What changed in this filing

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Item 1. Financial Statements

2025-11-07 compared with 2025-05-09 · 130 added, 167 removed, 383 unchanged (44% of the section changed)

3 unchanged sentences

(In thousands, except share and per share data)

March 31, 2025 June 30, 2024

September 30, 2025 June 30, 2025

Current assets:

Cash and cash equivalents $ 177,195 $ 149,727

Accounts receivable, net of allowance for doubtful accounts of $ 6,061 and $ 498 at March 31, 2025 and June 30, 2024, respectively

Accounts receivable, net of allowance for doubtful accounts of $ 11,929 and $ 11,956 at September 30, 2025 and June 30, 2025, respectively

245,336 244,616

17 unchanged sentences

Operating lease liabilities — long-term 33,689 35,458

Debt — long-term — 669,878

Deferred tax liability — long-term — 492

Other long-term liabilities 29,010 26,349

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500,000,000 shares authorized:

60,490,469 and 60,462,539 issued and outstanding as of March 31, 2025 and June 30, 2024, respectively

60,499,555 and 60,492,105 issued and outstanding as of September 30, 2025 and June 30, 2025, respectively

Additional paid–in capital 17,781 17,075

4 unchanged sentences

UBIQUITI INC.

Consolidated Statements of Operations and Comprehensive Income

Consolidated Statements of Operations

(In thousands, except per share amounts)

Three Months Ended March 31, Nine Months Ended March 31,

2025 2024 2025 2024

Three Months Ended September 30,

Revenues $ 733,773 $ 550,344

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(In thousands, except share data)

Three and Nine Months Ended March 31, 2025

Three Months Ended September 30, 2025

Common Stock Additional Paid-In Capital Retained Earnings Total Stockholders’ Equity

9 unchanged sentences

60,499,555 $ 61 $ 17,781 $ 810,602 $ 828,444

Net Income — — — 136,795 136,795

Restricted stock units issued, net of tax withholdings 309 — — — —

Share-based compensation expense — — 1,793 — 1,793

Dividends Paid on Common Stock ($ 0.60 per share)

— — — ( 36,282 ) ( 36,282 )

Balances at December 31, 2024

60,470,517 $ 60 $ 13,811 $ 276,574 $ 290,445

Net Income — — — 180,435 180,435

Restricted stock units issued, net of tax withholdings 19,952 1 ( 321 ) — ( 320 )

Share-based compensation expense — — 1,848 — 1,848

Dividends Paid on Common Stock ($ 0.60 per share)

— — — ( 36,295 ) ( 36,295 )

Balances at March 31, 2025

60,490,469 $ 61 $ 15,338 $ 420,714 $ 436,113

Three and Nine Months Ended March 31, 2024

Three Months Ended September 30, 2024

Common Stock Additional Paid-In Capital Retained Earnings (Deficit) Total Stockholders’ Equity (Deficit)

9 unchanged sentences

60,470,208 $ 60 $ 12,018 $ 176,061 $ 188,139

Net Income — — — 82,116 82,116

Restricted stock units issued, net of tax withholdings 731 — ( 11 ) — ( 11 )

Share-based compensation expense — — 1,506 — 1,506

Dividends Paid on Common Stock ($ 0.60 per share)

— — — ( 36,269 ) ( 36,269 )

Balances at December 31, 2023

60,448,287 $ 60 $ 7,403 $ ( 23,185 ) $ ( 15,722 )

Net Income — — — 76,290 76,290

Restricted stock units issued, net of tax withholdings 13,118 — ( 82 ) — ( 82 )

Share-based compensation expense — — 1,664 — 1,664

Dividends Paid on Common Stock $ 0.60 per share)

— — — ( 36,277 ) ( 36,277 )

Balances at March 31, 2024

60,461,405 $ 60 $ 8,985 $ 16,828 $ 25,873

See accompanying notes to consolidated financial statements (unaudited).

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(In thousands) (Unaudited)

Nine Months Ended March 31,

Three Months Ended September 30,

Cash Flows from Operating Activities:

7 unchanged sentences

Deferred taxes ( 318 ) 99

Provision for bad debts 5,563 140

Other, net ( 384 ) 202

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Cash Flows from Financing Activities:

Proceeds from borrowing under the credit facility- Revolver 30,000 —

Repayment against credit facility- Revolver — ( 35,000 )

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Net cash used in financing activities ( 165,826 ) ( 192,230 )

Net increase (decrease) in cash and cash equivalents 24,625 ( 12,339 )

Net increase in cash and cash equivalents 27,468 38,833

Cash and cash equivalents at beginning of period 149,727 126,342

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These consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the fiscal year ended June 30, 2025, included in its 2025 Annual Report on Form 10-K, as filed with the SEC on August 22, 2025 (the “2025 Annual Report”).

The results of operations for the three and nine months ended March 31, 2025 are not necessarily indicative of the results to be expected for any future periods.

The results of operations for the three months ended September 30, 2025 are not necessarily indicative of the results to be expected for any future periods.

NOTE 2— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company’s significant accounting policies are disclosed in its audited consolidated financial statements for the fiscal year ended June 30, 2024, included in the Annual Report on Form 10-K.

