What changed in this filing

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Item 1. Financial Statements

2026-08-06 compared with 2026-05-07 · 352 added, 213 removed, 820 unchanged (41% of the section changed)

64 unchanged sentences

(in thousands, except per share amounts)

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

$ 49,130 $ 43,200 $ 100,066 $ 80,521

12,399 8,528 21,593 18,985

Total revenues

61,529 51,728 121,659 99,506

Costs and Expenses:

Costs of revenues

19,107 14,886 36,045 27,841

Research and development

17,316 14,913 35,644 29,541

Selling, general, and administrative

18,984 19,744 36,476 43,116

Amortization of acquired intangible assets

1,058 1,068 2,117 1,446

Income (loss) from operations

5,064 1,117 11,377 ( 2,438 )

Interest expense

( 1,106 ) ( 1,242 ) ( 2,195 ) ( 1,553 )

Interest income and other, net

Income (loss) before income tax expense

Income tax expense

666 196 1,258 1,066

Income (loss) before income tax benefit (expense)

4,624 71 10,440 ( 2,925 )

Income tax benefit (expense)

( 353 ) 1,075 ( 1,378 ) 1,039

Net income (loss)

$ 4,271 $ 1,146 $ 9,062 $ ( 1,886 )

Other comprehensive income (loss):

Foreign currency translation adjustments, net of tax

( 14 ) 1,298 ( 325 ) 1,760

Change in unrealized loss related to available-for-sale debt securities, net of tax

Total other comprehensive income (loss)

( 14 ) 1,299 ( 325 ) 1,751

Comprehensive income (loss)

$ 4,257 $ 2,445 $ 8,737 $ ( 135 )

Net income (loss) per share:

$ 0.10 $ 0.03 $ 0.22 $ ( 0.05 )

Weighted average common shares used to calculate net income (loss) per share:

40,932 39,148 40,397 39,118

41,776 39,260 41,079 39,118

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited)

2 unchanged sentences

(in thousands)

Three Months Ended March 31, 2026

Three Months Ended June 30, 2026

Accumulated Other

Treasury Stock

1 unchanged sentence

Stockholders’

Balances, December 31, 2025

Balances, March 31, 2026

Shares issued under equity plans

Shares withheld for taxes related to shares issued under equity plans

Stock-based compensation

Shares issued under secondary offering, net of underwriting discounts and commissions

Stock-based compensation expense

Comprehensive income (loss)

Balances, June 30, 2026

Three Months Ended June 30, 2025

Accumulated Other

Treasury Stock

Comprehensive

Stockholders’

Income (Loss)

Balances, March 31, 2025

Three Months Ended March 31, 2025

Shares issued under equity plans

Shares withheld for taxes related to shares issued under equity plans

Stock-based compensation expense

Comprehensive income

Balances, June 30, 2025

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited)

PDF SOLUTIONS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS ’ EQUITY

(in thousands)

Six Months Ended June 30, 2026

Accumulated Other

Treasury Stock

4 unchanged sentences

Shares withheld for taxes related to shares issued under equity plans

Stock-based compensation

Shares issued under secondary offering, net of underwriting discounts and commissions

Stock-based compensation expense

Comprehensive income (loss)

Balances, March 31, 2025

Balances, June 30, 2026

Six Months Ended June 30, 2025

Accumulated Other

Treasury Stock

Comprehensive

Stockholders’

Income (Loss)

Balances, December 31, 2024

Shares issued under equity plans

Shares withheld for taxes related to shares issued under equity plans

Stock-based compensation expense

Comprehensive income (loss)

Balances, June 30, 2025

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited)

2 unchanged sentences

(in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

Net income (loss)

$ 9,062 $ ( 1,886 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Stock-based compensation expense

12,394 12,795

Depreciation and amortization

2 unchanged sentences

Net accretion of discounts on short-term investments

Recovery from previously written-off property and equipment

Deferred taxes

327 ( 1,298 )

Changes in operating assets and liabilities:

Accounts receivable

( 7,398 ) 7,413

Prepaid expenses and other current assets

( 15,228 ) ( 7,911 )

Operating lease right-of-use assets

Other non-current assets

7,415 ( 2,097 )

Accounts payable

( 2,450 ) ( 275 )

Accrued compensation and related benefits

4,171 ( 3,244 )

Accrued and other liabilities

( 183 ) ( 2,188 )

Deferred revenues

787 ( 2,695 )

Operating lease liabilities

( 994 ) ( 860 )

Net cash provided by operating activities

3 unchanged sentences

Purchases of property and equipment

( 24,528 ) ( 16,651 )

Prepayment for the purchase of property and equipment

( 54 ) ( 78 )

Recovery from previously written-off property and equipment

Payment for business acquisition, net of cash acquired

— ( 129,718 )

Net cash used in investing activities

( 24,582 ) ( 124,246 )

Cash flows from financing activities:

Proceeds from long-term debt, net of debt discount

Payments of debt issuance costs

Repayments of long-term debt

Proceeds from shares issued under secondary offering, net of underwriting discounts and commissions of $ 3,860

Proceeds from exercise of stock options and employee stock purchase plan

Payments for taxes related to net share settlement of equity awards

Net cash provided by (used in) financing activities

( 4,096 ) ( 3,535 )

Repayments of long-term debt

( 625 ) ( 625 )

Proceeds from long-term debt, net of debt discount

Payments of debt issuance costs

( 143 ) ( 900 )

Net cash provided by financing activities

79,190 66,645

Effect of exchange rate changes on cash and cash equivalents

Net change in cash and cash equivalents

72,663 ( 53,179 )

Cash and cash equivalents at beginning of period

42,220 90,594

Cash and cash equivalents at end of period

$ 114,883 $ 37,415

Continued on next page

2 unchanged sentences

(in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Supplemental disclosure of cash flow information:

5 unchanged sentences

Property and equipment received and accrued in accounts payable and accrued and other current liabilities

Net carrying value of property and equipment expensed in cost of revenues, and property and equipment transferred to sales-type leases and from other non-current assets, net

Stock-based compensation capitalized as property and equipment

26 unchanged sentences

The following table presents reclassified historical amounts to conform to the current period’s presentation (in thousands):

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Six Months Ended June 30, 2025

Previously Reported

1 unchanged sentence

Current Presentation

Previously Reported

Change in Presentation Reclassification

Current Presentation

$ 48,822 $ ( 48,822 ) $ — $ 91,293 $ ( 91,293 ) $ —

1 unchanged sentence

2,906 ( 2,906 ) — 8,213 ( 8,213 ) —

N/A 37,321 37,321

N/A 10,457 10,457

N/A 43,200 43,200 N/A 80,521 80,521

N/A 8,528 8,528 N/A 18,985 18,985

Total revenues

86 unchanged sentences

The following table shows the percentage of total revenue that is classified as recurring and upfront for the periods presented:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Recurring revenue (1)

80 % 89 % 84 % 90 %

Upfront revenue (2)

20 % 11 % 16 % 10 %

100 % 100 % 100 % 100 %

Recurring revenue is comprised of revenue that either recurs on a regular schedule (e.g., SaaS and other services and time-based licenses) or is a type of revenue that generally has often re-occurred in the past (e.g., Cimetrix runtime licenses, secureWISE data, and Gainshare), and that is not Upfront revenue.

2 unchanged sentences

The following table shows revenues from contracts with customers from geographical regions, based on billing address of the customer (amounts in thousands):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

United States

6 unchanged sentences

$ 61,529 100 % $ 51,728 100 % $ 121,659 100 % $ 99,506 100 %

International revenues accounted for approximately 59 % and 62 % of the Company’s total revenues during the three months ended March 31, 2026 and 2025 , respectively.

International revenues accounted for approximately 45 % and 61 % of the Company’s total revenues during the three months ended June 30, 2026 and 2025 , respectively, and approximately 52 % and 61 % of the Company’s total revenues during the six months ended June 30, 2026 and 2025 , respectively.

Significant Judgments

20 unchanged sentences

The majority of the Company’s contract assets represent unbilled amounts related to fixed-price service contracts when the revenue recognized exceeds the amount billed to the customer.

The $ 5.2 million increase in contract assets during the three months ended March 31, 2026 , was primarily due to revenue recognized in the first quarter of 2026 for which the payment is subject to conditions other than the passage of time.

The $3.3 million increase in contract assets during the six months ended June 30, 2026 , was primarily due to revenue recognized during the six months ended June 30, 2026 for which the payment is subject to conditions other than the passage of time.

The contract assets are generally classified as current and are recorded on a net basis with deferred revenues (i.e.

9 unchanged sentences

Deferred revenues that will be recognized during the succeeding twelve -month period are recorded as current deferred revenues and the remaining portion is recorded in other non-current liabilities in the Condensed Consolidated Balance Sheets.

The $ 3.8 million increase in contract liabilities during the three months ended March 31, 2026 reflected the timing of revenue recognition relative to billings for products and services from which there are unsatisfied performance obligations to customers such that revenue had not yet been recognized as of March 31, 2026 .

The $0.8 million increase in contract liabilities during the six months ended June 30, 2026 , reflected the timing of revenue recognition relative to billings for products and services from which there are unsatisfied performance obligations to customers such that revenue had not yet been recognized as of June 30, 2026 .

Deferred revenues were as follows (in thousands):

4 unchanged sentences

Additional information related to deferred revenue was as follows (in thousands):

Three Months Ended March 31,

Revenue recognized that was included in the deferred revenues and billings in excess of recognized revenues balances at the beginning of each year

Three Months Ended June 30,

Six Months Ended June 30,

Revenue recognized that was included in the deferred revenues and billings in excess of recognized revenues balances at the beginning of each period

$ 10,587 $ 12,063 $ 14,271 $ 18,625

As of March 31, 2026 , the aggregate amount of the transaction price allocated to the remaining performance obligations related to customer contracts that were unsatisfied or partially unsatisfied was approximately $ 246.4 million.

