What changed in this filing

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Item 1. Financial Statements

2026-05-08 compared with 2025-11-06 · 145 added, 221 removed, 567 unchanged (39% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value) September 30,

(In thousands, except par value) March 31,

2026 December 31,

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Deferred revenue, non-current 3,554 3,929

Contingent consideration liability, non-current — 18,700

Operating lease liabilities, non-current 59,004 56,592

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Authorized 1,000,000 shares;

issued and outstanding 301,853 and 294,418 shares at September 30, 2025 and December 31, 2024, respectively

issued and outstanding 310,487 and 301,956 shares at March 31, 2026 and December 31, 2025, respectively

Additional paid-in capital 2,705,779 2,699,892

Accumulated other comprehensive income

Accumulated other comprehensive (loss) income

Accumulated deficit ( 2,703,577 ) ( 2,695,302 )

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

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

Three Months Ended March 31,

(In thousands, except per share amounts) 2026 2025

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Amortization of acquired intangible assets

183 3,201 4,711 7,172

Loss on purchase commitment

75 — 4,167 998

Total cost of revenue 24,337 38,524

Gross profit 15,901 10,004 29,214 27,224

Gross profit (loss)

12,841 ( 1,371 )

Operating Expense:

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Impairment charges — 15,000

Settlement charges 15,400 —

Gain on disposal of assets ( 45,796 ) —

Amortization of acquired intangible assets 833 362,042

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( 8,091 ) ( 426,377 )

Income tax provision

Income tax provision (benefit)

Net loss ( 8,275 ) ( 426,075 )

Other comprehensive income:

Unrealized gain (loss) on investments

Other comprehensive loss:

Unrealized loss on investments

( 604 ) ( 41 )

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

Three Months Ended September 30, 2025

Three Months Ended March 31, 2026

Common Stock Additional

Capital Accumulated

Comprehensive Income

Comprehensive Income (Loss)

Deficit Total

2 unchanged sentences

Shares Amount

Balance at June 30, 2025 300,350 $ 300 $ 2,677,853 $ 267 $ ( 2,616,931 ) $ 61,489

Net loss — — — — ( 38,000 ) ( 38,000 )

Other comprehensive income

— — — 148 — 148

Issuance of common stock in conjunction with equity plans 1,503 2 1,467 — — 1,469

Share-based compensation expense — — 10,984 — — 10,984

Balance at September 30, 2025 301,853 $ 302 $ 2,690,304 $ 415 $ ( 2,654,931 ) $ 36,090

Nine Months Ended September 30, 2025

Common Stock Additional

Capital Accumulated

Comprehensive

Income Accumulated

Deficit Total

Stockholders'

(In thousands) Shares Amount

Balance at December 31, 2025 301,956 $ 302 $ 2,699,892 $ 457 $ ( 2,695,302 ) $ 5,349

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Share-based compensation expense — — 4,459 — — 4,459

Balance at September 30, 2025 301,853 $ 302 $ 2,690,304 $ 415 $ ( 2,654,931 ) $ 36,090

Three Months Ended September 30, 2024

Balance at March 31, 2026 310,487 $ 311 $ 2,705,779 $ ( 147 ) $ ( 2,703,577 ) $ 2,366

Three Months Ended March 31, 2025

Common Stock Additional

Capital Accumulated

Comprehensive

(Loss) Income

Comprehensive Income

Deficit Total

2 unchanged sentences

Shares Amount

Balance at June 30, 2024 272,491 $ 272 $ 2,583,523 $ ( 523 ) $ ( 2,090,572 ) $ 492,700

Net loss — — — — ( 60,725 ) ( 60,725 )

Other comprehensive income

— — — 2,076 — 2,076

Issuance of common stock in conjunction with equity plans 1,321 2 810 — — 812

Share-based compensation expense — — 18,259 — — 18,259

Balance at September 30, 2024 273,812 $ 274 $ 2,602,592 $ 1,553 $ ( 2,151,297 ) $ 453,122

Nine Months Ended September 30, 2024

Common Stock Additional

Capital Accumulated

Comprehensive Income

Deficit Total

Stockholders'

(In thousands) Shares Amount

Balance at December 31, 2024 294,418 $ 294 $ 2,654,804 $ 422 $ ( 2,148,926 ) $ 506,594

Net loss — — — — ( 426,075 ) ( 426,075 )

Other comprehensive income

Other comprehensive loss

— — — ( 41 ) — ( 41 )

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Share-based compensation expense — — 9,201 — — 9,201

Balance at September 30, 2024 273,812 $ 274 $ 2,602,592 $ 1,553 $ ( 2,151,297 ) $ 453,122

Balance at March 31, 2025 300,041 $ 300 $ 2,665,958 $ 381 $ ( 2,575,001 ) $ 91,638

See accompanying notes to the condensed consolidated financial statements.

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands) 2026 2025

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Impairment charges — 15,000

Gain on disposal of assets ( 48,100 ) —

Accretion of discount and amortization of premium on marketable securities, net ( 295 ) ( 1,706 )

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Cash flows from investing activities

Proceeds from disposal of assets

Payment for waiver of milestone obligation ( 1,900 ) —

Purchases of property and equipment ( 3,043 ) ( 1,389 )

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Purchases of investments ( 52,448 ) ( 61,820 )

Sales of investments — 8,061

Maturities of investments 48,250 113,443

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Proceeds from issuance of common stock from equity plans 1,437 1,959

Notes payable principal payoff — ( 490 )

Net cash provided by financing activities 1,437 1,959

Net increase (decrease) in cash, cash equivalents, and restricted cash

Net (decrease) increase in cash, cash equivalents, and restricted cash

( 7,395 ) 3,137

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We are a life science technology company that designs, develops, and manufactures advanced sequencing solutions that enable scientists and clinical researchers to improve their understanding of the genome and ultimately, resolve genetically complex problems.

Our products and technology, which include our HiFi long-read sequencing technology, address solutions across a broad set of applications including human germline sequencing, plant and animal sciences, infectious disease and microbiology, oncology, and other emerging applications.

Our products and technology, which primarily consist of our HiFi long-read sequencing systems, address a broad set of applications including human germline sequencing, plant and animal sciences, infectious disease and microbiology, oncology, and other emerging applications.

