[Filing Information](index=1&type=section&id=Filing%20Information) This section provides essential identification details for the registrant, SYNTEC OPTICS HOLDINGS, INC., and specifics of the Form 8-K filing, including its jurisdiction, address, and report dates [Registrant and Filing Details](index=1&type=section&id=Registrant%20and%20Filing%20Details) This section provides the core identification details for the registrant, SYNTEC OPTICS HOLDINGS, INC., and the specifics of the Form 8-K filing, including its jurisdiction, address, and the date of the report - The registrant is **SYNTEC OPTICS HOLDINGS, INC.**, incorporated in Delaware, with principal executive offices at 515 Lee Rd., Rochester, NY 14606[1](index=1&type=chunk)[2](index=2&type=chunk) - The Form 8-K report date is **October 6, 2025**, with the earliest event reported on **October 3, 2025**[1](index=1&type=chunk) [Securities Information](index=1&type=section&id=Securities%20Information) This part details the securities registered by SYNTEC OPTICS HOLDINGS, INC. under Section 12(b) of the Securities Exchange Act of 1934, including their trading symbols and the exchange on which they are registered Securities Registered Under Section 12(b) | Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | | :------------------ | :---------------- | :---------------------------------------- | | Common stock, par value $0.0001 per share | OPTX | The Nasdaq Capital Market | | Redeemable warrants, exercisable for common stock at an exercise price of $11.50 per share, subject to adjustment | OPTXW | The Nasdaq Capital Market | [Emerging Growth Company Status](index=1&type=section&id=Emerging%20Growth%20Company%20Status) The company has indicated its status as an 'emerging growth company' as defined by relevant SEC rules - **SYNTEC OPTICS HOLDINGS, INC.** is designated as an 'Emerging growth company'[3](index=3&type=chunk) [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) This section details the company's announcement of financial results for specific quarters and the full year through a press release [Financial Results Announcement](index=2&type=section&id=Financial%20Results%20Announcement) SYNTEC OPTICS HOLDINGS, INC. announced its financial results for the fourth quarter and full year ended December 31, 2024, and the first and second quarters of 2025, through a press release - On **October 6, 2025**, the Company issued a press release announcing financial results for **Q4 2024, Q1 2025, and Q2 2025**[4](index=4&type=chunk) - The press release is attached as **Exhibit 99.1** and is furnished under Item 2.02, not deemed 'filed' for Section 18 purposes unless specifically referenced[4](index=4&type=chunk)[5](index=5&type=chunk) [Item 9.01 Financial Statement and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statement%20and%20Exhibits) This section provides a comprehensive list of all documents filed as exhibits to the Form 8-K, including the financial results press release and interactive data [Exhibits List](index=2&type=section&id=Exhibits%20List) This section lists the documents filed as exhibits to the Form 8-K, including the press release detailing financial results and the interactive data file Exhibits Filed | Exhibit Number | Description | | :------------- | :---------- | | 99.1 | Press release dated October 6, 2025 | | 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | [Signatures](index=3&type=section&id=SIGNATURES) This section confirms the official signing of the report by the registrant's authorized officer, validating its submission [Report Signatures](index=3&type=section&id=Report%20Signatures) The report is officially signed by the registrant's authorized officer, confirming its submission in accordance with the Securities Exchange Act of 1934 - The report was signed on behalf of **SYNTEC OPTICS HOLDINGS, INC.** by **Al Kapoor, Chief Executive Officer**, on **October 6, 2025**[8](index=8&type=chunk)[9](index=9&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 31, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from _______ To _______ Commission File Number: 1-11749 Lennar Corporation (Exact name of registrant as specified in its charter) (State or other jurisdiction of ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 31, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from _______ To _______ Commission File Number: 1-11749 Lennar Corporation (Exact name of registrant as specified in its charter) (State or other jurisdiction of ...

Fiscal Year 2025 Financial Results Overview [Highlights of Fiscal Year 2025](index=1&type=section&id=Fiscal%20Year%202025%20Highlights) Tianci International reported 8% logistics revenue growth but a $2.69 million net loss due to higher costs and Nasdaq listing expenses, prompting a strategic shift - Revenue from logistics operations increased by **8% in FY2025**[3](index=3&type=chunk) - Cost of revenue increased by **17%** from FY2024 to FY2025, leading to a decrease in gross profit margin from **12.24% to 4.85%**[3](index=3&type=chunk) - Operating expenses increased from **$886,876 in fiscal year 2024 to $3,158,038 in fiscal year 2025**, primarily due to transactions related to the Company's listing on Nasdaq[7](index=7&type=chunk) - The Company incurred a net loss of **$2,686,357 in fiscal 2025**, after recording net income of $110,320 in fiscal 2024[7](index=7&type=chunk) - The Company intends to reorient its focus towards long-distance shipping lines, which generally produce higher profit margins, and is accumulating inventory for global commodity trade[4](index=4&type=chunk) - Completed a public offering of **1,750,000 common shares** for net proceeds of **$5,217,937**, resulting in working capital of **$2,906,601** at July 31, 2025[5](index=5&type=chunk)[7](index=7&type=chunk) - The Company's common stock was listed for trading on the Nasdaq Capital Market[7](index=7&type=chunk) [About Tianci International, Inc.](index=1&type=section&id=About%20Tianci%20International%2C%20Inc.) Tianci International, through its subsidiary Roshing, provides global logistics services specializing in ocean freight forwarding, operating under an asset-light model across Asia-Pacific - Tianci International Inc., through its subsidiary Roshing, provides global logistics services specializing in ocean freight forwarding, including container and bulk goods shipping[6](index=6&type=chunk) - Operates under an asset-light model, with logistics solutions tailored for customers across the Asia-Pacific, including Japan, South Korea, and Vietnam[6](index=6&type=chunk) - Generates revenue from the sale of electronic parts and business consulting services in addition to logistics[6](index=6&type=chunk) - Company's mission is to provide customers with efficient, reliable, and safe shipping services that create value[6](index=6&type=chunk) Financial Statements [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) As of July 31, 2025, total assets significantly increased to $3.15 million, driven by cash and lease assets, while stockholders' equity rose to $2.99 million from public offerings despite an accumulated deficit | Item | July 31, 2025 | July 31, 2024 | Change (YoY) | | :-------------------------------- | :-------------- | :-------------- | :------------- | | **ASSETS** | | | | | Total current assets | $3,003,252 | $910,305 | +230% | | Total non-current assets | $142,719 | $1,656 | +8511% | | **TOTAL ASSETS** | **$3,145,971** | **$911,961** | **+245%** | | **LIABILITIES** | | | | | Total current liabilities | $97,651 | $121,951 | -20% | | Total liabilities | $159,054 | $121,951 | +30% | | **STOCKHOLDERS' EQUITY** | | | | | Total stockholders' equity | $2,986,917 | $790,010 | +278% | - Cash increased significantly from **$413,129 in 2024 to $2,405,352 in 2025**[12](index=12&type=chunk) - Additional paid-in capital surged from **$962,416 in 2024 to $5,845,505 in 2025**, reflecting capital raised from public offerings[12](index=12&type=chunk) - Accumulated deficit increased from **$(222,071) in 2024 to $(2,862,860) in 2025**[12](index=12&type=chunk) [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) For FY2025, Tianci International reported an 8% revenue increase to $9.28 million, but a 16.8% rise in cost of revenues and a 256% surge in operating expenses led to a $2.69 million net loss, reversing the prior year's net income | Item | 2025 | 2024 | Change (YoY) | | :------------------------------------- | :----------- | :----------- | :------------- | | Total Operating Revenues | $9,282,997 | $8,617,265 | +8% | | Total Cost of Revenues | $8,832,874 | $7,562,086 | +16.8% | | Gross profit | $450,123 | $1,055,179 | -57.4% | | Total operating expenses | $3,158,038 | $886,876 | +256% | | Income (loss) from operations | $(2,707,915) | $168,303 | N/A (loss from income) | | Net income (loss) | $(2,686,357) | $110,320 | N/A (loss from income) | | Net income (loss) attributable to TIANCI INTERNATIONAL, INC. | $(2,640,789) | $54,450 | N/A (loss from income) | | Basic and diluted Income (loss) per common share | $(0.17) | $0.01 | N/A (loss from income) | - Global logistics services revenue increased from **$8,320,402 in 2024 to $9,006,407 in 2025**[14](index=14&type=chunk) - General and administrative expenses significantly increased from **$520,884 in 2024 to $2,927,260 in 2025**, contributing to the net loss[14](index=14&type=chunk) [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) In fiscal year 2025, Tianci International experienced a significant net cash outflow of $(3.23) million from operating activities, offset by a substantial $5.22 million inflow from financing activities, primarily public offerings, resulting in a net cash increase of $1.99 million and an ending cash balance of $2.41 million | Item | 2025 | 2024 | Change (YoY) | | :------------------------------------- | :----------- | :----------- | :------------- | | Net cash (used in) provided by operating activities | $(3,225,714) | $112,740 | N/A (outflow from inflow) | | Net cash provided by financing activities | $5,217,937 | $44,047 | +11744% | | Net increase in cash | $1,992,223 | $156,787 | +1171% | | Cash, ending | $2,405,352 | $413,129 | +482% | - Net loss of **$(2,686,357)** was a primary factor for the negative operating cash flow[17](index=17&type=chunk) - Proceeds received from public or private offerings totaled **$5,439,333 in 2025**, significantly boosting financing cash flow[17](index=17&type=chunk) Additional Information [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) This report contains forward-looking statements subject to known and unknown risks and uncertainties, where actual results may differ materially from expectations, and the Company disclaims any obligation to update them unless legally required - Forward-looking statements involve known and unknown risks and uncertainties, based on current expectations and projections[8](index=8&type=chunk) - Actual results may differ materially from anticipated results[8](index=8&type=chunk) - The Company undertakes no obligation to update or revise publicly any forward-looking statements, except as may be required by law[8](index=8&type=chunk) - Investors are encouraged to review other factors that may affect future results discussed in the Company's filings with the U.S. Securities and Exchange Commission[8](index=8&type=chunk) [Investor and Media Inquiries](index=2&type=section&id=Investor%20and%20Media%20Inquiries) For investor and media inquiries, contact Tianci International, Inc. Investor Relations via email, and refer to the audited financial statements filed with the SEC on Form 10-K for further details - For investor and media inquiries, contact Tianci International, Inc. Investor Relations via email: ir@rqscapital.com[9](index=9&type=chunk) - Financial information should be read in conjunction with audited financial statements and notes filed on Form 10-K for the period ended July 31, 2025, available on www.sec.gov and www.tianci-ciit.com[9](index=9&type=chunk)