As of June 30, 2026 , the aggregate amount of the transaction price allocated to the remaining performance obligations related to customer contracts that were unsatisfied or partially unsatisfied was approximately $ 270.7 million.

Given the applicable contract terms with customers, the majority of this amount is expected to be recognized as revenue over the next two years, with the remainder recognized thereafter.

2 unchanged sentences

The estimated timing of the recognition of remaining unsatisfied performance obligations is subject to change and is affected by changes to the scope, change in timing of delivery of products and services, or contract modifications.

The adjustment to revenue recognized from performance obligations satisfied (or partially satisfied) in previous periods was an increase of $ 6.5 million and $ 0.2 million during the three months ended March 31, 2026 and 2025 , respectively.

The adjustment to revenue recognized from performance obligations satisfied (or partially satisfied) in previous periods was an increase of $1.1 million and a decrease of $ 1.5 million during the three months ended June 30, 2026 and 2025 , respectively, and an increase of $6.9 million and an increase of $ 0.2 million during the six months ended June 30, 2026 and 2025 , respectively.

These amounts primarily represent changes in estimated percentage-of-completion based contracts and changes in actual versus estimated Gainshare revenue.

10 unchanged sentences

Amortization of capitalized direct sales commission costs were as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Amortization of capitalized direct sales commission costs

$ 706 $ 625 $ 1,465 $ 1,497

There was no impairment loss in relation to the costs capitalized for the periods presented.

1 unchanged sentence

The Company does not adjust the transaction price for the effects of a significant financing component when the period between the transfers of the promised good or service to the customer and payment for that good or service by the customer is expected to be one year or less.

The Company assessed each of its revenue generating arrangements in order to determine whether a significant financing component exists, and determined its contracts did not include a material significant financing component during the three months ended March 31, 2026 and 2025 .

BALANCE SHEET COMPONENTS

Accounts Receivable

Accounts receivable include amounts that are unbilled at the end of the period that are expected to be billed and collected within a 12‑month period.

Unbilled accounts receivable, included in accounts receivable, totaled $ 48.7 million and $ 44.8 million as of March 31, 2026 , and December 31, 2025 , respectively.

Unbilled accounts receivable that are not expected to be billed and collected during the succeeding 12‑month period are recorded in other non-current assets and totaled $ 9.2 million and $ 8.7 million as of March 31, 2026 , and December 31, 2025 , respectively.

Accounts receivable includes amounts that are unbilled at the end of the period that are expected to be billed and collected within a 12‑month period.

Unbilled accounts receivable, included in accounts receivable, totaled $46.5 million and $ 44.8 million as of June 30, 2026 , and December 31, 2025 , respectively.

Unbilled accounts receivable that are not expected to be billed and collected during the succeeding 12‑month period are recorded in other non-current assets and totaled $ 8.7 million as of June 30, 2026 , and December 31, 2025 .

The Company performs ongoing credit evaluations of its customers’ financial condition.

1 unchanged sentence

The allowance for credit losses is reviewed on a quarterly basis to assess the adequacy of the allowance.

The allowance for credit losses was $ 0.9 million as of March 31, 2026 , and December 31, 2025 .

The allowance for credit losses was $ 0.9 million as of June 30, 2026 , and December 31, 2025 .

Prepaid expenses and other current assets

32 unchanged sentences

$ 94,520 $ 81,609

Test equipment mainly includes DirectScan system and CV system assets at customer sites that are contributing to revenue.

Test equipment mainly includes DirectScan system and CV system assets at customer sites that generate revenue.

Property and equipment in progress represent mainly the development or construction of property and equipment that have not yet been placed in service for the Company’s intended use and are not depreciated.

Depreciation and amortization expense was $ 1.6 million and $ 0.7 million for the three months ended March 31, 2026 , and 2025, respectively.

Depreciation and amortization expense was $ 2.1 million and $ 0.8 million during the three months ended June 30, 2026 and 2025 , respectively, and $ 3.7 million and $ 1.5 million during the six months ended June 30, 2026 , and 2025, respectively.

Goodwill and Intangible Assets, Net

The changes in goodwill were as follows (in thousands):

Three Months Ended March 31,

Six Months Ended June 30,

Balance at the beginning of period

7 unchanged sentences

Intangible assets, net, consisted of the following (in thousands):

March 31, 2026

June 30, 2026

December 31, 2025

10 unchanged sentences

$ 95,726 $ ( 47,670 ) $ 48,056 $ 95,765 $ ( 43,571 ) $ 52,194

The weighted average amortization period for acquired identifiable intangible assets was 8.5 years as of March 31, 2026 .

The weighted average amortization period for acquired identifiable intangible assets was 8.3 years as of June 30, 2026 .

The amortization expense related to intangible assets were as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Amortization of acquired technology (included in costs of revenues)

$ 998 $ 998 $ 1,996 $ 1,676

Amortization of acquired intangible assets (presented separately under costs and expenses)

1,058 1,068 2,117 1,446

Total amortization expense

2 unchanged sentences

Year Ending December 31,

2026 (remaining nine months)

2026 (remaining six months)

2031 and thereafter

Total future amortization expense

There was no impairment charge for goodwill and intangible assets during the three months ended March 31, 2026 and 2025 .

There was no impairment charge for goodwill and intangible assets during the three and six months ended June 30, 2026 and 2025.

Other Non-current Assets

22 unchanged sentences

$ 31,029 $ 21,836

Maturities of leases payments under sales-type leases as of March 31, 2026 , were as follows (in thousands):

Maturities of leases payments under sales-type leases as of June 30, 2026 , were as follows (in thousands):

Year Ending December 31,

2026 (remaining nine months)

2026 (remaining six months)

2031 and thereafter

3 unchanged sentences

Calculated using the rate implicit in the lease determined for each lease.

There was no allowance for credit losses on lease receivables as of March 31, 2026 , and December 31, 2025 .

There was no allowance for credit losses on lease receivables as of June 30, 2026 , and December 31, 2025 .

The Company’s ongoing risk management strategy for residual assets includes performing regular reviews of estimated residual values.

8 unchanged sentences

These operating leases expire at various dates through 2031.

The Company had no leases that were classified as a financing lease as of March 31, 2026 , and December 31, 2025 .

Lease expense comprised of the following (in thousands):

Three Months Ended March 31,

The Company had no leases that were classified as a financing lease as of June 30, 2026 , and December 31, 2025 .

Lease expense was comprised of the following (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Operating lease expense

$ 489 $ 435 $ 978 $ 849

Short-term lease and variable lease expense (1)

183 193 355 400

Total lease expense

$ 672 $ 628 $ 1,333 $ 1,249

Leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets, and the Company recognizes lease expense for these leases on a straight-line basis over the lease term.

3 unchanged sentences

Weighted average discount rate for operating lease liabilities

Maturities of operating lease liabilities as of March 31, 2026 , were as follows (in thousands):

Maturities of operating lease liabilities as of June 30, 2026 , were as follows (in thousands):

Year Ending December 31,

2026 (remaining nine months)

2026 (remaining six months)

Total future minimum lease payments

5 unchanged sentences

Debt consisted of the following (in thousands):

$ 22,500 $ 23,125

Revolving credit facility

45,000 45,000

Total debt (principal amount)

67,500 68,125

Unamortized debt discount and issuance costs

( 1,048 ) ( 1,126 )

Total debt, net of unamortized debt discount and issuance costs

$ 66,452 $ 66,999

Current portion of long-term debt, net

$ 2,238 $ 2,236

Long-term debt, net

64,214 64,763

Total debt, net

$ 66,452 $ 66,999

On March 7, 2025, the Company entered into a Credit Agreement (the “Credit Agreement”) with the lenders who are party to the Credit Agreement and the lenders who may become a party to the Credit Agreement pursuant to the terms thereof (the “Lenders”) and Wells Fargo Bank, National Association, as administrative agent to the Lenders (the “Agent”).

5 unchanged sentences

The applicable margin for Term Loan borrowings bearing interest at the alternate base rate ranges from 1.00 % to 1.75 %, and the applicable margin for Term Loan borrowings bearing interest based on the SOFR ranges from 2.00 % to 2.75 %, in each case, based on the Company’s consolidated total net leverage ratio as of the most recently ended fiscal quarter.

The Company will pay an annual commitment fee during the term of the Credit Agreement at a rate per annum equal to 0.50 % for any undrawn portion of the Revolving Credit Facility.

The Company’s weighted average annual interest rate on its outstanding debt was 5.9 % and 6.5 % for the three months ended March 31, 2026 , and 2025, respectively.

On April 23, 2026, the Company entered into a First Amendment to Credit Agreement with the Lenders and the Agent to increase the Revolving Credit Facility to an aggregate principal amount of $ 75.0 million and make leveraged-based adjustments to the annual Revolving Credit Facility commitment fee during the term of the Credit Agreement (see Note 15, Subsequent Events ).

The Revolving Credit Facility includes a payment of an annual commitment fee during the term of the Credit Agreement at a rate per annum equal to 0.50 % for any undrawn amount, which was later amended in April 2026 to a leveraged-based adjustment to the annual Revolving Credit Facility commitment fee (see First Amendment to Credit Agreement section below).

The Company’s weighted average annual interest rate on its outstanding debt was 5.9 % and 6.5 % for the six months ended June 30, 2026 , and 2025, respectively.

The Credit Agreement contains customary representations and warranties, as well as customary affirmative and negative covenants.

1 unchanged sentence

In addition, the Credit Agreement requires that the Company maintain a consolidated total net leverage ratio of not greater than 3.00 to 1.00, and a consolidated fixed charge coverage ratio of not less than 1.25 to 1.00.

As of March 31, 2026 , the Company was in compliance with the covenants contained in the Credit Agreement.

