What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-11-04 compared with 2025-08-08 · 78 added, 69 removed, 152 unchanged (49% of the section changed)

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and its subsidiaries.

For an understanding of the significant factors that influenced our results, the following discussion should be read in conjunction with our unaudited condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q for the quarter ended June 30, 2025.

Management’s Discussion and Analysis should also be read in conjunction with the management’s discussion and analysis and consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission (“SEC”).

Cautionary Statement Regarding Forward-Looking Information

Certain statements and information in this Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 (as well as information included in other written or oral statements we make from time to time) may contain or constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Certain statements and information in this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 (as well as information included in other written or oral statements we make from time to time) may contain or constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

The words “believe,” “estimate,” “project,” “expect,” “anticipate,” “affirm,” “plan,” “intend,” “foresee,” “should,” “would,” “could,” “continue,” “committed,” “attempt,” “aim,” “target,” “objective,” “guides,” “seek,” “focus,” “provides guidance,” “provides outlook” or other similar expressions are intended to identify forward-looking statements, which are not historical in nature.

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our inability to make debt service payments or refinance such indebtedness;

our inability to successfully execute on, integrate, or achieve the anticipated benefits of acquisitions, including the acquisition of Arroweye, or execute on divestitures or strategic relationships;

our inability to successfully execute on, integrate, or achieve the anticipated benefits of acquisitions, including the acquisition of Arroweye, or execute on divestitures, strategic relationships, or investments;

our status as an accelerated filer and complying with the Sarbanes-Oxley Act of 2002 and the costs associated with such compliance and implementation of procedures thereunder;

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the effects of climate change on our business;

our inability to adequately protect our trade secrets and intellectual property rights from misappropriation,

infringement claims brought against us and risks related to open source software;

our inability to adequately protect our trade secrets and intellectual property

rights from misappropriation, infringement claims brought against us and risks related to open source software;

our inability to renew licenses with key technology licensors;

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the influence of securities analysts over the trading market for and price of our common stock, particularly due to the lack of substantial research coverage of our common stock;

the impact of stockholder activism or securities litigation on the trading price and volatility of our common stock;

the impact of stockholder activism or actual or threatened securities litigation on the trading price and volatility of our common stock;

certain provisions of our organizational documents and other contractual provisions that may delay or prevent a change in control and make it difficult for stockholders other than our significant stockholders to change the composition of our board of directors;

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Our revenues are primarily generated from the production of and services related to secure debit and credit cards that are issued on the networks of the Payment Card Brands, including Prepaid Debit Cards.

On May 6, 2025, we acquired Arroweye Solutions, Inc.

(“Arroweye”), a leading provider of digitally-driven on-demand payment card solutions for the U.S.

market, based in Las Vegas, Nevada for a purchase price of $45.6 million, subject to customary post-closing working capital adjustments.

On May 6, 2025, we acquired Arroweye for a purchase price of $45.8 million.

Segment Overview

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card-issuing financial institutions.

Products produced by this segment primarily include payment cards, including contact, contactless, eco-focused, and magnetic stripe cards.

Products produced by this segment primarily include payment cards, including contact, contactless, eco-focused, metal and magnetic stripe cards.

Services include personalization;

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As a result of the tariffs announced by the U.S.

presidential administration in the first half of 2025, and potential tariff modifications or the imposition of tariffs or export controls by other countries, we have experienced and anticipate further increased supply chain challenges and fluctuations in the costs of raw materials and components used in our products.

In addition, tariffs or other trade restrictions caused and may lead to continuing economic uncertainty, which has and may continue to reduce demand for our products and services, and negatively affect our net sales and profitability.

presidential administration in the first nine months of 2025, and potential tariff modifications or the imposition of tariffs or export controls by other countries, we have experienced and may experience further increased supply chain challenges and fluctuations in the costs of raw materials and components used in our products.

In addition, tariffs or other trade restrictions caused and may lead to continuing economic uncertainty, which has increased costs and may reduce demand for our products and services, and negatively affect our net sales and profitability.