PART I [Item 1. Business Overview](index=4&type=section&id=Item%201.%20Business) Tianci International, Inc. primarily offers global logistics services through Roshing, focusing on ocean freight and mineral trade, with minor other revenues and global expansion plans - Tianci International, Inc. completed a reverse acquisition of RQS United Group Limited on March 6, 2023, transforming into a company primarily engaged in global logistics services through its subsidiary Roshing[13](index=13&type=chunk)[15](index=15&type=chunk)[274](index=274&type=chunk) - Roshing provides global logistics services, including ocean freight forwarding (container and bulk goods shipping) and related solutions, utilizing an asset-light strategy by chartering cargo space from suppliers[16](index=16&type=chunk)[17](index=17&type=chunk)[18](index=18&type=chunk) - The company is launching a global mineral trade business, accumulating high-grade industrial metals inventory, and intends to integrate ore distribution with existing shipping operations for end-to-end supply chain solutions[18](index=18&type=chunk)[223](index=223&type=chunk) - Roshing's business is primarily conducted in Hong Kong and the Asia-Pacific region (Japan, South Korea, Vietnam), with strategic plans to expand services to other continents like South America and Africa[18](index=18&type=chunk)[221](index=221&type=chunk)[51](index=51&type=chunk) - Other revenue streams, including the sale of electronic parts, software technical services, and business consulting services, represent a small portion of total revenue[19](index=19&type=chunk)[51](index=51&type=chunk)[222](index=222&type=chunk) Employee Count by Function (As of July 31) | Function | 2025 | 2024 | 2023 | | :------------------------- | :--- | :--- | :--- | | Senior Management | 7 | 7 | 3 | | Human Resources and Admin | 1 | 1 | 1 | | Finance | 1 | 1 | 1 | | Sales and Marketing | 4 | 2 | 2 | | Procurement | 0 | 0 | 1 | | Technical | 0 | 0 | 2 | | **TOTAL** | **13** | **11** | **10** | [Item 1A. Risk Factors](index=14&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks in global logistics from geopolitical instability, intense competition, and volatile market conditions, alongside operational and compliance challenges - Geopolitical conditions, trade barriers, and international hostilities significantly impact the maritime transportation industry, potentially reducing global trade and increasing costs, thereby adversely affecting the company's logistics business[60](index=60&type=chunk)[62](index=62&type=chunk)[63](index=63&type=chunk) - The global logistics services industry is highly competitive, with larger firms possessing more resources, and failure to adapt to changing customer requirements or volatile market conditions could negatively impact margins and operating results[64](index=64&type=chunk)[67](index=67&type=chunk) - Roshing faces risks associated with shipment contents, potential product damage, transportation incidents, and contractual obligations with shipping suppliers, which could lead to financial costs, legal liability, and reputational damage[71](index=71&type=chunk)[75](index=75&type=chunk) - The company has a limited operating history, significant customer concentration (two customers accounted for **68.9% of revenue in FY2025**), and relies on a small number of employees, posing challenges to business growth and stability[95](index=95&type=chunk)[96](index=96&type=chunk) - Material weaknesses in internal control over financial reporting were identified, including inadequate segregation of duties and a lack of formal policies for reviewing significant accounting transactions, which could impair financial reporting and public disclosure[105](index=105&type=chunk)[109](index=109&type=chunk)[378](index=378&type=chunk)[383](index=383&type=chunk) - Operating primarily in Hong Kong exposes the company to risks from potential PRC government intervention, restrictions on fund transfers, changes in international trade policies, and the impact of the Hong Kong National Security Law, which could materially affect operations and stock value[124](index=124&type=chunk)[127](index=127&type=chunk)[132](index=132&type=chunk)[133](index=133&type=chunk) - The company has incurred IRS penalties for failure to file certain foreign-owned U.S. corporation information, highlighting risks of non-compliance with tax obligations and potential adverse effects from changes in tax laws[165](index=165&type=chunk)[166](index=166&type=chunk)[170](index=170&type=chunk) [Item 1B. Unresolved Staff Comments](index=38&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) This section states that there are no unresolved staff comments applicable to the company - The company has no unresolved staff comments[193](index=193&type=chunk) [Item 1C. Cybersecurity](index=38&type=section&id=Item%201C.%20Cybersecurity) Tianci International, Inc. has implemented a cybersecurity risk management program, overseen by its Board, with no material risks identified as of the filing date - The company has a cybersecurity risk management program integrated into its enterprise risk management, including risk assessment, a security team, external service providers, employee training, and an incident response plan[194](index=194&type=chunk)[195](index=195&type=chunk)[196](index=196&type=chunk)[197](index=197&type=chunk) - The Board of Directors and its Audit Committee oversee cybersecurity risks, with the Corporate Controller reporting to the CEO/CFO and the Board on the program's effectiveness and any identified flaws[199](index=199&type=chunk)[200](index=200&type=chunk)[201](index=201&type=chunk) - As of the filing date, no material risks from known cybersecurity threats have been identified that have affected operations, business strategy, results, or financial condition[198](index=198&type=chunk) [Item 2. Properties](index=39&type=section&id=Item%202.%20Properties) The company's principal executive office is located in Hong Kong under a rental agreement expiring in June 2027, deemed adequate for foreseeable operations - The principal executive office is located in Hong Kong, covering approximately **1,200 square feet**, under a rental service agreement expiring in June 2027[202](index=202&type=chunk) - Management believes the current leased property is sufficient for its operations in the foreseeable future[203](index=203&type=chunk) [Item 3. Legal Proceedings](index=39&type=section&id=Item%203.%20Legal%20Proceedings) Neither Tianci International nor its subsidiaries are currently party to any material pending legal proceedings - Neither Tianci International nor any of its subsidiaries are party to material pending legal proceedings[204](index=204&type=chunk) [Item 4. Mine Safety Disclosures](index=39&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section states that mine safety disclosures are not applicable to the company - Mine safety disclosures are not applicable to the company[205](index=205&type=chunk) PART II [Item 5. Market For Registrant's Common Equity, Related Stockholder Matters And Issuer Purchases Of Equity Securities](index=40&type=section&id=Item%205.%20Market%20For%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20And%20Issuer%20Purchases%20Of%20Equity%20Securities) The company's common stock is thinly traded on Nasdaq, with **16,531,803 shares outstanding** as of October 3, 2025, and no anticipated cash dividends, while an Equity Incentive Plan authorizes **7,000,000 common shares** for future issuance - The Company's common stock is quoted on the Nasdaq Capital Market under the symbol "CIIT" and is thinly traded, which may make it difficult for investors to sell shares[207](index=207&type=chunk)[208](index=208&type=chunk) - As of October 3, 2025, there were **16,531,803 shares of common stock outstanding** and **127 stockholders of record**[7](index=7&type=chunk)[209](index=209&type=chunk) - The company does not anticipate paying any cash dividends in the foreseeable future, intending to retain and use future earnings for business development and expansion[184](index=184&type=chunk)[210](index=210&type=chunk) Securities Authorized for Issuance Under Equity Compensation Plans (As of July 31, 2025) | | Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans | | :--------------------- | :-------------------------------------------------------------------------- | :------------------------------------------------------------------------ | :----------------------------------------------------------------------------------------- | | Approved by security holders | 0 | N.A. | 7,000,000 | | Not approved by security holders | 0 | N.A. | 0 | | **Total** | **0** | **N.A.** | **7,000,000** | - The company did not make any sale of unregistered securities or repurchase any shares of its common stock during the 4th quarter of fiscal year 2025[213](index=213&type=chunk)[214](index=214&type=chunk) [Item 6. Climate – Related Disclosure](index=41&type=section&id=Item%206.%20Climate%20%E2%80%93%20Related%20Disclosure) This section states that climate-related disclosures are not applicable to the company

[Filing Information](index=1&type=section&id=Filing%20Information) This section provides core identification details of the registrant, filing type, and trustee information [Registrant and Filing Details](index=1&type=section&id=Registrant%20and%20Filing%20Details) This section provides the core identification details of the registrant, the type of SEC filing, the reporting date, and the contact information for the trustee - The registrant is **MV Oil Trust**, filing a **Form 8-K**[1](index=1&type=chunk)[2](index=2&type=chunk) - The report date is **October 3, 2025**[2](index=2&type=chunk) - The trustee is **The Bank of New York Mellon Trust Company, N.A.**, located in Houston, Texas[2](index=2&type=chunk) [Securities and Company Status](index=1&type=section&id=Securities%20and%20Company%20Status) This part outlines the securities registered by the registrant and confirms its status regarding emerging growth company definitions Registered Securities | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :--------------------- | :---------------- | :---------------------------------------- | | Units of Beneficial Interest | MVO | The New York Stock Exchange | - The registrant is **not an emerging growth company**[4](index=4&type=chunk) [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) This section details the announcement of the quarterly distribution and the filing status of the related press release [Quarterly Distribution Announcement](index=2&type=section&id=Quarterly%20Distribution%20Announcement) MV Oil Trust issued a press release announcing its quarterly distribution for the period ending September 30, 2025 - **MV Oil Trust** issued a press release on **October 3, 2025**[5](index=5&type=chunk) - The press release announced the Trust's **quarterly distribution** for the payment period ended **September 30, 2025**[5](index=5&type=chunk) [Filing Status of Press Release](index=2&type=section&id=Filing%20Status%20of%20Press%20Release) The press release, furnished as Exhibit 99.1, is explicitly stated not to be 'filed' for Section 18 liabilities and is not incorporated by reference in other filings, as per General Instruction B.2 of Form 8-K - The press release (**Exhibit 99.1**) is 'furnished' per **General Instruction B.2 of Form 8-K**[6](index=6&type=chunk) - It is **not 'filed'** for Section 18 of the Securities Exchange Act of 1934 and is **not subject to its liabilities**[6](index=6&type=chunk) - The press release is **not incorporated by reference** in any other MV Oil Trust filing[6](index=6&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section provides a comprehensive list of all exhibits included in the Form 8-K filing [List of Exhibits](index=2&type=section&id=List%20of%20Exhibits) This section lists the exhibits included with the Form 8-K filing Exhibits Included | Exhibit No. | Description | | :---------- | :------------------------------------ | | 99.1 | MV Oil Trust Press Release issued October 3, 2025 | [Signatures](index=3&type=section&id=SIGNATURES) This section confirms the official signing of the report by the authorized representative of the Trustee [Authorization and Signatory Details](index=3&type=section&id=Authorization%20and%20Signatory%20Details) This section confirms the official signing of the report by the authorized representative of the Trustee on behalf of MV Oil Trust - The report was signed on behalf of **MV Oil Trust** by **The Bank of New York Mellon Trust Company, N.A.**, as Trustee[11](index=11&type=chunk) - **Elaina C. Rodgers**, Vice President, signed the report[11](index=11&type=chunk) - The report was signed on **October 3, 2025**[11](index=11&type=chunk)