The Company’s significant accounting policies are disclosed in its audited consolidated financial statements for the fiscal year ended June 30, 2025, included in the 2025 Annual Report.

There have been no changes to the Company’s significant accounting policies as discussed in the 2025 Annual Report.

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Recent Accounting Pronouncements Not Yet Effective

Segment Reporting

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2023-07, Segment Reporting ( Topic 280 ) (“ASU 2023-07”), which enhances the segment disclosure requirements for public entities on an annual and interim basis.

Under this proposal, public entities will be required to disclose significant segment expenses that are regularly provided to the chief operating decision maker (the “CODM”) and included within each reported measure of segment profit or loss.

Additionally, current annual disclosures about a reportable segment’s profit or loss and assets will be required on an interim basis.

Entities will also be required to disclose information about the CODM’s title and position at the Company along with an explanation of how the CODM uses the reported measures of segment profit or loss in their assessment of segment performance and deciding how to allocate resources.

Finally, ASU 2023-07 requires all segment disclosures for public entities, even those with a single reportable segment.

The amendments in ASU 2023-07 will become effective on a retrospective basis for annual disclosures in the Company's fiscal year beginning July 1, 2024, with interim period disclosures required effective with the Company's fiscal year beginning July 1, 2025.

Early adoption of ASU 2023-07 is permitted.

We do not expect this ASU to have a significant impact on our disclosures or results of operations, cash flows, and financial condition.

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740) ("ASU 2023-09"), which amends the existing guidance relating to the annual disclosures for accounting for income taxes.

ASU 2023-09 requires a public business entity to disclose a tabular rate reconciliation using specified categories and providing additional information for reconciling items that exceed a

quantitative threshold.

ASU 2023-09 requires a public business entity to disclose a tabular rate reconciliation using specified categories and providing additional information for reconciling items that exceed a quantitative threshold.

In addition, ASU 2023-09 requires the disaggregation of federal, state and foreign income taxes paid (net of funds received), with further disaggregation required for individual jurisdictions in which the income taxes paid exceed five percent of the Company's total income taxes paid.

The provision for income taxes in the Company's statement of operations will also be required to be disaggregated by federal, state and foreign.

The amendments in ASU 2023-09 will become effective for annual disclosures in the Company's fiscal year beginning July 1, 2025, with early adoption permitted.

The provision for income taxes in the Company's statement of operations will also be required to be disaggregated by federal, state and foreign jurisdictions.

The amendments in ASU 2023-09 will become effective for annual disclosures for fiscal year 2026.

The FASB indicated ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted.

We expect this ASU to only impact our disclosures with no impact to our results of operations, cash flows, and financial condition.

This ASU will only impact our disclosures with no impact to our results of operations, cash flows, and financial condition.

Disaggregation of Expenses

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and depreciation, amortization and depletion expenses for each caption on the income statement where such expenses are included.

The amendments in ASU 2024-03 will become effective for annual disclosures in the Company's fiscal year beginning July 1, 2027, with interim period disclosures required effective with the Company's fiscal year beginning July 1, 2028.

The amendments in ASU 2024-03 will become effective for

annual disclosures in the Company's fiscal year beginning July 1, 2027, with interim period disclosures required effective with the Company's fiscal year beginning July 1, 2028.

Early adoption is permitted, and the amendments may be applied prospectively to reporting periods after the effective date or retrospectively to all periods presented in the financial statements.

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The current portion of deferred revenue is included in other current liabilities and the non-current portion is included in other long-term liabilities in our consolidated balance sheets.

As of March 31, 2025 and June 30, 2024, the Company’s customer deposits were $ 1.4 million and $ 1.3 million, respectively.

As of March 31, 2025, the Company’s deferred revenue, included in other current liabilities and other long-term liabilities, was $ 30.2 million and $ 22.1 million, respectively.

As of September 30, 2025 and June 30, 2025, the Company’s customer deposits were $ 1.6 million and $ 2.8 million, respectively.

As of September 30, 2025, the Company’s deferred revenue, included in other current liabilities and other long-term liabilities, was $ 41.1 million and $ 29.0 million, respectively.

As of June 30, 2025, the Company’s deferred revenue, included in other current liabilities and other long-term liabilities, was $ 36.0 million and $ 26.0 million, respectively.

We expect the majority of our deferred revenue to convert to revenue in two years .

For the three and nine months ended March 31, 2025 we recognized revenues amounting to $ 4.3 million and $ 16.6 million, respectively, from the deferred revenue balance as of June 30, 2024.

For the three and nine months ended March 31, 2024, we recognized revenues amounting to $ 3.7 million and $ 14.7 million, respectively, from the deferred revenue balance as of June 30, 2023.

For the three months ended September 30, 2025, we recognized revenues amounting to $ 13.0 million from the deferred revenue balance as of June 30, 2025.

For the three months ended September 30, 2024, we recognized revenues amounting to $ 7.4 million from the deferred revenue balance as of June 30, 2024.