We are continuing to evaluate these factors and their possible effects as well as our ability to potentially offset all or a portion of the impacts through pricing actions and cost savings efforts for the rest of fiscal year 2025 and in the future.

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The following table presents the components of our condensed consolidated statements of operations and comprehensive income for each of the periods presented:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(dollars in thousands)

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Interest, net

Other income (expense), net

Loss on debt extinguishment

Other expense, net

Income before taxes

Income tax expense

Income tax (expense) benefit

Gross profit margin

* Calculation not meaningful.

(1) For the three months ended June 30, 2025 and 2024, net sales and cost of sales each include $0.2 million and $0.6 million of intersegment eliminations, respectively.

For the six months ended June 30, 2025 and 2024, net sales and cost of sales each include $0.7 million and $0.9 million of intersegment eliminations, respectively.

The following discussion of our consolidated results of operations and segment results refers to the three and six months ended June 30, 2025, compared to the corresponding prior year period.

(1) For the three months ended September 30, 2025 and 2024, net sales and cost of sales each include $0.6 million and $0.2 million of intersegment eliminations, respectively.

For the nine months ended September 30, 2025 and 2024, net sales and cost of sales each include $1.3 million and $1.0 million of intersegment eliminations, respectively.

The following discussion of our consolidated results of operations and segment results refers to the three and nine months ended September 30, 2025, compared to the corresponding prior year period.

The results of operations should be read in conjunction with the discussion of our segment results of operations, which provide more detailed discussions concerning certain components of the condensed consolidated statements of operations and comprehensive income.

Net sales increased for the three and six months ended June 30, 2025, primarily due to increased Products net sales in our Debit and Credit segment, which included contributions from the acquisition of Arroweye, partially offset by decreased Services net sales in our Debit and Credit and Prepaid Debit segments.

The decrease in Services net sales in the Prepaid Debit segment was attributable to a change in accounting resulting in reduced revenue recognition related to work-in-process orders as discussed in Note 1, “Business Overview and Summary of Significant Accounting Policies” of the condensed consolidated financial statements in this report.

Net sales increased for the three months ended September 30, 2025, primarily due to contributions of Products net sales from the acquisition of Arroweye, partially offset by lower Services net sales in our Prepaid Debit segment.

Net sales increased for the nine months ended September 30, 2025, primarily due to higher Products net sales, including increased volumes of contactless cards and contributions from the acquisition of Arroweye, partially offset by decreased Services net sales in our Debit and Credit and Prepaid Debit segments.

The decrease in Services net sales in the Prepaid Debit segment for the nine months ended September 30, 2025 was attributable to a change in accounting in the second quarter of 2025 resulting in reduced revenue recognition related to work-in-process orders as discussed in Note 1, “Business Overview and Summary of Significant Accounting Policies,” of the condensed consolidated financial statements in this report.

Gross Profit and Gross Profit Margin:

Gross profit decreased for the three and six months ended June 30, 2025, primarily due to negative impacts from a change in accounting resulting in reduced revenue recognition related to work-in-process orders, primarily in our Prepaid Debit segment.

Gross profit margin decreased for the three and six months ended June 30, 2025, as negative sales mix and increases in production costs, including increased tariffs, were partially offset by increases in net sales.

Gross profit and gross profit margin decreased for the three and nine months ended September 30, 2025, primarily due to negative sales mix and increased production costs, including increased tariff and depreciation expenses;

partially offset by increases in net sales.

Operating Expenses:

Operating expenses increased for the three and six months ended June 30, 2025, primarily due to increased professional service fees related to acquisition and integration costs associated with the acquisition of Arroweye.

Operating expenses increased for the three and nine months ended September 30, 2025, primarily due to increased professional service fees and other costs associated with the acquisition and integration of Arroweye.

These increases were partially offset by decreased compensation-related expenses, including decreased employee performance-based incentive compensation.

The three months ended September 30, 2025 was also impacted by decreased executive severance, while the nine months ended September 30, 2025 was also impacted by costs that were incurred in the prior year period in accordance with the former Chief-Executive Officer’s (“CEO”) retention agreement.

