POWER INTEGRATIONS INC 10-Q

ITEM 1. FINANCIAL STATEMENTS POWER INTEGRATIONS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In thousands) ​ March 31, 2026 ​ December 31, 2025 ASSETS ​ ​ ​ ​ ​ ​ Current assets: ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 63,390 ​ $ 58,755 Short-term investments ​ 193,814 ​ 190,755 Accounts receivable, net ​ 14,407 ​ 18,254 Inventories ​ 162,982 ​ 166,887 Prepaid expenses and other current assets ​ 23,747 ​ 23,678 Total current assets ​ 458,340 ​ 458,329 Property and equipment, net ​ 143,630 ​ 146,536 Intangible assets, net ​ 7,061 ​ 7,244 Goodwill ​ 95,271 ​ 95,271 Other non-current assets ​ 66,385 ​ 64,827 TOTAL ASSETS ​ $ 770,687 ​ $ 772,207 LIABILITIES AND STOCKHOLDERS’ EQUITY ​ ​ ​ ​ Current liabilities: ​ ​ ​ ​ Accounts payable ​ $ 31,407 ​ $ 33,963 Accrued payroll and related expenses ​ 13,224 ​ 13,840 Other accrued liabilities ​ 21,958 ​ 22,558 Total current liabilities ​ 66,589 ​ 70,361 Other liabilities ​ 32,292 ​ 29,001 TOTAL LIABILITIES ​ 98,881 ​ 99,362 Commitments and contingencies (Note 11) ​ ​ ​ ​ STOCKHOLDERS’ EQUITY: ​ ​ ​ ​ Common stock, $ 0.001 par value, 140,000 shares authorized; and 55,600 and 55,339 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively ​ 20 ​ 20 Additional paid-in capital ​ 8,997 ​ — Accumulated other comprehensive loss ​ ( 2,491 ) ​ ( 1,105 ) Retained earnings ​ 665,280 ​ 673,930 TOTAL STOCKHOLDERS' EQUITY ​ 671,806 ​ 672,845 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ​ $ 770,687 ​ $ 772,207 ​ The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. ​ 4 Table of Contents POWER INTEGRATIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ ​ ​ March 31, (In thousands, except per share amounts) ​ 2026 ​ ​ ​ 2025 Net revenue ​ $ 108,308 ​ $ 105,529 Cost of revenue ​ 51,370 ​ 47,294 Gross profit ​ 56,938 ​ 58,235 ​ ​ ​ ​ ​ ​ ​ Operating expenses: ​ ​ ​ ​ Research and development ​ 26,255 ​ 24,095 Selling, general and administrative ​ 24,444 ​ 27,422 Other operating expenses ​ ​ ( 1,419 ) ​ ​ — Restructuring and related charges ​ ​ 6,204 ​ ​ — Total operating expenses ​ 55,484 ​ 51,517 Income from operations ​ 1,454 ​ 6,718 Other income ​ 2,466 ​ 3,167 Income before income taxes ​ 3,920 ​ 9,885 Provision for income taxes ​ 620 ​ 1,095 NET INCOME ​ $ 3,300 ​ $ 8,790 ​ ​ ​ ​ ​ ​ ​ Earnings per share: ​ ​ ​ ​ Basic ​ $ 0.06 ​ $ 0.15 Diluted ​ $ 0.06 ​ $ 0.15 ​ ​ ​ ​ ​ ​ ​ Shares used in per share calculation: ​ ​ ​ ​ Basic ​ 55,506 ​ ​ 56,871 Diluted ​ 55,874 ​ ​ 57,123 ​ ​ The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. ​ 5 Table of Contents POWER INTEGRATIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ ​ March 31, ​ (In thousands) ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ Net income ​ $ 3,300 ​ $ 8,790 ​ Other comprehensive income (loss), net of tax: ​ ​ ​ ​ ​ Foreign currency translation adjustments, net of $ 0 tax in each of the three months ended March 31, 2026 and 2025 ​ ​ ( 389 ) ​ ​ 390 ​ Unrealized gain (loss) on investments, net of ($ 250 ) and ($ 116 ) tax in the three months ended March 31, 2026 and 2025, respectively ​ ​ ( 999 ) ​ ​ 451 ​ Amortization of defined benefit pension items, net of tax of $ 0 in each of the three months ended March 31, 2026 and 2025 ​ ​ 2 ​ ​ ( 1 ) ​ Total other comprehensive income (loss) ​ ( 1,386 ) ​ 840 ​ TOTAL COMPREHENSIVE INCOME ​ $ 1,914 ​ $ 9,630 ​ ​ The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. ​ 6 Table of Contents POWER INTEGRATIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2026 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ Other ​ ​ ​ ​ Total ​ ​ Common Stock ​ Paid-In ​ Comprehensive ​ Retained ​ Stockholders’ (In thousands) Shares Amount Capital Loss Earnings Equity BALANCE AT DECEMBER 31, 2025 55,339 ​ $ 20 ​ $ — ​ $ ( 1,105 ) ​ $ 673,930 ​ $ 672,845 Issuance of common stock under employee stock option and stock award plans 192 ​ — ​ — ​ — ​ — ​ — Issuance of common stock under employee stock purchase plan 69 ​ — ​ 2,690 ​ — ​ — ​ 2,690 Stock-based compensation expense related to employee stock awards — ​ — ​ 5,917 ​ — ​ — ​ 5,917 Stock-based compensation expense related to employee stock purchases — ​ — ​ 390 ​ — ​ — ​ 390 Payment of dividends to stockholders — ​ — ​ — ​ — ​ ( 11,950 ) ​ ( 11,950 ) Unrealized actuarial gain on pension benefits — ​ — ​ — ​ 2 ​ — ​ 2 Unrealized loss on investments — ​ — ​ — ​ ( 999 ) ​ — ​ ( 999 ) Foreign currency translation adjustment — ​ — ​ — ​ ( 389 ) ​ — ​ ( 389 ) Net income — ​ — ​ — ​ — ​ 3,300 ​ 3,300 BALANCE AT MARCH 31, 2026 55,600 ​ $ 20 ​ $ 8,997 ​ $ ( 2,491 ) ​ $ 665,280 ​ $ 671,806 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ Other ​ ​ ​ ​ Total ​ ​ Common Stock ​ Paid-In ​ Comprehensive ​ Retained ​ Stockholders’ (In thousands) Shares Amount Capital Loss Earnings Equity BALANCE AT DECEMBER 31, 2024 56,837 ​ $ 22 ​ $ 18,734 ​ $ ( 3,023 ) ​ $ 734,039 ​ $ 749,772 Issuance of common stock under employee stock option and stock award plans 207 ​ — ​ — ​ — ​ — ​ — Repurchase of common stock ( 404 ) ​ — ​ ( 23,098 ) ​ — ​ — ​ ( 23,098 ) Issuance of common stock under employee stock purchase plan 53 ​ — ​ 2,787 ​ — ​ — ​ 2,787 Stock-based compensation expense related to employee stock awards — ​ — ​ 8,329 ​ — ​ — ​ 8,329 Stock-based compensation expense related to employee stock purchases — ​ — ​ 354 ​ — ​ — ​ 354 Payment of dividends to stockholders — ​ — ​ — ​ — ​ ( 11,959 ) ​ ( 11,959 ) Unrealized actuarial loss on pension benefits — ​ — ​ — ​ ( 1 ) ​ — ​ ( 1 ) Unrealized gain on investments — ​ — ​ — ​ 451 ​ — ​ 451 Foreign currency translation adjustment — ​ — ​ — ​ 390 ​ — ​ 390 Net income — ​ — ​ — ​ — ​ 8,790 ​ 8,790 BALANCE AT MARCH 31, 2025 56,693 ​ $ 22 ​ $ 7,106 ​ $ ( 2,183 ) ​ $ 730,870 ​ $ 735,815 ​ The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. ​ 7 Table of Contents POWER INTEGRATIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (In thousands) ​ ​ ​ 2026 ​ ​ ​ 2025 CASH FLOWS FROM OPERATING ACTIVITIES: ​ ​ ​ ​ Net income ​ $ 3,300 ​ $ 8,790 Adjustments to reconcile net income to net cash provided by operating activities: ​ ​ ​ ​ Depreciation ​ 6,380 ​ 7,244 Amortization of intangibles ​ 183 ​ 207 Loss on disposal of property and equipment ​ 49 ​ — Stock-based compensation expense ​ 6,307 ​ 8,683 Accretion of discount on investments ​ ( 156 ) ​ ( 346 ) Decrease in accounts receivable allowance for credit losses ​ — ​ ( 381 ) Change in operating assets and liabilities: ​ ​ ​ ​ Accounts receivable ​ 3,847 ​ 4,747 Inventories ​ 3,905 ​ ( 3,456 ) Prepaid expenses and other assets ​ 3,414 ​ 832 Accounts payable ​ ( 4,072 ) ​ 4,002 Other accrued liabilities ​ ( 3,112 ) ​ ( 3,936 ) NET CASH PROVIDED BY OPERATING ACTIVITIES ​ 20,045 ​ 26,386 ​ ​ ​ ​ ​ ​ ​ CASH FLOWS FROM INVESTING ACTIVITIES: ​ ​ ​ ​ Purchases of property and equipment ​ ( 1,998 ) ​ ( 5,726 ) Purchases of investments ​ ( 14,807 ) ​ ( 5,630 ) Proceeds from sales and maturities of investments ​ 10,655 ​ 15,882 NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES ​ ( 6,150 ) ​ 4,526 ​ ​ ​ ​ ​ ​ ​ CASH FLOWS FROM FINANCING ACTIVITIES: ​ ​ ​ ​ Issuance of common stock under employee stock plans ​ 2,690 ​ 2,787 Repurchase of common stock ​ — ​ ( 23,098 ) Payments of dividends to stockholders ​ ( 11,950 ) ​ ( 11,959 ) NET CASH USED IN FINANCING ACTIVITIES ​ ( 9,260 ) ​ ( 32,270 ) ​ ​ ​ ​ ​ ​ ​ NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ​ 4,635 ​ ( 1,358 ) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD ​ 58,755 ​ 50,972 CASH AND CASH EQUIVALENTS AT END OF PERIOD ​ $ 63,390 ​ $ 49,614 ​ ​ ​ ​ ​ ​ ​ ​ ​ The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. ​ 8 POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ​ ​ 1. BASIS OF PRESENTATION: The condensed consolidated financial statements include the accounts of Power Integrations, Inc., a Delaware corporation (the “Company”), and its wholly owned subsidiaries. Significant intercompany accounts and transactions have been eliminated in consolidation. Certain prior-period amounts have been reclassified to conform to current year presentation. These reclassifications had no effect on the reported results of operations. While the financial information furnished is unaudited, the condensed consolidated financial statements included in this report reflect all adjustments (consisting only of normal recurring adjustments) that the Company considers necessary for the fair presentation of the results of operations for the interim periods covered and the financial condition of the Company at the date of the interim balance sheet in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The results for interim periods are not necessarily indicative of the results for the entire year. The condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and the notes thereto for the year ended December 31, 2025, included in its Form 10-K filed on February 6, 2026, with the Securities and Exchange Commission. 2. SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS: Significant Accounting Policies and Estimates No material changes have been made to the Company’s significant accounting policies disclosed in Note 2, Significant Accounting Policies and Recent Accounting Pronouncements , of the Company’s financial statements set forth in Item 8 of the Company’s Annual Report on Form 10-K, filed on February 6, 2026, for the year ended December 31, 2025. Recent Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) which requires additional disclosure of certain costs and expenses, including inventory purchases, employee compensation, selling expense and depreciation expense within the notes to financial statements. The guidance is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the impact that the updated standard will have on its financial statement disclosures. In September 2025, the FASB issued ASU 2025-06, Intangibles–Goodwill and Other–Internal-Use Software (Subtopic 350-40) which amends certain aspects of the accounting for and disclosure of software costs. The guidance is effective for annual reporting periods beginning after December 15, 2027, and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the impact that the updated standard will have on its financial statement disclosures. ​ 9 ​ Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ 3. CONDENSED CONSOLIDATED BALANCE SHEET COMPONENTS AND OTHER INFORMATION: Accounts Receivable ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ ​ December 31, (In thousands) ​ 2026 ​ 2025 Accounts receivable trade ​ $ 51,519 ​ $ 54,177 Allowance for ship and debit ​ ( 33,659 ) ​ ( 33,601 ) Allowance for stock rotation and rebate ​ ( 3,359 ) ​ ( 2,228 ) Allowance for