NOTE 4— EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share for the periods indicated (in thousands, except per share data):

Three Months Ended March 31, Nine Months Ended March 31,

2025 2024 2025 2024

Three Months Ended September 30,

Net income $ 207,876 $ 127,988

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Inventories consisted of the following (in thousands):

March 31, 2025 June 30, 2024

September 30, 2025 June 30, 2025

Finished goods $ 631,023 $ 627,971

3 unchanged sentences

Prepaid expenses and other current assets consisted of the following (in thousands):

March 31, 2025 June 30, 2024

September 30, 2025 June 30, 2025

Prepaid income taxes $ 7,517 $ 7,339

Prepaid expenses and other assets 40,287 23,702

Prepaid expenses and other current assets 37,687 39,458

Other taxes 9,825 8,775

2 unchanged sentences

Property and equipment, net consisted of the following (in thousands):

March 31, 2025 June 30, 2024

September 30, 2025 June 30, 2025

Testing equipment $ 19,230 $ 20,581

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Other long-term assets consisted of the following (in thousands):

March 31, 2025 June 30, 2024

September 30, 2025 June 30, 2025

Hong Kong Tax deposit (1)

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See Note 11, "Income Taxes" to the consolidated financial statements for additional details regarding this ongoing tax audit.

(2) Accumulated amortization was $ 8.6 million and $ 7.5 million as of March 31, 2025, and June 30, 2024, respectively.

(2) Accumulated amortization was $ 9.4 million and $ 9.1 million as of September 30, 2025, and June 30, 2025, respectively.

( 3) Amortization expense for intangible assets was $ 0.4 million both for the three months ended September 30, 2025 and 2024, respectively.

The following table presents expected future intangible asset amortization as of September 30, 2025:

Fiscal 2026 $ 513

Fiscal 2027 250

Fiscal 2028 250

Fiscal 2029 244

Fiscal 2030 241

Thereafter 743

Total future intangible asset amortization $ 2,241

Other Current Liabilities

Other current liabilities consisted of the following (in thousands):

March 31, 2025 June 30, 2024

September 30, 2025 June 30, 2025

Deferred revenue — short-term $ 41,077 35,968

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Other long-term liabilities consisted of the following (in thousands):

March 31, 2025 June 30, 2024

September 30, 2025 June 30, 2025

Deferred revenue — long-term $ 29,010 $ 26,015

Deferred tax liability $ — $ 334

Total $ 29,010 $ 26,349

NOTE 6— ACCRUED WARRANTY

The Company offers warranties on certain products, generally a period of one to two years and records a liability for the estimated future costs associated with potential warranty claims.

The warranty costs are reflected in the Company’s consolidated statements of

operations and comprehensive income within cost of revenues.

The warranty costs are reflected in the Company’s consolidated statements of operations within cost of revenues.

The warranties are typically in effect for one year for distributors from the date of shipment and two years for direct sales from the date of delivery.

3 unchanged sentences

Warranty obligations, included in other current liabilities, were as follows (in thousands):

Nine Months Ended March 31,

Three Months Ended September 30,

Beginning balance $ 11,739 $ 10,825

3 unchanged sentences

Ending balance $ 11,186 $ 11,113

On March 30, 2021, the Company, as borrower and certain domestic subsidiaries, as guarantors (the "Domestic Guarantors"), entered into an amended and restated credit agreement (the “Third Amended and Restated Credit Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”), the other financial institutions named as lenders therein, and Wells Fargo as administrative agent and collateral agent for the lenders, that extended the $ 700 million senior secured revolving credit facility (the “Revolving Facility,” together with the Term Loan Facilities, as defined below, the "Facilities") and provided a $ 500 million senior secured term loan facility (the “Initial Term Loan Facility”), and extended the maturity of the Facilities to March 30, 2026.

In addition, the Facilities include an option to request increases in the amounts of such credit facilities by up to an additional $ 500 million in the aggregate.

The loans under the Initial Term Loan Facility are payable in quarterly installments of $ 6.25 million per quarter, commencing with the quarter ending June 30, 2021.

On April 3, 2023, the Company as borrower and the Domestic Guarantors entered into a first amendment (the “First Amendment”) to the Third Amended and Restated Credit Agreement (as amended, the “Amended Credit Agreement”) with the financial institutions named as lenders therein and Wells Fargo.

The First Amendment added a new term loan facility in an aggregate principal amount of $ 250 million (the “First Amendment Term Loan Facility,” together with the Initial Term Loan Facility, the "Term Loan Facilities") which was payable in quarterly installments equal to $ 3.125 million, commencing with the quarter ended June 30, 2023, and had a maturity date of March 30, 2026.

On March 30, 2021, the Company, as borrower and certain domestic subsidiaries, as guarantors (the "Domestic Guarantors"), entered into an amended and restated credit agreement (as amended by a first amendment on April 3, 2023, the “Amended Credit Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”), the other financial institutions named as lenders therein, and Wells Fargo as administrative agent and collateral agent for the lenders, that extended the $ 700 million senior secured revolving credit facility (the “Revolving Facility,” together with the Term Loan Facility, as defined below, the "Facilities") and provided a $ 500 million senior secured term loan facility (the “Term Loan Facility”), and extended the maturity of the Facilities to March 30, 2026.