Interest, net :

Interest expense increased for the three and six months ended June 30, 2025, primarily due to impacts from higher interest rates and higher average borrowing on the 10.000% Senior Secured Notes due 2029 (defined below) entered into on July 11, 2024, compared to the 8.625% Senior Secured Notes due 2026 outstanding in the prior year period.

Other Income (Expense), net:

Other income (expense), net, was relatively consistent for the three and six months ended June 30, 2025.

Income Tax Expense:

Our effective tax rates on pre-tax income were 61.4% and 27.7% for the three months ended June 30, 2025 and 2024, respectively, and 32.0% and 28.2% for the six months ended June 30, 2025 and 2024, respectively.

The increase in the Company’s effective tax rate for the three months and six months ended June 30, 2025, compared to the prior year related to limitations on deductibility of executive compensation and non-deductible acquisition-related costs and increased state tax expenses related to the acquisition of Arroweye.

Interest expense decreased for the three and nine months ended September 30, 2025, primarily due to payment in the prior year period of an early redemption premium of $5.8 million related to the redemption in full of the $267.9 million 8.625% Senior Secured Notes due 2026 (the “2026 Senior Notes”), as compared to payment in the current period of a $0.6 million premium related to the redemption of $20.0 million 10.000% Senior Secured Notes due 2029.

Loss on Debt Extinguishment:

During the three and nine months ended September 30, 2024, we recorded a $3.0 million loss on debt extinguishment relating to the unamortized deferred financing costs in connection with the redemption of the 2026 Senior Notes and the refinancing of our ABL Revolver Credit Agreement in July 2024 .

Other Expense, net:

Other expense, net, was relatively consistent for the three and nine months ended September 30, 2025.

Income Tax (Expense) Benefit:

Our effective tax rates on pre-tax income were 38.3 % and (57.9)% for the three months ended September 30, 2025 and 2024, respectively, and 34.0% and 24.0% for the nine months ended September 30, 2025 and 2024, respectively.

The increase in the Company’s effective tax rate for the three months and nine months ended September 30, 2025, compared to the prior year related to limitations on deductibility of executive compensation and non-deductible acquisition-related costs, deductibility of stock-based compensation realized upon certain stock option exercises and restricted stock unit vesting and increased state tax expenses related to the acquisition of Arroweye.

Segment Discussion

Debit and Credit:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(dollars in thousands)

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Gross profit margin

Net sales for Debit and Credit increased for the three and six months ended June 30, 2025, primarily due to increased Products net sales, including contributions from the Arroweye acquisition , partially offset by decreased Services net sales.

The increase in Products net sales was driven by higher volumes of contactless cards, including metal cards, as well as increased Card@Once printer sales.

The decrease in Services net sales was driven by lower personalization services.

Net sales for Debit and Credit increased for the three months ended September 30, 2025, primarily due to increased Products net sales, including contributions from the Arroweye acquisition and increased Card@Once printer sales;

partially offset by lower volumes of contact-only EMV cards.

Net sales for Debit and Credit increased for the nine months ended September 30, 2025, primarily due to increased Products net sales, including contributions from the Arroweye acquisition, higher volumes of contactless cards, including metal cards, and increased Card@Once printer sales, partially offset by decreased sales of other cards and personalization services.

Gross Profit and Gross Profit Margin:

Gross profit for Debit and Credit was relatively consistent for the three and six months ended June 30, 2025, primarily due to increased net sales, including additional net sales from the Arroweye acquisition.

Gross profit margin decreased primarily due to negative sales mix and increased production costs, including increased tariffs.

Gross profit for Debit and Credit decreased for the three and nine months ended September 30, 2025, primarily due to negative sales mix and increased production costs, including increased tariff and depreciation expenses, partially offset by increases in net sales.

Income from Operations:

Income from operations for Debit and Credit decreased for the three and six months ended June 30, 2025, primarily due to relatively consistent gross profit and increased operating expenses, including increased compensation-related expenses, driven by increased headcount including the Arroweye acquisition.