credit losses ​ ​ ( 94 ) ​ ​ ( 94 ) Total ​ $ 14,407 ​ $ 18,254 ​ ​ Inventories ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ ​ December 31, (In thousands) ​ 2026 ​ 2025 Raw materials ​ $ 99,517 ​ $ 101,366 Work-in-process ​ 29,944 ​ 27,905 Finished goods ​ 33,521 ​ 37,616 Total ​ $ 162,982 ​ $ 166,887 ​ Other non-current assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ ​ December 31, (In thousands) ​ 2026 ​ 2025 Deferred tax assets ​ $ 34,797 ​ $ 35,594 Right of use for leased properties ​ 22,718 ​ 19,325 Prepaid expenses ​ 6,753 ​ 6,863 Other non-current assets ​ ​ 2,117 ​ ​ 3,045 Total ​ $ 66,385 ​ $ 64,827 ​ Accumulated Other Comprehensive Income Changes in accumulated other comprehensive income for the three months ended March 31, 2026 and 2025, were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrealized Gains ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ and Losses on ​ Defined Benefit ​ Foreign Currency ​ ​ ​ ​ Investments ​ Pension Items ​ Items ​ Total ​ Three Months Ended ​ Three Months Ended ​ Three Months Ended ​ Three Months Ended ​ March 31, ​ March 31, ​ March 31, ​ March 31, (In thousands) 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Beginning balance $ 1,751 ​ $ 693 ​ $ ( 32 ) ​ $ 99 ​ $ ( 2,824 ) ​ $ ( 3,815 ) ​ $ ( 1,105 ) ​ $ ( 3,023 ) Other comprehensive income (loss) before reclassifications ( 999 ) ​ 451 ​ — ​ — ​ ( 389 ) ​ 390 ​ ( 1,388 ) ​ 841 Amounts reclassified from accumulated other comprehensive income (loss) — ​ — ​ 2 (1) ( 1 ) (1) — ​ — ​ 2 ​ ( 1 ) Net-current period other comprehensive income (loss) ( 999 ) ​ 451 ​ 2 ​ ( 1 ) ​ ( 389 ) ​ 390 ​ ( 1,386 ) ​ 840 Ending balance $ 752 ​ $ 1,144 ​ $ ( 30 ) ​ $ 98 ​ $ ( 3,213 ) ​ $ ( 3,425 ) ​ $ ( 2,491 ) ​ $ ( 2,183 ) (1) This component of accumulated other comprehensive income is included in the computation of net periodic pension cost for the three months ended March 31, 2026 and 2025. ​ ​ 10 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ 4. RESTRUCTURING: The Company continuously evaluates its operations to better align the organization with market opportunities, increase operational efficiency, decrease costs and increase profitability. During the three months ended March 31, 2026, the Company undertook a restructuring plan, reducing its workforce by approximately 7 % to better align expenses with revenue and create flexibility to invest in the products, people, and markets that are expected to drive long-term growth and profitability. In conjunction with this restructuring plan, restructuring charges of $ 6.6 million were recognized during the first quarter of 2026, primarily composed of severance costs. The restructuring plan was substantially completed in the first quarter of 2026. No restructuring charges were incurred in fiscal 2025. Restructuring liabilities are included in other accrued liabilities in the accompanying unaudited condensed consolidated balance sheets, and are summarized in the following table: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2026 Plan ​ ​ ​ (in thousands) ​ Employee severance ​ Other ​ Total Restructuring liability as of January 1, 2026 ​ $ — ​ $ — ​ $ — Charges ​ ​ 4,591 ​ ​ 151 ​ ​ 4,742 Cash payments ​ ​ ( 3,745 ) ​ ​ ( 55 ) ​ ​ ( 3,800 ) Non-cash and other ​ ​ — ​ ​ — ​ ​ — Restructuring liability as of March 31, 2026 ​ $ 846 ​ $ 96 ​ $ 942 ​ Cash severance charges of $ 0.4 million related to the departure of an executive officer are included in the table hereto. In addition, stock-based compensation expense of $ 1.8 million was recognized in the three months ended March 31, 2026 due to the acceleration of equity awards in accordance with the terms of the executive’s severance agreement. ​ The following table provides a summary of restructuring-related charges as presented in the unaudited condensed consolidated statements of income: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ ​ March 31, (in thousands) ​ ​ 2026 ​ ​ ​ 2025 Restructuring and related charges in cost of revenue ​ ​ $ 365 ​ $ — Restructuring and related charges in operating expenses ​ ​ ​ 6,204 ​ ​ — ​ ​ ​ $ 6,569 ​ $ — ​ In conjunction with the restructuring actions, certain engineers were moved from sales and marketing projects to product development priorities. In accordance with this, $ 3.0 million of related department costs have been classified as research and development expense in the accompanying condensed consolidated statement of income this quarter and will be accounted for accordingly going forward . ​ ​ ​ ​ ​ ​ 5. FAIR VALUE MEASUREMENTS: The FASB established a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices for identical assets in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which requires the Company to develop its own assumptions. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. The Company’s cash equivalents and short-term investments are classified within Level 1 or Level 2 of the fair-value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. 