FORM 8-K Filing Information This section provides administrative details for the Form 8-K filing, including registrant identification and event date [Registrant and Filing Details](index=1&type=section&id=Registrant%20and%20Filing%20Details) This section provides basic identification details for the Form 8-K filing, including the registrant's name, address, and the date of the earliest event reported - Registrant is ABBVIE INC., located at 1 North Waukegan Road, North Chicago, Illinois[1](index=1&type=chunk)[2](index=2&type=chunk) - The date of the earliest event reported is October 3, 2025[1](index=1&type=chunk) [Securities Registered](index=1&type=section&id=Securities%20Registered) This section lists the classes of securities registered by AbbVie Inc. pursuant to Section 12(b) of the Act, including common stock and various senior notes, along with their trading symbols and the exchanges on which they are registered Securities Registered | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :------------------ | :---------------- | :---------------------------------------- | | Common Stock, $0.01 Par Value | ABBV | New York Stock Exchange, NYSE Texas | | 0.750% Senior Notes due 2027 | ABBV27 | New York Stock Exchange | | 2.125% Senior Notes due 2028 | ABBV28 | New York Stock Exchange | | 2.625% Senior Notes due 2028 | ABBV28B | New York Stock Exchange | | 2.125% Senior Notes due 2029 | ABBV29 | New York Stock Exchange | | 1.250% Senior Notes due 2031 | ABBV31 | New York Stock Exchange | [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) This section outlines AbbVie's preliminary financial estimates for Q3 2025, highlighting a significant pre-tax acquired IPR&D and milestones expense [Third Quarter 2025 Preliminary Financial Estimates](index=2&type=section&id=Third%20Quarter%202025%20Preliminary%20Financial%20Estimates) AbbVie expects its Q3 2025 GAAP and adjusted non-GAAP earnings to be significantly impacted by a $2.7 billion pre-tax acquired IPR&D and milestones expense, resulting in an unfavorable $1.50 impact per share - Q3 2025 GAAP and adjusted non-GAAP earnings are expected to include **$2.7 billion pre-tax acquired IPR&D and milestones expense**[5](index=5&type=chunk) - This expense represents an unfavorable impact of **$1.50** to both GAAP and adjusted non-GAAP diluted earnings per share[5](index=5&type=chunk) - Results for the quarter ended September 30, 2025, are preliminary and subject to financial statement closing procedures[5](index=5&type=chunk) [Updated Earnings Per Share Guidance](index=2&type=section&id=Updated%20Earnings%20Per%20Share%20Guidance) The company has updated its full-year and third-quarter 2025 adjusted diluted EPS guidance to include the impact of the acquired IPR&D and milestones expense, which was previously excluded from forecasts due to its uncertain nature - AbbVie does not typically forecast acquired IPR&D and milestones expense due to uncertainty in occurrence and timing[6](index=6&type=chunk) Updated Adjusted Diluted EPS Guidance (including Q3 2025 IPR&D expense) | Period | Adjusted Diluted EPS Guidance Range | | :----- | :---------------------------------- | | Full-year 2025 | $10.38 - $10.58 | | Third Quarter 2025 | $1.74 - $1.78 | - Guidance for 2025, including the estimated acquired IPR&D and milestones expense, is furnished as Exhibit 99.1[7](index=7&type=chunk) [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) This section provides a disclaimer regarding the inherent risks and uncertainties associated with forward-looking statements in the report [Disclaimer on Future Performance](index=2&type=section&id=Disclaimer%20on%20Future%20Performance) This standard disclosure warns that some statements in the report are forward-looking and subject to various risks and uncertainties, including intellectual property challenges, competition, R&D difficulties, litigation, regulatory changes, and macroeconomic factors, which could cause actual results to differ materially - Forward-looking statements are identified by words like 'believe,' 'expect,' 'anticipate,' 'project' and similar expressions[9](index=9&type=chunk) - Such statements are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied[9](index=9&type=chunk) - Risks include challenges to intellectual property, competition, R&D difficulties, adverse litigation, regulatory changes, and global macroeconomic factors[9](index=9&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section lists the financial statements and exhibits included in the Form 8-K filing [Exhibits Filed](index=2&type=section&id=Exhibits%20Filed) This item lists the exhibits accompanying the Form 8-K, specifically Exhibit 99.1, which provides detailed guidance including the impact of acquired IPR&D and milestones expense, and Exhibit 104 for the Inline XBRL cover page Exhibits | Exhibit No. | Exhibit Description | | :---------- | :------------------ | | 99.1 | Guidance including the impact of acquired IPR&D and milestones expense | | 104 | The cover page from this Current Report on Form 8-K formatted in Inline XBRL (included as Exhibit 101) | [SIGNATURE](index=4&type=section&id=SIGNATURE) This section formally concludes the Form 8-K filing, indicating due authorization and signature [Report Authorization](index=4&type=section&id=Report%20Authorization) This section formally concludes the Form 8-K filing, indicating that the registrant has duly authorized and signed the report - The report was signed on October 3, 2025, by Scott T. Reents, Executive Vice President and Chief Financial Officer of ABBVIE INC[14](index=14&type=chunk)

[Introduction](index=5&type=section&id=Introduction) This section provides an overview of the report's structure and foundational information PART I [Item 1. Business](index=7&type=section&id=Item%201.%20Business) Micron Technology, Inc. is a leading provider of innovative memory and storage solutions, including DRAM, NAND, and NOR products, serving various markets from data centers to mobile devices. The company recently reorganized its business units to better address AI-driven demand and maintains a global manufacturing and R&D footprint. Micron faces intense competition and relies on continuous technological advancement and efficient operations - Micron is an industry leader in memory and storage solutions, delivering high-performance DRAM, NAND, and NOR products through its Micron® and Crucial® brands[18](index=18&type=chunk) - Innovations fuel the data economy, enabling advances in AI and compute-intensive applications from data centers to mobile[18](index=18&type=chunk) - The company faces intense competition, requiring continuous R&D, new product development, and cost reduction to remain competitive[20](index=20&type=chunk) [Overview](index=8&type=section&id=Overview) [Business Segments](index=8&type=section&id=Business%20Segments) Micron reorganized into four business units to address AI-driven demand, focusing on cloud, data center, mobile, and automotive markets - Micron reorganized into four business units in Q4 2025: Cloud Memory Business Unit (CMBU), Core Data Center Business Unit (CDBU), Mobile and Client Business Unit (MCBU), and Automotive and Embedded Business Unit (AEBU)[21](index=21&type=chunk) - CMBU focuses on memory solutions for large hyperscale cloud customers and High-Bandwidth Memory (HBM) for all data center customers[21](index=21&type=chunk) - CDBU focuses on memory solutions for mid-tier cloud, enterprise, and OEM data center customers and storage solutions for all data center customers[21](index=21&type=chunk) [Products, Market, and Sales](index=9&type=section&id=Products,%20Market,%20and%20Sales) This section details Micron's product technologies, market applications, and sales performance across various business units [Product Technologies](index=9&type=section&id=Product%20Technologies) Micron's portfolio includes DRAM, NAND, and NOR, with recent innovations in 1γ DRAM and G9 NAND production - Micron's product portfolio includes DRAM, NAND, and NOR, sold in various forms such as components, modules, SSDs, managed NAND, multi-chip packages, and wafers[22](index=22&type=chunk) - In 2025, Micron began shipping the industry's first **1γ (1-gamma) production node DRAM**, which incorporates EUV lithography and offers improved power efficiency, performance, and bit density[24](index=24&type=chunk) - In 2024, Micron began volume production of **Micron G9 NAND**, representing the industry's ninth-generation 3D NAND node[31](index=31&type=chunk) Product Type Revenue | Product Type | 2025 Revenue ($B) | 2024 Revenue ($B) | 2023 Revenue ($B) | | :----------- | :---------------- | :---------------- | :---------------- | | DRAM | 28.58 | 17.60 | 10.98 | | NAND | 8.50 | 7.23 | 4.21 | [Products by Business Unit and Market](index=10&type=section&id=Products%20by%20Business%20Unit%20and%20Market) Sales across CMBU, CDBU, MCBU, and AEBU are driven by diverse memory and storage solutions for various end markets - CMBU sales to the data center end market are driven by server demand across the cloud market, including HBM, high-capacity DIMMs, and low-power server DRAM solutions, with **HBM3E 12-high** representing the majority of HBM shipments in Q4 2025[36](index=36&type=chunk)[38](index=38&type=chunk) - CDBU sales to OEM data center customers include DDR5 and DDR4, and in 2025, began shipping **9550 and 6550 ION SSDs**, and strengthened its portfolio with G9-based PCIe Gen6 SSDs[41](index=41&type=chunk)[42](index=42&type=chunk) - MCBU offers memory and storage for mobile and client segments, including **LPDDR5X memory built on the 1γ node** for AI applications in flagship smartphones, shipped in 2025[45](index=45&type=chunk)[47](index=47&type=chunk) - AEBU focuses on automotive, industrial, and consumer embedded segments, announcing production readiness of automotive LPDDR5X DRAM and automotive-qualified 4150 SSD in 2025[52](index=52&type=chunk)[53](index=53&type=chunk) Revenue by Business Unit | Business Unit | 2025 Revenue ($B) | 2024 Revenue ($B) | 2023 Revenue ($B) | | :------------ | :---------------- | :---------------- | :---------------- | | CMBU | 13.52 | 3.79 | 1.87 | | CDBU | 7.23 | 4.98 | 2.12 | | MCBU | 11.86 | 11.67 | 7.39 | | AEBU | 4.75 | 4.63 | 4.14 | [Marketing and Customers](index=12&type=section&id=Marketing%20and%20Customers) Micron markets products under Micron and Crucial