Our focus is on creating some of the world's most advanced sequencing systems to provide our customers with the most complete and accurate view of genomes, transcriptomes, and epigenomes.

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On an ongoing basis, we evaluate our significant estimates, including those relating to the valuation of inventory, fair value of contingent consideration, valuation of acquired intangible assets, useful lives assigned to finite-lived assets, asset impairment assessments, computation of provisions for income taxes, and valuations related to our convertible senior notes.

While the extent of the potential impact of current macroeconomic conditions on our business is highly uncertain, we considered information available related to assumptions and estimates used to determine the results reported and asset valuations as of September 30, 2025.

Actual results could differ materially from these estimates.

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Recent Accounting Pronouncements

Accounting Pronouncements Pending Adoption

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

Improvements to Income Tax Disclosures .

This new standard requires a company to expand its existing income tax disclosures, specifically related to the rate reconciliation and income taxes paid.

The standard is effective for annual periods beginning in 2025 and is expected to be applied retrospectively.

We expect that the adoption of this new standard will result in incremental income tax related disclosures to the notes to the consolidated financial statements but will not have a material impact on the consolidated financial statements.

Recently Adopted Accounting Standards

In November 2024, the FASB issued ASU 2024-04, Debt—Debt With Conversion and Other Options (Subtopic 470-20):

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This new standard clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion or extinguishment of convertible debt.

The standard will be effective for us beginning in the first quarter of 2026, with early adoption permitted.

The new standard is expected to be applied prospectively, but retrospective application is permitted.

We do not expect the adoption of this new standard to have a material impact on the consolidated financial statements and related disclosures.

The standard was effective for us and we adopted prospectively beginning in the first quarter of 2026.

The adoption of this new standard did not have a material impact on the consolidated financial statements and related disclosures.

Accounting Pronouncements Pending Adoption

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

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We are currently evaluating the impact of ASU 2025-06 on the consolidated financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025-10, Accounting for Government Grants Received by Business Entities.

This new standard provides guidance on the recognition, measurement, and presentation of government grants.

The standard will be effective for us beginning in the first quarter of fiscal year 2029, with early adoption permitted, and can be applied using a modified prospective, modified retrospective or full

Q1 Fiscal 2026 Form 10-Q

retrospective transition approach.

We are currently evaluating the impact of ASU 2025-10 on the consolidated financial statements.

Significant Accounting Policies

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unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

We consider an active market as one in which transactions for the asset or liability occurs with sufficient frequency and volume to provide pricing information on an ongoing basis.

We consider an active market as one in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Conversely, we view an inactive market as one in which there are few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers.

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Q1 Fiscal 2026 Form 10-Q

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table sets forth the fair value of our financial assets and liabilities that were measured on a recurring basis:

September 30, 2025 December 31, 2024

Assets Measured at Fair Value on a Recurring Basis

The following table sets forth the fair value of our financial assets that were measured on a recurring basis:

March 31, 2026 December 31, 2025

(In thousands)

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Cash and cash equivalents $ 56,274 $ — $ — $ 56,274 $ 60,496 $ 3,211 $ — $ 63,707

Commercial paper — — — — — — — —

Corporate debt securities — 20,238 — 20,238 — 23,250 — 23,250

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Total assets measured at fair value $ 57,864 $ 219,688 $ — $ 277,552 $ 62,048 $ 219,010 $ — $ 281,058

Contingent consideration $ — $ — $ — $ — $ — $ — $ 18,700 $ 18,700

Total liabilities measured at fair value $ — $ — $ — $ — $ — $ — $ 18,700 $ 18,700

During the nine months ended September 30, 2025, there were no transfers between Level 1, Level 2, or Level 3 assets or liabilities reported at fair value on a recurring basis, and our valuation techniques did not change compared to the prior year.

During the three months ended March 31, 2026, there were no transfers between Level 1, Level 2, or Level 3 assets reported at fair value on a recurring basis, and our valuation techniques did not change compared to the prior year.

Contingent Consideration

In connection with the August 2023 Apton Biosystems, Inc.

(“Apton”) acquisition, contingent consideration of $ 25.0 million, which we may elect to pay in cash, shares of our common stock or a combination of cash and shares of our common stock, is due upon the achievement of a milestone, defined as the achievement of $ 50.0 million in revenue associated with Apton's technology, provided that the milestone event occurs prior to the five-year anniversary of the closing date of the acquisition.

The number of shares, if any, to be issued in connection with the achievement of the specified milestone is not known and will be calculated based on the daily volume-weighted average price of our common stock for the twenty trading days ending on and including the fifth trading day immediately prior to the occurrence of the specified milestone.

Upon achievement of the milestone, we may pay cash in lieu of our common stock to ensure that the issuance of our common stock does not exceed 19.9 % of our outstanding shares of common stock then outstanding.

The contingent consideration is accounted for as a liability at fair value, with changes during each reporting period recognized in our condensed consolidated statements of operations and comprehensive loss.

(“Apton”) acquisition, contingent consideration of $ 25.0 million, which we could elect to pay in cash, shares of our common stock or a combination of cash and shares of our common stock, was due upon the achievement of a milestone, defined as the achievement of $ 50.0 million in revenue associated with Apton's technology, provided that the milestone event occurred prior to the five-year anniversary of the closing date of the acquisition.

On January 30, 2026, we completed a disposition of certain assets (the "Asset Sale") to Illumina Cambridge Limited (the “Buyer”) pursuant to an Asset Purchase Agreement dated January 30, 2026.

Under the agreement, Buyer acquired certain intellectual property and other assets related to our short-read DNA sequencing technology and related clustering, sequencing reagent, and detection technologies.

In consideration, Buyer paid $ 50.0 million in cash, assumed certain liabilities, and granted us a non-exclusive license to certain intellectual property included in the purchased assets.

During the three months ended March 31, 2026, in connection with the Asset Sale, Buyer paid, at our direction, 4 % of the net cash proceeds to the former equity holders of Apton in connection with the waiver of remaining milestone obligations from the Apton acquisition.

As a result, we received approximately $ 48.1 million in net cash proceeds from the Asset Sale.