Income from operations for Debit and Credit decreased for the three and nine months ended September 30, 2025, primarily due to decreased gross profit and increased operating expenses driven by increased compensation-related expenses resulting from increased headcount, including from the Arroweye acquisition.

Prepaid Debit:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(dollars in thousands)

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Gross profit margin

Net sales for Prepaid Debit decreased for the three and six months ended June 30, 2025, primarily due to a change in accounting resulting in reduced revenue recognition for work-in-process orders, partially offset by increased sales of higher-priced packaging solutions and healthcare payment solutions.

Net sales for Prepaid Debit decreased for the three months ended September 30, 2025, primarily due to decreased sales from existing customers.

Net sales for Prepaid Debit decreased for the nine months ended September 30, 2025, primarily due to a change in accounting resulting in reduced revenue recognition for work-in-process orders;

partially offset by increased sales of higher-priced packaging solutions and healthcare payment solutions.

Gross Profit and Gross Profit Margin:

Gross profit and gross profit margin for Prepaid Debit decreased for the three and six months ended June 30, 2025, primarily due to negative impacts from a change in accounting resulting in reduced revenue recognition for work-in-process orders;

Gross profit and gross profit margin for Prepaid Debit decreased for the three months ended September 30, 2025, primarily due to decreased net sales.

Gross profit and gross profit margin for Prepaid Debit decreased for the nine months ended September 30, 2025, primarily due to a change in accounting that was implemented in the second quarter resulting in reduced revenue recognition for work-in-process orders;

partially offset by increased net sales to existing customers.

Income from Operations:

Income from operations for Prepaid Debit decreased for the three and six months ended June 30, 2025, primarily due to the factors discussed in “Gross Profit and Gross Profit Margin” above.

Income from operations for Prepaid Debit decreased for the three and nine months ended September 30, 2025, primarily due to the factors discussed in “Gross Profit and Gross Profit Margin” above.

As the Other segment is comprised entirely of corporate expenses, income from operations for Other consists of operating expenses shown below.

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(dollars in thousands)

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Operating Expenses:

Other operating expenses increased for the three months ended June 30, 2025, primarily due to increased professional service fees related to acquisition and integration costs associated with the acquisition of Arroweye, as well as increased severance expense.

These increases were partially offset by decreased compensation-related expenses, including decreased stock compensation and employee performance-based incentive compensation.

Other operating expenses decreased for the six months ended June 30, 2025, primarily due to decreased compensation-related expenses, including the impact of costs in the prior year period related to the prior-Chief Executive Officer (“CEO”) retention agreement, and decreased stock compensation.

These decreases were partially offset by increased professional service fees related to acquisition and integration costs associated with the acquisition of Arroweye.

Other operating expenses decreased for the three and nine months ended September 30, 2025, primarily due to decreased compensation-related expenses, including employee performance-based incentive compensation and executive severance;

partially offset by increased professional service fees related to acquisition and integration costs associated with the acquisition of Arroweye.

Other operating expenses for the nine months ended September 30, 2025, also decreased due to the impact of costs that were incurred in the prior year period in accordance with the former CEO’s retention agreement.

Liquidity and Capital Resources

At June 30, 2025, we had $17.1 million of cash and cash equivalents.

At September 30, 2025, we had $16.0 million of cash and cash equivalents.

Our primary source of liquidity has been cash generated from our operating activities, which has been driven by net income and fluctuations in working capital.

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Our ability to make investments in and grow our business, service our debt, and improve our debt leverage ratios, while maintaining strong liquidity, depends on our ability to generate excess operating cash flows.

Although we can provide no assurances, we believe that our cash flows from operations, combined with our current cash levels and our senior secured revolving credit facility (the “ABL Revolver”) with available borrowing capacity of $42.9 million as of June 30, 2025, will be adequate to fund debt service requirements and provide cash, as required, to support our ongoing operations, capital expenditures, lease obligations and working capital needs.

