diversigen molecular services line of business by the end of June 30, 2024, and consolidate facilities by bringing third-party manufacturing activities into its Pennsylvania facilities by the end of the third quarter of 2025.

This was accounted for pursuant to ASC 420, Exit or Disposal Cost Obligations .

The charges for termination benefits included in the Company's consolidated statements of operations are as follows:

For the Nine Months Ended September 30,

Cost of products and services sold $ 889

Research and development 478

Sales and marketing 125

General and administrative 160

As of September 30, 2025 the Company had $ 0.3 million accrued and had paid $ 1.4 million related to the reduction in workforce.

No additional expenses were incurred during the nine months ended September 30, 2025.

The Company expects this reduction in workforce to be completed by October 2025.

During the second quarter of 2024, the Company executed a reduction in workforce as the Company notified employees of its intention to consolidate its Novosanis site in Belgium into other locations by the end of December 31, 2024, discontinue the Diversigen molecular services line of business by the end of June 30, 2024, and consolidate facilities by bringing third-party manufacturing activities into its Pennsylvania facilities by the end of the third quarter of 2025.

As of March 31, 2026 the Company had paid the full $ 1.7 million related to the reduction in workforce.

No additional charges were incurred during the three months ended March 31, 2026.

This reduction in workforce was completed by March 31, 2026.

Q3 2024 Reduction in Workforce

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Additional employees were notified in the fourth quarter of 2024.

This was accounted for pursuant to ASC 420, Exit or Disposal Cost Obligations .

As of March 31, 2026, the Company had $ 0.1 million accrued and had paid $ 1.1 million related to the reduction in workforce.

The Company expects this reduction in workforce to be completed by September 2026.

Q1 2026 Reduction in Workforce

During the first quarter of 2026, the Company executed a reduction in workforce to better align the Company's cost structure.

The charges for termination benefits included in the Company's consolidated statements of operations are as follows:

For the Three Months Ended September 30,

For the Three Months Ended March 31,

Cost of products and services sold $ 65

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General and administrative 680

As of September 30, 2025 the Company had $ 0.2 million accrued and had paid $ 1.0 million related to the reduction in workforce.

No additional expense was incurred during the nine months ended September 30, 2025.

The Company expects this reduction in workforce to be completed by December 2025.

As of March 31, 2026, the Company had $ 1.0 million accrued and had paid $ 0.2 million related to the reduction in workforce.

The Company expects this reduction in workforce to be completed by February 2027.

Revenues by Product Line .

The following table represents total net revenues by product line:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2025 2024 2025 2024

For the Three Months Ended March 31,

HIV $ 13,019 $ 12,900

Sample Management Solutions (1)

10,306 12,806 29,271 36,237

HCV 2,663 4,333

Other product and services revenues (2)

1,196 1,196 2,963 2,623

89 2,155 578 44,222

Risk Assessment Testing (4)

— 1,911 1,866 6,265

Molecular Services — 9 — 1,692

Net product and services revenues $ 26,376 $ 28,997

Non-product and services revenues (5)

1,749 263 4,078 1,002

Net revenues $ 27,925 $ 29,931

(1) Includes Genomics, Microbiome and Colli-Pee ® product revenues.

(2) Includes Syphilis revenues.

(2) Includes Syphilis revenues and single order fulfillment.

(3) Includes COVID-19 Diagnostics and COVID-19 Sample Management Solutions revenues.

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The following table represents total net revenues by geographic area, based on the location of the customer:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2025 2024 2025 2024

For the Three Months Ended March 31,

United States $ 18,672 $ 20,335

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The following table represents customer concentration risk:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

Commercial customer (1)

Non-commercial customer N/A 26 %

September 30, December 31,

For the Three Months Ended March 31,

Net Revenues 2026 2025

Commercial customer 12 % N/A

March 31, December 31,

Accounts Receivable 2026 2025

Commercial customer (1)

(1) Each commercial customer is different.

There were no customers that accounted for over 10% of the Company's consolidated net revenues during the three and nine months ended September 30, 2025.

Vendor Concentrations.

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The Company records deferred revenue when funds are received prior to the recognition of the associated revenue.