In connection with the transaction, the Company incurred transaction costs of $ 2.3 M in the first quarter of 2026 that are offset against the gain on disposal of assets on our condensed consolidated statements of operations and comprehensive loss.

The contingent consideration was accounted for as a liability at fair value, with changes during each reporting period recognized in our condensed consolidated statements of operations and comprehensive loss.

The fair value of the contingent consideration liability was calculated using a Monte Carlo Simulation to estimate the volatility and systematic relative risk of revenues subject to sales milestone payments and discounting the associated cash payment amounts to their present values using a credit-risk-adjusted interest rate.

We classify contingent consideration within Level 3, as factors used to develop the estimate of fair value include unobservable inputs that are not supported by market activity and are significant to the fair value.

We classified contingent consideration within Level 3, as factors used to develop the estimate of fair value include unobservable inputs that are not supported by market activity and are significant to the fair value.

Estimates and assumptions used in the Monte Carlo simulation include risk-adjusted forecasted revenues for products and services leveraging Apton's technology and an estimated credit spread.

We estimate the fair value of the contingent consideration liability based on the simulated revenue of the Company through the five-year anniversary of the closing date of the acquisition.

The key input used in the determination of the fair value included projected revenues of the high-throughput short-read products and services leveraging Apton's technology.

Primarily due to management's decision to cease development of the high-throughput short-read system, and the resulting changes in the expected future revenues, among other factors, and as the milestone event must occur prior to the five-year anniversary of the closing date of the acquisition, the estimated fair value of the contingent consideration liability is $ 0 .

An increase in the fair value of the liability may result from an acceleration in the timing of or increase in projected revenues and from a

As of March 31, 2025, primarily due to management's decision to cease development of the high-throughput short-read system, and the resulting changes in the expected future revenues, among other factors, and as the milestone event needed to occur prior to the five-year anniversary of the closing date of the acquisition, the estimated fair value of the contingent consideration liability was $ 0 , resulting in a change in fair value for the

Q1 Fiscal 2026 Form 10-Q

decrease in discount rates, including the risk-free rate and estimated subordinated credit spread for a CCC credit rating.

Changes in the estimated fair value of the contingent consideration liability during the nine months ended September 30, 2025 were as follows:

(In thousands)

Beginning balance as of December 31, 2024 $ 18,700

Change in estimated fair value ( 18,700 )

Ending balance as of September 30, 2025 $ —

first quarter of 2025 of $ 18.7 million.

Changes to the fair value are recorded as change in fair value of contingent consideration in the condensed consolidated statements of operations and comprehensive loss.

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The following tables summarize our cash, cash equivalents, restricted cash, and investments:

As of September 30, 2025

As of March 31, 2026

(In thousands)

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Long-term restricted cash $ 1,532 $ — $ — $ 1,532

Q3 Fiscal 2025 Form 10-Q

The following table summarizes the contractual maturities of our cash equivalents and available-for-sale investments, excluding money market funds, as of September 30, 2025:

The following table summarizes the contractual maturities of our cash equivalents and available-for-sale investments, excluding money market funds, as of March 31, 2026:

(In thousands)

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Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations without call or prepayment penalties.

Investment income included in other income, net on the condensed consolidated statements of operations and comprehensive loss was $ 3.1 million and $ 10.4 million for the three and nine months ended September 30, 2025, respectively, and $ 6.0 million and $ 19.8 million for the three and nine months ended September 30, 2024, respectively.

Investment income included in other income, net on the condensed consolidated statements of operations and comprehensive loss was $ 2.5 million for the three months ended March 31, 2026 and $ 3.9 million for the three months ended March 31, 2025, respectively.

Q1 Fiscal 2026 Form 10-Q

BALANCE SHEET COMPONENTS

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(In thousands)

September 30,

2026 December 31,

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Goodwill is reviewed for impairment at least annually during the second quarter, or more frequently if an event occurs indicating the potential for impairment.

Based on quantitative interim impairment tests performed in 2024, we recorded impairment charges of $ 93.2 million in the second quarter of 2024 and $ 51.3 million in the fourth quarter of 2024.

We conducted a quantitative interim impairment test as of March 31, 2025, based on a decline in stock price and market capitalization during the first quarter of 2025, macroeconomic uncertainties, and revised strategic plans emphasizing HiFi sequencing and discontinuing short-read platform development, and concluded there was no impairment.

We completed our annual goodwill impairment assessment on April 1, 2025 and noted no impairment.

Based primarily on the decline in our stock price and overall market capitalization during the first quarter of 2025, driven in part by macroeconomic uncertainties, as well as our updated strategic plans and restructuring initiatives that prioritized accelerating adoption of HiFi sequencing and ceasing development of our high-throughput short-read platform, we concluded that changes to the timing and amount of expected future cash flows, among other factors, indicated that it was more likely than not that the fair value of the reporting unit was less than its carrying amount, requiring an interim goodwill impairment assessment.

As a result of the quantitative interim impairment test performed as of March 31, 2025, we concluded that there was no impairment, as the estimated fair value of the entity-level reporting unit exceeded the carrying value.

Changes in our future operating results, cash flows, share price, market capitalization or discount rates used when conducting future goodwill impairment tests could affect the implied fair value of goodwill and may result in additional impairment charges in the future.

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In connection with the Apton acquisition in August 2023, we allocated $ 55.0 million of the purchase price to IPR&D.

This asset is considered indefinite-lived until the associated research and development activities are either completed or abandoned, and it is tested for impairment annually and more

IPR&D is reviewed for impairment at least annually, or more frequently if an event occurs indicating the potential for impairment.

We recognized a $ 40.0 million impairment charge during the year ended December 31, 2024 as a result of a quantitative interim impairment test.

During the first quarter of 2025, based on our decision to cease development of the high-throughput short-read sequencing platform, which would utilize the IPR&D, and the resulting changes to the expected future cash flows, among other factors, we concluded that it was more likely than not that the fair value of the IPR&D was less than its carrying amount, requiring an interim impairment assessment.

Using a discounted cash flow model under the income approach, we determined the fair value was $ 0 and recorded a $ 15.0 million impairment charge.