Although we can provide no assurances, we believe that our cash flows from operations, combined with our current cash levels and our senior secured revolving credit facility (the “ABL Revolver”) with available borrowing capacity of $50.2 million as of September 30, 2025, will be adequate to fund debt service requirements and provide cash, as required, to support our ongoing operations, capital expenditures, lease obligations and working capital needs.

Our future cash flows could be impacted by a variety of factors, some of which are beyond our control.

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Cash Flows from Operating Activities

Cash provided by operating activities for the six months ended June 30, 2025, increased to $9.9 million from $4.1 million for the six months ended June 30, 2024, primarily due to reduced working capital usage, partially offset by lower net income.

Working capital benefited from increased collections on accounts receivable, lower inventory purchases, and lower payments related to the prior-CEO retention agreement, partially offset by incentive payments related to a customer contract originally entered into in the first quarter of 2024, higher employee performance-based incentive compensation payments in 2025, and higher cash paid for interest on our Senior Notes due to a higher coupon rate and higher average borrowings.

Cash provided by operating activities for the nine months ended September 30, 2025, increased to $19.9 million from $16.7 million for the nine months ended September 30, 2024, primarily due to reduced working capital usage.

Investing Activities

Arroweye Acquisition

On May 6, 2025, we acquired Arroweye for initial cash consideration of $42.4 million, which is net of cash acquired of $1.6 million and an initial working capital adjustment.

Final cash consideration is subject to customary post-closing working capital adjustments.

On May 6, 2025, we acquired Arroweye for initial cash consideration of $42.4 million.

In October 2025, we made a final payment of $1.8 million resulting in a final purchase price of $45.8 million, which includes a final net working capital adjustment.

The final cash consideration paid was $44.2 million, which is net of cash acquired of $1.6 million.

The acquisition was funded through a combination of cash on hand and our available capacity under the ABL Revolver.

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Capital Expenditures

During the six months ended June 30, 2025, capital expenditures, including investments to support the business, such as machinery and information technology equipment, totaled $9.1 million, primarily related to the new production facility in Indiana.

As of June 30, 2025, and December 31, 2024, we had the following outstanding borrowings:

During the nine months ended September 30, 2025, capital expenditures, including investments to support the business, such as machinery and information technology equipment, totaled $13.8 million, primarily related to our new production facility in Indiana.

As of September 30, 2025, and December 31, 2024, we had the following outstanding borrowings:

September 30,

(dollars in thousands)

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Total long-term debt

On July 11, 2024 (the “Closing Date”), we completed a private offering by our wholly-owned subsidiary, CPI CG Inc., of $285.0 million aggregate principal amount of 10.000% Senior Secured Notes due 2029 (the “Senior Notes”) and related guarantees at an issue price of 100%.

On the Closing Date, we completed a private offering of the Senior Notes and related guarantees at an issue price of 100%.

The Senior Notes mature on July 15, 2029 and interest is payable on January 15 and July 15 of each year.

On July 15, 2025, the Company redeemed $20.0 million of its outstanding $285.0 million aggregate principal amount Senior Notes.

The redemption was made pursuant to the terms of the indenture governing the Senior Notes, at a redemption price of 103.000% of par plus accrued and unpaid interest to the date of redemption.

The Company has obligations to make an offer to repay the Senior Notes, requiring prepayment in advance of the maturity date, upon the occurrence of certain events including a change of control and certain asset sales.

On the Closing Date, the Company and CPI CG Inc.

as borrower (the “Borrower”), entered into a credit agreement with JPMorgan Chase Bank, N.A., as lender, administrative agent and collateral agent, providing for an asset-based, senior secured revolving credit facility (the “ABL Revolver”) of up to $75.0 million.

On the Closing Date, the Company, the Borrower, and JPMorgan entered into the ABL Revolver.

The ABL Revolver matures on the earliest to occur of July 11, 2029 and the date that is 91 days prior to the maturity of the Senior Notes.

We primarily utilize our ABL Revolver to provide general liquidity and to support shorter term financing requirements.

On July 2, 2025, the Company, the Borrower, and JPMorgan entered into the Amendment, which amends the ABL Revolver to, among other things, increase the available borrowing capacity to $100.0 million from $75.0 million.