brands, with approximately half of revenue from its top ten customers - Micron markets its semiconductor memory and storage products under its Micron and Crucial brand names, primarily through its direct sales force, distributors, retailers, and independent sales representatives[58](index=58&type=chunk) - Approximately **one-half of Micron's total revenue** in each of the last three years was from its top ten customers[60](index=60&type=chunk) [Competitive Conditions](index=13&type=section&id=Competitive%20Conditions) Micron faces intense competition from industry rivals and geopolitical challenges, necessitating continuous technological advancement - Micron faces intense competition from companies like Samsung, SK hynix, Kioxia, Sandisk, CXMT, and YMTC, some of whom benefit from government assistance and lower operating costs[61](index=61&type=chunk)[62](index=62&type=chunk) - The May 2023 decision by China's Cyberspace Administration (CAC) restricted critical information infrastructure operators in China from purchasing Micron products, adversely impacting its ability to compete[62](index=62&type=chunk) - Micron plans to advance process technology to increase bit output and improve yields, but faces risks from potential industry oversupply due to increased capital expenditures by competitors and rapid technological change[63](index=63&type=chunk) [Manufacturing](index=14&type=section&id=Manufacturing) Micron operates global manufacturing facilities, expanding capacity in the U.S. and other regions for advanced semiconductor production - Micron manufactures products in wholly-owned facilities in Taiwan, Singapore, Japan, the United States, Malaysia, China, and India, utilizing **300mm wafers** and operating 24/7[65](index=65&type=chunk) - Semiconductor manufacturing is capital-intensive and complex, with costs influenced by process line-width, 3D non-volatile layers, NAND cell levels, and manufacturing yield[66](index=66&type=chunk) - The company is expanding production capacity in the United States and other regions, which are complex, capital-intensive projects dependent on available materials, specialized equipment, and skilled labor[70](index=70&type=chunk) [Resources](index=15&type=section&id=Resources) This section covers Micron's supply chain, intellectual property, research and development, and human capital management [Supply Chain, Materials, and Third-Party Service Providers](index=15&type=section&id=Supply%20Chain,%20Materials,%20and%20Third-Party%20Service%20Providers) Micron's supply chain relies on limited suppliers for critical materials and services, facing risks from shortages and geopolitical tensions - Micron's supply chain relies on a limited number of suppliers for certain critical materials (e.g., chemicals, silicon wafers, gases) and third-party services (e.g., controllers, foundries, assembly, test)[71](index=71&type=chunk)[72](index=72&type=chunk) - Shortages, increased lead times, and inflationary pressures can increase costs and limit bit shipments, materially affecting business[71](index=71&type=chunk)[72](index=72&type=chunk) - Geopolitical tensions, trade disputes, and restrictions on rare earth elements (primarily from China) could limit material access and increase costs, impacting manufacturing capabilities[74](index=74&type=chunk)[75](index=75&type=chunk) [Patents and Licenses](index=16&type=section&id=Patents%20and%20Licenses) Micron holds over 60,000 global patents and actively monetizes its intellectual property through sales and licensing - As of August 28, 2025, Micron holds over **60,000 granted patents globally**, including approximately **15,000 active U.S. patents** and **7,500 active foreign patents**[79](index=79&type=chunk) - The company actively sells and licenses its technology, pursuing opportunities to monetize intellectual property through partnering and other arrangements[80](index=80&type=chunk) [Research and Development](index=17&type=section&id=Research%20and%20Development) R&D focuses on advanced memory and storage solutions, including 1γ DRAM, G9 NAND, and HBM technologies - R&D efforts focus on developing memory and storage solutions, including the **1γ production node DRAM** (first with EUV lithography) and **Micron G9 NAND node**[82](index=82&type=chunk) - **HBM3E technology is industry-leading**, and HBM4 technology is advancing, on schedule for volume production in calendar 2026[82](index=82&type=chunk) - R&D expenses are primarily driven by the number of development wafers, personnel costs, and investments in advanced equipment like EUV lithography[84](index=84&type=chunk) [Human Capital](index=17&type=section&id=Human%20Capital) Micron employs approximately 53,000 people globally, focusing on talent attraction, development, and well-being through comprehensive programs - Micron employs approximately **53,000 people globally**, focusing on attracting, developing, and retaining highly skilled STEM talent through partnerships and continuous learning[85](index=85&type=chunk)[86](index=86&type=chunk) - Compensation programs include base salary, bonuses, equity awards, and comprehensive benefits, with regular reviews to ensure fairness and market competitiveness[88](index=88&type=chunk) - The company fosters a culture of respect, psychological safety, and well-being, supported by employee assistance programs and **10 Employee Resource Groups (ERGs)**[89](index=89&type=chunk)[91](index=91&type=chunk) [Government Regulations](index=19&type=section&id=Government%20Regulations) Micron adheres to environmental and trade regulations, managing compliance and mitigating risks from evolving international laws [Environmental Compliance](index=19&type=section&id=Environmental%20Compliance) Micron proactively manages environmental compliance, with wafer fabrication facilities conforming to ISO 14001:2015 standards - Micron proactively manages environmental compliance and sustainability, adhering to federal, state, local, and foreign laws and regulations[96](index=96&type=chunk) - Wafer fabrication facilities conform to the **ISO 14001:2015 environmental management systems standard**, ensuring continuous performance improvement[96](index=96&type=chunk) [Trade Regulations](index=19&type=section&id=Trade%20Regulations) Micron's sales and technical transfers are subject to international trade laws, with changes potentially impacting costs and market access - Sales of products and transfer of technical information are subject to international trade laws, including export control, customs, and sanctions regulations administered by U.S. and other government agencies[97](index=97&type=chunk) - Changes in trade laws, increased tariffs, or other restrictions can increase product costs, reduce demand, and limit access to markets or materials[97](index=97&type=chunk) [Information About Our Executive Officers](index=20&type=section&id=Information%20About%20Our%20Executive%20Officers) Key executive officers include Sanjay Mehrotra, Mark J. Murphy, and Scott J. DeBoer, leading the company's strategic direction - Key executive officers include **Sanjay Mehrotra** (Chairman, President, and CEO), **Mark J. Murphy** (Executive Vice President and Chief Financial Officer), and **Scott J. DeBoer** (Executive Vice President, Chief Technology and Products Officer)[104](index=104&type=chunk)[105](index=105&type=chunk)[103](index=103&type=chunk) [Available Information](index=23&type=section&id=Available%20Information) Micron provides public information on its website and through SEC filings, disseminating material non-public financial data via investor relations - Micron provides public information on its website (www.micron.com), including corporate governance documents and SEC filings[109](index=109&type=chunk)[111](index=111&type=chunk) - Material non-public financial information is disseminated via the investor relations website, SEC filings, press releases, public conference calls, blog posts, and X (@MicronTech)[110](index=110&type=chunk) [Item 1A. Risk Factors](index=24&type=section&id=Item%201A.%20Risk%20Factors) Micron faces a broad range of risks, including significant volatility in product average selling prices and gross margins, geopolitical risks from international operations (e.g., CAC decision, Taiwan production), intense industry competition, and challenges in developing new technologies. Other risks include supply chain disruptions, economic downturns, manufacturing interruptions, customer concentration, product defects, cybersecurity threats, AI uncertainties, human capital challenges, and risks related to government incentives and capacity expansions. Legal and regulatory risks, including intellectual property litigation and evolving tax and environmental laws, also pose potential material adverse effects. Financial risks encompass cash flow generation, debt obligations, foreign currency fluctuations, counterparty default, and stock price volatility - Key risks include volatility in average selling prices, gross margin factors, international operations/geopolitical risks, intense industry competition, and ability to develop new technologies[116](index=116&type=chunk) - Other risks cover intellectual property protection, legal/regulatory investigations, compliance with laws/regulations (e.g., export restrictions, tariffs, tax laws), and financial market risks (cash flow, debt, currency rates, stock price volatility)[116](index=116&type=chunk) - Significant volatility in DRAM and NAND average selling prices (e.g., DRAM **+/- 40% range**, NAND **+/- 30-50% range** in past 5 years) can adversely affect business[117](index=117&type=chunk) - Gross margins are affected by manufacturing costs, product diversification, technology transitions, and capacity utilization; difficulties in ramping new technologies or forecasting AI demand can lead to elevated inventory and margin pressure[118](index=118&type=chunk)[119](index=119&type=chunk)[125](index=125&type=chunk) - International operations (Taiwan, Singapore, Japan, Malaysia, China, India) expose the company to geopolitical risks, including the CAC decision impacting sales in China and potential disruptions to Taiwan production[126](index=126&type=chunk)[130](index=130&type=chunk)[132](index=132&type=chunk) - Intense competition from major players and government-assisted new entrants can lead to oversupply and price declines, while failure to develop new technologies (e.g., HBM, EUV lithography) could impact future success[134](index=134&type=chunk)[138](index=138&type=chunk) - Dependency on government incentives (e.g., CHIPS Act) for funding capital expenditures carries risks of non-compliance, reduction, or clawback of funds[152](index=152&type=chunk)[153](index=153&type=chunk) - Supply chain disruptions, limited suppliers for critical materials (including rare earth elements from China), and reliance on third-party service providers can limit production and increase costs[155](index=155&type=chunk)[157](index=157&type=chunk)[160](index=160&type=chunk) - Uncertainties associated with AI use and evolution, including flawed algorithms, intellectual property risks, and evolving regulations, could adversely impact the business[182](index=182&type=chunk)[183](index=183&type=chunk) - Changes in tax laws (e.g., OBBBA in the U.S., Pillar Two globally) and challenges by tax authorities can significantly impact the effective tax rate and cash flows[211](index=211&type=chunk)[212](index=212&type=chunk) - Debt obligations (**$14.58 billion** as of Aug 28, 2025) require significant cash flow for principal and interest payments, impacting liquidity and future financing capacity[220](index=220&type=chunk) [Risk Factor Summary](index=24&type=section&id=Risk%20Factor%20Summary) Key risks include market volatility, geopolitical factors, intense competition, and challenges in technology development and regulatory compliance - Key risks include volatility in average selling prices, gross margin factors, international operations/geopolitical risks, intense industry competition, and ability to develop new technologies[116](index=116&type=chunk) - Other risks cover intellectual property protection, legal/regulatory investigations, compliance with laws/regulations (e.g., export restrictions, tariffs, tax laws), and financial market risks (cash flow, debt, currency rates, stock price volatility)[116](index=116&type=chunk) [Risks Related to Our Business, Operations, and Industry](index=25&type=section&id=Risks%20Related%20to%20Our%20Business,%20Operations,%20and%20Industry) [Risks Related to Intellectual Property and Litigation](index=40&type=section&id=Risks%20Related%20to%20Intellectual%20Property%20and%20Litigation) [Risks Related to Laws and Regulations](index=42&type=section&id=Risks%20Related%20to%20Laws%20and%20Regulations) [Risks Related to Capitalization and Financial Markets](index=44&type=section&id=Risks%20Related%20to%20Capitalization%20and%20Financial%20Markets) [Item 1B. Unresolved Staff Comments](index=47&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) Micron Technology, Inc. has no unresolved staff comments to report - No unresolved staff comments are reported[231](index=231&type=chunk) [Item 1C. Cybersecurity](index=47&type=section&id=Item%201C.