Deferred revenue as of September 30, 2025 and December 31, 2024 was comprised of customer prepayments of $ 1.9 million and $ 3.0 million, respectively.

Deferred revenue as of March 31, 2026 and December 31, 2025 was comprised of customer prepayments of $ 0.9 million and $ 1.2 million, respectively.

Deferred revenue as of December 31, 2025 was also comprised of $ 0.4 million of unearned grant income.

The Company had no unearned grant income in deferred revenue as of March 31, 2026.

The following table represents deferred revenue recognized:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Deferred Revenue Recognized 2026 2025

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INCOME TAXES:

The components of income tax expense are as follows:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2025 2024 2025 2024

The components of the income tax benefit are as follows:

For the Three Months Ended March 31,

Federal income tax expense $ 3 $ 8

State income tax (benefit) expense ( 612 ) 18 1,792 ( 209 )

Foreign income tax expense (benefit) 656 660 ( 369 ) 1,250

State income tax expense 28 9

Foreign income tax benefit ( 463 ) ( 473 )

$ ( 432 ) $ ( 456 )

During the three months ended September 30, 2025 and 2024, the Company recorded income tax expense of $ 47.0 thousand and $ 0.7 million, respectively.

The state income tax benefit for the three months ended September 30, 2025 is largely comprised of an adjustment made to the Company's liability for uncertain tax position for certain tax matters, including penalty and interest.

During the nine months ended September 30, 2025 and 2024, the Company recorded income tax expense of $ 1.6 million and $ 1.0 million, respectively.

The state income tax expense for the nine months ended September 30, 2025 is largely due to recording an uncertain tax position for certain tax matters, including penalty and interest.

The decline in foreign taxes for the nine months ended September 30, 2025 is due to lower pretax earnings in 2025 as compared to 2024.

During the three months ended March 31, 2026 and 2025, the Company recorded income tax benefit of $ 0.4 million and $ 0.5 million, respectively.

The three months ended March 31, 2026 and 2025 net tax benefits are due to having a U.S.

and foreign pretax loss in 2026 and 2025, respectively.

During the three months ended March 31, 2026 and 2025, the Company had an effective tax rate of 2.0 % and 2.9 %, respectively.

The decrease in the Company's effective tax rate was primarily due to an increase in the valuation allowance associated with the Company's U.S.

Income tax expense reflects taxes due to the taxing authorities and the tax effects of temporary differences between the basis of assets and liabilities recognized for financial reporting and tax purposes, and net operating loss and tax credit carryforwards.

The significant components of the Company's total deferred tax asset as of September 30, 2025 and at December 31, 2024 relate to the tax effects of the basis difference of acquired intangible assets.

A valuation allowance is recorded to the extent it is more likely than not that some portion or all of the deferred tax assets will not be realized.

A full valuation allowance was recorded on the Company’s U.S.

deferred tax assets as of September 30, 2025 and December 31, 2024.

Uncertain tax positions were approximately $ 1.9 million and $ 0.0 million, as of September 30, 2025 and December 31, 2024, respectively.

deferred tax assets as of March 31, 2026 and December 31, 2025.

Uncertain tax positions were approximately $ 2.0 million as of March 31, 2026 and December 31, 2025.

The Company’s uncertain tax position relates to U.S.

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Any assessments or settlements could result in changes to our contingencies related to positions on prior years’ tax filings.

On July 4, 2025, Congress enacted the One Big Beautiful Bill Act (“OBBBA”), which includes several changes to the Internal Revenue Code which will result in changes to the Company’s income tax expense.

The Company has evaluated the impacts of the OBBBA and determined changes in tax law will not materially affect the Company’s operating performance or financial position.

INCOME (LOSS) PER SHARE:

LOSS PER SHARE:

Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period.

Diluted earnings (loss) per share is computed in a manner similar to basic earnings (loss) per share except that the weighted-average number of shares outstanding is increased to include incremental shares from the assumed vesting or exercise of dilutive securities, such as common stock options, unvested restricted stock or performance stock units, unless the impact is anti-dilutive.

The number of incremental shares is calculated by assuming that outstanding stock options were exercised and unvested restricted shares and performance stock units were vested, and the proceeds from such exercises or vesting were used to acquire shares of common stock at the average market price during the reporting period.

during the reporting period.