In addition, the Facilities include an option to request increases in the amounts of such credit facilities by up to an additional $ 500

million in the aggregate.

The loans under the Term Loan Facility are payable in quarterly installments of $ 6.25 million per quarter, commencing with the quarter ending June 30, 2021.

The obligations of the Company and certain domestic subsidiaries under the Amended Credit Agreement are required to be guaranteed by the Domestic Guarantors and are collateralized by substantially all assets (excluding intellectual property) of the Company and the Domestic Guarantors.

As of September 30, 2024 the Company had repaid all of the First Amendment Term Loan Facility and as a result there are no future payments due.

The Company's unamortized balance of debt issuance costs is $ 0.6 million as of March 31, 2025, which are amortized as interest expense over the life of the Facilities.

Amortization of debt issuance costs included in interest expense for the three months ended March 31, 2025 and March 31, 2024 were $ 0.3 million and $ 0.4 million, respectively.

Amortization of debt issuance costs included in interest expense for the nine months ended March 31, 2025 and March 31, 2024 were $ 1.7 million and $ 1.3 million, respectively.

The Company's unamortized balance of debt issuance costs is $ 0.3 million as of September 30, 2025, which are amortized as interest expense over the life of the Facilities.

Amortization of debt issuance costs included in interest expense for the three months ended September 30, 2025 and September 30, 2024 were $ 0.33 million and $ 1.04 million, respectively.

The Company's debt consisted of the following (in thousands):

March 31, 2025 June 30, 2024

Initial Term Loan Facility - short term $ 340,000 $ 25,000

First Amendment Term Loan Facility - short-term — 12,500

September 30, 2025 June 30, 2025

Term Loan Facility - short term $ 133,750 $ 250,000

Debt issuance costs, net ( 294 ) ( 443 )

Total Debt - short term 133,456 249,557

Initial Term Loan Facility - long term — 393,750

First Amendment Term Loan Facility - long-term — 101,875

Revolving Facility - long term — 175,000

Debt issuance costs, net — ( 747 )

Total Debt - long term $ — $ 669,878

The Revolving Facility includes a sub-limit of $ 25.0 million for letters of credit and a sub-limit of $ 25.0 million for swingline loans.

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Loans under the Facilities may be prepaid at any time without penalty.

The revolving loans and term loans under the Initial Term Loan Facility bear interest, at the Company’s option, at either (i) a floating rate per annum equal to the Base Rate (as defined below) plus a margin of between 0.50 % and 1.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter or (ii) a floating per annum rate equal to the Adjusted Term SOFR (as defined below) for a specified period, plus a margin of between 1.50 % and 2.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter.

The revolving loans and term loans under the Term Loan Facility bear interest, at the Company’s option, at either (i) a floating rate per annum equal to the Base Rate (as defined below) plus a margin of between 0.50 % and 1.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter or (ii) a floating per annum rate equal to the Adjusted Term SOFR (as defined below) for a specified period, plus a margin of between 1.50 % and 2.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter.

Swingline loans bear interest at a floating rate per annum equal to the Base Rate plus a margin of be tween 0.50 % and 1.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter.

The loans under the First Amendment Term Loan Facility bear interest, at the Company's option, at either (i) a floating rate per annum equal to Base Rate plus a margin of between 1.00 % and 1.75 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter or (ii) a floating per annum rate equal to the applicable Adjusted Term SOFR rate for a specified period, plus a margin between 2.00 % and 2.75 %, depending on the Company's consolidated total leverage ratio as of the most recently ended fiscal quarter.

Base Rate is defined in the Amended Credit Agreement as the highest of (a) the Prime Rate (as defined in the Amended Credit Agreement), (b) the Federal Funds Rate (as defined in the Amended Credit Agreement) plus 0.50 % and (c) Adjusted Term SOFR for a one-month tenor in effect on such day plus 1.00 %;

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The Facilities

As of March 31, 2025, $ 340.0 million was outstanding on the Initial Term Loan Facility.

There was no outstanding balance on the Revolving Facility as of March 31, 2025, resulting in $ 700.0 million being available on the Revolving Facility.

The First Amendment Term Loan Facility was fully repaid during the three months ended September 30, 2024 and there is no balance outstanding as of March 31, 2025.

Term Loan Facilities

During the nine months ended March 31, 2025, the Company made aggregate payments of $ 214.5 million under the Term Loan Facilities, of which $ 193.1 million was repayment of principal and $ 21.4 million was payment of interest.

As of September 30, 2025, $ 133.8 million was outstanding on the Term Loan Facility.

There was no outstanding balance on the Revolving Facility as of September 30, 2025, resulting in $ 700.0 million being available on the Revolving Facility.

As of September 30, 2025 and June 30, 2025, the fair value of the Company's Facilities approximated the historical cost.

Term Loan Facility

During the three months ended September 30, 2025, the Company made aggregate payments of $ 119.5 million under the Term Loan Facility, of which $ 116.3 million was repayment of principal and $ 3.2 million was payment of interest.