%20Cybersecurity) Micron has a robust cybersecurity program aligned with NIST-CSF, including regular risk assessments, technical safeguards, and employee training. The Board of Directors, through its Security Committee, oversees cybersecurity risk management, with the Chief Security Officer and Chief Information Officer responsible for day-to-day management and regular reporting. No material cybersecurity incidents have been experienced - Micron's cybersecurity program aligns with **NIST-CSF**, with established policies and processes for assessing, identifying, and managing material risks[232](index=232&type=chunk) - The company conducts regular risk assessments, implements technical safeguards (firewalls, intrusion detection, access controls), and provides employee training[233](index=233&type=chunk)[235](index=235&type=chunk) - The Board of Directors, through its Security Committee, oversees cybersecurity risk management, with the Chief Security Officer and Chief Information Officer providing regular briefings[238](index=238&type=chunk)[239](index=239&type=chunk)[240](index=240&type=chunk) - Micron has not experienced any cybersecurity incidents determined to be material[237](index=237&type=chunk) [Risk Management and Strategy](index=47&type=section&id=Risk%20Management%20and%20Strategy) [Governance](index=47&type=section&id=Governance) [Item 2. Properties](index=49&type=section&id=Item%202.%20Properties) Micron operates principal facilities for R&D, wafer fabrication, and assembly/test across Taiwan, Singapore, the U.S., Japan, Malaysia, China, and India. The company is undertaking significant expansion in the U.S., including new DRAM manufacturing fabs in Idaho and New York, supported by up to $6.4 billion in CHIPS Act grants and a 35% investment tax credit, alongside $5.5 billion from New York State. Global investments also include an HBM advanced packaging facility in Singapore and modernization in Japan for EUV DRAM production - Micron's principal facilities for R&D, wafer fabrication, and assembly/test are located in Taiwan, Singapore, the United States, Japan, Malaysia, China, and India[243](index=243&type=chunk)[244](index=244&type=chunk) - The company is investing in leading-edge memory manufacturing sites in Idaho and New York, with construction of the first Idaho fab beginning in October 2023 and first DRAM wafer output projected in the **second half of calendar 2027**[245](index=245&type=chunk)[246](index=246&type=chunk) - Micron secured up to **$6.4 billion in CHIPS Act grants** for U.S. manufacturing expansion and modernization projects, including new fabs in Idaho and New York, and modernization in Virginia[248](index=248&type=chunk) - In addition to CHIPS Act direct funding, Micron receives a **35% investment tax credit** on qualified U.S. semiconductor manufacturing investments and up to **$5.5 billion in funding from New York State** for the planned four-fab facility[249](index=249&type=chunk) - Planned international investments include an assembly and test facility in Gujarat, India; modernization of the Hiroshima, Japan facility for EUV lithography; and an HBM advanced packaging facility in Singapore[250](index=250&type=chunk)[305](index=305&type=chunk) [Item 3. Legal Proceedings](index=50&type=section&id=Item%203.%20Legal%20Proceedings) Micron is involved in various legal proceedings, including multiple patent infringement lawsuits from entities such as Netlist, YMTC, Besang Inc., Palisade Technologies, LLP, and Advanced Memory Technologies, LLC, covering a wide range of its memory and storage products. The company also faces securities class action and shareholder derivative complaints. The outcomes of these matters are uncertain and could have a material adverse effect on its business, results of operations, or financial condition - Micron is subject to multiple patent infringement lawsuits from entities like Netlist, YMTC, Besang Inc., Palisade Technologies, LLP, and Advanced Memory Technologies, LLC, covering DRAM, NAND, and HBM products[397](index=397&type=chunk)[398](index=398&type=chunk)[399](index=399&type=chunk)[400](index=400&type=chunk)[401](index=401&type=chunk)[403](index=403&type=chunk)[404](index=404&type=chunk) - The company faces securities class action and shareholder derivative complaints alleging false or misleading statements regarding industry dynamics and product demand[405](index=405&type=chunk)[406](index=406&type=chunk)[407](index=407&type=chunk) - The outcome of these legal matters is unpredictable, and adverse resolutions could result in significant liability, operational changes, or material adverse effects on the business[410](index=410&type=chunk) [Item 4. Mine Safety Disclosures](index=50&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Micron Technology, Inc - This item is not applicable[253](index=253&type=chunk) PART II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities](index=51&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity,%20Related%20Stockholder%20Matters,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Micron's common stock trades on Nasdaq under 'MU'. As of September 26, 2025, there were 1,443 shareholders of record. The Board declared a quarterly dividend of $0.115 per share payable October 21, 2025, with future dividends being discretionary. The company has a $10 billion share repurchase authorization, with $2.81 billion remaining as of August 28, 2025, and no repurchases in Q4 2025. The performance graph shows Micron's stock outperforming the S&P 500 and SOX over five years - Micron's common stock is listed on The Nasdaq Global Select Market under the trading symbol '**MU**'[255](index=255&type=chunk) - As of September 26, 2025, there were approximately **1,443 shareholders of record**[255](index=255&type=chunk) - The Board of Directors declared a quarterly dividend of **$0.115 per share**, payable in cash on October 21, 2025[256](index=256&type=chunk) - The Board authorized a discretionary repurchase of up to **$10 billion of common stock**, with **$2.81 billion remaining** as of August 28, 2025; no repurchases were made in Q4 2025[258](index=258&type=chunk) [Market Information](index=51&type=section&id=Market%20Information) [Holders of Record](index=51&type=section&id=Holders%20of%20Record) [Dividends](index=51&type=section&id=Dividends) [Issuer Purchase of Equity Securities](index=51&type=section&id=Issuer%20Purchase%20of%20Equity%20Securities) [Performance Graph](index=52&type=section&id=Performance%20Graph) Cumulative Total Returns (August 31, 2020 = $100) | Index | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | | :----------------------------- | :--- | :--- | :--- | :--- | :--- | :--- | | Micron Technology, Inc. | $100 | $162 | $125 | $156 | $216 | $268 | | S&P 500 Composite Index | 100 | 131 | 116 | 135 | 172 | 199 | | Philadelphia Semiconductor Index (SOX) | 100 | 153 | 122 | 169 | 240 | 266 | [Item 6. [Reserved]](index=50&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information - This item is reserved[264](index=264&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=53&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Micron experienced substantial improvements in 2025, driven by accelerating AI demand, leading to higher DRAM pricing, volumes, and margins. Total revenue increased 49% in 2025, with gross margin improving to 40%. The company is making significant capital investments in new U.S. fabs, supported by CHIPS Act funding, and global manufacturing. Cash flow from operations increased to $17.53 billion in 2025. Critical accounting estimates, recently adopted, and issued accounting standards are also discussed - AI-driven demand is accelerating, outpacing industry supply and leading to substantial improvements in DRAM pricing, volumes, and margins in 2025[267](index=267&type=chunk) - Total revenue increased **49% in 2025** compared to 2024, and **62% in 2024** compared to 2023, primarily due to increased DRAM and NAND sales[272](index=272&type=chunk)[273](index=273&type=chunk) - Consolidated gross margin improved to **40% for 2025** from **22% for 2024**, driven by increases in average selling prices, an increased mix of higher-margin products (HBM), and manufacturing cost reductions[274](index=274&type=chunk) - Net cash provided by operating activities increased to **$17.53 billion in 2025** (from $8.51 billion in 2024) due to higher net income and changes in operating assets/liabilities[306](index=306&type=chunk) - Micron expects capital expenditures of approximately **$4.5 billion in Q1 2026**, net of government incentives, for new U.S. fabs and global manufacturing[293](index=293&type=chunk) - Secured up to **$6.4 billion in CHIPS Act grants** for U.S. manufacturing expansion and modernization, plus a **35% investment tax credit** on qualified investments[297](index=297&type=chunk)[299](index=299&type=chunk) [Overview](index=53&type=section&id=Overview) [Industry Conditions](index=53&type=section&id=Industry%20Conditions) [Results of Operations](index=54&type=section&id=Results%20of%20Operations) This section analyzes Micron's consolidated financial performance, including revenue, gross margin, and operating income by business unit [Consolidated Results](index=54&type=section&id=Consolidated%20Results) Micron's 2025 consolidated results show significant revenue growth and improved gross margins driven by DRAM and NAND sales Consolidated Results Summary | Metric | 2025 ($M) | 2024 ($M) | 2023 ($M) | 2025 % of Revenue | 2024 % of Revenue | 2023 % of Revenue | | :---------------------- | :-------- | :-------- | :-------- | :---------------- | :---------------- | :---------------- | | Revenue | 37,378 | 25,111 | 15,540 | 100% | 100% | 100% | | Cost of goods sold | 22,505 | 19,498 | 16,956 | 60% | 78% | 109% | | Gross margin | 14,873 | 5,613 | (1,416) | 40% | 22% | (9)% | | Operating income (loss) | 9,770 | 1,304 | (5,745) | 26% | 5% | (37)% | | Net income (loss) | 8,539 | 778 | (5,833) | 23% | 3% | (38)% | | Basic EPS | $7.65 | $0.70 | $(5.34) | | | | | Diluted EPS | $7.59 | $0.70 | $(5.34) | | | | - Total revenue for 2025 increased **49%** as compared to 2024, primarily due to increases in sales of both DRAM and NAND