Basic and dilutive computations of net loss per share are the same in periods in which a net loss exists as the dilutive effects of excluded items would be anti-dilutive.

For the three months ended September 30, 2025 and 2024, outstanding common stock options, unvested restricted stock, and unvested performance stock units representing 585 shares and 389 shares, respectively, were excluded from the computation of diluted loss per share.

For the nine months ended September 30, 2025 and 2024, outstanding common stock options, unvested restricted stock, and unvested performance stock units representing 605 shares and 999 shares, respectively, were excluded from the computation of diluted loss per share.

For the three months ended March 31, 2026 and 2025, outstanding common stock options, unvested restricted stock, and unvested performance stock units representing 746 shares and 689 shares, respectively, were excluded from the computation of diluted loss per share.

STOCKHOLDERS' EQUITY:

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The amount and timing of share repurchases under the Repurchase Program may be carried out at the discretion of the Company's management through various methods in compliance with applicable state and federal securities laws.

The Company repurchased 3.3 million shares of its common stock under the Repurchase Program during the nine months ended September 30, 2025.

The reconciliation of the changes in stockholders' equity for the three and nine months ended September 30, 2025 and 2024 is as follows:

The Company repurchased 1.8 million shares of its common stock under the Repurchase Program during the three months ended March 31, 2026.

The Company did not repurchase any shares of the Company's common stock under the Repurchase Program during the three months ended March 31, 2025.

The reconciliation of the changes in stockholders' equity for the three months ended March 31, 2026 and 2025 is as follows:

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total

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Vesting of restricted stock and performance stock units 1,190 — — — — —

Purchase and retirement of common shares ( 252 ) — ( 941 ) — — ( 941 )

Purchase and retirement of common shares in satisfaction of minimum tax withholdings for vested restricted stock and performance stock units ( 416 ) — ( 1,261 ) — — ( 1,261 )

Stock-based compensation — — 2,768 — — 2,768

Shares repurchased and retired in connection with share repurchase program ( 1,768 ) — ( 5,000 ) — — ( 5,000 )

Net loss — — — — ( 22,377 ) ( 22,377 )

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Balance at March 31, 2026 69,397 $ — $ 527,900 $ ( 20,037 ) $ ( 194,539 ) $ 313,324

Vesting of restricted stock and performance stock units 713 — — — — —

Purchase and retirement of common shares ( 271 ) — ( 784 ) — — ( 784 )

Stock-based compensation — — 3,165 — — 3,165

Repurchase of common stock ( 1,821 ) — ( 5,000 ) — — ( 5,000 )

Net loss — — — — ( 19,693 ) ( 19,693 )

Currency translation adjustments — — — 6,751 — 6,751

Balance at June 30, 2025 73,735 $ — $ 537,256 $ ( 17,371 ) $ ( 139,164 ) $ 380,721

Vesting of restricted stock and performance stock units 76 — — — — —

Purchase and retirement of common shares ( 21 ) — ( 61 ) — — ( 61 )

Stock-based compensation — — 2,835 — — 2,835

Repurchase of common stock ( 1,525 ) — ( 5,001 ) — — ( 5,001 )

Net loss — — — — ( 13,712 ) ( 13,712 )

Currency translation adjustments — — — ( 2,802 ) — ( 2,802 )

Balance at September 30, 2025 72,265 $ — $ 535,029 $ ( 20,173 ) $ ( 152,876 ) $ 361,980

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total

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Balance at December 31, 2024 74,598 $ — $ 538,129 $ ( 24,360 ) $ ( 103,431 ) $ 410,338

Common stock issued upon exercise of options 32 — 214 — — 214

Vesting of restricted stock and performance stock units 768 — — — — —

Purchase and retirement of common shares ( 194 ) — ( 1,462 ) — — ( 1,462 )

Purchase and retirement of common shares in satisfaction of minimum tax withholdings for vested restricted stock and performance stock units ( 252 ) — ( 941 ) — — ( 941 )

Stock-based compensation — — 2,687 — — 2,687

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Balance at March 31, 2025 75,114 $ — $ 539,875 $ ( 24,122 ) $ ( 119,471 ) $ 396,282