The decline in the fair value of the IPR&D to $ 0 as of March 31, 2025 resulted primarily from changes in the timing of expected future cash flows as compared to the fair value as of December 31, 2024, driven by the restructuring initiatives that prioritize accelerating adoption of HiFi sequencing and resulted in ceasing development of our high-throughput short-read sequencing platform.

The impairment charge is included in our condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2025.

Restructuring for additional information on costs incurred in connection with our restructuring activities.

Q1 Fiscal 2026 Form 10-Q

frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired.

We recognized a $ 40.0 million impairment charge in the fourth quarter of 2024 as a result of a quantitative interim impairment test.

Based on our decision to cease development of the high-throughput short-read sequencing platform, which would utilize the IPR&D, and the resulting changes to the expected future cash flows, among other factors, we concluded that it was more likely than not that the fair value of the IPR&D was less than its carrying amount, requiring an interim impairment assessment.

Using a discounted cash flow model under the income approach, we determined the fair value was below carrying value and recorded a $ 15.0 million impairment charge.

The decline in the fair value of the IPR&D below its carrying amount as of March 31, 2025 resulted primarily from changes in the timing of expected future cash flows as compared to the fair value as of December 31, 2024, driven by the restructuring initiatives that prioritize the adoption of HiFi sequencing.

The impairment charge is included in our consolidated statements of operations and comprehensive loss for the nine months ended September 30, 2025.

Significant estimates and assumptions used in the income approach include timing of future cash flows, revenue growth assumptions, a selected discount rate of 14.0 %, and a selected obsolescence factor of 11 years.

The discount rate was based primarily on the weighted average cost of capital, determined using market, peer company, industry data, and related risk factors.

The assessment is a level 3 measurement due to its reliance on certain unobservable inputs and significant management judgment.

The assumptions used were inherently subject to uncertainty and small changes in these assumptions could have had a significant impact on the concluded value.

A decrease of 200 basis points to the discount rate used in our analysis would have resulted in an increase in the estimated fair value of the IPR&D of approximately $ 3 million, and an increase of one year to the obsolescence factor used in our analysis would have resulted in an increase in the estimated fair value of the IPR&D of approximately $ 3 million.

Changes to IPR&D during the nine months ended September 30, 2025 were as follows:

(In thousands)

Balance as of December 31, 2024

Impairment charge ( 15,000 )

Balance as of September 30, 2025

Restructuring for additional information on costs incurred in connection with our current year restructuring activities.

In addition to IPR&D, we had the following acquired finite-lived intangible assets:

As of September 30, 2025 As of December 31, 2024

We have the following acquired finite-lived intangible assets:

As of March 31, 2026 As of December 31, 2025

(In thousands, except years)

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Total $ 421,539 $ ( 407,435 ) $ 14,104 $ 421,539 $ ( 406,415 ) $ 15,124

Q3 Fiscal 2025 Form 10-Q

The estimated future amortization expense of intangible assets with finite lives is as follows:

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As a result of the change in estimate, during the three months ended March 31, 2025, we recognized accelerated amortization of $ 359.3 million within amortization of acquired intangible assets in operating expenses, reflecting our revised estimate that the asset will no longer generate economic benefit beyond March 31, 2025.

This expense had a negative impact on basic and diluted net loss per share of $ 1.20 for the nine months ended September 30, 2025.

This expense had a negative impact on basic and diluted net loss per share of $ 1.21 for the three months ended March 31, 2025.

We review finite-lived intangible assets for impairment when indication of potential impairment exists, such as a significant reduction in cash flows associated with the assets.

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Both the acquired technology and license are classified as intangible assets and are being amortized over an estimated useful life of three years .

As of September 30, 2025, $ 5.0 million of these intangible assets remained unpaid.

This amount is included in accrued liabilities on the condensed consolidated balance sheets and is expected to be paid in 2026.

Restructuring for additional information on costs incurred in connection with our current year restructuring activities.

Q1 Fiscal 2026 Form 10-Q

In the first quarter of 2026, the Company entered into a license and settlement agreement with Personal Genomics of Taiwan, Inc.

PGI had previously filed a suit against the Company for alleged patent infringement and related matters.

Under the terms of the agreement, the parties agreed to dismiss all claims and counterclaims and to release one another from all claims arising out of the litigation (the "PGI Settlement").

In connection with the settlement, PGI granted the Company a non-exclusive, royalty-free, worldwide license to certain patents and patent applications and provided a covenant not to sue the Company and its affiliates for patent infringement for a specified period.

Under the fixed payment structure, the Company paid PGI $ 8,000,000 in the second quarter of 2026, and will pay $ 5,000,000 in the first quarter of each of 2027, 2028 and 2029, with the payment in 2027 increasing by $ 1,000,000 if the Company’s 2026 revenue is at least $ 165,000,000 and another $ 1,000,000 if it is at least $ 180,000,000 .

The Company accounted for the transaction as a settlement of litigation combined with a license to patents.

The total consideration was allocated on a relative fair value basis between (i) the license to the patents and (ii) the settlement of past and potential claims relating to the patents and associated with the litigation.

The fair value of the license was estimated using an income approach, specifically the relief-from-royalty method, which is based on the present value of hypothetical royalty payments avoided as a result of obtaining the license.

The fair value of the settlement component was estimated using an income-based approach that considered a hypothetical royalty rate applied to historical revenues generated during the alleged infringement period.

This valuation represents a level 3 fair value measurement due to its reliance on certain unobservable inputs.

The determination of fair value involves estimates and assumptions, including projected future revenues attributable to the licensed patents, historical revenues generated during the alleged infringement period, an estimated royalty rate derived from comparable market transactions, and a discount rate applied to the projected cash flows.

The royalty rate utilized in the valuation was 5 %, the discount rate of 14.5 % applied to the projected future revenues was based on the Company’s estimated weighted average cost of capital, considering market participant assumptions and risk factors specific to the asset, and the discount rate of 6.3 % applied to the historical revenues was based on the Company's estimated cost of debt, considering market participant assumptions.

The assumptions used were inherently subject to uncertainty.

The portion of the consideration allocated to the license of $ 5.5 million was capitalized and included in other long-term assets on the condensed consolidated balance sheets.

The asset is being amortized on a straight-line basis over a period of approximately three years, which approximates the remaining economic life of the underlying patent rights.