products[272](index=272&type=chunk) - Consolidated gross margin percentage improved to **40% for 2025** from **22% for 2024**, driven by increases in average selling prices, an increased mix of higher-margin products (HBM), and manufacturing cost reductions[274](index=274&type=chunk) [Inventory NRV Write-Downs](index=55&type=section&id=Inventory%20NRV%20Write-Downs) Inventory write-downs in 2023 impacted gross margin, with a partial benefit realized in 2024 from subsequent sales - In 2023, Micron recorded charges of **$1.83 billion** to write down inventories to their estimated net realizable value due to declines in average selling prices for DRAM and NAND[277](index=277&type=chunk) - These write-downs resulted in a **$987 million benefit** to consolidated gross margin in 2024 due to lower costs from the sale of inventories written down in prior periods[277](index=277&type=chunk) [Revenue by Business Unit](index=55&type=section&id=Revenue%20by%20Business%20Unit) CMBU, CDBU, and MCBU experienced revenue increases in 2025, primarily driven by AI demand and average selling price improvements - CMBU revenue increased **257% in 2025**, primarily due to increases in DRAM bit shipments and average selling prices driven by accelerating AI demand in cloud server markets for HBM, DIMMs, and low-power server DRAM[279](index=279&type=chunk) - CDBU revenue increased **45% in 2025**, primarily due to increases in average selling prices for both data center DRAM and NAND and NAND bit shipments due to increased demand for data center SSDs[279](index=279&type=chunk) - MCBU revenue increased **2% in 2025**, primarily due to increases in DRAM and NAND revenue, with higher DRAM average selling prices partially offset by decreases in bit shipments as supply was constrained for higher-value segments[279](index=279&type=chunk) Revenue by Business Unit | Business Unit | 2025 Revenue ($M) | 2024 Revenue ($M) | 2023 Revenue ($M) | | :------------ | :---------------- | :---------------- | :---------------- | | CMBU | 13,524 | 3,792 | 1,872 | | CDBU | 7,229 | 4,984 | 2,124 | | MCBU | 11,859 | 11,667 | 7,394 | | AEBU | 4,753 | 4,631 | 4,139 | [Operating Income (Loss) by Business Unit](index=56&type=section&id=Operating%20Income%20(Loss)%20by%20Business%20Unit) Operating income significantly improved across CMBU, CDBU, and MCBU in 2025 due to higher prices, shipments, and cost reductions - CMBU operating income increased significantly in 2025, primarily due to higher bit shipments and increases in average selling prices driven by robust AI demand in cloud server markets, particularly for HBM, DIMMs, and low-power server DRAM products[281](index=281&type=chunk) - CDBU operating income increased in 2025, primarily due to increases in data center average selling prices, higher bit shipments, and manufacturing cost reductions[281](index=281&type=chunk) - MCBU operating income improved in 2025, primarily due to increases in DRAM average selling prices, manufacturing cost reductions, and higher NAND bit shipments, partially offset by decreases in NAND average selling prices and constrained DRAM bit shipments[281](index=281&type=chunk) Operating Income (Loss) by Business Unit | Business Unit | 2025 Operating Income ($M) | 2024 Operating Income ($M) | 2023 Operating Income ($M) | 2025 % of Revenue | 2024 % of Revenue | 2023 % of Revenue | | :------------ | :------------------------- | :------------------------- | :------------------------- | :---------------- | :---------------- | :---------------- | | CMBU | 6,129 | 244 | (768) | 45% | 6% | (41)% | | CDBU | 2,180 | 255 | (563) | 30% | 5% | (27)% | | MCBU | 1,981 | (1) | (3,189) | 17% | 0% | (43)% | | AEBU | 557 | 432 | 680 | 12% | 9% | 16% | [Operating Expenses and Other](index=56&type=section&id=Operating%20Expenses%20and%20Other) R&D and SG&A expenses increased in 2025, while interest income improved and tax provision was reduced by incentive arrangements - Research and Development (R&D) expenses increased **11% in 2025** compared to 2024, primarily due to increases in employee compensation, depreciation expense, and higher volumes of development and pre-qualification wafers[282](index=282&type=chunk) - Selling, General, and Administrative (SG&A) expenses for 2025 increased **7%** as compared to 2024, primarily due to an increase in employee compensation and professional services[283](index=283&type=chunk) - Interest income (expense), net, improved in 2025 compared to 2024, primarily due to decreases in interest expense resulting from increased capitalized interest driven by higher levels of building construction[285](index=285&type=chunk) - The income tax provision for 2025 was **$(1,124) million**, with an effective tax rate of **11.6%**, compared to $(451) million and 36.4% in 2024, primarily due to changes in profitability[286](index=286&type=chunk) - Tax incentive arrangements reduced the tax provision by **$1.05 billion in 2025**, benefiting diluted earnings per share by **$0.93**[287](index=287&type=chunk) - Future tax rates are expected to be in the **mid to high-teens percentage range** starting in 2026, influenced by the U.S. One Big Beautiful Bill Act (OBBBA) and global Pillar Two Model Rules[288](index=288&type=chunk) [Liquidity and Capital Resources](index=58&type=section&id=Liquidity%20and%20Capital%20Resources) This section details Micron's cash flow activities, capital expenditures, and financing strategies, including debt and government incentives [Cash Flows](index=59&type=section&id=Cash%20Flows) Operating cash flow significantly increased in 2025, while investing activities focused on capital expenditures, partially offset by government incentives Cash Flow Summary | For the year ended | 2025 ($M) | 2024 ($M) | 2023 ($M) | | :----------------- | :-------- | :-------- | :-------- | | Net cash provided by operating activities | 17,525 | 8,507 | 1,559 | | Net cash used for investing activities | (14,087) | (8,309) | (6,191) | | Net cash provided by (used for) financing activities | (850) | (1,842) | 4,983 | | Net increase (decrease) in cash, cash equivalents, and restricted cash | 2,594 | (1,604) | 317 | - Net cash provided by operating activities increased to **$17.53 billion in 2025**, primarily due to higher net income and favorable changes in receivables and accounts payable[306](index=306&type=chunk) - Net cash used for investing activities was **$14.09 billion in 2025**, primarily for **$15.86 billion in capital expenditures**, partially offset by **$2.01 billion in government incentives**[308](index=308&type=chunk) - Net cash used for financing activities was **$850 million in 2025**, consisting primarily of **$4.62 billion in debt repayments** and **$522 million in dividend payments**, partially offset by **$4.43 billion from new debt issuances**[311](index=311&type=chunk) [Critical Accounting Estimates](index=60&type=section&id=Critical%20Accounting%20Estimates) Micron's critical accounting estimates involve significant judgment in areas such as contingencies, goodwill, government incentives, and inventory valuation [Contingencies](index=61&type=section&id=Contingencies) Estimating potential losses from contingencies requires significant judgment, with accruals made when probable and reasonably estimable - Estimating the probability and amount of potential losses from various contingencies requires significant judgment, with accruals made when a potential loss is both probable and reasonably estimable[315](index=315&type=chunk) [Goodwill](index=61&type=section&id=Goodwill) Goodwill is annually tested for impairment, involving judgment in fair value determination based on revenue growth, costs, and discount rates - Goodwill is tested annually for impairment, involving significant judgment in determining the fair value of reporting units based on estimates like revenue growth rates, manufacturing costs, and discount rates[316](index=316&type=chunk)[317](index=317&type=chunk) - In 2023, a **$101 million charge** was recognized to impair goodwill assigned to the former Storage Business Unit; no impairment was found in 2025 after segment reorganization[316](index=316&type=chunk) [Government Incentives](index=61&type=section&id=Government%20Incentives) Government incentives are recognized when conditions are met, reducing asset carrying amounts or offsetting operating expenses based on project costs - Government incentives are recognized when there is reasonable assurance that conditions are met, reducing asset carrying amounts for capital expenditures or offsetting related operating expenses[318](index=318&type=chunk)[319](index=319&type=chunk) - Estimates of total expected project costs are used to recognize a proportionate benefit as qualified costs are incurred, with adjustments made for changes in estimates[319](index=319&type=chunk) [Income Taxes](index=62&type=section&id=Income%20Taxes) Estimating income tax provision and deferred tax asset realizability involves significant judgment, regulatory interpretations, and future taxable income forecasts - Estimating the provision for income taxes and the realizability of deferred tax assets involves significant judgment, interpretations of regulations, and forecasting future taxable income in various jurisdictions[320](index=320&type=chunk) [Inventories](index=62&type=section&id=Inventories) Inventories are valued at the lower of cost or net realizable value, requiring judgment in projecting future selling prices, volumes, and costs - Inventories are stated at the lower of cost or net realizable value (NRV), requiring significant judgment in projecting future average selling prices, sales volumes, and costs per part[321](index=321&type=chunk) - A **5% decrease** in future average selling prices would have changed the estimated NRV of finished goods and work in process inventories by approximately **$750 million** as of August 28, 2025[321](index=321&type=chunk) [Property, Plant, and Equipment](index=62&type=section&id=Property,%20Plant,%20and%20Equipment) Useful lives of property, plant, and equipment are periodically assessed, with impairment reviews relying on future cash flow judgments - Estimated useful lives of property, plant, and equipment are periodically assessed based on technology node transitions and capital spending; impairment reviews involve significant judgment on future cash flows[323](index=323&type=chunk) [Revenue Recognition](index=62&type=section&id=Revenue%20Recognition) Revenue is recognized upon transfer of control, with estimates for returns and price protection based on historical data and pricing trends - Revenue is recognized when control of promised goods is transferred; estimates for returns and price protection for distributors are based on historical data and current pricing trends[324](index=324&type=chunk) [Recently Adopted Accounting Standards](index=63&type=section&id=Recently%20Adopted%20Accounting%20Standards) Micron adopted ASU 2023-07 in Q4 2025, retrospectively adjusting segment disclosures - Micron adopted **ASU 2023-07** (Improvements to Reportable Segment Disclosures) in the fourth quarter of 2025 on a retrospective basis, resulting in increased disclosures in Note 27[365](index=365&type=chunk) [Recently Issued Accounting Standards](index=63&type=section&id=Recently%20Issued%20Accounting%20Standards) Upcoming accounting standards, including ASU 2023-09, 2024-03, and 2025-06, will impact future income tax and expense disclosures - **ASU 2023-09** (Improvements to Income Tax Disclosures) will be effective for annual reporting for 2026, requiring disaggregated income tax disclosures[366](index=366&type=chunk) - **ASU 2024-03** (Disaggregation of Income Statement Expenses) will be effective for annual