As of June 30, 2026 , the Company was in compliance with the covenants contained in the Credit Agreement.

The Credit Agreement contains customary events of default.

2 unchanged sentences

The Company used the amounts borrowed under the Credit Facilities to finance, in part, the purchase price paid for the acquisition of SecureWise (see Note 14, Business Combination ).

First Amendment to Credit Agreement

On April 23, 2026, the Company entered into a First Amendment to Credit Agreement (the “Amendment”) with the Lenders and the Agent to increase the Revolving Credit Facility to an aggregate principal amount of $ 75.0 million.

The Amendment introduces leveraged-based adjustments to the annual Revolving Credit Facility commitment fee during the term of the Credit Agreement.

Instead of a flat per annum rate of 0.50 %, the Revolving Credit Facility commitment fee will be 0.50 % when the total debt to earnings before interest, taxes, depreciation, and amortization (“EBITDA”) ratio (as defined in the Amendment) is greater than or equal to 2.50 to 1.00, 0.35 % when the total debt to EBITDA ratio is less than 2.50 to 1.00 but greater than or equal to 0.50 to 1.00 and 0.20 % when the total debt to EBITDA ratio is less than 0.50 to 1.00.

All other material terms of the Credit Agreement remain unchanged.

Under this facility, $ 30.0 million is available to the Company for drawdown as of June 30, 2026 .

Future Payments on Total Debt

As of March 31, 2026 , the estimated future principal payments of the total long-term debt were as follows (in thousands):

As of June 30, 2026 , the estimated future principal payments of the total long-term debt were as follows (in thousands):

Year Ending December 31,

2026 (remaining nine months)

2026 (remaining six months)

Total future principal payments of long-term debt

2 unchanged sentences

On April 15, 2024, the Board of Directors adopted a stock repurchase program (the “2024 Program”) to repurchase up to $ 40.0 million of the Company’s common stock both on the open market and in privately negotiated transactions, including through Rule 10b5 - 1 plans, from time to time, over the next two years from the adoption date.

In 2025, the Company repurchased 12,500 shares under the 2024 Program at an average price of $ 19.55 per share for an aggregate total price of $ 0.2 million.

During the three months ended March 31, 2026 , the Company did not repurchase any shares under the 2024 Program.

As of March 31, 2026 , approximately $ 39.8 million remained available under the 2024 Program.

Subsequently, on April 14, 2026, the 2024 Program expired.

Also, subsequently, in May 2026, the Board Directors adopted a new stock repurchase program (the “2026 Program”) to repurchase up to $ 50.0 million of the Company’s common stock both on the open market and in privately negotiated transactions, including through Rule 10b5 - 1 plans, from time to time, over the next two years from the adoption date.

The Company repurchased a total of 12,500 shares under the 2024 Program at an average price of $ 19.55 per share for an aggregate total price of $ 0.2 million.

The 2024 Program expired on April 14, 2026.

In May 2026, the Board Directors adopted a new stock repurchase program (the “2026 Program”) to repurchase up to $ 50.0 million of the Company’s common stock both on the open market and in privately negotiated transactions, including through Rule 10b5 - 1 plans, from time to time, over the next two years from the adoption date.

As of June 30, 2026 , $ 50.0 million remained available under the 2026 Program.

Secondary Offering

On May 13, 2026, the Company entered into an underwriting agreement with Morgan Stanley & Co.

LLC, as representative of the several underwriters named therein (collectively, the “Underwriters”), and Advantest America, Inc.

(the “Selling Stockholder”) in connection with (i) the offering, issuance and sale by the Company of 1,946,630 shares of the Company’s common stock, $ 0.00015 par value per share, including 685,246 shares sold pursuant to the Underwriters’ full exercise of their option to purchase additional shares, and (ii) the offering and sale by the Selling Stockholder of 3,306,924 shares of the Company’s common stock, at an offering price of $ 44.00 per share, less underwriting discounts and commissions (collectively, the “Offering”).

The Offering closed on May 15, 2026.

The Offering was made pursuant to an effective shelf registration statement on Form S- 3 filed with the SEC.

The net proceeds to the Company from the sale of shares of newly issued common stock were approximately $ 81.8 million, after deducting $ 3.9 million of underwriting discounts and commissions.

The Company did not receive any proceeds from the sale of shares by the Selling Stockholder.

EMPLOYEE BENEFIT PLANS

1 unchanged sentence

On June 15, 2021, the Company’s stockholders initially approved the 2021 Employee Stock Purchase Plan, which has been amended and restated by the Board of Directors and approved by the Company’s stockholders since then (as amended through the date of this report, the “2021 Purchase Plan”).

The 2021 Purchase Plan commenced on August 1, 2021, and provided for twenty-four -month offering periods with four six -month purchase periods in each offering period.

As of March 31, 2026 , 523,886 shares were available for future issuance under the 2021 Purchase Plan.

Subsequently, on April 23, 2026, the Company’s Board of Directors approved an amendment and restatement of the 2021 Purchase Plan, which is subject to stockholder approval at the 2026 annual meeting of stockholders, to increase the number of shares reserved for issuance under such plan by an additional 0.2 million shares, to a total of 1.6 million shares.

The most recent amendment, approved by the Company’s Board of Directors on April 23, 2026, and the stockholders on June 16, 2026, increased the number of shares reserved for issuance under such plan by an additional 0.2 million shares, to a total of 1.6 million shares.

The 2021 Purchase Plan commenced on August 1, 2021, and provides for twenty-four -month offering periods with four six -month purchase periods in each offering period.

As of June 30, 2026 , 0.7 million shares were available for future issuance under the 2021 Purchase Plan.

The Company estimated the fair value of purchase rights granted under the 2021 Purchase Plan during the period using the Black-Scholes-Merton option-pricing model with the following weighted average assumptions, resulting in the following weighted average fair values:

Three Months Ended March 31,

Six Months Ended June 30,

Expected life (in years)

5 unchanged sentences

$ 12.05 $ 9.36

During the three months ended March 31, 2026 and 2025 , a total of 117,181 shares and 89,508 shares, respectively, were issued under the 2021 Purchase Plan, at a weighted average purchase price of $ 18.46 per share and $ 23.68 per share, respectively.

As of March 31, 2026 , the estimated unrecognized compensation cost related to the 2021 Purchase Plan was $ 2.6 million, which is expected to be recognized over a weighted average period of 1.4 years.

During the six months ended June 30, 2026 and 2025 , a total of 117,181 shares and 90,076 shares, respectively, were issued under the 2021 Purchase Plan, at a weighted average purchase price of $ 18.46 per share and $ 23.68 per share, respectively.

As of June 30, 2026 , the estimated unrecognized compensation cost related to the 2021 Purchase Plan was $ 2.1 million, which is expected to be recognized over a weighted average period of 1.1 years.

Stock Incentive Plan

On November 16, 2011, the Company’s stockholders initially approved the 2011 Stock Incentive Plan, which has been amended and restated by the Board of Directors and approved by the Company’s stockholders a number of times since then (as amended through the date of this report, the “2011 Plan”).

As of March 31, 2026 , 15.9 million shares of common stock were reserved to cover stock-based awards under the 2011 Plan, of which 3.2 million shares were available for future grant.

Subsequently, on April 23, 2026, the Company’s Board of Directors approved an amendment and restatement of the 2011 Plan, which is subject to stockholder approval at the 2026 annual meeting of stockholders, to increase the number of shares reserved for issuance under such plan by an additional 0.8 million shares, to a total of 16.7 million shares, and extend the deadline to grant incentive stock options to April 23, 2036.

The most recent amendment, approved by the Company’s Board of Directors on April 23, 2026, and the stockholders on June 16, 2026, increased the number of shares reserved for issuance under such plan by an additional 0.8 million shares, to a total of 16.7 million shares, and extended the deadline to grant incentive stock options to April 23, 2036.

As of June 30, 2026 , 4.3 million shares were available for future grant under the 2011 Plan.

Stock Award Activities

7 unchanged sentences

( 415 ) 29.29

Nonvested, March 31, 2026

Nonvested, June 30, 2026

1,591 $ 29.27

As of March 31, 2026 , there was $ 39.3 million of total unrecognized compensation cost related RSUs which is expected to be recognized over a weighted average period of 2.5 years.

The Company withholds common stock to satisfy employee tax withholding obligations in connection with the vesting of RSUs and treats RSUs withheld for tax withholding in a similar manner to common stock repurchases and reports such shares as treasury stock.

Shares withheld for taxes related to employees’ tax withholding obligation for shares issued under the equity plans and the respective amounts are reflected in the condensed consolidated statements of stockholders’ equity.

As of June 30, 2026 , there was $ 34.1 million of total unrecognized compensation cost related RSUs which is expected to be recognized over a weighted average period of 2.4 years.

Additional information related to RSUs is as follows:

Three Months Ended March 31,

Six Months Ended June 30,

Total fair value of restricted stock units vested (in thousands)

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Stock Options

There were no stock options granted during the three months ended March 31, 2026 and 2025 .

As of March 31, 2026 , the outstanding stock options totaled 16,302 shares.

Total fair value of shares vested during the three months ended March 31, 2026 , was immaterial.

As of March 31, 2026 , there was no remaining unrecognized compensation cost related to unvested stock options.

There were no stock options granted during the six months ended June 30, 2026 and 2025 .

As of June 30, 2026 , the outstanding stock options totaled 12,557 shares.

Total fair value of shares vested during the three and six months ended June 30, 2026 , was immaterial.

As of June 30, 2026 , there was no remaining unrecognized compensation cost related to unvested stock options.

Stock-Based Compensation

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Stock-based compensation expense before taxes related to the Company’s stock plan and employee stock purchase plan was allocated as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Costs of revenues

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Research and development

2,169 2,251 4,561 4,670

Selling, general, and administrative

2,571 2,691 5,296 5,526

Total stock-based compensation expense

$ 5,998 $ 6,199 $ 12,394 $ 12,795

Income tax expense increased by $ 1.0 million for the three months ended March 31, 2026 , to $ 1.0 million as compared to $ 36 thousand income tax expense for the three months ended March 31, 2025 .