The remaining portion of the consideration was recorded as a litigation settlement charge.

The Company recorded $ 0.5 million of settlement charges within cost of product revenue in the condensed consolidated statements of operations and $ 15.4 million of settlement charges within operating expenses in the condensed consolidated statements of operations and comprehensive loss.

The Company recorded the liability at its present value of $ 21.4 million as of March 31, 2026.

The liability will be accreted to its undiscounted amount using the effective interest method, resulting in an effective interest rate of 9.5 %, with accretion recognized as interest expense in the condensed consolidated statements of operations.

The liability for the settlement obligation is classified between current and non-current portions based on the timing of expected payments.

As of March 31, 2026, $ 13.4 million is included in accrued expenses in the condensed consolidated balance sheets and $ 8.0 million is included in other liabilities, non-current in the condensed consolidated balance sheets.

Deferred Revenue

As of September 30, 2025, we had a total of $ 20.4 million of deferred revenue, $ 16.0 million of which was recorded as deferred revenue, current, and $ 4.4 million of which was recorded as deferred revenue, non-current, which primarily relates to deferred service contract revenues and is scheduled to be recognized in the next four years .

Revenue recorded in the three and nine months ended September 30, 2025 includes $ 2.4 million and $ 10.5 million, respectively, that was included in deferred revenue as of December 31, 2024.

As of March 31, 2026, we had a total of $ 19.9 million of deferred revenue, $ 16.3 million of which was recorded as deferred revenue, current, and $ 3.6 million of which was recorded as deferred revenue, non-current, which primarily relates to deferred service contract revenues and is scheduled to be recognized in the next five years .

Revenue recorded in the three months ended March 31, 2026 includes $ 5.0 million that was included in deferred revenue as of December 31, 2025.

Q1 Fiscal 2026 Form 10-Q

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Most performance obligations are generally satisfied within a year of the contract execution date.

As of September 30, 2025, the aggregate amount of the transaction price allocated to remaining performance obligations was $ 48.7 million, of which approximately 72 % is expected to be converted to revenue over the next twelve months , approximately 23 % in the following twelve months , and the remainder thereafter.

As of March 31, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations was $ 46.6 million, of which approximately 78 % is expected to be converted to revenue over the next twelve months , approximately 17 % in the following twelve months , and the remainder thereafter.

Product Warranties

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Changes in the reserve for product warranties were as follows for the periods indicated:

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

Three Months Ended March 31,

(In thousands)

2025 2024 2025 2024

Balance at beginning of period $ 3,046 $ 3,100

2 unchanged sentences

Balance at end of period $ 2,821 $ 2,859

Q1 Fiscal 2026 Form 10-Q

CONVERTIBLE SENIOR NOTES

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The 2029 Notes, the Exchange Shares, and shares of common stock issuable upon conversion of the 2029 Notes were subject to certain lock-up restrictions for a six-month period (the “Lock-Up Period”) beginning on the Closing Date of the 2024 Exchange Transaction.

Additionally, on November 21, 2024, in connection with the issuance of the 2029 Notes, the Company and SBN entered into the Letter Agreement pursuant to which the Company and SBN agreed that, for so long as SBN and its affiliates hold at least $ 180 million aggregate principal amount of the 2029 Notes, the Company and its subsidiaries are subject to certain negative covenants that restrict the Company’s and its subsidiaries’ ability to incur additional indebtedness and create liens, in each case, subject to the exceptions set forth in the Letter Agreement, including exceptions which permit the Company to incur up to $ 75 million in aggregate principal amount of secured indebtedness pursuant to Credit Facilities (as defined in the Letter Agreement).

In addition, the Letter Agreement restricts the ability of the Company and its subsidiaries from guaranteeing any indebtedness or incurring certain indebtedness outside of the ordinary course of business unless, in each case, the Company and its subsidiaries concurrently provide a guarantee of the Company’s obligations under the 2029 Notes.

Upon any conversion of the 2029 Notes, SBN will not be entitled to be issued a number of shares of the Company’s common stock which would cause SBN's beneficial ownership of common stock to exceed either 9.9 % of the total number of issued and outstanding shares of common stock or 9.9 % of the combined voting power of all of the securities of the Company, in each case, following such conversion.

4 unchanged sentences

The 2029 Notes will mature on August 15, 2029, subject to earlier conversion, redemption or repurchase.

Q3 Fiscal 2025 Form 10-Q

The 2029 Notes are convertible at the option of the holder at any time from the expiration of the Lock-Up Period until the second scheduled trading day prior to the maturity date, including in connection with a redemption by the Company.

4 unchanged sentences

The 2029 Notes are subject to certain debt and lien covenants as well as springing guarantees, in each case, the terms of which are set forth in a second letter agreement between the Company and SBN entered into in connection with the Indenture.

Q1 Fiscal 2026 Form 10-Q

The 2029 Indenture includes customary “events of default,” which may result in the acceleration of the maturity of the 2029 Notes under the 2029 Indenture.

11 unchanged sentences

However, due to the nature and terms of the reporting obligations, the value of the embedded derivative is immaterial.

Q3 Fiscal 2025 Form 10-Q

The exchange qualified as a troubled debt restructuring under ASC 470-60 – Troubled Debt Restructurings by Debtors .

3 unchanged sentences

The gain was calculated as the difference between the carrying amount of the old debt and the carrying amount of the new debt, adjusted for debt issuance costs.

We incurred issuance costs related to the 2029 Notes of approximately $ 3.1 million, including $ 0.2 million of lender fees, which were recorded as a reduction to the gain on debt restructuring in our consolidated statements of operations and comprehensive loss.

We incurred issuance costs related to the 2029 Notes of approximately $ 3.1 million, including $ 0.2 million of lender fees, which were recorded as a reduction to the gain on debt restructuring in our condensed consolidated statements of operations and comprehensive loss.

We also paid accrued but unpaid interest of $ 1.8 million on the 2028 Notes in connection with the 2024 Exchange Transaction.

2 unchanged sentences

Following the closing of the 2024 Exchange Transaction, no amounts were outstanding on the 2028 Notes.