11 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ The fair-value hierarchy of the Company’s cash equivalents and short-term investments at March 31, 2026 and December 31, 2025, was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurement at ​ ​ March 31, 2026 ​ ​ ​ ​ ​ Quoted Prices in ​ ​ ​ ​ ​ ​ ​ ​ Active Markets for ​ Significant Other ​ ​ ​ ​ ​ Identical Assets ​ Observable Inputs (In thousands) ​ Total Fair Value ​ (Level 1) ​ (Level 2) Commercial paper ​ $ 7,234 ​ $ — ​ $ 7,234 Corporate securities ​ ​ 192,275 ​ ​ — ​ ​ 192,275 Money market funds ​ 1,396 ​ 1,396 ​ ​ ​ Total ​ $ 200,905 ​ $ 1,396 ​ $ 199,509 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurement at ​ ​ December 31, 2025 ​ ​ ​ ​ ​ Quoted Prices in ​ ​ ​ ​ ​ ​ ​ ​ Active Markets for ​ Significant Other ​ ​ ​ ​ ​ Identical Assets ​ Observable Inputs (In thousands) ​ Total Fair Value ​ (Level 1) ​ (Level 2) Commercial paper ​ $ 5,555 ​ $ — ​ $ 5,555 Corporate securities ​ ​ 189,258 ​ ​ — ​ ​ 189,258 Money market funds ​ 3,559 ​ 3,559 ​ — U.S. government securities ​ ​ 999 ​ ​ — ​ ​ 999 Total ​ $ 199,371 ​ $ 3,559 ​ $ 195,812 ​ The Company did not transfer any investments between Level 1 and Level 2 of the fair-value hierarchy in the three months ended March 31, 2026 and the twelve months ended December 31, 2025. 6. INVESTMENTS: Amortized cost and estimated fair market value of investments classified as available-for-sale (excluding cash equivalents) at March 31, 2026, were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized ​ Gross Unrealized ​ Estimated Fair (In thousands) ​ ​ ​ Cost ​ ​ ​ Gains ​ ​ ​ Losses ​ ​ ​ Market Value Investments due in 3 months or less: ​ ​ ​ ​ ​ ​ ​ ​ Commercial paper ​ $ 1,538 ​ $ — ​ $ — ​ $ 1,538 Corporate securities ​ ​ 8,300 ​ ​ 9 ​ ​ — ​ ​ 8,309 Total ​ 9,838 ​ 9 ​ — ​ 9,847 Investments due in 4-12 months: ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ ​ 78,626 ​ ​ 460 ​ ​ — ​ ​ 79,086 Total ​ 78,626 ​ 460 ​ — ​ 79,086 Investments due in 12 months or greater: ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ 104,659 ​ 389 ​ ( 167 ) ​ 104,881 Total ​ ​ 104,659 ​ 389 ​ ​ ( 167 ) ​ 104,881 Total investments ​ $ 193,123 ​ $ 858 ​ $ ( 167 ) ​ $ 193,814 ​ Accrued interest receivable was $ 1.8 million at March 31, 2026, and was recorded within prepaid expenses and other current assets on the condensed consolidated balance sheet. 12 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ Amortized cost and estimated fair market value of investments classified as available-for-sale (excluding cash equivalents) at December 31, 2025, were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized ​ Gross Unrealized ​ Estimated Fair (In thousands) ​ ​ ​ Cost ​ ​ ​ Gains ​ ​ ​ Losses ​ ​ ​ Market Value Investments due in 3 months or less: ​ ​ ​ ​ ​ ​ ​ ​ Commercial paper ​ $ 1,498 ​ $ — ​ $ — ​ $ 1,498 Corporate securities ​ ​ 8,152 ​ ​ 8 ​ ​ — ​ ​ 8,160 Total ​ 9,650 ​ 8 ​ — ​ 9,658 Investments due in 4-12 months: ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ 32,256 ​ 267 ​ — ​ 32,523 Total ​ 32,256 ​ 267 ​ — ​ 32,523 Investments due in 12 months or greater: ​ ​ ​ ​ ​ ​ ​ ​ Corporate securities ​ ​ 146,910 ​ 1,665 ​ ( 1 ) ​ 148,574 Total ​ 146,910 ​ 1,665 ​ ( 1 ) ​ 148,574 Total investments ​ $ 188,816 ​ $ 1,940 ​ $ ( 1 ) ​ $ 190,755 ​ Accrued interest receivable was $ 2.3 million at December 31, 2025, and was recorded within prepaid expenses and other current assets on the condensed consolidated balance sheet. The following table summarizes investments classified as available-for-sale (excluding cash equivalents) in a continuous unrealized loss position for which an allowance for credit losses was not recorded at March 31, 2026: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less Than 12 Months ​ 12 Months or Longer ​ Total ​ ​ ​ ​ Estimated ​ ​ ​ Gross ​ ​ ​ Estimated ​ ​ ​ Gross ​ ​ ​ Estimated ​ ​ ​ Gross ​ ​ Fair Market ​ Unrealized ​ Fair Market ​ Unrealized ​ Fair Market ​ Unrealized (In thousands) ​ Value ​ Losses ​ Value ​ Losses ​ Value ​ Losses Corporate securities ​ $ 30,224 ​ $ ( 167 ) ​ $ — ​ $ — ​ $ 30,224 ​ $ ( 167 ) Total investments ​ $ 30,224 ​ $ ( 167 ) ​ $ — ​ $ — ​ $ 30,224 ​ $ ( 167 ) ​ In the three months ended March 31, 2026 and 2025, no unrealized losses on investments were recognized in the condensed consolidated statements of income. The Company does not intend to sell, and it is unlikely that it will be required to sell the securities held prior to their anticipated recovery. The issuers are high quality (investment grade) and the decline in fair value is largely due to changes in interest rates. Additionally, the issuers continue to make timely interest payments on the investments with the fair value expected to recover as they reach maturity. ​ 7. STOCKHOLDERS’ EQUITY: Cash Dividends In October 2024, the Company’s board of directors declared dividends of $ 0.21 per share to be paid to stockholders of record at the end of each quarter in 2025. In October 2025, the Company’s board of directors raised the quarterly cash dividend with the declaration of four cash dividends of $ 0.215 per share to be paid at the end of each quarter in 2026. For the three months ended March 31, 2026 and 2025, cash dividends declared and paid were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (In thousands, except per share amounts) ​ ​ ​ 2026 ​ ​ ​ 2025 Dividends declared and paid ​ $ 11,950 ​ $ 11,959 Dividends declared per common share ​ $ 0.215 ​ $ 0.21 ​ 13 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ Common Stock Repurchases From time to time, the Company’s board of directors has authorized the use of funds to repurchase