The Company’s effective tax rate was 18 % for the three months ended March 31, 2026 , compared to ( 1 )% for the three months ended March 31, 2025 .

Income tax expense increased by $ 2.4 million for the six months ended June 30, 2026 , to $ 1.4 million income tax expense as compared to $ 1.0 million income tax benefit for the six months ended June 30, 2025 .

The Company’s effective tax rate was 13 % for the six months ended June 30, 2026 , compared to 36 % for the six months ended June 30, 2025 .

The increase was primarily due to changes in the foreign, federal and state taxes, and year-to-date recognition of worldwide pre-tax income (loss) in relation to their forecasted amounts for the full year.

The Company’s provision for income taxes for the three months ended March 31, 2026 , was primarily attributable to state and foreign taxes.

The Company’s total amount of unrecognized tax benefits, excluding interest, as of March 31, 2026 , was $ 17.3 million, of which $ 2.5 million, if recognized, would affect the Company’s effective tax rate.

The Company’s provision for income taxes for the six months ended June 30, 2026 , was primarily attributable to foreign taxes, U.S.

federal and state taxes.

The Company’s total amount of unrecognized tax benefits, excluding interest, as of June 30, 2026 , was $ 17.3 million, of which $ 2.5 million, if recognized, would affect the Company’s effective tax rate.

The Company’s total amount of unrecognized tax benefits, excluding interest, as of December 31, 2025 , was $ 17.1 million, of which $ 2.5 million, if recognized, would affect the Company’s effective tax rate.

As of March 31, 2026 , the Company has recorded unrecognized tax benefits of $ 3.3 million, including interest of $ 0.8 million, as long-term taxes payable in the condensed consolidated balance sheets.

As of June 30, 2026 , the Company has recorded unrecognized tax benefits of $ 3.1 million, including interest of $ 0.7 million, as long-term taxes payable in the condensed consolidated balance sheets.

The remaining $ 14.9 million has been recorded within the Company’s DTAs, which is subject to a full valuation allowance.

The valuation allowance was approximately $ 69.9 million as of March 31, 2026 , and December 31, 2025 , which was related to U.S.

The valuation allowance was approximately $ 69.9 million as of June 30, 2026 , and December 31, 2025 , which was related to U.S.

net federal and state DTAs.

The worldwide net DTA balances were immaterial as of March 31, 2026 , and December 31, 2025 .

The worldwide net DTA balances were immaterial as of June 30, 2026 , and December 31, 2025 .

The Company has historically maintained a full valuation allowance against all the domestic DTAs because it was more likely than not that the DTAs will not be realized.

The Company intends to continue maintaining a full valuation allowance on the DTAs until sufficient evidence indicates its DTAs will be realized.

However, considering the Company’s current assessment of the probability of maintaining profitability, there is a reasonable possibility that in the short term, a portion, or all, of the valuation allowance would no longer be prudent.

As such, the Company may release a portion, or all, of the valuation allowance against DTAs within the next 12 months.

This release, if any, would result in the recognition of certain DTAs and a decrease to income tax expense for the period such release is recorded.

The Company is currently evaluating both quantitative and qualitative factors that may impact the valuation allowance assessment.

Therefore, the exact timing and amount of the valuation allowance release are subject to the Company’s profitability and projected ability to utilize the Company’s tax attributes, among other factors.

The Company conducts business globally and, as a result, files numerous consolidated and separate income tax returns in the U.S.

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In addition, all of the net operating loss and research and development credit carryforwards that may be utilized in future years may be subject to federal and state examination.

In May 2026, the Company received a notice from the Department of the Treasury Internal Revenue Service that Company’s federal income tax return for 2023 was selected for examination.

The Company is not currently under known income tax examinations in the U.S.

In May 2026, the Company received a notice from the Department of the Treasury Internal Revenue Service (“IRS”) that the Company’s federal income tax return for 2023 was selected for examination.

The examination remains in its early stages, and no issues have been raised by the IRS to date.

The Company is not currently under other known income tax examinations in the U.S.

for any other periods or in any other of its major foreign subsidiaries’ jurisdictions.

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The following is a reconciliation of the numerators and denominators used in computing basic and diluted net income (loss) per share (in thousands except per share amount):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Net income (loss)

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Net income (loss) per share:

For the three months ended March 31, 2025, because the Company was in a loss position, diluted net loss per share is the same as basic net loss per share as the inclusion of the potential common shares would have been anti-dilutive.

For the six months ended June 30, 2025, because the Company was in a loss position, diluted net loss per share is the same as basic net loss per share as the inclusion of the potential common shares would have been anti-dilutive.

The following table summarizes the potential shares of common stock that were not included in the diluted net income (loss) per share calculation above because to do so would be anti-dilutive for the periods indicated (in thousands):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Non-vested restricted stock units

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Further, the CODM reviews and utilizes functional expenses (costs of revenues, research and development, and selling, general and administrative) at the consolidated level to manage the Company’s operations.

Other segment items included in the condensed consolidated net income (loss) are amortization of acquired intangible assets, interest expense, interest income and other, net and income tax expense, which are reflected in the condensed consolidated statements of operations and comprehensive income.

Accordingly, the Company considers itself as one operating and reporting segment because it does not distinguish between markets, specifically the provision of services for differentiated data and analytics solutions to the semiconductor and electronics industries.

Accordingly, because it does not distinguish between markets, the Company considers itself as one operating and reporting segment, specifically the provision of services for differentiated data and analytics solutions to the semiconductor and electronics industries.

The following table presents segment total revenues, costs of revenues, gross profit, income from operations, and net income (loss) for the periods presented (in thousands):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Total revenues

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$ 4,271 $ 1,146 $ 9,062 $ ( 1,886 )

Revenues from an individual customer that are approximately 10% or more of the Company’s consolidated total revenues were as follows:

Three Months Ended March 31,

Revenues from individual customers, each of which was approximately 10% or more of the Company’s consolidated total revenues, were as follows:

Three Months Ended June 30,

Six Months Ended June 30,

22 % 19 % 25 % 17 %

* % 12 % * % 15 %

10 % 17 % 10 % 14 %

19 % * 10 % * %

* represents less than 10%

Gross accounts receivable balances (including amounts that are unbilled) from individual customers that are approximately 10% or more of the Company’s gross accounts receivable balance were as follows:

Gross accounts receivable balances (including amounts that are unbilled) from individual customers, each of which was approximately 10% or more of the Company’s gross accounts receivable balance, were as follows:

Long-lived assets, net by geographic area were as follows (in thousands):

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$ 111,910 $ 97,333

( 1 ) Includes assets deployed at customer sites which could be outside the U.S.

( 1 ) Includes assets deployed at customer sites which could be outside the United States.

FAIR VALUE MEASUREMENTS

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The Company’s financial assets measured at fair value on a recurring basis and the classification by level of input within the fair value hierarchy were as follows (in thousands):

March 31, 2026

June 30, 2026

December 31, 2025

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Cash equivalents

$ 12,645 $ 12,645 $ — $ — $ 14,535 $ 14,535 $ — $ —

Available-for-sale debt securities:

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Other current assets

2,162 — — 2,162 2,138 — — 2,138

$ 14,807 $ 12,645 $ — $ 2,162 $ 16,673 $ 14,535 $ — $ 2,138

In August 2024, the Company purchased a $ 2.0 million non-marketable convertible promissory note from an unrelated third party (the “convertible note”).

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COMMITMENTS AND CONTINGENCIES

Strategic Partnership with Advantest — See Note 13, Strategic Partnership Agreement with Advantest and Related Party Transactions , for the discussion about the Company’s commitments under the strategic partnership with Advantest.

Operating Leases — Refer to Note 4, Leases , for the discussion about the Company’s lease commitments.

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The standard warranty reserve is based on estimated total expected costs to fulfill our warranty obligation based on best available information as of the reporting date.

The standard warranty reserve was immaterial as of March 31, 2026 , and December 31, 2025 .

The standard warranty reserve was immaterial as of June 30, 2026 , and December 31, 2025 .

Purchase Obligations — The Company has purchase obligations with certain suppliers for the purchase of goods and services entered into in the ordinary course of business.

As of March 31, 2026 , total outstanding purchase obligations were $ 64.6 million, the majority of which is due within the next 18 months.

As of June 30, 2026 , total outstanding purchase obligations were $54.5 million, the majority of which is due within the next 2 years.

Indemnification of Officers and Directors — As permitted by the Delaware General Corporation Law, the Company has included a provision in its certificate of incorporation to eliminate the personal liability of its officers and directors for monetary damages for breach or alleged breach of their fiduciary duties as officers or directors.

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The Company accrues for losses related to litigation when a potential loss is probable, and the loss can be reasonably estimated, and recognizes gains related to litigation at the earlier of when the gain has been realized or when it is realizable in accordance with FASB requirements.

As of March 31, 2026 , the Company was not party to any material legal proceedings for which a loss was probable or an amount was accrued.

As of June 30, 2026 , the Company was not party to any material legal proceedings for which a loss was probable or an amount was accrued.

On May 6, 2020, the Company initiated an arbitration proceeding with the Hong Kong International Arbitration Center (the “Tribunal”) against SMIC New Technology Research & Development (Shanghai) Corporation (“SMIC”) due to SMIC’s failure to pay fees due to the Company under a series of contracts.

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No payments under the Award have been received by the Company to date and in February 2026, SMIC filed an application with the High Court of Hong Kong seeking to set the Award aside.

The Company believes the set aside application is without merit and intends to defend it, and is pursuing judicial enforcement of the Award.