The carrying amount of the liability for the 2029 Notes as of September 30, 2025 is $ 212.0 million, of which $ 209.0 million is included as convertible senior notes, net, non-current, and $ 3.0 million is included as accrued expenses on our consolidated balance sheets.

Changes to the 2029 Notes during the nine months ended September 30, 2025 were as follows:

The carrying amount of the liability for the 2029 Notes as of March 31, 2026 is $ 210.5 million, of which $ 207.5 million is included as convertible senior notes, net, non-current, and $ 3.0 million is included as accrued expenses on our condensed consolidated balance sheets.

Q1 Fiscal 2026 Form 10-Q

Changes to the 2029 Notes during the three months ended March 31, 2026 were as follows:

(In thousands)

1 unchanged sentence

Contractual interest expense ( 1,500 )

Carrying amount as of September 30, 2025

As of September 30, 2025, the estimated fair value (Level 2) of the 2029 Notes was $ 169.4 million.

Carrying amount as of March 31, 2026

As of March 31, 2026, the estimated fair value (Level 2) of the 2029 Notes was $ 171.1 million.

The fair value of the 2029 Notes is estimated using a binomial lattice model that is primarily affected by the trading price of our common stock, market interest rates and volatility.

10 unchanged sentences

Upon conversion of the 2030 Notes, we may elect to settle such conversion obligation in cash, shares of our common stock, or a combination of cash and shares of our common stock.

Q3 Fiscal 2025 Form 10-Q

consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide the redemption notice at a redemption price of 100 % of the principal amount of such 2030 Notes, plus accrued and unpaid interest up to, but excluding, the redemption date.

On or after June 20, 2028, and prior to the 31st scheduled trading day immediately preceding the maturity date, the 2030 Notes will be redeemable by the Company in the event that the closing sale price of our common stock has been at least 150 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide the redemption notice at a redemption price of 100 % of the principal amount of such 2030 Notes, plus accrued and unpaid interest up to, but excluding, the redemption date.

Upon the occurrence of a Fundamental Change (as defined in the 2030 Indenture), the holders of the 2030 Notes may require that we repurchase all or part of the principal amount of the 2030 Notes at a purchase price equal to 100 % of the principal amount of the notes to be repurchased, plus any accrued and unpaid interest up to, but excluding, the fundamental change repurchase date, and all unpaid interest from the fundamental change repurchase date thereon, but excluding, the maturity date.

1 unchanged sentence

The 2030 Indenture also includes customary covenants for convertible notes of this type.

To the extent we elect, the sole remedy for an event of default relating to our failure to comply with certain of our reporting obligations shall, for the first 360 calendar days after the occurrence of such an event of default, consist exclusively of the right to receive additional interest on the 2030 Notes at a rate equal to (i) 0.25 % per annum of the principal amount of the 2030 Notes outstanding for each day during the first 180 calendar days of the 360 -day period after the occurrence of such an event of default during which such event of default is continuing (or, if earlier, the date on which such event of default is cured or waived) and (ii) 0.50 % per annum of the principal amount of the 2030 Notes outstanding for each day from, and including, the 181 st calendar day to, and including, the 360 th calendar day after the occurrence of such an event of default during which such event of default is continuing (or, if earlier, the date on which such event of default is cured or waived as provided for in the 2030 Indenture).

Q1 Fiscal 2026 Form 10-Q

of default is continuing (or, if earlier, the date on which such event of default is cured or waived as provided for in the 2030 Indenture).

On the 361 st day after such event of default (if the event of default relating to our failure to comply with its obligations is not cured or waived prior to such 361 st day), the 2030 Notes shall be subject to acceleration as provided for in the 2030 Indenture.

8 unchanged sentences

However, due to the nature and terms of the reporting obligations, the value of the embedded derivative is immaterial.

The 2023 Exchange Transaction was accounted for as an extinguishment driven by the change in fair value of the embedded conversion option.

We recorded a loss on extinguishment of debt of approximately $ 2.0 million in connection with the 2023 Exchange Transaction during the year ended December 31, 2023, which represents the difference between the fair value and the principal amount of the 2030 Notes of the debt at the modification date, plus unamortized debt issuance costs of $ 1.5 million related to the respective portion of the 2028 Notes.

We incurred issuance costs related to the 2030 Notes of approximately $ 7.3 million, which were recorded as debt issuance costs and are presented as a reduction to the 2030 Notes on our condensed consolidated balance sheets.

The debt issuance costs are amortized to interest expense using the effective interest method over the term of the 2030 Notes, resulting in an effective interest rate of 1.6 %.

We also paid accrued but unpaid interest of $ 2.5 million on the 2028 Notes in connection with the 2023 Exchange Transaction on June 30, 2023.

We did not receive any cash proceeds from the 2023 Exchange Transaction.

In exchange for issuing the 2030 Notes pursuant to the 2023 Exchange Transaction, we received and cancelled the exchanged 2028 Notes.

Q3 Fiscal 2025 Form 10-Q

Following the closing of the 2023 Exchange Transaction, $ 459.0 million in aggregate principal amount of 2028 Notes remained outstanding with terms unchanged.

1 unchanged sentence

(In thousands)

September 30,

2026 December 31,

4 unchanged sentences

Interest expense for the 2030 Notes was as follows:

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

Three Months Ended March 31,

(In thousands)

2025 2024 2025 2024

Contractual interest expense $ 1,516 $ 1,516

1 unchanged sentence

Total interest expense $ 1,759 $ 1,755

As of September 30, 2025, the estimated fair value (Level 2) of the 2030 Notes was $ 314.5 million.

As of March 31, 2026, the estimated fair value (Level 2) of the 2030 Notes was $ 313.2 million.

The fair value of the 2030 Notes is estimated using a binomial lattice model that is primarily affected by the trading price of our common stock, market interest rates and volatility.

2028 Convertible Senior Notes

On February 9, 2021, we entered into an investment agreement with SBN relating to the issuance and sale to SBN of $ 900.0 million in aggregate principal amount of the 2028 Notes.

The 2028 Notes were issued on February 16, 2021 and bore interest at a rate of 1.50 % per annum.

As discussed above, in June 2023 we completed an exchange of $ 441.0 million in aggregate principal amount of our 2028 Notes for $ 441.0 million aggregate principal amount of the 2030 Notes, leaving approximately $ 459.0 million in aggregate principal amount of 2028 Notes outstanding.