shares of the Company’s common stock. As of December 31, 2025, the Company did no t have any amount authorized to repurchase shares of its common stock. Employee Stock Incentive Plans The following table summarizes the stock-based compensation expense recognized in accordance with ASC 718-10 for the three months ended March 31, 2026 and 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (In thousands) ​ ​ ​ 2026 ​ ​ ​ 2025 Cost of revenue ​ $ 469 ​ $ 657 Research and development ​ 1,904 ​ 2,250 Selling, general and administrative ​ 3,526 ​ 5,776 Other operating expenses (see note below) ​ ​ ( 1,419 ) ​ ​ — Restructuring and related charges ​ 1,827 ​ — Total stock-based compensation expense ​ $ 6,307 ​ $ 8,683 ​ Other Operating Expenses In connection with his retirement in July 2025, the Company’s former chief executive officer, Balu Balakrishnan, entered into a transition agreement and a consulting agreement with the Company. Pursuant to these agreements, Mr. Balakrishnan’s outstanding equity awards continue to vest subject to his continuous service and the applicable award agreements. The majority of these awards are subject to performance criteria established at the time of grant and will only be earned to the extent that the Company’s performance satisfies such criteria at the conclusion of the applicable performance periods. As the services to be performed by Mr. Balakrishnan under the transition agreement and the consulting agreement do not qualify as “substantive services” under ASC 718, Compensation–Stock Compensation, the continued vesting of the outstanding equity awards represents a modification of the original awards. Consequently, in the year ended December 31, 2025, the Company recognized stock-based compensation in the amount of $ 8.4 million in other operating expenses. In the quarter ended March 31, 2026, the Company recorded a $ 1.4 million credit in other operating expenses on the condensed consolidated statements of income, reversing a portion of the previously recognized stock-based compensation expense. The reversal reflects our revised estimate of the portion of the awards that will ultimately vest. Subsequent changes in our estimates could result in further adjustments in future periods until the vesting of these equity awards. ​ ​ ​ ​ 8. REVENUE: Customer Concentration The Company’s top ten customers accounted for approximately 80 % of net revenue in both the three months ended March 31, 2026 and 2025. A significant portion of revenue is attributable to sales of the Company’s products to distributors of electronic components. These distributors sell the Company’s products to a broad, diverse range of end users, including original equipment manufacturers (“OEMs”) and merchant power-supply contract manufacturers (“CMs”). Similarly, merchant power-supply manufacturers sell power supplies incorporating the Company’s products to a broad range of OEMs. Sales to distributors and direct sales to OEMs and power-supply CMs contributed to the Company’s net revenue as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (In thousands) ​ 2026 ​ ​ ​ 2025 14 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ Sales to distributors ​ $ 76,739 ​ $ 75,164 Sales to OEMs and CMs ​ 31,569 ​ 30,365 Total net revenue ​ $ 108,308 ​ $ 105,529 ​ During the three months ended March 31, 2026 and 2025, 15 % and 13 % of net revenue related to an OEM that fulfilled its purchases through the Company’s CM customers in each respective quarter. The following customers represented 10% or more of the Company’s net revenue for the respective periods: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, Customer ​ 2026 ​ 2025 Customer A 30 % ​ 32 % Customer B ​ 10 % ​ * ​ Customer C ​ 10 % ​ * ​ Customer D 10 % ​ * ​ ​ * Total customer revenue was less than 10% of net revenue. No other customers accounted for 10% or more of the Company’s net revenue in the periods presented. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash investments and trade receivables. The Company does not have any off-balance-sheet credit exposure related to its customers. As of March 31, 2026 and December 31, 2025, 87 % and 89 % of accounts receivable were concentrated with the Company’s top ten customers. The following customers represented 10% or more of accounts receivable at March 31, 2026 and December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, Customer ​ ​ ​ 2026 ​ 2025 Customer A ​ 30 % ​ 32 % Customer B ​ 14 % ​ 11 % Customer C ​ 14 % ​ 18 % Customer D ​ 11 % ​ * ​ * Total customer accounts receivable was less than 10% of accounts receivable. No other customers accounted for 10% or more of the Company’s accounts receivable in the periods presented. 