There can be no assurances that the Company will receive all or any part of the Award.

Accordingly, no amounts have been recognized in connection with the Award as of March 31, 2026.

STRATEGIC PARTNERSHIP AGREEMENT WITH ADVANTEST AND RELATED PARTY TRANSACTIONS

In July 2020, the Company entered into a long-term strategic partnership with Advantest Corporation through its wholly-owned subsidiary, Advantest America, Inc.

(collectively referred to herein as “Advantest”), which includes:

(i) a Securities Purchase Agreement wherein the Company issued and sold to Advantest America, Inc., an aggregate of 3,306,924 shares of its common stock, for aggregate gross proceeds of $ 65.2 million;

(ii) a significant agreement for its assistance in development of cloud-based applications for Advantest tools that leverages our Exensio analytics software;

(iii) a commercial agreement providing for the license to third parties of solutions that result from the development work that combine Advantest’s testing applications and our Exensio platform;

and (iv) a 5 -year cloud-based subscription that expired in July 2025 for Exensio analytics software and related services.

Revenue recognized from Advantest was $ 0.5 million and $ 3.6 million during the three months ended March 31, 2026 and 2025 , respectively.

Accounts receivable from Advantest were not material as of March 31, 2026 , and December 31, 2025 .

Deferred revenue amounted to $ 1.3 million and $ 0.7 million as of March 31, 2026 , and December 31, 2025 , respectively.

The Company believes the set aside application is without merit, is defending it, and is pursuing judicial enforcement of the Award in various jurisdictions.

At this time, there is no assurance that the Company will receive all or any part of the Award.

Accordingly, no amounts have been recognized in connection with the Award as of June 30, 2026 .

RELATED PARTY TRANSACTIONS

Through May 15, 2026, Advantest Corporation through its wholly-owned subsidiary, Advantest America, Inc.

(collectively referred to herein as “Advantest”) was a related party because it owned more than 5% of the Company’s outstanding equity following the purchase by Advantest of 3,306,924 shares of common stock from the Company in July 2020 pursuant to a securities purchase agreement entered into between them, for aggregate gross proceeds to the Company of $ 65.2 million.

On May 15, 2026, as a result of the Offering, Advantest ceased to be a related party.

See Note 6, Stockholders’ Equity .

In July 2020, the Company and Advantest also entered into (i) a development agreement for Advantest tools to leverage the Company’s Exensio analytics software;

(ii) a commercialization agreement providing for the license to third parties of solutions resulting from the development work;

and, (iii) a cloud-based subscription for Exensio analytics software and related services.

The Exensio subscription expired in July 2025, while the development and commercialization agreements continue in effect.

Revenue recognized from Advantest during the three and six months ended June 30, 2026, was $ 0.2 million and $ 0.7 million, respectively, and during the three and six months ended June 30, 2025, $ 3.5 million and $ 7.1 million, respectively.

Since it was no longer a related party as of June 30, 2026, there were no accounts receivable and deferred revenue from Advantest as of such date.

As of December 31, 2025 , accounts receivable from Advantest was not material and deferred revenue amounted to $ 8.3 million.

BUSINESS COMBINATION

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The Company financed the Transaction using a combination of cash on hand and borrowings under the Credit Facilities.

The Company expects the Transaction to accelerate equipment makers’ ability to derive value from equipment data by enabling them to leverage the Company’s Exensio analytics software and to expand the capability of the Company’s secure data exchange (“DEX”) outsourced semiconductor assembly and test (“OSAT”) network by allowing equipment makers, fab operators, and fabless companies to collaborate to optimize chip manufacturing and test.

The Company acquired SecureWise to accelerate equipment makers’ ability to derive value from equipment data by enabling them to leverage the Company’s Exensio analytics software and to expand the capability of the Company’s secure data exchange (“DEX”) outsourced semiconductor assembly and test (“OSAT”) network by allowing equipment makers, fab operators, and fabless companies to collaborate to optimize chip manufacturing and test.

The Company accounted for the Transaction as a business combination in accordance with ASC Topic 805, Business Combinations.

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Pro forma information reflecting the impact of the Transaction has not been presented as the Transaction was not material to the Company’s financial results.

SUBSEQUENT EVENTS

First Amendment to Credit Agreement

On April 23, 2026, the Company entered into a First Amendment to Credit Agreement (the “Amendment”) with the Lenders and the Agent to amend the Credit Agreement dated as of March 7, 2025 ( see Note 5, Debt ).

The Amendment increases the Revolving Credit Facility to an aggregate principal amount of $ 75 million.

The Amendment introduces leveraged-based adjustments to the annual Revolving Credit Facility commitment fee during the term of the Credit Agreement.

Instead of a flat per annum rate of 0.50 %, the Revolving Credit Facility commitment fee will be 0.50 % when the total debt to EBITDA ratio is greater than or equal to 2.50 to 1.00, 0.35 % when the total debt to EBITDA ratio is less than 2.50 to 1.00 but greater than or equal to 0.50 to 1.00 and 0.20 % when the total debt to EBITDA ratio is less than 0.50 to 1.00.

All other material terms of the Credit Agreement remain unchanged.

Under this facility, $ 30.0 million is available to the Company for drawdown.

Stock Repurchase Programs and Employee Benefit Plans

Refer to Note 6, Stockholders’ Equity , for the discussion about the adoption of the 2026 Stock Repurchase Program in May 2026.

Refer to Note 7, Employee Benefit Plan , for the discussion about the amendments to the 2011 Stock Incentive Plan and the 2021 Purchase Plan in April 2026.

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations

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cost and schedule of new product development and investments in research and development;

the continuing impact of macroeconomic conditions, including inflation, changing interest rates and tariffs, the evolving trade regulatory environment and geopolitical tensions, and other trends impacting the semiconductor industry, the Company ’ s customers, operations, and supply and demand for its products;

the continuing impact of macroeconomic conditions, including inflation, changing interest rates and tariffs, energy prices, the evolving trade regulatory environment and geopolitical tensions, and other trends impacting the semiconductor industry, the Company ’ s customers, operations, and supply and demand for its products;

supply chain disruptions;

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Worldwide economic performance is uneven, and the possibility of a recession persists, leading to uneven demand.

Geopolitical tensions and conflicts in various locations around the world have created volatility in the global financial markets and may have further global economic consequences, including potential disruptions of the global supply chain, heightened volatility of commodity and raw material prices, and increased fears of a global recession.

Inventories of semiconductor devices remain elevated in some instances.

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Based on our current assessments, we expect the near-term impact of these evolving trade restrictions on our business to be limited.

Secondary Offering

In May 2026, we completed a registered offering of an aggregate of 5,253,554 shares of our common stock at a price of $44.00 per share.

The shares sold consisted of 3,306,924 shares held by a selling stockholder and 1,946,630 shares newly issued by us.

The net proceeds to us from the sale of shares of our common stock were approximately $81.8 million, after deducting $3.9 million of underwriting discounts and commissions.

We did not receive any proceeds from the sale of shares by the selling stockholder.

Financial Highlights

Financial highlights for the three months ended March 31, 2026, are as follows:

Total revenues were $60.1 million, an increase of $12.4 million, or 26%, compared to the same period in 2025.

Platform revenue was $50.9 million, an increase of $13.6 million, or 36%, compared to the same period in 2025.

The increase in Platform revenue was driven by higher revenue from CV and DirectScan systems, the addition of revenues related to secureWISE systems, and increase in revenue from Exensio software and services.

Volume-based revenue was $9.2 million, a decrease of $1.3 million, or 12%, compared to the same period in 2025, primarily due to a decrease in revenue from Gainshare, partially offset by an increase in revenue from secureWISE data usage.

Costs of revenues increased by $4.0 million, compared to the same period in 2025, primarily due to increases in personnel-related costs, software license and maintenance costs, facilities and IT-related costs, including depreciation and amortization expense, amortization of acquired technology, and travel expense.

Net income was $4.8 million, compared to a net loss of $3.0 million for the same period in 2025.

The increase in net income was primarily attributable to (a) an increase in total revenues, (b) a decrease in acquisition-related and integration costs, and (c) a net favorable fluctuation in foreign currency exchange rates, partially offset by (i) an increase in overall costs and expenses mainly due to increases in personnel-related expenses, costs related to the operation of SecureWise, facilities and IT-related costs, including depreciation and amortization, amortization of acquired intangible assets, subcontractor fees, software license and maintenance costs, and travel expenses, (ii) an increase in interest expense from our long-term debt, (iii) a decrease in interest income, and (iv) an increase in income tax expense.

Financial highlights for the three months ended June 30, 2026, are as follows:

Total revenues were $61.5 million, an increase of $9.8 million, or 19%, compared to the three months ended June 30, 2025.

Platform revenue was $49.1 million, an increase of $5.9 million, or 14%, compared to the three months ended June 30, 2025.

The increase in Platform revenue was due to higher revenue from DirectScan systems, partially offset by decreases in revenue from CV systems, Exensio software and services, and secureWISE systems.

Volume-based revenue was $12.4 million, an increase of $3.9 million, or 45%, compared to the three months ended June 30, 2025, primarily due to an increase in revenue from Gainshare and Cimetrix runtime licenses.

Costs of revenues increased by $4.2 million, compared to the three months ended June 30, 2025, primarily due to increases in hardware costs (including cost of leased asset under sales-type leases), facilities and IT-related costs (including depreciation and amortization expense of property and equipment), personnel-related costs, and software license and maintenance costs, partially offset by a decrease in subcontractor costs.

Net income was $4.3 million, compared to a net income of $1.1 million for the three months ended June 30, 2025.

The increase in net income was primarily attributable to an increase in total revenues and a net favorable fluctuation in foreign currency exchange rates, partially offset by increases in costs of revenues, operating expenses, and income taxes, and a decrease in other income.