Also as discussed above, in November 2024 we completed an exchange of the remaining $ 459.0 million in aggregate principal amount of the 2028 Notes outstanding for (i) $ 200.0 million aggregate principal amount of the 2029 Notes, (ii) the Exchange Shares and (iii) $ 50.0 million of cash.

As of December 31, 2024 no amounts were outstanding on the 2028 Notes.

We incurred issuance costs related to the 2028 Notes of approximately $ 4.5 million, which were recorded as debt issuance costs and are presented as a reduction to the 2028 Notes on our consolidated balance sheets.

The debt issuance costs were amortized to interest expense using the effective interest method over the term of the 2028 Notes, resulting in an effective interest rate of 1.6 %.

In connection with the 2024 Exchange Transaction, the remaining unamortized debt issuance costs related to the 2028 Notes of $ 1.1 million were extinguished by offsetting the carrying amount of the convertible senior notes.

Interest expense for the 2028 Notes was as follows:

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

(in thousands) 2025 2024 2025 2024

Contractual interest expense $ — $ 1,721 $ — $ 5,163

Amortization of debt issuance costs — 81 — 243

Total interest expense $ — $ 1,802 $ — $ 5,406

Q1 Fiscal 2026 Form 10-Q

5 unchanged sentences

(In thousands)

Three Months Ended September 30, 2025 Cumulative amount incurred to date

Three Months Ended March 31, 2026 Cumulative amount incurred to date

Employee separation costs

9 unchanged sentences

(In thousands, excluding non-cash activities)

Employee Separation Costs

Other Costs Total

Expense recorded in YTD 2025

$ 4,787 $ 629 $ 5,416

Amount recorded in current liabilities as of December 31, 2025 $ 389

Cash paid during YTD 2026

( 4,787 ) ( 528 ) ( 5,315 )

Amount recorded in current liabilities

as of September 30, 2025 $ — $ 101 $ 101

Amount recorded in current liabilities as of March 31, 2026

Estimated total restructuring costs to still be incurred $ —

Q3 Fiscal 2025 Form 10-Q

2024 Restructuring

In the second quarter of 2024, we implemented an expense reduction initiative that included workforce reductions, the closing of our San Diego office, and other actions to reduce annualized run-rate operating expenses.

A summary of the pre-tax restructuring charges are as follows:

(In thousands)

Three Months Ended September 30, 2025 Cumulative amount incurred to date

Employee separation costs $ — $ 10,008

Other costs — 16,102

Total restructuring charges (1)

(1) Cumulative charges incurred to date include $ 15.8 million in sales, general and administrative expense;

$ 5.9 million in research and development expense;

and $ 4.4 million in cost of revenue.

Cumulative charges incurred to date include employee separation costs comprised of approximately $ 5.5 million related to salaries, wages and other employee benefits paid to terminated employees pursuant to the Worker Adjustment and Retraining Notification (WARN) Act and approximately $ 4.5 million of severance costs.

Other costs in cumulative charges incurred to date are primarily related to accelerated amortization and depreciation of $ 8.1 million for the right-of-use asset, leasehold improvements, and furniture and fixtures relating to the abandonment of the San Diego office.

We also incurred cumulative charges to date for excess inventory of $ 3.6 million primarily relating to a decrease in internal demand resulting from the expense reduction initiatives which were recognized in cost of product revenues.

The accelerated amortization and depreciation, which was recognized in sales, general and administrative expense, was determined as a result of the Company's change in estimate pertaining to its remaining useful life of the San Diego office utilizing the estimated date on which it planned to abandon the San Diego office.

The lease liability pertaining to the San Diego office was also remeasured during the three months ended June 30, 2024 resulting in a reduction in the operating lease liability balance of $ 4.4 million, which was offset against the right-of-use asset on the condensed consolidated balance sheets.

We fully exited our San Diego office in September 2024.

A summary of the liabilities related to the restructuring is as follows:

(In thousands)

Other Costs Total

Amount recorded in current liabilities as of December 31, 2024 $ 170 $ 170

Additional expense recorded 888 888

Cash payments ( 1,058 ) ( 1,058 )

Amount recorded in current liabilities as of September 30, 2025

Estimated total restructuring costs to still be incurred $ — $ —

The table above excludes noncash activities and amounts incurred relating to the San Diego office lease liability.

The ending balance of the San Diego office lease liability was $ 0 at the end of the second quarter of 2025.

We recognized approximately $ 1 million of expense related to the 2024 restructuring during the three months ended March 31, 2026.

See Note 6 – Restructuring in Part II, Item 8 of the 2025 Annual Report for information regarding the 2024 restructuring initiative.

Q1 Fiscal 2026 Form 10-Q

1 unchanged sentence

The Company has entered into various operating lease agreements, primarily relating to our corporate offices.

On March 7, 2025, we amended our existing lease covering our corporate headquarters, as well as our research and development, manufacturing, and distribution facilities in Menlo Park, California.

The lease amendment extends the term to April 30, 2034.

See Note 6 – Commitments and Contingencies , subsection titled “Leases”, in Part I, Item 1 of the Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 for information regarding the Company’s maturity of lease liabilities under its lease agreements.

See Note 7 – Commitments and Contingencies, subsection titled “Leases”, in Part II, Item 8 of the 2025 Annual Report for information regarding the Company’s maturity of lease liabilities under its lease agreements.

Contingencies

10 unchanged sentences

To the extent that any such indemnification obligations apply to the lawsuits described above, any associated expenses incurred are included within the related accrued litigation expense amounts.

No additional liability associated with such indemnification obligations has been recorded as of September 30, 2025 and December 31, 2024.

No additional liability associated with such indemnification obligations has been recorded as of March 31, 2026 and December 31, 2025.

EQUITY PLANS AND SHARE-BASED COMPENSATION

As of September 30, 2025, the Company had share-based compensation awards outstanding under the 2020 Equity Incentive Plan (the “2020 Plan”), the 2020 Inducement Equity Incentive Plan (the “Inducement Plan”), the 2021 adopted Omniome Equity Incentive Plan of Pacific Biosciences of California, Inc.