The Amendment did not modify the maturity date of the ABL Revolver nor the interest rate.

Borrowings under the ABL Revolver bear interest at a rate per annum that ranges based on the applicable term secured overnight financing rate as administered by the Federal Reserve Bank of New York plus 1.50% to 1.75% (subject, in each case, to a credit spread adjustment of 0.10%), based on the average daily borrowing capacity under the ABL Revolver over the most recently completed month.

The unused portion of the ABL Revolver commitment accrues a commitment fee, which ranges from 0.375% to 0.50% per annum, based on the average daily excess availability under the ABL Revolver over the immediately preceding month.

As of June 30, 2025, we had $30.0 million of outstanding borrowings on the ABL Revolver.

As of September 30, 2025, we had $47.0 million of outstanding borrowings on the ABL Revolver.

Amounts borrowed and outstanding under the ABL Revolver and Senior Notes are required to be repaid in full, together with any accrued and unpaid interest, no later than July 15, 2029 and may be subject to earlier mandatory prepayment upon certain events.

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Debt Service Requirements

As of June 30, 2025, the total projected principal and interest payments on our borrowings were $451.9 million, primarily related to the Senior Notes, of which $29.5 million of interest is expected to be paid in the next 12 months.

The remaining interest payments are expected to be paid over the remaining term of the Senior Notes, which mature in 2029, and the principal is due upon maturity.

We have estimated our future interest payments including an additional $32.0 million of borrowings under the ABL Revolver and early redemptions of principal of $20.0 million on the Senior Notes, both of which occurred on July 15, 2025.

This also assumes no debt issuances or renewals upon the maturity dates of our notes.

As of September 30, 2025, the total projected principal and interest payments on our borrowings were $422.3 million, primarily related to the Senior Notes, of which $29.1 million of interest is expected to be paid in the next 12 months.

T he remaining interest payments are expected to be paid over the remaining term of the Senior Notes, which mature in 2029, and the principal is due upon maturity.

We have estimated our future interest payments assuming no additional borrowings under the ABL Revolver, no early redemptions of principal on the Senior Notes, and no debt issuances or renewals upon the maturity dates of our notes.

However, we may borrow additional amounts under the ABL Revolver, redeem principal on the Senior Notes early, or refinance all or a portion of our borrowings in future periods.

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Refer to Part II, Item 8, Financial Statements and Supplementary Data , Note 9, “Financing and Operating Leases,” in our Annual Report on Form 10-K for the year ended December 31, 2024, for details on our leasing arrangements, including future maturities of our operating lease liabilities.

In February 2024, we entered into a build-to-suit lease agreement to relocate and modernize our operations at our Fort Wayne, Indiana production facility, which commenced in the first quarter of 2025, and payments beginning in 2026.

In February 2024, we entered into a build-to-suit lease agreement to relocate and modernize our operations at our Fort Wayne, Indiana production facility, which was made available for our use in the first quarter of 2025, and payments beginning in the fourth quarter of 2025.

Under this lease agreement, we will pay an annual base rent of $0.9 million, subject to an annual rent increase of 2.0%.

The lease is for 10 years and includes two consecutive options to extend the term of the lease by five years for each such option.

The lease commenced on August 1, 2025, for an initial term of 10 years and includes two consecutive options to extend the term of the lease by five years for each such option.

Purchase Obligations

A purchase obligation is an agreement to purchase goods or services that is enforceable, legally binding, and specifies all significant terms.

As of June 30, 2025, there have not been any material changes to the purchase obligations disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

As of September 30, 2025, there have not been any material changes to the purchase obligations disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Critical Accounting Policies and Estimates

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Actual results could differ from those estimates.

Our Critical Accounting Policies and Estimates disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024, for which there were no material changes as of June 30, 2025, included:

Our Critical Accounting Policies and Estimates disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024, for which there were no material changes as of September 30, 2025, included:

● Revenue recognition, including estimates of work performed but not completed , and

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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 2. Management’s Discussion and Analysis