The increase in overall costs and operating expenses was primarily due to increases in hardware costs (including cost of leased asset under sales-type leases), facilities and IT-related costs (including depreciation and amortization of property and equipment), personnel-related expenses, software licenses and maintenance costs, and legal fees related to the arbitration proceeding over a disputed customer contract, partially offset by an increase in capitalized software development costs.

Financial highlights for the six months ended June 30, 2026, are as follows:

Total revenues were $121.7 million, an increase of $22.2 million, or 22%, compared to the six months ended June 30, 2025.

Platform revenue was $100.1 million, an increase of $19.5 million, or 24%, compared to the six months ended June 30, 2025.

The increase in Platform revenue was primarily due to higher revenue from DirectScan, CV, and secureWISE systems.

Volume-based revenue was $21.6 million, an increase of $2.6 million, or 14%, compared to the six months ended June 30, 2025, primarily due to an increase in revenue from Cimetrix runtime licenses and secureWISE data usage.

Costs of revenues increased by $8.2 million, compared to the six months ended June 30, 2025, primarily due to increases in hardware costs (including cost of leased assets under sales-type leases), personnel-related costs, facilities and IT-related costs (including depreciation and amortization expense of property and equipment), software license and maintenance costs, and amortization of acquired technology.

Net income was $9.1 million, compared to a net loss of $1.9 million for the six months ended June 30, 2025.

The increase in overall costs and operating expenses was primarily driven by increases in personnel-related expenses, hardware costs (including cost of leased assets under sales-type leases), facilities and IT-related costs (including depreciation and amortization of property and equipment), software licenses and maintenance costs, amortization of acquired intangible assets, travel expenses, subcontractor fees, and costs and expenses related to the operation of SecureWise, partially offset by a decrease in acquisition-related and integration costs and an increase in capitalized software development costs.

Critical Accounting Policies

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For additional information about our critical accounting policies, see Note 1, Basis of Presentation and Summary of Significant Accounting Policies , and Note 2, Revenue from Contracts with Customers to our unaudited condensed consolidated financial statements in this Quarterly Report on Form 10‑Q and Part II Item 7 , Management ’ s Discussion and Analysis of Financial Condition and Results of Operation, under the heading of “ Critical Accounting Estimates ” in our Annual Report.

There were no material changes during the three months ended March 31, 2026, to the items that we disclosed as our critical accounting policies and estimates in Part II, Item 7 of the Annual Report.

There were no material changes during the six months ended June 30, 2026, to the items that we disclosed as our critical accounting policies and estimates in Part II, Item 7 of the Annual Report.

Recent Accounting Pronouncements and Accounting Changes

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Results of Operations

Discussion of Financial Data for the Three Months ended March 31, 2026 and 2025

Discussion of Financial Data for the Three and Six Months ended June 30, 2026 and 2025

Revenues, Costs of Revenues, and Gross Margin

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The following table presents reclassified historical amounts to conform to the current period’s presentation (in thousands):

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(Dollars in thousands)

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Platform Revenue

Platform revenue increased $13.6 million for the three months ended March 31, 2026, compared to the same period in 2025.

The increase in Platform revenue was primarily driven by higher revenue from CV and DirectScan systems, the addition of revenues related to SecureWISE systems, and increase in revenue from Exensio software and services.

Platform revenue increased $5.9 million for the three months ended June 30, 2026, compared to the same period in 2025.

The increase in Platform revenue was primarily due to higher revenue from DirectScan systems, partially offset by decreases in revenue from CV systems, Exensio software and services, and secureWISE systems.

Platform revenue increased $19.5 million for the six months ended June 30, 2026, compared to the same period in 2025.

The increase in Platform revenue was primarily due to higher revenue from DirectScan, CV, and secureWISE systems.

Volume-based Revenue

Volume-based revenue decreased $1.3 million for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to decrease in revenue from Gainshare, partially offset by an increase in secureWISE data usage.

Volume-based revenue increased $3.9 million for the three months ended June 30, 2026, compared to the same period in 2025, primarily due to an increase in revenue from Gainshare and Cimetrix runtime licenses.

Volume-based revenue increased $2.6 million for the six months ended June 30, 2026, compared to the same period in 2025, primarily due to an increase in revenue from Cimetrix runtime licenses and secureWISE data usage.

Our revenues may also fluctuate in the future due to other factors, including the semiconductor industry’s continued acceptance of our products, services and solutions, the timing of purchases by existing and new customers, cancellations by existing customers, our ability to attract new customers and penetrate new markets, supply chain challenges and further penetration of our current customer base.

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Software license costs consist of costs associated with third-party cloud-delivery related expenses and licensing third-party software used by us in providing services to our customers in solution engagements or sold in conjunction with our software products.

The increase in costs of revenues of $4.0 million for the three months ended March 31, 2026, compared to the same period in 2025, was primarily due to (i) a $1.8 million increase in personnel-related costs due to increased headcount and higher bonus expense, (ii) a $0.9 million increase in facilities and IT-related costs, including depreciation and amortization expense, (iii) a $0.7 million increase in software license and maintenance costs, (iv) a $0.3 million increase in amortization of acquired technology, and (v) a $0.2 million increase in travel expense.

Gross margin decreased one percentage point for the three months ended March 31, 2026, to 72% compared to 73% for the same period in 2025, primarily due to decrease in revenue from Gainshare and higher costs.

Costs of revenues increased $4.2 million for the three months ended June 30, 2026, compared to the same period in 2025, primarily due to (i) a $2.8 million increase in hardware costs (including cost of leased assets under sales-type leases), (ii) a $0.9 million increase in facilities and IT-related costs (including depreciation and amortization expense of property and equipment), (iii) a $0.5 million increase in personnel-related costs due to increased headcount, employee benefits expense, and higher bonus expense, and (iv) a $0.4 million increase in software license and maintenance costs, partially offset by a $0.5 million decrease in subcontractor costs.

Costs of revenues increased $8.2 million for the six months ended June 30, 2026, compared to the same period in 2025, primarily due to (i) a $2.8 million increase in hardware costs (including cost of leased assets under sales-type leases), (ii) a $2.3 million increase in personnel-related costs due to increased headcount and higher bonus expense, (iii) a $1.4 million increase in facilities and IT-related costs (including depreciation and amortization expense of property and equipment), (iv) a $1.3 million increase in software license and maintenance costs, (v) a $0.3 million increase in amortization of acquired technology, and (vi) a $0.2 million increase in travel expense, partially offset by a $0.4 million decrease in subcontractor costs.

Gross margin for the three months ended June 30, 2026, decreased two percentage points to 69%, compared to 71% for the same period in 2025, primarily driven by higher costs of revenues compared to the increase in revenues.

Gross margin for the six months ended June 30, 2026, decreased two percentage points to 70%, compared to 72% for the same period in 2025, primarily driven by higher costs of revenues compared to the increase in revenues.

Operating Expenses:

Research and Development

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(Dollars in thousands)

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Research and development expenses consist primarily of personnel-related costs (including compensation, employee benefits, bonus and stock-based compensation expense), outside development services, travel expenses, third-party cloud-services related costs, IT and facilities cost allocations to support product development activities.

Research and development expenses increased $3.7 million for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to (i) a $2.5 million increase in personnel-related costs due to increased headcount, higher bonus expense, and employee benefits expense, (ii) a $0.5 million increase in subcontractor fees primarily related to secureWISE systems and Exensio software, and (iii) a $0.5 million increase in facilities and IT-related costs, including depreciation and amortization expense.

Research and development expenses increased $2.4 million for the three months ended June 30, 2026, compared to the same period in 2025, primarily due to (i) a $1.2 million increase in personnel-related costs due to increased headcount, higher bonus expense, and employee benefits expense, partially offset by an increase in capitalized software development costs, (ii) a $0.8 million increase in facilities and IT-related costs (including depreciation and amortization expense of property and equipment), and (iii) a $0.3 million increase in software license and maintenance costs.

Research and development expenses increased $6.1 million for the six months ended June 30, 2026, compared to the same period in 2025, primarily due to (i) a $3.7 million increase in personnel-related costs due to increased headcount, higher bonus expense, and employee benefits expense, partially offset by an increase in capitalized software development costs, (ii) a $1.3 million increase in facilities and IT-related costs (including depreciation and amortization expense of property and equipment), (iii) a $0.6 million increase in subcontractor costs, and (iv) a $0.4 million increase in software license and maintenance costs.

We anticipate our expenses in research and development will fluctuate in absolute dollars from period to period as a result of the size and the timing of product development projects.

Selling, General, and Administrative

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(Dollars in thousands)

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Selling, general, and administrative expenses consist primarily of personnel-related costs (including compensation, employee benefits, bonus, commission and stock-based compensation expense for sales, marketing, and general and administrative personnel), legal, tax and accounting services, marketing communications and trade conference-related expenses, third-party cloud-services related costs, travel, business acquisition and integration costs, IT and facilities cost allocations.

Selling, general, and administrative expenses decreased $5.9 million for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to (i) a $4.3 million decrease in acquisition and integration costs related to the acquisition of SecureWise, (ii) a $1.4 million decrease in personnel-related costs mainly due to lower compensation expense allocated to selling and marketing activities, and stock-based compensation expense, and (iii) a $0.5 million decrease in facilities and IT-related costs, partially offset by a $0.2 million increase in subcontractor expenses.

Selling, general, and administrative expenses decreased $0.8 million for the three months ended June 30, 2026, compared to the same period in 2025, primarily due to (i) a $1.2 million decrease in personnel-related costs mainly due to lower compensation expense allocated to selling and marketing activities, and (ii) a $0.3 million decrease in facilities and IT-related costs (including depreciation and amortization expense of property and equipment), partially offset by (i) a $0.4 million increase in legal expenses related to the arbitration proceeding over a disputed customer contract, and (ii) a $0.2 million increase in software licenses and maintenance costs.