Vesting of restricted stock and performance stock units 1,033 — — — — —

Purchase and retirement of common shares ( 424 ) — ( 1,984 ) — — ( 1,984 )

Stock-based compensation — — 3,322 — — 3,322

Net loss — — — — ( 615 ) ( 615 )

Currency translation adjustments — — — ( 1,134 ) — ( 1,134 )

Balance at June 30, 2024 74,568 $ — $ 532,601 $ ( 18,631 ) $ ( 88,130 ) $ 425,840

Vesting of restricted stock and performance stock units 44 — — — — —

Purchase and retirement of common shares ( 19 ) — ( 87 ) — — ( 87 )

Stock-based compensation — — 2,888 — — 2,888

Net loss — — — — ( 4,507 ) ( 4,507 )

Currency translation adjustments — — — 1,431 — 1,431

Balance at September 30, 2024 74,593 $ — $ 535,402 $ ( 17,200 ) $ ( 92,637 ) $ 425,565

BUSINESS SEGMENT INFORMATION:

The Company is organized on the basis of products and services into a single reportable segment.

All products and services reside under the same reporting hierarchy.

The Company's reportable segment derives its revenues from the sale of diagnostics products and sample management solutions, as described in Note 1 Summary of Significant Accounting Policies.

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The following table represents total long-lived assets by geographic area:

September 30, December 31,

March 31, December 31,

United States $ 35,387 $ 36,254

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The following table represents reported segment revenues, segment profit (loss), and significant segment expenses:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2025 2024 2025 2024

For the Three Months Ended March 31,

Net revenues $ 27,925 $ 29,931

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Research and development (2)

10,106 5,623 31,110 19,960

Sales and marketing (2)

6,299 7,615 19,533 23,994

General and administrative (2)

14,556 14,102

Loss on impairments — — — 4,392

Change in the estimated fair value of acquisition-related contingent consideration 93 478

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Operating loss ( 23,269 ) ( 17,750 )

Other income 154 95 138 335

Other income (expense) 169 ( 21 )

Interest revenue 1,220 2,156

Other segment items (1)

594 ( 199 ) ( 705 ) 65

Loss before income taxes ( 13,291 ) ( 3,218 ) ( 46,154 ) ( 6,494 )

Income tax expense 47 678 1,591 1,041

Loss before income taxes and equity investment ( 21,721 ) ( 15,972 )

Income tax benefit ( 432 ) ( 456 )

Loss on equity investment ( 1,088 ) ( 524 )

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(2) The following tables represent additional significant segment expense categories:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2025 2024 2025 2024

For the Three Months Ended March 31,

Stock-based Compensation

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$ 2,768 $ 2,687

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2025 2024 2025 2024

Depreciation and Amortization

For the Three Months Ended March 31,

Depreciation & Amortization

Cost of products and services sold $ 992 $ 1,389

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BUSINESS COMBINATIONS:

Sherlock Biosciences

On December 19, 2024, the Company acquired all of the outstanding stock of Sherlock, pursuant to the terms of a merger agreement (the "Merger Agreement").

The Company began operating this entity as of the December 19, 2024 closing date.

The primary reason for the acquisition was Sherlock's first test for Chlamydia Trachomatis (CT) and Neisseria Gonorrhoeae (NG), which is in clinical studies and is expected to be submitted to the FDA in late 2025 or early 2026 for r.

Subject to regulatory approvals, this test is expected to expand the Company's portfolio for rapid diagnostics for sexually transmitted infections.

On November 12, 2025, the Company acquired all of the outstanding stock of BioMedomics, pursuant to the terms of an acquisition agreement (the "Acquisition Agreement").

The Company began operating this entity as of the November 12, 2025 closing date.

The primary reason for the acquisition of BioMedomics was to expand the Company's diagnostic portfolio by adding SickleSCAN ® , a rapid, point-of-need test for sickle cell disease that is sold outside of the United States.

The initial aggregate purchase price of this transaction was funded with cash on hand as shown in the table below:

Milestone contingent consideration $ 15,910

Royalty based contingent consideration 7,000

Cash paid to Sherlock 5,000

Legal expenses 389

Insurance policy expense 50

Cash paid to BioMedomics $ 2,865

Transaction expenses 403

Debt paid off 330

Earnout contingent consideration 233

Expense fund 40

Initial aggregate purchase price $ 3,871

Pursuant to the Merger Agreement, the Company agreed to pay up to $ 20.0 million of contingent consideration based on the achievement of a regulatory milestone on or before December 31, 2026 as defined in the Merger Agreement.