15 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ Net Revenue by Geography The Company markets its products globally through its sales personnel and a worldwide network of independent sales representatives and distributors. Net revenue by region and country with 10% or more of the Company’s revenue during any of the periods presented, based on “bill to” customer locations were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (In thousands) ​ ​ ​ 2026 ​ ​ ​ 2025 Americas ​ $ 7,083 ​ $ 5,717 EMEA ​ 15,125 ​ 11,291 APAC: ​ ​ ​ ​ Hong Kong/China ​ 49,971 ​ 56,488 Korea ​ ​ 10,747 ​ ​ 12,269 Other APAC ​ 25,382 ​ 19,764 Total net revenue ​ $ 108,308 ​ $ 105,529 ​ ​ ​ ​ ​ ​ ​ 9. EARNINGS PER SHARE: Basic earnings per share are calculated by dividing net income by the weighted-average shares of common stock outstanding during the period. Diluted earnings per share are calculated by dividing net income by the weighted-average shares of common stock and dilutive common equivalent shares outstanding during the period. Dilutive common equivalent shares included in this calculation consist of the assumed vesting of outstanding restricted stock units, the assumed issuance of awards under the stock purchase plan and contingently issuable performance-based awards, as computed using the treasury stock method. A summary of the earnings per share calculation is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (In thousands, except per share amounts) ​ ​ ​ 2026 ​ ​ ​ 2025 Basic earnings per share: ​ ​ ​ ​ Net income ​ $ 3,300 ​ $ 8,790 Weighted-average common shares ​ 55,506 ​ 56,871 Basic earnings per share ​ $ 0.06 ​ $ 0.15 Diluted earnings per share: (1) ​ ​ ​ ​ Net income ​ $ 3,300 ​ $ 8,790 Weighted-average common shares ​ 55,506 ​ 56,871 Effect of dilutive awards: ​ ​ ​ ​ Employee stock plans ​ 368 ​ 252 Diluted weighted-average common shares ​ 55,874 ​ 57,123 Diluted earnings per share ​ $ 0.06 ​ $ 0.15 ​ (1) The Company includes the shares underlying performance-based awards in the calculation of diluted earnings per share if the performance conditions have been satisfied as of the end of the reporting period and excludes such shares when the necessary conditions have not been met. The Company has excluded the shares underlying the outstanding performance-based awards in the 2026 and 2025 calculations as the shares were not contingently issuable as of the end of the reporting period. ​ 10. INCOME TAXES: Income-tax expense includes a provision for federal, state and foreign taxes based on the annual estimated effective tax rate applicable to the Company and its subsidiaries, adjusted for certain discrete items which are fully recognized in the period they occur. Accordingly, the interim effective tax rate may not be reflective of the annual estimated effective tax rate. 16 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ The Company’s effective tax rate for the three months ended March 31, 2026, was 15.8 % and 11.1 % in the corresponding period of 2025. The effective tax rate in these periods were lower than the statutory federal income-tax rate of 21 % due to the geographic distribution of the Company’s world-wide earnings in lower-tax jurisdictions and federal tax credits. In the three months ended March 31, 2026, the Company’s effective tax rate was affected by the recognition of a tax accounting shortfall associated with share-based payments. Additionally, i n the three months ended March 31, 2025, the Company’s effective tax rate was unfavorably impacted by the recognition of share-based payments and foreign income subject to U.S. tax. The Company has not been granted any incentivized tax rates and does not operate under any tax holidays in any jurisdiction . ​ 11. COMMITMENTS AND CONTINGENCIES: Supplier Agreements Under the terms of the Company’s wafer-supply agreements with various foundries, the wafers purchased from these suppliers are priced in U.S. dollars, with mutual sharing of the impact of fluctuations in the exchange rate between the Japanese yen and the U.S. dollar on future purchases. Each year, the Company’s management and several suppliers review and negotiate future pricing; the negotiated pricing is denominated in U.S. dollars but is subject to contractual exchange-rate true-up provisions. The fluctuation in the exchange rate is shared between the Company and each of these suppliers on future purchases. ​ Warranty The Company generally warrants that its products will substantially conform to the published specifications for 12 months from the date of shipment. Under the terms and conditions of sale, the Company’s liability is limited generally to either a credit equal to the purchase price or replacement of the part. ​ Legal Proceedings From time to time in the ordinary course of business, the Company becomes involved in lawsuits, or customers and distributors may make claims against the Company. In accordance with ASC 450-10, Contingencies , the Company makes a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. During the year ended December 31, 2025, the Company had been defending against patent-infringement claims filed by a third party against a customer of the Company, including claims filed in 2019 and a follow-on claim filed in the first quarter of 2025. The Company intervened on behalf of its customer and sought a declaration of non-infringement with respect to use of the Company’s products. In the second half of 2025, the Company successfully obtained verdicts of noninfringement and invalidity of all asserted claims, and as part of the noninfringement verdict, the jury found that no products incorporating the Company’s specified products met the specific requirements of the claimant’s asserted claims. The Court thereafter entered judgment in favor of the Company and also dismissed the follow-on claim. In April 2026, the Company executed a settlement in which the claimant granted the Company a full release and covenant not to assert