Selling, general, and administrative expenses decreased $6.6 million for the six months ended June 30, 2026, compared to the same period in 2025, primarily due to (i) a $4.5 million decrease in acquisition-related and integration costs related to the acquisition of SecureWise, (ii) a $2.6 million decrease in personnel-related costs mainly due to lower compensation expense allocated to selling and marketing activities, and stock-based compensation expense, and (iii) a $0.9 million decrease in facilities and IT-related costs, including shipping costs and third-party cloud-services related costs, partially offset by (i) a $0.5 million increase in legal expenses related to the arbitration proceeding over a disputed customer contract, (ii) a $0.3 million increase in software licenses and maintenance costs, (iii) a $0.3 million increase in travel expenses, and (iv) a $0.3 million increase in subcontractor expenses.

We anticipate our selling, general, and administrative expenses will fluctuate in absolute dollars from period to period as a result of cost control initiatives and to support increased selling efforts in the future.

Amortization of Acquired Intangible Assets

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(Dollars in thousands)

1 unchanged sentence

Amortization of acquired intangible assets represents amortization expense on intangibles assets acquired from business combinations in prior years.

The increase in amortization expense for the three months ended March 31, 2026, compared to the same period in 2025, was a result of the amortization of intangible assets acquired in the SecureWise acquisition in March 2025.

The amortization expense for the three months ended June 30, 2026, was flat compared to the same period in 2025.

The increase in amortization expense for the six months ended June 30, 2026, compared to the same period in 2025, was a result of the amortization of intangible assets acquired in the SecureWise acquisition in March 2025.

Interest Expense

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(Dollars in thousands)

1 unchanged sentence

Interest expense is from our long-term debt that was used in financing the acquisition of SecureWise in March 2025, and the related amortization of debt discount and issuance costs.

Interest expense increased $0.8 million for the three months ended March 31, 2026, compared to the same period in 2025, driven by a full quarter of interest on long-term debt and the amortization of debt discount and issuance costs in the first quarter of 2026, compared to approximately one month of interest following the drawdown of long-term debt in March 2025.

Interest expense slightly decreased by $0.1 million for the three months ended June 30, 2026, compared to the same period in 2025, primarily due to slightly lower interest rates on our long-term debt and lower outstanding debt balance.

Interest expense increased $0.6 million for the six months ended June 30, 2026, compared to the same period in 2025, was driven by a full two quarters of interest on long-term debt in 2026, compared to approximately four months of interest in 2025 following the drawdown of long-term debt in March 2025.

Interest Income and Other, Net

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(Dollars in thousands)

1 unchanged sentence

Interest income and other, net, primarily consists of interest income and foreign currency transaction exchange gains and losses.

Interest income and other, net decreased $0.3 million for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to $0.9 million decrease in interest income from cash and cash equivalents, partially offset by a $0.6 million net favorable fluctuations in foreign currency exchange rates.

Income Tax Expense

Three Months Ended March 31,

Interest income and other, net increased $0.5 million for the three months ended June 30, 2026, compared to the same period in 2025, primarily due to a $1.1 million net favorable fluctuations in foreign currency exchange rates, and a $0.2 million increase in interest income from cash and cash equivalents, partially offset by a $0.6 million decrease in other income due to a one-time recovery from previously written-off property and equipment in the second quarter of 2025.

Interest income and other, net increased $0.2 million for the six months ended June 30, 2026, compared to the same period in 2025, primarily due to a $1.7 million net favorable fluctuations in foreign currency exchange rates, partially offset by a $0.7 million decrease in interest income primarily due to a lower average balance of cash and cash equivalents during the first half of 2026, and $0.6 million decrease in other income due to a one-time recovery from previously written-off property and equipment in the second quarter of 2025.

Income Tax Benefit (Expense)

Three Months Ended June 30,

Six Months Ended June 30,

(Dollars in thousands)

Income tax expense

Income tax expense increased for the three months ended March 31, 2026, compared to the same period in 2025, primarily due to the impact of enacted U.S.

Income tax benefit (expense)

We had an income tax expense for three and six months ended June 30, 2026 and income tax benefit for comparative prior year periods.

Income tax expense increased for the three and six months ended June 30, 2026, compared to the same periods in 2025, primarily due to the impact of enacted U.S.

federal tax legislation, changes in the foreign, federal and state taxes and year-to-date recognition of worldwide pre-tax income in relation to their forecasted amounts for the full year.

1 unchanged sentence

Our future tax rates may be adversely affected by a number of factors including increase in expenses not deductible for tax purposes, new or changing tax legislation in the United States and in foreign countries where we are subject to tax jurisdictions, the geographic composition of our pre-tax income, the amount of our pre-tax income as business activities fluctuate, our ability to use tax attributes such as research and development tax credits and net operation losses, the tax effects of employee stock activity, audit examinations with adverse outcomes, changes in accounting principles generally accepted in the United States of America and the effectiveness of our tax planning strategies.

The Organization for Economic Co-operation and Development (“OECD”) has a framework to implement a global minimum corporate tax of 15% for companies with global revenue and profits above certain thresholds (referred to as Pillar 2).

Although the U.S.

has not enacted legislation to implement Pillar 2, certain countries in which we operate have adopted legislation, and other countries are in the process of introducing legislation to implement Pillar 2.

The OECD issued new administrative guidance on January 5, 2026, with respect to Pillar 2 which modifies key aspects of the framework for countries to enact in their own laws.

Pillar 2 did not have an impact on our condensed consolidated financial statements for the first quarter of 2026 because we do not currently meet the 750 million Euro sales threshold.

We have historically maintained a full valuation allowance against all the domestic DTAs because it was more likely than not that the DTAs will not be realized.

The valuation allowance was approximately $69.9 million as of June 30, 2026, and December 31, 2025, which was related to U.S.

net federal and state DTAs.

The worldwide net DTA balances were immaterial as of June 30, 2026, and December 31, 2025.

We intend to continue maintaining a full valuation allowance on the DTAs until sufficient evidence indicates its DTAs will be realized.

However, considering our current assessment of the probability of maintaining profitability, there is a reasonable possibility that in the short term, a portion, or all, of the valuation allowance would no longer be prudent.

As such, we may release a portion, or all, of the valuation allowance against DTAs within the next 12 months.

This release, if any, would result in the recognition of certain DTAs and a decrease to income tax expense for the period such release is recorded.

We are currently evaluating both quantitative and qualitative factors that may impact the valuation allowance assessment.

Therefore, the exact timing and amount of the valuation allowance release are subject to our profitability and projected ability to utilize our tax attributes, among other factors.

Liquidity and Capital Resources

As of March 31, 2026, our working capital, defined as total current assets less total current liabilities, was $100.7 million, compared to $92.0 million as of December 31, 2025.

Total cash and cash equivalents were $31.2 million as of March 31, 2026, compared to $42.2 million as of December 31, 2025.

As of March 31, 2026, and December 31, 2025, cash and cash equivalents held by our foreign subsidiaries were $8.7 million and $6.7 million, respectively.

As of June 30, 2026, our working capital, defined as total current assets less total current liabilities, was $179.3 million, compared to $92.0 million as of December 31, 2025.

Total cash and cash equivalents were $114.9 million as of June 30, 2026, compared to $42.2 million as of December 31, 2025.

As of June 30, 2026, and December 31, 2025, cash and cash equivalents held by our foreign subsidiaries were $12.3 million and $6.7 million, respectively.

Our material cash requirements include payments for capital expenditures, principal and interest payments on our debt, cash needed to fund our operating activities, operating lease payments, and purchase obligations to support our operations.

Refer to Part I, Item 1, Financial Statements, Note 4, Leases , Note 5, Debt , and Note 12, Commitments and Contingencies for details relating to our material cash requirements for debt, leasing arrangements, including future maturities of operating lease liabilities, and purchase obligations, respectively.

Additionally, we also use our available cash to pay for employees withholding tax obligations related to net share settlement of equity awards issued under the Company’s equity plan.

Refer to Part I, Item 1, Financial Statements, Note 4, Leases , Note 5, Debt , Note 7, Employee Benefit Plans , and Note 12, Commitments and Contingencies for details relating to our material cash requirements for leasing arrangements, including future maturities of operating lease liabilities, debt, taxes related to net share settlement of equity awards, and purchase obligations, respectively.

As we continuously grow our DirectScan systems business, we will also continuously invest in our DirectScan systems assets and our capital expenditures for the foreseeable future will be mainly related to the construction of these assets.

We believe that our existing cash resources and anticipated funds from operations will satisfy our cash requirements to fund our operating activities, capital expenditures, other obligations including repayment of long-term debt and corresponding interest for at least the next twelve months, and thereafter for the foreseeable future.

Secondary Offering

In May 2026, we completed a registered offering of an aggregate of 5,253,554 shares of the Company's common stock at a price of $44.00 per share.

The shares sold consisted of 3,306,924 shares held by a selling stockholder and 1,946,630 shares newly issued by us.

The net proceeds to us from the sale of shares of our common stock were approximately $81.8 million, after deducting $3.9 million of underwriting discounts and commissions.

We did not receive any proceeds from the sale of shares by the selling stockholder.

Term Loan and Revolving Credit Facility

3 unchanged sentences

The principal of the Term Loan is due in the amount of $0.6 million quarterly and a balloon payment of $13.1 million in March 2030.

Borrowings under the Credit Facilities will accrue interest at rates equal, at our election, to (i) the alternate base rate, which is defined as the highest of (a) the federal funds effective rate in effect from time to time plus 0.50%, (b) the prime commercial lending rate in effect from time to time, and (c) the daily simple secured overnight financing rate (“SOFR”) plus 1.00% or (ii) SOFR, plus, in each case, the applicable margin.