Revolving Facility

Under the Amended Credit Agreement, during the nine months ended March 31, 2025, the Company made aggregate payments of $ 210.0 million under the Revolving Facility, of which $ 205.0 million was repayment of principal and $ 5.0 million was payment of interest.

The following table summarizes the Company’s estimated debt and interest payment obligations as of March 31, 2025, for the remainder of fiscal 2025 and future fiscal years (in thousands):

There were no payments made under the Revolving Facility during the three months ended September 30, 2025.

The following table summarizes the Company’s estimated debt and interest payment obligations as of September 30, 2025 for the remainder of fiscal 2026 and future fiscal years (in thousands):

2026 (remainder)

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Total $ 138,241 $ — $ — $ — $ — $ — $ 138,241

(1) Interest payments are calculated based on the applicable rates and payment dates as of March 31, 2025.

(1) Interest payments are calculated based on the applicable rates and payment dates as of September 30, 2025.

Although our interest rates on our debt obligations may vary, we have assumed the most recent available interest rates for all periods presented.

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Some of our leases include options to extend the term of such leases for a period from 12 months to 60 months, and/or have options to early terminate the lease.

As of March 31, 2025, we included such options in determining the lease terms for certain of our leases because we were reasonably certain that we would exercise the extension options.

As of September 30, 2025, we included such options in determining the lease terms for certain of our leases because we were reasonably certain that we would exercise the extension options.

Most of our leases require us to pay certain operating expenses in addition to base rent, such as taxes, insurance and maintenance costs.

The following table summarizes our lease costs for the three and nine months ended March 31, 2025 and 2024 (in thousands):

Financial Statement Classification Three Months Ended March 31, Nine Months Ended March 31,

2025 2024 2025 2024

The following table summarizes our lease costs for the three months ended September 30, 2025 and 2024 (in thousands):

Financial Statement Classification Three Months Ended September 30,

Operating lease costs:

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The operating lease costs in the table above include costs for long-term and short-term leases.

Total short-term costs for the three and nine months ended March 31, 2025 and 2024 were immaterial.

Total short-term costs for the three months ended September 30, 2025 and 2024 were immaterial.

Variable lease costs primarily include maintenance, utilities and operating expenses that are incremental to the fixed base rent payments and are excluded from the calculation of operating lease liabilities and ROU assets.

For both the three months ended March 31, 2025 and 2024, cash paid for amounts associated with the Company's operating lease liabilities were approximately $ 4.3 million.

For the nine months ended March 31, 2025 and 2024, cash paid for amounts associated with the Company's operating lease liabilities were approximately $ 13.3 million and $ 12.9 million, respectively.

For the three months ended September 30, 2025 and 2024, cash paid for amounts associated with the Company's operating lease liabilities were approximately $ 4.6 million and $ 4.4 million, respectively.

Cash paid for amounts associated with the Company’s operating lease liabilities were classified as operating activities in the consolidated statement of cash flows.

The following table shows the Company’s undiscounted future fixed payment obligations under the Company’s recognized operating leases and a reconciliation to the operating lease liabilities as of March 31, 2025:

Remainder of Fiscal 2026

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We subcontract with third parties to manufacture our products and supply key components.

As of March 31, 2025, we had $ 1,264.5 million of purchase commitments with these third parties.

As of September 30, 2025, we had $ 1,249.8 million of purchase commitments with these third parties.

If we cancel all or part of the orders, we may still be liable to the contract manufacturers for the cost of the components purchased by the subcontractors to manufacture our products.

There have been no significant liabilities for current or anticipated cancellations recorded as of March 31, 2025.

There have been no significant liabilities for current or anticipated cancellations recorded as of September 30, 2025.

Our consolidated financial position and results of operations could be negatively impacted if we were required to compensate these third parties.

In addition, we may be subject to additional purchase obligations to our contract manufacturers for supply agreements and components ordered by them based on manufacturing forecasts we provide them each month.

Transition Tax

We have an obligation of $ 28.1 million as of March 31, 2025, related to the mandatory transition tax on accumulated foreign earnings from the 2017 Tax Cuts and Jobs Act.

We expect to make a payment to fully settle this obligation in the first quarter of fiscal 2026.

This obligation is included within income tax payable on our consolidated balance sheets.

Other Obligations

As of March 31, 2025, the Company has other obligations of $ 5.2 million which consisted primarily of commitments related to research and development projects.

As of September 30, 2025, the Company has other obligations of $ 4.9 million which consisted primarily of commitments related to research and development projects.

Indemnification Obligations

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The Company assesses its potential liability by analyzing specific litigation and regulatory matters using available information.

develops its views on estimated losses in consultation with inside and outside counsel, which involves a subjective analysis of potential results and outcomes, assuming various combinations of appropriate litigation and settlement strategies.

The Company develops its views on estimated losses in consultation with inside and outside counsel, which involves a subjective analysis of potential results and outcomes, assuming various combinations of appropriate litigation and settlement strategies.

Taking all of the above factors into account, the Company records an amount where it is probable that the Company will incur a loss and where that loss can be reasonably estimated.

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The Company may also incur significant legal fees, which are expensed as incurred, in defending against these claims.