any claims against the Company or its customers on any of the claimant’s patents based on the use or incorporation of any product. The Company did not provide any payment to the claimant in exchange for the resolution of the dispute. Pursuant to the settlement, all pending motions in the case have been terminated and the matter is now closed. As of December 31, 2025, the Company had reserved approximately $ 11.3 million for an employee relations dispute including legal fees which is pending ongoing court proceedings. While the court ruled in favor of the plaintiff in the second quarter of 2025, the Company disagrees with the jury’s verdict and court’s orders related to plaintiff attorney fees and related costs against the Company and has appealed the judgement. The charges associated with the established reserve were recognized in other operating expenses in the accompanying condensed consolidated statements of income. The Company is unable to predict the outcome of any further proceedings with certainty, and there can be no assurance that the Company will prevail in the hereto-mentioned litigation. The Company evaluates, at least on a quarterly 17 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ basis, developments in its legal matters that could affect the amount of any accrual, as well as any developments that would result in a loss contingency to become both probable and reasonably estimable. These litigations, whether or not determined in the Company’s favor or settled, will be costly and will divert the efforts and attention of the Company’s management and technical personnel from normal business operations, potentially causing a material adverse effect on the business, financial condition and operating results. In addition, adverse determinations in patent litigation could result in the loss of proprietary rights, subject the Company to significant liabilities, require the Company to seek licenses from third parties or prevent the Company from licensing the technology, and incur monetary losses, any of which could have a material adverse effect on the Company’s business, financial condition and operating results. Indemnifications The Company sells products to its distributors under contracts, collectively referred to as Distributor Sales Agreements (“DSA”). Each DSA contains the relevant terms of the contractual arrangement with the distributor, and generally includes certain provisions for indemnifying the distributor against losses, expenses, and liabilities from damages that may be awarded against the distributor in the event the Company’s products are found to infringe upon a patent, copyright, trademark, or other proprietary right of a third party (“Customer Indemnification”). The DSA generally limits the scope of and remedies for the Customer Indemnification obligations in a variety of industry-standard respects, including, but not limited to, limitations based on time and geography, and a right to replace an infringing product. The Company also, from time to time, has granted a specific indemnification right to individual customers. The Company believes its internal development processes and other policies and practices limit its exposure related to such indemnifications. In addition, the Company requires its employees to sign a proprietary information and inventions agreement, which assigns the rights to its employees’ development work to the Company. While the Company has on occasion been made aware of claims against its distributors or customers that may trigger an indemnification claim, to date, the Company has not had to reimburse any of its distributors or customers for any losses related to these indemnifications and no material claims were outstanding as of March 31, 2026. For several reasons, including the lack of prior indemnification claims and the lack of a monetary liability limit for certain infringement cases, the Company cannot determine the maximum amount of potential future payments, if any, related to such indemnifications. ​ 12. SEGMENT REPORTING: The Company is organized and operates as one operating and reportable segment; the design, development, manufacture and marketing of integrated circuits and related components for use primarily in high-voltage power conversion. This determination is based on the management approach which designates internal information regularly available to the Chief Operating Decision Maker (“CODM”) for making decisions and assessing performance as the source of determination of the Company’s reportable segments. The Company’s CODM, the Chief Executive Officer, reviews financial information presented on a consolidated basis for the purpose of making operating decisions and assessing financial performance. The CODM uses net income as the measure of profit or loss to allocate resources and assess performance. The CODM regularly reviews net income as reported on the Company’s consolidated statements of income. Financial forecasts and budget to actual results used by the CODM to assess performance and allocate resources, as well as those used for strategic decisions related to headcount and capital expenditures, are also reviewed on a consolidated basis. The CODM considers the impact on net income of the significant segment expenses in the table below when deciding whether to reinvest profits, propose dividends or share repurchase, or pursue strategic mergers and acquisitions. The measure of segment assets is reported on the balance sheet as total assets. The CODM does not review segment assets at a level other than that presented in the Company’s consolidated balance sheets. 