The acquisition-date fair value of the milestone contingent consideration was $ 15.9 million.

The range of outcome for the milestone contingent consideration is zero to $ 20.0 million.

There is also a mid-single digits quarterly royalty fee based on future sales until 2034 as defined in the Merger Agreement, the fair value of which was determined as part of the contingent consideration.

The estimated acquisition-date fair value of the royalty fee acquisition-related contingent consideration was $ 7.0 million.

The range of outcome for the royalty payment cannot be determined due to the fact it is based on future sales associated with the acquired in-process research and development technology through 2034 and thus does not have an upper limit.

Pursuant to the Acquisition Agreement, the Company agreed to pay up to $ 5.0 million of contingent consideration based on the achievement of sales thresholds before December 31, 2031.

The acquisition-date fair value of the earnout contingent consideration was $ 0.2 million.

The range of outcome for the earnout contingent consideration is zero to $ 5.0 million.

During the year ended December 31, 2025, the Company incurred a total of $ 0.5 million of acquisition related costs, including accounting, legal, and other professional fees, all of which were expensed and reported as a component of general and administrative expenses in the consolidated statement of operations for the year ended December 31, 2025.

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Assets Acquired

Other current assets $ 2,570

Property, plant, and equipment, net 9,244

Other noncurrent assets 462

Other current and non current assets $ 10

Inventory 284

Operating right-of-use assets 120

In-process research and development technology intangible asset 17,000

Developed technology intangible asset 1,900

Goodwill 1,775

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Net Cash Paid (net of cash acquired of $ 25 )

The purchase price was allocated to the tangible assets and identifiable intangible assets acquired and liabilities assumed based on their acquisition-date estimate fair values.

The identifiable intangible assets included in-process research and development technology ("IPR&D Technology"), which is an indefinite lived asset.

The Company, with the assistance of an independent valuation specialist, assessed the fair value of the assets and contingent consideration of Sherlock.

The income approach was used to value the acquired intangibles and the fair value measurements were primarily based on significant inputs that are not observable in the market and are considered Level 3 fair value measurements.

The income approach estimates fair value for an asset based on the present value of cash flows projected to be generated by the asset.

Projected cash flows are discounted at a required rate of return that reflects the relative risk of achieving the cash flows and the time value of money.

The regulatory milestone scenario based model was used to value the assumed milestone contingent consideration, were primarily based on significant unobservable inputs and are considered Level 3 fair value measurements.

The regulatory milestone scenario based model estimates fair value for contingent consideration based on the probability of on the achievement of a certain milestone as defined under the agreements and the discount rate.

The income approach was used to value the royalty based contingent consideration, were primarily based on significant unobservable inputs and are considered Level 3 fair value measurements.

The fair value of contingent payments approach were primarily based on projected cash flows, probability of on the achievement of a regulatory milestone as defined under the agreements, and discount rate.

The purchase price was allocated to the tangible assets and identifiable intangible asset acquired and liabilities assumed based on their acquisition-date estimate fair values.

The identifiable intangible asset was developed technology.

The developed technology was all assigned a ten year useful life.

The Company, with the assistance of an independent valuation specialist, assessed the fair value of the intangible asset and contingent consideration of BioMedomics.

The fair values recorded as of November 12, 2025 are based on significant inputs that are not observable in the market and thus represent a fair value measurement categorized within Level 3 of the fair value hierarchy.

The fair value of the acquired developed technology was determined using the multi-period excess earnings method, which required judgment in estimating appropriate cash flows, discount rate, survival factor, and remaining useful life.

The fair value of the earnout contingent consideration was determined using the Monte Carlo simulation model, which required judgment in estimating expected revenue, volatility, expected discount rate and risk-free interest rate.

Goodwill is calculated as the difference between the acquisition date fair value of the consideration transferred and the fair value of the net assets acquired, and represents the future economic benefits that we expect to achieve as a result of the acquisition.