The Company is not currently aware of any pending or threatened litigation that would have a material adverse effect on the Company’s financial statements.

The Company is not currently aware of any pending or threatened litigation that would have a material

adverse effect on the Company’s financial statements.

Intellectual Ventures I LLC v.

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Share-Based Compensation Plans

The Company’s 2020 and 2010 Equity Incentive Plans are described in the Company’s Annual Report.

As of March 31, 2025, the Company had 4,847,521 authorized shares available for future issuance under all of its stock incentive plans.

The Company’s 2020 and 2010 Equity Incentive Plans are described in the 2025 Annual Report.

As of September 30, 2025, the Company had 4,849,977 authorized shares available for future issuance under all of its stock incentive plans.

Share-Based Compensation

The following table shows total share-based compensation expense included in the consolidated statements of operations and comprehensive income for the three and nine months ended March 31, 2025 and 2024 (in thousands):

Three Months Ended March 31, Nine Months Ended March 31,

2025 2024 2025 2024

The following table shows total share-based compensation expense included in the consolidated statements of operations for the three months ended September 30, 2025 and 2024 (in thousands):

Three Months Ended September 30,

Cost of revenues $ 70 $ 54

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Stock Options

There were no options exercised under the Company’s stock incentive plans during the three and nine months ended March 31, 2025 and 2024.

As of March 31, 2025, the Company had no unrecognized compensation costs related to stock options, and the Company did no t grant any employee stock options during the three and nine months ended March 31, 2025, and 2024.

There were no options exercised under the Company’s stock incentive plans during the three months ended September 30, 2025 and 2024.

As of September 30, 2025, the Company had no unrecognized compensation costs related to stock options, and the Company did no t grant any employee stock options during the three months ended September 30, 2025 and 2024.

Restricted Stock Units (“RSUs”)

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RSUs canceled ( 3,205 ) $ 203.51

Non-vested RSUs, March 31, 2025

Non-vested RSUs, September 30, 2025

91,379 $ 223.43

The intrinsic value of RSUs vested in the three months ended March 31, 2025 and 2024 was $ 6.9 million and $ 1.9 million, respectively.

The intrinsic value of RSUs vested in the nine months ended March 31, 2025 and 2024 was $ 8.5 million and $ 3.3 million, respectively.

The total intrinsic value of all outstanding RSUs was $ 31.9 million as of March 31, 2025.

As of March 31, 2025, there were unrecognized compensation costs related to RSUs of $ 16.1 million which the Company expects to recognize over a weighted average period of 3.2 years.

The intrinsic value of RSUs vested during the three months ended September 30, 2025 and 2024 was $ 4.4 million and $ 1.5 million, respectively.

The total intrinsic value of all outstanding RSUs was $ 60.4 million as of September 30, 2025.

As of September 30, 2025, there were unrecognized compensation costs related to RSUs of $ 14.0 million which the Company expects to recognize over a weighted average period of 3.0 years.

NOTE 11— INCOME TAXES

The Company recorded tax provisions of $ 41.0 million and $ 102.2 million for the three and nine months ended March 31, 2025 as compared to $ 16.1 million and $ 56.1 million for the three and nine months ended March 31, 2024.

Our effective tax rate increased to 18.5 % for the three months ended March 31, 2025 as compared to 17.4 % for the three months ended March 31, 2024.

Our effective tax rate increased from 18.6 % for the nine months ended March 31, 2024 to 18.7 % for the nine months ended March 31, 2025.

The change in effective tax rates for the three and nine months ended March 31, 2025, as compared to the same periods in the prior year, was primarily driven by changes in the mix of the income earned in various tax jurisdictions as well as a one-time benefit for U.S.

state income taxes recorded in the three months ended March 31, 2024.

The Company recorded tax provisions of $ 50.7 million for the three months ended September 30, 2025 as compared to $ 30.6 million for the three months ended September 30, 2024.

Our effective tax rate increased to 19.6 % for the three months ended September 30, 2025 as compared to 19.3 % for the three months ended September 30, 2024.

The change in effective tax rates for the three months ended September 30, 2025, as compared to the same period in the prior year, was primarily driven by changes in the mix of the income earned in various tax jurisdictions as well as in the mix of income eligible for the Foreign-Derived Intangible Income (“FDII”) rules and subject to the Global Intangible Low-Taxes Income ("GILTI") and Pillar Two rules.

The Company’s estimated fiscal year 2026 effective tax rate, before discrete items, differs from the U.S.

statutory rate primarily due to profits earned in jurisdictions where the tax rate is lower than the U.S.

tax rate, partially offset by additional U.S.

tax related to our non-U.S.

operations under the Global Intangible Low-Taxes Income ("GILTI") rules.

As of March 31, 2025, the Company had approximately $ 37.9 million of unrecognized tax benefits, substantially all of which would, if recognized, affect its tax expense.

statutory rate primarily due to the income tax benefits from the FDII deduction as well as profits earned in jurisdictions where the tax rate is lower than the U.S.

tax rate, partially offset by additional Pillar Two top up taxes related to our non-U.S.

operations as well as income subject to GILTI.