18 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ The table below presents the Company’s consolidated operating results including significant segment expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (In thousands) ​ 2026 ​ ​ ​ 2025 Net revenue ​ $ 108,308 ​ $ 105,529 Less: ​ ​ ​ ​ ​ ​ Stock-based compensation (1) ​ ​ 6,307 ​ ​ 8,683 Amortization of acquisition-related intangible assets (2) ​ ​ 147 ​ ​ 147 Cost of revenue (excluding 1 & 2) ​ ​ 50,754 ​ ​ 46,490 Research and development (excluding 1) ​ ​ 24,351 ​ ​ 21,845 Selling, general and administrative (excluding 1) ​ ​ 20,918 ​ ​ 21,646 Other operating expenses (excluding 1) ​ ​ — ​ ​ — Restructuring and related charges in operating expenses (excluding 1) ​ ​ 4,377 ​ ​ — Income from operations ​ ​ 1,454 ​ ​ 6,718 ​ ​ ​ ​ ​ ​ ​ Other income ​ ​ 2,466 ​ ​ 3,167 Provision for income taxes ​ ​ 620 ​ ​ 1,095 NET INCOME ​ $ 3,300 ​ $ 8,790 ​ 19 Table of Contents POWER INTEGRATIONS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) ​ The table below presents other segment information: ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (In thousands) ​ 2026 ​ ​ ​ 2025 Depreciation ​ $ 6,380 ​ $ 7,244 Amortization of intangibles ​ $ 183 ​ $ 207 Interest income ​ $ 2,524 ​ $ 3,360 ​ ​ 13. BANK LINES OF CREDIT In 2016, the Company entered into a credit agreement with Wells Fargo Bank, National Association (the "Prior Credit Agreement") that provided the Company with a $ 75.0 million revolving line of credit to use for general corporate purposes and a $ 20.0 million sub-limit for the issuance of standby and trade letters of credit with an interest rate based on the Secured Overnight Financing Rates (“SOFR”). The Prior Credit Agreement had a term which originally extended to June 7, 2026; the Prior Credit Agreement was terminated on April 10, 2026. The Company was compliant with all covenants and had no advances outstanding under the Prior Credit Agreement as of termination of the Prior Credit Agreement. On February 24, 2026, the Company entered into that certain Loan Agreement with PNC Bank, National Association (the "PNC Loan Agreement") to replace the Prior Credit Agreement. The PNC Loan Agreement became effective and available for use on April 10, 2026 when the Company terminated the Prior Credit Agreement. The PNC Loan Agreement provides the Company with a $ 100.0 million revolving line of credit with a $ 25.0 million sub-limit for the issuance of standby and trade letters of credit. The interest rate on outstanding borrowings under the PNC Loan Agreement is based on SOFR plus 1.60 %. The Company’s obligations under the PNC Loan Agreement are unsecured. The PNC Loan Agreement term extends through February 24, 2031; all advances under the revolving line of credit, together with all accrued and unpaid interest, fees and other obligations owing thereon, will become due on such date, or earlier upon the occurrence of an Event of Default (as defined in the PNC Loan Agreement). The PNC Loan Agreement requires the Company to maintain a Minimum Liquidity of at least $ 50.0 million as of the last day of each fiscal quarter and a ratio of Funded Indebtedness to Adjusted EBITDA (each as defined in the PNC Loan Agreement) of less than 2.00 to 1.00 as of the last day of each fiscal quarter and determined on a rolling four-quarter basis. The PNC Loan Agreement contains representations and warranties, affirmative covenants and conditions precedent to borrowing usual and customary for credit agreements of this type. The PNC Loan Agreement contains negative covenants, including negative covenants that restrict, subject to certain exceptions, the Company’s ability to: ● use the proceeds of any credit extended under the PNC Loan Agreement except to refinance all indebtedness outstanding under the Prior Credit Agreement and for working capital or other general business purposes; ● create, incur, assume or permit to exist any indebtedness or liabilities resulting from borrowings, loans or advances; ● mortgage, pledge, grant or permit to exist a security interest in, or lien upon, all or any portion of the Company’s assets; ● guarantee or become liable for any obligations or liabilities of any other person or entity; ● purchase or hold beneficially any stock, or other securities or evidence of indebtedness of, or make or have outstanding, any loans or advances to, or otherwise extend credit to, or make any investment or acquire any interest whatsoever in, any other person, firm, corporation or other entity; and ● liquidate, dissolve, merge or consolidate with or into any person, firm, corporation or other entity, or make acquisitions of all or substantially all of the property or assets of any person, firm, corporation or other entity, or sell, lease, transfer or otherwise dispose of all or a substantial part of the Company’s property, assets, operations or business. The Company was compliant with all covenants and had no advances outstanding under the PNC Loan Agreement as of April 10, 2026. ​ 20 Table of Contents ​ ​