The applicable margin for the Revolving Credit Facility borrowings bearing interest at the alternate base rate ranges from 1.00% to 1.75%, and the applicable margin for Revolving Credit Facility borrowings bearing interest based on the SOFR ranges from 2.00% to 2.75%, in each case, based on our consolidated total net leverage ratio as of the most recently ended fiscal quarter.

The applicable margin for Term Loan borrowings bearing interest at the alternate base rate ranges from 1.00% to 1.75%, and the applicable margin for Term Loan borrowings bearing interest based on the SOFR ranges from 2.00% to 2.75%, in each case, based on our consolidated total net leverage ratio as of the most recently ended fiscal quarter.

We will pay an annual commitment fee during the term of the Credit Agreement at a rate per annum equal to 0.50% for any undrawn portion of the Revolving Credit Facility.

The Company’s weighted average annual interest rate on its outstanding debt was 5.9% for the three months ended March 31, 2026.

The Credit Agreement contains customary representations and warranties, as well as customary affirmative and negative covenants.

Negative covenants include, among others, restrictions on the incurrence of debt, the incurrence of liens, the making of investments and distributions, dividends, and stock buy-backs.

In addition, the Credit Agreement requires that we maintain a consolidated total net leverage ratio of not greater than 3.00 to 1.00, and a consolidated fixed charge coverage ratio of not less than 1.25 to 1.00.

As of March 31, 2026, we were in compliance with the covenants contained in the Credit Agreement.

The Credit Agreement contains customary events of default.

Upon the occurrence and during the continuance of an event of default, the Agent may declare the outstanding advances and all other obligations under the Credit Agreement immediately due and payable.

The obligations under the Credit Agreement are guaranteed by all present and future material domestic subsidiaries of the Company (collectively with the Company referred to herein as the “Credit Parties”), subject to customary exceptions, and are secured by the equity interests of the Credit Parties (other than the Company) and substantially all of the personal property owned by the Credit Parties, including 65% of the equity interests of certain foreign subsidiaries owned by the Credit Parties.

The Company used the amounts borrowed under the Credit Facilities to finance, in part, the purchase price paid for the acquisition of SecureWise.

First Amendment to Credit Agreement

On April 23, 2026, the Company entered into a First Amendment to Credit Agreement (the “Amendment”) with the Lenders and the Agent to amend the Credit Agreement dated as of March 7, 2025.

The Amendment increases the Revolving Credit Facility to an aggregate principal amount of $75 million.

The Amendment introduces leveraged-based adjustments to the annual Revolving Credit Facility commitment fee during the term of the Credit Agreement.

Instead of a flat per annum rate of 0.50%, the Revolving Credit Facility commitment fee will be 0.50% when the total debt to EBITDA ratio is greater than or equal to 2.50 to 1.00, 0.35% when the total debt to EBITDA ratio is less than 2.50 to 1.00 but greater than or equal to 0.50 to 1.00 and 0.20% when the total debt to EBITDA ratio is less than 0.50 to 1.00.

All other material terms of the Credit Agreement remain unchanged.

Under this facility, $30.0 million is available for the issuance of letters of credit.

On April 23, 2026, we entered into a First Amendment to Credit Agreement (the “Amendment”) with the Lenders and the Agent to amend the Credit Agreement which increased the Revolving Credit Facility to an aggregate principal amount of $75.0 million.

Under this facility, $30.0 million is available to us for drawdown as of June 30, 2026.

As of June 30, 2026, our outstanding total debt, net of debt discounts and issuance costs, was $66.5 million, compared to $67.0 million as of December 31, 2025.

We believe we have operating flexibility, cash flow, and access to capital markets to meet scheduled payments of our debt.

As of June 30, 2026, we were in compliance with all of the terms and conditions of the Credit Agreement, and management believes, based on its current financial projections, that we will be in compliance with our covenants over the next twelve months.

See Note 6, Debt to our unaudited condensed consolidated financial statements in this Quarterly Report on Form 10‑Q.

Repurchase of Company ’ s Common Stock

On April 15, 2024, the Board of Directors adopted a stock repurchase program (the “2024 Program”) to repurchase up to $40.0 million of the Company’s common stock both on the open market and in privately negotiated transactions, including through Rule 10b5-1 plans, from time to time, over the next two years from the adoption date.

In 2025, the Company repurchased 12,500 shares under the 2024 Program at an average price of $19.55 per share for an aggregate total price of $0.2 million.

During the three months ended March 31, 2026, the Company did not repurchase any shares under the 2024 Program.

As of March 31, 2026, approximately $39.8 million remained available under the 2024 Program.

Subsequently, on April 14, 2026, the 2024 Program expired.

Also, subsequently, in May 2026, the Board Directors adopted a new stock repurchase program (the “2026 Program”) to repurchase up to $50.0 million of the Company’s common stock both on the open market and in privately negotiated transactions, including through Rule 10b5-1 plans, from time to time, over the next two years from the adoption date.

In May 2026, the Board Directors adopted a new stock repurchase program (the “2026 Program”) to repurchase up to $50.0 million of the Company’s common stock both on the open market and in privately negotiated transactions, including through Rule 10b5-1 plans, from time to time, over the next two years from the adoption date.

As of June 30, 2026, $50.0 million remained available under the 2026 Program.

See details of our stock repurchase program in Note 6, Stockholders ’ Equity to our condensed consolidated financial statements in this Quarterly Report on Form 10‑Q.

Cash Flow Data

The following table summarizes our cash flows for the periods presented:

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands)

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Net Cash Flows Provided by Operating Activities

Net cash flows provided by operating activities were $1.7 million for the three months ended March 31, 2026, compared to $8.6 million for the same period in 2025.

The decrease in net cash flows provided by operating activities between the periods was primarily driven by higher disbursements for operations, including payments related to vendor invoices and income taxes, lower collections from customers, and payments of interest related to bank loans, partially offset by a decrease in bonus payments under the Company’s bonus plan, and decrease in payments for business acquisition-related costs.

Net cash flows provided by operating activities were $18.1 million for the six months ended June 30, 2026, compared to $3.4 million for the same period in 2025.

The increase in net cash flows provided by operating activities between the periods was primarily driven by (i) higher collections from customers, (ii) the timing of payments under the Company’s bonus and incentive plans between the comparative periods, and (iii) a decrease in payments for business acquisition-related costs and income taxes, partially offset by an increase in payments of interest related to bank loans and decrease in interest income.

Net Cash Flows Used in Investing Activities

For the three months ended March 31, 2026, net cash flows used in investing activities were $10.5 million related to purchases and prepayments of property and equipment, mainly related to our DirectScan systems.

For the three months ended March 31, 2025, net cash flows used in investing activities were $123.9 million, which were primarily related to $129.7 million payments for the acquisition of SecureWise, net of cash acquired, $2.9 million purchases of short-term investments, and $8.2 million purchases and prepayments of property and equipment primarily related to our DirectScan systems, partially offset by $17.0 million proceeds from maturities and sales of short-term investments.

Net Cash Flows Provided by (Used in) Financing Activities

For the three months ended March 31, 2026, net cash flows used in financing activities were $2.1 million, which primarily consisted of $3.7 million in cash payments for taxes related to net share settlement of equity awards, and $0.6 million repayment of long-term debt, partially offset by $2.2 million proceeds from our employee stock purchase plan and exercise of stock options.

For the three months ended March 31, 2025, net cash flows provided by financing activities were $68.0 million, which primarily consisted of $69.2 million proceeds from long-term debt, net of debt discount and issuance costs, that was used in financing the acquisition of SecureWise, and $2.1 million proceeds from our employee stock purchase plan, partially offset by $3.3 million in cash payments for taxes related to net share settlement of equity awards.

For the six months ended June 30, 2026, net cash flows used in investing activities were $24.6 million related to purchases and prepayments of property and equipment, mainly related to our DirectScan systems assets and capitalized software development costs related to the next generation of Exensio Analytics Platform and Sapience Manufacturing Hub.

For the six months ended June 30, 2025, net cash flows used in investing activities were $124.2 million, which were primarily related to $129.7 million payments for the acquisition of SecureWise, net of cash acquired, and $16.7 million purchases and prepayments of property and equipment primarily related to our DirectScan systems assets, partially offset by $21.6 million proceeds from maturities and sales, net of purchases of short-term investments, and $0.6 million recovery from previously written-off property and equipment.

Net Cash Flows Provided by Financing Activities

For the six months ended June 30, 2026, net cash flows provided by financing activities were $79.2 million, which primarily consisted of $81.8 million proceeds from shares issued under secondary offering, net of underwriting discounts and commissions of $3.9 million, and $2.3 million proceeds from shares issued under our equity plans, partially offset by $4.1 million in payments for taxes related to net share settlement of equity awards, and $0.6 million repayment of long-term debt.

For the six months ended June 30, 2025, net cash provided by financing activities were $66.6 million, which primarily consisted of $69.6 million proceeds from long-term debt, net of debt discount, that was used in financing the acquisition of SecureWise, and $2.2 million proceeds from shares issued under our equity plans, partially offset by (i) $3.5 million in payments for taxes related to net share settlement of equity awards, (ii) $0.9 million payments of debt issuance costs, and (iii) $0.6 million repayment of long-term debt.

Related Party Transactions

Refer to Note 13, Strategic Partnership Agreement with Advantest and Related Party Transactions , to our condensed consolidated financial statements in this Quarterly Report on Form 10‑Q, for the discussion about related party transactions between the Company and Advantest (as defined therein).

Refer to Note 13, Related Party Transactions , to our condensed consolidated financial statements in this Quarterly Report on Form 10‑Q, for the discussion about related party transactions between the Company and Advantest (as defined therein).

Off-Balance Sheet Agreements

As of March 31, 2026, we do not have any off-balance sheet arrangements, investments in special purpose entities or undisclosed borrowings or debt.

As of June 30, 2026, we do not have any off-balance sheet arrangements, investments in special purpose entities or undisclosed borrowings or debt.

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