As of September 30, 2025, the Company had approximately $ 34.7 million of unrecognized tax benefits, substantially all of which would, if recognized, affect its tax expense.

Accrued interest and penalties are included within the related tax liability line in the consolidated balance sheets.

As of March 31, 2025, the Company had $ 5.9 million accrued interest related to uncertain tax matters.

As of September 30, 2025, the Company had $ 6.0 million accrued interest related to uncertain tax matters.

The Company and one or more of its subsidiaries, file income tax returns in the United States federal jurisdiction, and various state, local, and foreign jurisdictions and is currently undergoing income tax examinations by the U.S.

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The majority of the Company's foreign jurisdictions have been concluded through 2015, with the exception of Hong Kong which has been reviewed through 2009 and is currently under audit for the 2010-2019 statutory tax years.

In July 2018, the Company received a draft Notice of Proposed Adjustment (“Draft NOPA”) from the IRS proposing an adjustment to income for the fiscal 2015 and fiscal 2016 tax years based on its interpretation of certain obligations of the non-US entities under the credit facility.

In July 2018, the Company received a draft Notice of Proposed Adjustment (“NOPA”) from the IRS proposing an adjustment to income for the fiscal 2015 and fiscal 2016 tax years based on its interpretation of certain obligations of the non-U.S.

entities under the credit facility.

This draft NOPA was superseded by an Acknowledgement of Facts (“AOF”) issued to the Company by the IRS on January 17, 2020.

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On November 8, 2023, the Company filed a Motion for Summary Judgment.

responded to the Company’s Motion on December 26, 2023 and filed a Cross-Motion for Summary Judgment.

The IRS responded to the Company’s Motion on December 26, 2023 and filed a Cross-Motion for Summary Judgment.

On January 22, 2024, the judge assigned to this case rejected both Motions for Summary Judgment.

As such, the Company is awaiting a trial date to be set.

The Company continues to believe that its tax position filed with the IRS with regard to this matter is more likely than not to be sustained based on the technical merits.

The Company continues to believe that its tax position filed with the IRS with regard to this matter is more likely than not to be sustained based on technical merits.

However, there can be no assurance that this matter will be resolved in the Company’s favor.

Regardless of whether the matter is resolved in the Company’s favor, the final resolution of this matter could be expensive and time-consuming to defend and/or settle.

The Company estimates the incremental tax liability associated with the income adjustment proposed in the AOF would be approximately $ 50.0 million, excluding potential interest and penalties, after adjusting for the impact of an adjustment on the amount of transition tax payable in future years by the Company.

As the Company believes that the tax originally paid in fiscal 2015 and fiscal 2016 is correct, it has not provided a reserve for this tax uncertainty.

However, an adverse outcome may have a material and adverse effect on the Company’s results of operations and financial condition.

The IRD is examining the Company’s claims that its revenue is generated through activities performed wholly outside of the Hong Kong tax jurisdiction and are therefore exempt from Hong Kong tax.

The Hong Kong Inland Revenue Department (the “IRD”) is examining the Company’s claims that its revenue is generated through activities performed wholly outside of the Hong Kong tax jurisdiction and are therefore exempt from Hong Kong tax.

The Company is fully cooperating with the examination including submitting documentation in support of its position.

The Company continues to believe that its tax positions filed with IRD are more likely than not to be sustained based on their technical merits and therefore no reserve has been provided for this tax uncertainty.

Between fiscal years 2018 and 2024, the Company made payments totaling a combined amount of $ 60.4 million as deposits with the Hong Kong IRD in connection with extending the statute of limitation for the 2010-2018 income tax audits.

On March 28, 2025, the Company received notification that the Hong Kong IRD is seeking an additional $ 2.0 million deposit covering the 2019 statutory tax year.

The Company filed a formal protest in response to this notice and is waiting for a confirmation from the Assessor's office which the Company expects to receive in the fourth quarter of fiscal 2025.

The Company continues to believe that its tax positions filed with the IRD are more likely than not to be sustained based on their technical merits and therefore no reserve has been provided for this tax uncertainty.

Between fiscal years 2018 and 2024, the Company made payments totaling a combined amount of $ 60.4 million as deposits with the IRD in connection with extending the statute of limitation for income tax examinations currently under audit for 2010-2018 income tax audits.

On March 28, 2025, the Company received notification that the IRD is seeking an additional $ 2.0 million deposit covering the 2019 statutory tax year.

The Company filed a formal protest in response to this notice and the Assessor's office agreed to a reduced deposit of $ 0.2 million covering the 2019 statutory tax year.

The refundable deposits are included within other long-term assets on our consolidated balance sheets.

The Company expects the $ 60.6 million (net of foreign currency impact) of deposits made with IRD to be refunded upon completion of the audit.

However, there can be no assurance that this matter will be resolved in the Company’s favor and therefore it's possible that an adverse outcome of the matter could have a material effect on the Company’s results of operations and financial condition.

The Company expects the $ 60.8 million (net of foreign currency impact) of deposits made with the IRD to be refunded upon completion of the audit.

However, there can be no assurance that this matter will be resolved in the Company’s favor and therefore it's possible that an adverse outcome of the matter

could have a material effect on the Company’s results of operations and financial condition.