As of March 31, 2026, the Company had share-based compensation awards outstanding under the 2020 Equity Incentive Plan (the “2020 Plan”), the 2020 Inducement Equity Incentive Plan (the “Inducement Plan”), the 2021 adopted Omniome Equity Incentive Plan of Pacific Biosciences of California, Inc.

(the “Omniome Plan”) and the 2010 Employee Stock Purchase Plan, from which we issued equity awards and employee stock.

On June 4, 2025, our stockholders approved an amendment to the 2020 Plan to reserve an additional 23 million shares of our common stock for issuance pursuant to equity awards granted under the 2020 Plan.

As of September 30, 2025, we had 37.8 million shares remaining and available for future issuance under the 2020 Plan, Inducement Plan, and the Omniome Plan.

As of March 31, 2026, we had 25.7 million shares remaining and available for future issuance under the 2020 Plan, Inducement Plan, and the Omniome Plan.

Shares remaining and available for future issuance reflect shares that may become eligible to vest upon the achievement of maximum targets for certain equity awards.

Q3 Fiscal 2025 Form 10-Q

Refer to Note 9 – Stockholders' Equity , in Part II, Item 8 of our 2025 Annual Report for more information on the Company's equity plans .

Q1 Fiscal 2026 Form 10-Q

Stock Options

5 unchanged sentences

Granted 5,854 1.69

Exercised ( 47 ) 1.25

Canceled ( 682 ) 2.79

Expired ( 304 ) 8.89

Outstanding at September 30, 2025 15,922 $ 6.57

Outstanding at March 31, 2026 20,330 $ 5.14

Restricted Stock Units ("RSU") and Performance Stock Units ("PSU")

1 unchanged sentence

We granted PSUs during the first quarter of 2023 for which the number of shares issuable is based on performance relative to specified revenue targets and continued employment through the vesting period.

The PSUs are issuable following the third year of the performance period.

Maximum achievement of the revenue goal under the PSUs will result in up to 200 % of the target number of shares subject to the PSUs to become eligible to vest, while not meeting the minimum achievement of the revenue goal under the PSUs will result in no shares subject to the PSUs becoming eligible to vest.

The PSUs were issuable following the third year of the performance period.

Maximum achievement of the revenue goal under the PSUs would result in up to 200 % of the target number of shares subject to the PSUs to become eligible to vest, while not meeting the minimum achievement of the revenue goal under the PSUs would result in no shares subject to the PSUs becoming eligible to vest.

The performance period ended on December 31, 2025.

Because threshold levels of achievement were not met, the PSUs were forfeited based on the determination by the Board of Directors in the first quarter of 2026.

The following table summarizes the time-based RSUs and PSUs activity:

5 unchanged sentences

Forfeited ( 749 ) ( 392 ) 2.56 9.43

Outstanding at September 30, 2025 18,123 392 $ 3.55 $ 9.43

Outstanding at March 31, 2026 19,226 — $ 2.60 $ —

Employee Stock Purchase Plan ("ESPP")

Shares issued under our ESPP wer e 3,102,930 and 1,906,529 durin g the nine months ended September 30, 2025 and 2024, respectively.

Shares issued under our ESPP wer e 1,266,217 and 1,752,417 durin g the three months ended March 31, 2026 and 2025, respectively.

In the first quarter of 2026, an additional 4.0 million shares were reserved under the ESPP.

As of September 30, 2025, 15.2 million shares of our common stock remain avai lable for issuance under our ESPP.

As of March 31, 2026, 17.9 million shares of our common stock remain avai lable for issuance under our ESPP.

Share-based Compensation

The following table summarizes share-based compensation expense:

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

Three Months Ended March 31,

(In thousands)

2025 2024 2025 2024

Cost of revenue $ 648 $ 1,165

16 unchanged sentences

The fair value of employee stock options was estimated using the following assumptions:

Nine Months Ended September 30,

Three Months Ended March 31,

Expected term in years 4.9 4.9

5 unchanged sentences

The fair value of shares to be issued under the ESPP was estimated using the following assumptions:

Nine Months Ended September 30,

Three Months Ended March 31,

Expected term in years 0.5 — 2.0

9 unchanged sentences

The following table presents the calculation of the basic and diluted net loss per share amounts presented in the condensed consolidated statements of operations and comprehensive loss:

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

Three Months Ended March 31,

(In thousands, except per share amounts) 2026 2025

Net loss $ ( 8,275 ) $ ( 426,075 )

Weighted average shares used in computing

basic net loss per share 300,844 272,915 299,303 271,631

Weighted average shares used in computing basic net loss per share

305,819 296,858

Basic net loss per share $ ( 0.03 ) $ ( 1.44 )

Weighted average shares used in computing

diluted net loss per share 300,844 272,915 299,303 271,631

Weighted average shares used in computing diluted net loss per share

305,819 296,858

Diluted net loss per share $ ( 0.03 ) $ ( 1.44 )

The following shares issuable upon conversion of the Notes and outstanding equity awards were excluded from the computation of diluted net loss per share for the periods presented because the effect of including such shares would have been antidilutive:

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

Three Months Ended March 31,

(In thousands) 2026 2025

Shares issuable upon conversion of

convertible senior notes 61,415 31,063 61,415 31,063

Shares issuable upon conversion of convertible senior notes

61,415 61,415

Equity awards 45,219 47,133

13 unchanged sentences

A summary of the segment profit or loss, including significant segment expenses is as follows:

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

Three Months Ended March 31,

(In thousands) 2026 2025

5 unchanged sentences

Impairment charges — 15,000

Settlement charges 15,400 —

Gain on disposal of assets ( 45,796 ) —

Change in fair value of contingent consideration — ( 18,700 )

1 unchanged sentence

Other income, net 266 2,557

1,260 3,352 6,775 9,063

Income tax provision

Income tax provision (benefit) 184 ( 302 )

Consolidated net loss ( 8,275 ) ( 426,075 )

A summary of our revenue by geographic location is as follows:

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

Three Months Ended March 31,

(In thousands) 2026 2025

4 unchanged sentences

A summary of our revenue by category is as follows:

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

Three Months Ended March 31,

(In thousands) 2026 2025

6 unchanged sentences

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