The Company believes the goodwill related to the acquisition was a result of Sherlock providing a product offering that will enable the Company to leverage those products with existing and new customers.

The Company believes the goodwill related to the acquisition was a result of BioMedomics providing a product that will enable the Company to leverage the product with existing and new customers.

The goodwill is not deductible for income tax purposes.

The Company has completed the fair value of the assets acquired and liabilities assumed.

Revenues from Sherlock primarily consist of grant revenues for research and development purposes.

Effective as of December 19, 2024, the financial results of Sherlock are included in the consolidated financial results of the Company.

The Company continues to evaluate the fair value of assets acquired and liabilities assumed.

Additional information, which existed as of the acquisition date, but was at that time unknown to the Company, may become known during the remainder of the measurement period.

Changes to amounts recorded as a result of the final determination may result in a corresponding adjustment to these assets and liabilities, including goodwill.

The determination of the estimated fair values of all assets acquired is expected to be completed within one year from the date of acquisition.

Revenues from BioMedomics consist of sales from the SickleSCAN ® test.

Effective as of November 12, 2025, the financial results of BioMedomics are included in the consolidated financial results of the Company.

BioMedomics contributed $ 0.1 million and $ 1.1 thousand of revenue and net income, respectively, to the consolidated statement of operations for the year ended December 31, 2025.

Unaudited Pro Forma Financial Information

The unaudited pro forma results presented below include the results of the Sherlock acquisition as if it had been consummated as of January 1, 2024.

The unaudited pro forma results include depreciation of the acquired property plant and equipment and the estimated tax effect of adjustments to income before income taxes but do not include changes in the fair value of the Company's contingent consideration obligations.

The unaudited pro forma results presented below include the results of the BioMedomics acquisition as if it had been consummated as of January 1, 2025.

The unaudited pro forma results include amortization of the acquired intangible asset, stock compensation, and lease expense adjustments to income before income taxes but do not include changes in the fair value of the Company's contingent consideration obligations.

Material nonrecurring charges, directly attributable to the transactions, including direct acquisition costs, are also excluded.

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Accordingly, the unaudited pro forma results are not necessarily indicative of either future results of operations or results that might have been achieved had the acquisition been consummated as of January 1, 2025.

For the Three Months Ended September 30, For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Net revenues $ 30,205

Net loss $ ( 12,472 ) $ ( 36,675 )

COMMITMENTS AND CONTINGENCIES:

CONTINGENCIES:

Collaborations

Sherlock has active third-party license agreements entered into in order to advance and obtain technologies and services related to the business.

Under these licenses, the Company is required to make up to $ 3.8 million of cash payments upon the achievement of certain scientific and commercial milestones as well as low single digit royalty payments on product sales.

The Company has the right to terminate the licenses.

From time to time, the Company is involved in certain legal actions arising in the ordinary course of business.

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NowDx, Berry, and Young agreed to a preliminary injunction which the Court entered on February 27, 2025.

The case is currently in the discovery phase and the schedule for any further proceedings is currently pending.

SUBSEQUENT EVENTS:

On November 5, 2025, the Company signed a definitive merger agreement ( the "Agreement") with BioMedomics, Inc.

(“BioMedomics”), pursuant to which BioMedomics will become a wholly-owned subsidiary of the Company.

The closing of the foregoing transaction is subject to various customary conditions, and is expected to occur within the fourth quarter of 2025.

The upfront purchase price is $ 4.0 million in cash, adjusted for certain transaction costs, indebtedness, holdback amounts and working capital adjustments.

In addition, pursuant to the Agreement, the Company has agreed to pay certain contingent consideration based on achievement of defined revenue targets by December 31, 2031.

Under certain circumstances, the original BioMedomics shareholders may opt to forgo a portion of the final revenue milestone, and instead choose either (i) different revenue milestones related to sales of certain products currently in development by BioMedomics (the “BM Pipeline Products”), or (ii) to share in a portion of the proceeds in the event that the Company enters into a disposition of any of the BM Pipeline Products on or prior to December 31, 2030.

On February 11, 2026, the Court issued an order scheduling trial for January 17, 2027.

The case is currently in the discovery phase.

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

What changed 10-Q

Item 1. Financial Statements