The Organization for Economic Co-operation and Development Inclusive Framework on Base Erosion and Profit Shifting released Pillar Two Model Rules (“Pillar Two”) for a global minimum tax.

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Entities operating in countries where Pillar Two has been enacted are required to estimate Pillar Two top-up tax obligations beginning in the first quarter of fiscal year 2025.

For the three and nine months ended March 31, 2025, the Company did not have material Pillar Two top-up tax obligations impacting the Company’s estimated annual effective tax rate.

The Company will continue to evaluate the impact of proposed and enacted legislation as new guidance becomes available.

On July 4, 2025, the United States enacted tax reform legislation through the One Big Beautiful Bill Act (“OBBBA”).

Included in this legislation are provisions that allow for the immediate expensing of domestic United States research and development expenses, immediate expensing of certain capital expenditures, and changes to the U.S.

taxation of profits derived from foreign operations.

ASC 740, "Income Taxes", requires the effects of changes in tax rates and laws on deferred tax balances to be recognized in the period in which the legislation is enacted.

The legislation has multiple effective dates, with certain provisions effective in 2025 (our current fiscal year 2026) and others implemented through 2027 (our fiscal year 2028).

The Company has evaluated the OBBBA enacted during the quarter and determined its impact on the consolidated financial statements to be immaterial.

NOTE 12— SEGMENT INFORMATION, REVENUES BY GEOGRAPHY AND SIGNIFICANT CUSTOMERS

Management has determined that the Company operates as one reportable and operating segment as the Company’s Chief Executive Officer, who is the Company’s chief operating decision maker, does not make decisions about resources to be allocated or assess performance on a segment basis.

Furthermore, the Company does not organize or report its costs on a segment basis.

The Company presents its revenues by product type in two primary categories:

We have one reportable segment, which reflects how the chief operating decision maker (“CODM”), our Chief Executive Officer, reviews and assesses performance of the business.

The CODM assesses the performance of the Company and decides how to allocate resources based on consolidated net income reported in the consolidated statement of operations.

The CODM uses consolidated net income in deciding whether to reinvest profits into certain parts of the business or return a portion of such profits to shareholders through dividends and stock repurchases.

Significant expense categories regularly provided to and reviewed by the CODM are those presented in the consolidated statement of operations.

The Company presents its revenue by product type in two primary categories:

Service Provider Technology and Enterprise Technology.

Revenues by product type are as follows (in thousands, except percentages):

Three Months Ended March 31, Nine Months Ended March 31,

2025 2024 2025 2024

Three Months Ended September 30,

Enterprise technology $ 657,147 90 % $ 470,184 85 %

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Revenues by geography based on customer’s ship-to destinations were as follows (in thousands, except percentages):

Three Months Ended March 31, Nine Months Ended March 31,

2025 2024 2025 2024

Three Months Ended September 30,

North America (1)

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Total revenues $ 733,773 100 % $ 550,344 100 %

(1) Revenue for the United States was $ 298.5 million and $ 226.2 million for the three months ended March 31, 2025 and 2024, respectively.

Revenue for the United States was $ 843.3 million and $ 645.8 million for the nine months ended March 31, 2025 and 2024, respectively.

For the periods presented, there were no customers with an accounts receivable balance of 10% or greater of total accounts receivable or customers with revenues of 10% or greater of total revenues.

(1) Revenue for the United States was $ 351.3 million and $ 248.7 million for the three months ended September 30, 2025 and 2024, respectively.

For the periods presented, there were no customers with an accounts receivable balance of 10% or greater or customers with net revenues of 10% or greater of total revenues.

NOTE 13— COMMON STOCK AND TREASURY STOCK

Common Stock Repurchases

On August 21, 2025, the Company’s Board of Directors approved a $ 500 million stock repurchase program (the “2025 August Program”).

Under the 2025 August Program, the Company is authorized to repurchase up to $ 500 million of its common stock.

2025 August Program expires on September 30, 2026.

During the three months ended September 30, 2025, the Company did not make any repurchases under the 2025 August Program.

NOTE 14— RELATED PARTY TRANSACTIONS AND CERTAIN OTHER TRANSACTIONS

Pera, our Chairman and Chief Executive Officer, is the controlling owner of the Memphis Grizzlies, a team in the National Basketball Association (the “Grizzlies”).

From time to time, the Grizzlies purchase our products through our webstore, on terms that we believe are no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances.

During the three months ended September 30, 2025, we received approximately $ 190,000 from sales to the Grizzlies, inclusive of sales tax and shipping charges.

Additionally, from time to time, the Grizzlies may participate in our product testing and marketing activities.

NOTE 15— SUBSEQUENT EVENTS

On May 6, 2025, the Company's Board of Directors approved a quarterly cash dividend of $ 0.60 per share payable on May 27, 2025 to shareholders of record at the close of business on May 19, 2025.

On November 5, 2025, the Company's Board of Directors approved a quarterly cash dividend of $ 0.80 per share payable on November 24, 2025 to shareholders of record at the close of business on November 17, 2025.

Any future dividends will be subject to the approval of the Company’s Board of Directors.

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