reporting for 2028, requiring disclosure of certain expenses[367](index=367&type=chunk) - **ASU 2025-06** (Targeted Improvements to the Accounting for Internal-Use Software) will be effective for the first quarter of 2029, with evaluation of its impact ongoing[368](index=368&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=63&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Micron is exposed to interest rate risk from its fixed-rate debt ($10.55 billion as of August 28, 2025) and floating-rate debt ($984 million), with potential impacts on fair value and annual interest expense. The company also faces foreign currency exchange rate risk from international operations, primarily in CAD, CNY, EUR, INR, JPY, MYR, TWD, and SGD, which it mitigates using rolling hedge strategies with currency forward contracts - As of August 28, 2025, Micron had fixed-rate debt with a carrying value of **$10.55 billion**; a hypothetical **1% decrease** in market interest rates would increase its fair value by approximately **$660 million**[328](index=328&type=chunk) - As of August 28, 2025, floating-rate debt had a principal amount of **$984 million**; a hypothetical **1% increase** in interest rates would result in an increase in annual interest expense of **$10 million**[330](index=330&type=chunk) - Micron's operations are exposed to foreign currency exchange rate fluctuations, primarily in the Canadian dollar, Chinese yuan, euro, Indian rupee, Japanese yen, Malaysian ringgit, New Taiwan dollar, and Singapore dollar[331](index=331&type=chunk) - The company uses rolling hedge strategies with currency forward contracts, generally maturing within three months to two years, to hedge exposures to changes in currency exchange rates[332](index=332&type=chunk) - A hypothetical **10% adverse change** in exchange rates versus the U.S. dollar would result in losses of approximately **$572 million** as of August 28, 2025[332](index=332&type=chunk) [Interest Rate Risk](index=63&type=section&id=Interest%20Rate%20Risk) Micron is exposed to interest rate risk from fixed and floating-rate debt, impacting fair value and annual interest expense - As of August 28, 2025, Micron had fixed-rate debt with a carrying value of **$10.55 billion**; a hypothetical **1% decrease** in market interest rates would increase its fair value by approximately **$660 million**[328](index=328&type=chunk) - As of August 28, 2025, floating-rate debt had a principal amount of **$984 million**; a hypothetical **1% increase** in interest rates would result in an increase in annual interest expense of **$10 million**[330](index=330&type=chunk) [Foreign Currency Exchange Rate Risk](index=63&type=section&id=Foreign%20Currency%20Exchange%20Rate%20Risk) Foreign currency exchange rate fluctuations, primarily in Asian currencies, are mitigated using rolling hedge strategies with forward contracts - Micron's operations are exposed to foreign currency exchange rate fluctuations, primarily in the Canadian dollar, Chinese yuan, euro, Indian rupee, Japanese yen, Malaysian ringgit, New Taiwan dollar, and Singapore dollar[331](index=331&type=chunk) - The company uses rolling hedge strategies with currency forward contracts, generally maturing within three months to two years, to hedge exposures to changes in currency exchange rates[332](index=332&type=chunk) - A hypothetical **10% adverse change** in exchange rates versus the U.S. dollar would result in losses of approximately **$572 million** as of August 28, 2025[332](index=332&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=63&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents Micron's audited consolidated financial statements for fiscal years 2025, 2024, and 2023, including statements of operations, comprehensive income (loss), balance sheets, changes in equity, and cash flows. It also includes detailed notes to the financial statements covering significant accounting policies, recent accounting standards, cash and investments, receivables, inventories, property, plant, and equipment, leases, intangible assets, accounts payable, debt, commitments, contingencies, equity, fair value measurements, derivative instruments, equity compensation plans, employee benefit plans, government incentives, revenue and customer contract liabilities, restructure and asset impairments, other operating/non-operating income/expense, income taxes, earnings per share, segment information, certain concentrations, and geographic information. The report of the independent registered public accounting firm and critical audit matters are also included - The section includes the Consolidated Statements of Operations, Comprehensive Income (Loss), Balance Sheets, Changes in Equity, and Cash Flows for fiscal years 2025, 2024, and 2023[334](index=334&type=chunk) - Detailed Notes to Consolidated Financial Statements (Note 1 through Note 29) provide comprehensive information on accounting policies, financial instruments, debt, equity, and other financial aspects[343](index=343&type=chunk) - PricewaterhouseCoopers LLP provided an unqualified opinion on the consolidated financial statements and the effectiveness of internal control over financial reporting as of August 28, 2025[478](index=478&type=chunk) - A critical audit matter identified is the accounting for U.S. CHIPS Act funding agreements, due to significant management judgment in assessing recognition of proportionate benefits and compliance with covenants[485](index=485&type=chunk) [Index to Consolidated Financial Statements](index=63&type=section&id=Index%20to%20Consolidated%20Financial%20Statements) [Consolidated Statements of Operations](index=66&type=section&id=Consolidated%20Statements%20of%20Operations) This statement summarizes Micron's revenue, gross margin, operating income, net income, and diluted EPS for fiscal years 2023-2025 Consolidated Statements of Operations Summary | For the year ended | August 28, 2025 | August 29, 2024 | August 31, 2023 | | :----------------- | :-------------- | :-------------- | :-------------- | | Revenue | $37,378 | $25,111 | $15,540 | | Gross margin | $14,873 | $5,613 | $(1,416) | | Operating income (loss) | $9,770 | $1,304 | $(5,745) | | Net income (loss) | $8,539 | $778 | $(5,833) | | Diluted EPS | $7.59 | $0.70 | $(5.34) | [Consolidated Statements of Comprehensive Income (Loss)](index=67&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This statement presents Micron's net income and other comprehensive income (loss) components for fiscal years 2023-2025 Consolidated Statements of Comprehensive Income (Loss) Summary | For the year ended | August 28, 2025 | August 29, 2024 | August 31, 2023 | | :----------------- | :-------------- | :-------------- | :-------------- | | Net income (loss) | $8,539 | $778 | $(5,833) | | Other comprehensive income (loss) | $102 | $178 | $248 | | Total comprehensive income (loss) | $8,641 | $956 | $(5,585) | [Consolidated Balance Sheets](index=68&type=section&id=Consolidated%20Balance%20Sheets) This statement provides a snapshot of Micron's assets, liabilities, and equity as of August 28, 2025, and August 29, 2024 Consolidated Balance Sheets Summary | As of | August 28, 2025 ($M) | August 29, 2024 ($M) | | :--------------------- | :------------------- | :------------------- | | Total current assets | 28,841 | 24,372 | | Total assets | 82,798 | 69,416 | | Total current liabilities | 11,454 | 9,248 | | Long-term debt | 14,017 | 12,966 | | Total liabilities | 28,633 | 24,285 | | Total equity | 54,165 | 45,131 | [Consolidated Statements of Changes in Equity](index=69&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Equity) This statement details changes in Micron's common stock, additional capital, retained earnings, and other comprehensive income for 2025 Consolidated Statements of Changes in Equity Summary (As of August 28, 2025) | As of August 28, 2025 | Common Stock (Shares) | Common Stock (Amount) | Additional Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Total Shareholders' Equity | | :-------------------- | :-------------------- | :-------------------- | :----------------- | :---------------- | :------------- | :-------------------------------------------- | :------------------------- | | Balance | 1,266 | $127 | $13,339 | $48,583 | $(7,852) | $(32) | $54,165 | - Net income of **$8,539 million** contributed to equity in 2025[341](index=341&type=chunk) - Stock-based compensation expense was **$972 million** in 2025[341](index=341&type=chunk) - Dividends declared were **$527 million** in 2025[341](index=341&type=chunk) [Consolidated Statements of Cash Flows](index=70&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This statement summarizes Micron's cash flows from operating, investing, and financing activities for fiscal years 2023-2025 Consolidated Statements of Cash Flows Summary | For the year ended | August 28, 2025 ($M) | August 29, 2024 ($M) | August 31, 2023 ($M) | | :----------------- | :------------------- | :------------------- | :------------------- | | Net cash provided by operating activities | 17,525 | 8,507 | 1,559 | | Net cash used for investing activities | (14,087) | (8,309) | (6,191) | | Net cash provided by (used for) financing activities | (850) | (1,842) | 4,983 | | Net increase (decrease) in cash, cash equivalents, and restricted cash | 2,594 | (1,604) | 317 | [Notes to Consolidated Financial Statements](index=71&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes provide detailed explanations of Micron's accounting policies, financial instruments, debt, equity, and other financial disclosures [Note 1. Significant Accounting Policies](index=71&type=section&id=Note%201.%20Significant%20Accounting%20Policies) This note outlines Micron's key accounting policies, including consolidation, fiscal year, derivative instruments, inventories, and revenue recognition - Consolidated financial statements include Micron Technology, Inc. and its consolidated subsidiaries, prepared in accordance with U.S. GAAP[344](index=344&type=chunk) - The fiscal year is the 52- or 53-week period ending on the Thursday closest to August 31; Fiscal 2025, 2024, and 2023 each contained **52 weeks**[345](index=345&type=chunk) - Micron uses derivative instruments to manage exposure to changes in currency exchange rates and commodity prices, with accounting based on the intended use and designation[346](index=346&type=chunk)[347](index=347&type=chunk) - Inventories are stated at the lower of cost or net realizable value, with cost determined on a FIFO basis and including depreciation, labor, material, and overhead costs[353](index=353&type=chunk) - Revenue is primarily recognized at a point in time when control of promised goods is transferred to customers, with estimates for returns and price protection for distributors[361](index=361&type=chunk) [Note 2. Recently Adopted Accounting Standards](index=75&type=section&id=Note%202.%20Recently%20Adopted%20Accounting%20Standards) Micron adopted ASU 2023-07 in Q4 2025, retrospectively adjusting reportable segment disclosures - Micron adopted **ASU 2023-07** (Improvements to Reportable Segment Disclosures) in the fourth quarter of 2025 on a retrospective basis, resulting in increased disclosures in Note 27[365](index=365&type=chunk) [Note 3. Recently Issued Accounting Standards](index=75&type=section&id=Note%203.%20Recently%20Issued%20Accounting%20Standards) Upcoming accounting standards, including ASU 2023-09, 2024-03, and 2025-06, will impact future income tax and expense disclosures - **ASU 2023-09** (Improvements to Income Tax Disclosures) will be effective for annual reporting for 2026, requiring disaggregated income tax disclosures[366](index=366&type=chunk) - **ASU 2024-03** (Disaggregation of Income Statement Expenses) will be effective for annual reporting for 2028, requiring disclosure of certain expenses[367](index=367&type=chunk) - **ASU 2025-06** (Targeted Improvements to the Accounting for Internal-Use Software) will be effective for the first quarter of 2029, with early adoption permitted and evaluation of its impact ongoing[368](index=368&type=chunk) [Note 4. Variable Interest Entities](index=75&type=section&id=Note%204.%20Variable%20Interest%20Entities) Micron uses third-party special purpose entities for equipment lease financing but does not consolidate them - Micron utilizes third-party special purpose entities (Lease SPEs) to facilitate equipment lease financing transactions but does not consolidate them as it lacks the power to direct their most significant economic activities[369](index=369&type=chunk) - As of August 28, 2025, Micron had approximately **$1.58 billion of financial lease liabilities** and right-of-use assets under these arrangements[369](index=369&type=chunk) [Note 5. Cash and Investments](index=76&type=section&id=Note%205.%20Cash%20and%20Investments) Total cash and marketable investments were $11.94 billion as of August 28, 2025, with a portion held by foreign subsidiaries Cash and Investments (As of August 28, 2025) | As of August 28, 2025 | Cash and Cash Equivalents ($M) | Short-term Investments ($M) | Long-term Marketable Investments ($M) | Total Fair Value ($M) | | :-------------------- | :----------------------------- | :-------------------------- | :------------------------------------ | :-------------------- | | Cash | 7,875 | — | — | 7,875 | | Money market funds | 410 | — | — | 410 | | Certificates of deposit | 1,292 | 6 | — | 1,298 | | Corporate bonds | 23 | 559 | 1,047 | 1,629 | | Asset-backed securities | — | 31 | 521 | 552 | | Government securities | 9 | 43 | 61 | 113 | | Commercial paper | 33 | 26 | — | 59 | | Total | 9,642 | 665 | 1,629 | 11,936 | - Total cash and marketable investments were **$11.94 billion** as of August 28, 2025, with **$5.20 billion** held by foreign subsidiaries[291](index=291&type=chunk)[371](index=371&type=chunk) - Non-marketable equity investments totaled **$194 million** as of August 28, 2025, with net losses of **$10 million** recognized in 2025[372](index=372&type=chunk) [Note 6. Receivables](index=77&type=section&id=Note%206.%20Receivables) Receivables include trade, government incentives, and income taxes, totaling $9.27 billion as of August 28, 2025 Receivables (As of August 28, 2025) | As of August 28, 2025 | Amount ($M) | | :-------------------- | :---------- | | Trade receivables | 7,163 | | Government incentives | 1,572 | | Income and other taxes | 436 | | Other | 94 | | Total | 9,265 | [Note 7. Inventories](index=77&type=section&id=Note%207.%20Inventories) Inventories, including finished goods, work in process, and raw materials, totaled $8.36 billion as of August 28, 2025 Inventories (As of August 28, 2025) | As of August 28, 2025 | Amount ($M) | | :-------------------- | :---------- | | Finished goods | 1,094 | | Work in process | 6,401 | | Raw materials and supplies | 860 | | Total | 8,355 | - In 2023, Micron recorded charges of **$1.83 billion** to cost of goods sold to write down the carrying value of work in process and finished goods inventories to their estimated net realizable value[374](index=374&type=chunk) [Note 8. Property, Plant, and Equipment](index=77&type=section&id=Note%208.%20Property,%20Plant,%20and%20Equipment) Net property, plant, and equipment totaled $46.59 billion as of August 28, 2025, with significant depreciation and capitalized interest Property, Plant, and Equipment (As of August 28, 2025) | As of August 28, 2025 | Amount ($M) | | :-------------------- | :---------- | | Land | 420 | | Buildings | 22,173 | | Equipment | 79,934 | | Construction in progress | 5,518 | | Software | 1,651 | | Accumulated depreciation | (63,106) |\ | Net | 46,590 | - Depreciation expense was **$8.28 billion** for 2025[375](index=375&type=chunk) - Interest capitalized as part of the cost of property, plant, and equipment was **$321 million** for 2025[375](index=375&type=chunk) [Note 9. Leases](index=77&type=section&id=Note%209.%20Leases) Micron has finance and operating leases for facilities, land, and equipment, with total lease costs of $615 million in 2025 - Micron has finance and operating leases for facilities, land, and equipment, with finance leases primarily for equipment and gas supply agreements, and operating leases for offices and laboratories[376](index=376&type=chunk) Lease Cost Components | Lease Cost Component | 2025 ($M) | 2024 ($M) | 2023 ($M) | | :------------------- | :-------- | :-------- | :-------- | | Finance lease cost | 462 | 246 | 129 | | Operating lease cost | 153 | 140 | 137 | | Total | 615 | 386 | 266 | - Non-cash acquisitions of right-of-use assets totaled **$1.298 billion** for finance leases and **$166 million** for operating leases in 2025[379](index=379&type=chunk) - As of August 28, 2025, excluded obligations for leases that have been executed but not yet commenced totaled **$1.16 billion** for finance lease obligations[380](index=380&type=chunk) [Note 10. Intangible Assets](index=79&type=section&id=Note%2010.%20Intangible%20Assets) Net intangible assets, primarily product and process technology, totaled $453 million as of August 28, 2025 Intangible Assets (As of August 28, 2025) | As of August 28, 2025 | Gross Amount ($M) | Accumulated Amortization ($M) | Net Carrying Amount ($M) | | :-------------------- | :---------------- | :---------------------------- | :----------------------- | | Product and process technology | 662 | (217) | 445 | | Other | 8 | — | 8 | | Total | 670 | (217) | 453 | - In 2025, Micron capitalized **$112 million** for product and process technology, with a weighted-average useful life of **9 years**[381](index=381&type=chunk) - Amortization expense for intangible assets was **$71 million** for 2025[381](index=381&type=chunk) [Note 11. Accounts Payable and Accrued Expenses](index=79&type=section&id=Note%2011.%20Accounts%20Payable%20and%20Accrued%20Expenses) Accounts payable and accrued expenses totaled $9.65 billion as of August 28, 2025, including property, plant, and equipment payables Accounts Payable and Accrued Expenses (As of August 28, 2025) | As of August 28, 2025 | Amount ($M) | | :-------------------- | :---------- | | Accounts payable | 3,132 | | Property, plant, and equipment | 4,391 | | Salaries, wages, and benefits | 1,116 | | Income and other taxes | 628 | | Other | 382 | | Total | 9,649 | [Note 12. Debt](index=80&type=section&id=Note%2012.%20Debt) Total debt, including notes and finance lease obligations, was $14.58 billion as of August 28, 2025, with new issuances and repayments Debt Summary (As of August 28, 2025) | Debt Instrument | Stated Rate | Principal (2025, $M) | Net Carrying Amount (2025, $M) | Principal (2024, $M) | Net Carrying Amount (2024, $M) | | :-------------------- | :---------- | :------------------- | :----------------------------- | :------------------- | :----------------------------- | | 2028 Notes | 5.375% | 542 | 540 | 600 | 597 | | 2029 Term Loan A | 5.455% | 984 | 982 | — | — | | 2029 A Notes | 5.327% | 700 | 698 | 700 | 698 | | 2029 B Notes | 6.750% | 1,159 | 1,168 | 1,250 | 1,261 | | 2030 Notes | 4.663% | 796 | 794 | 850 | 847 | | 2031 Notes | 5.300% | 1,000 | 995 | 1,000 | 994 | | 2032 Green Bonds | 2.703% | 1,000 | 996 | 1,000 | 996 | | 2032 Notes | 5.650% | 500 | 496 | — | — | | 2033 A Notes | 5.875% | 750 | 746 | 750 | 745 | | 2033 B Notes

[FORM 8-K Filing Information](index=1&type=section&id=FORM%208-K%20Filing%20Information) This section details the administrative information for the Form 8-K filing, including registrant identification and exchange listing [Registrant Details and Exchange Listing](index=1&type=section&id=Registrant%20Details%20and%20Exchange%20Listing) This section details the registrant's legal name, contact information, and New York Stock Exchange listing under SBR - Registrant Name: **SABINE ROYALTY TRUST**[2](index=2&type=chunk) Securities Registered | Title of each class | Symbol(s) | Name of each exchange on which registered | | :----------------------- | :-------- | :---------------------------------------- | | Units of Beneficial Interest | SBR | New York Stock Exchange | [Current Report Items](index=2&type=section&id=Current%20Report%20Items) This section outlines key reported events, including financial condition updates and accompanying exhibits [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) SABINE ROYALTY TRUST announced a monthly cash distribution to unitholders, furnished under Section 18 of the Securities Exchange Act - A press release on **October 3, 2025**, announced the monthly cash distribution to unitholders of record on **October 15, 2025**[6](index=6&type=chunk) - The furnished information is not considered 'filed' under Section 18 of the Securities Exchange Act of 1934, thus avoiding associated liabilities[7](index=7&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This item lists the Form 8-K exhibits, identifying the October 3, 2025 press release as Exhibit 99.1 - **Exhibit 99.1**: Press Release dated **October 3, 2025**[8](index=8&type=chunk) [SIGNATURES](index=3&type=section&id=SIGNATURES) This section confirms the official signing of the report by the authorized trustee representative [Signature Details](index=3&type=section&id=Signature%20Details) The report was signed by Argent Trust Company, Trustee for SABINE ROYALTY TRUST, on October 3, 2025 - The report was signed by **Argent Trust Company**, Trustee, on behalf of **SABINE ROYALTY TRUST**[11](index=11&type=chunk) - Signatory: **Nancy Willis**, Director of Royalty Trust Services[11](index=11&type=chunk) - Date of signature: **October 3, 2025**[11](index=11&type=chunk)

PART I: FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements and management's discussion and analysis [Item 1. Condensed Consolidated Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20%28unaudited%29) This section presents the unaudited condensed consolidated financial statements of Ennis, Inc. for the period ended August 31, 2025, including balance sheets, statements of operations, comprehensive income, changes in shareholders' equity, and cash flows, along with detailed notes on significant accounting policies, revenue recognition, investments, receivables, inventories, property, acquisitions, leases, goodwill, intangible assets, accrued expenses, credit facilities, shareholders' equity, stock-based compensation, pension plans, earnings per share, concentrations of risk, related party transactions, income taxes, other contingencies, segment reporting, and subsequent events [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity at specific dates | Metric (in thousands) | August 31, 2025 | February 28, 2025 | Change | | :-------------------- | :-------------- | :---------------- | :----- | | Cash | $31,886 | $67,000 | $(35,114) | | Short-term investments | $— | $5,475 | $(5,475) | | Inventories, net | $62,078 | $38,797 | $23,281 | | Goodwill | $106,906 | $94,349 | $12,557 | | Intangible assets, net | $40,645 | $33,270 | $7,375 | | Total assets | $361,833 | $348,935 | $12,898 | | Accounts payable | $19,641 | $13,799 | $5,842 | | Accrued expenses | $17,262 | $15,339 | $1,923 | | Total liabilities | $56,453 | $46,955 | $9,498 | | Total shareholders' equity | $305,380 | $301,980 | $3,400 | - Total Assets increased to **$361.8 million** at August 31, 2025, from **$348.9 million** at February 28, 2025, primarily driven by increases in inventories, goodwill, and intangible assets[10](index=10&type=chunk) - Current Assets decreased to **$138.9 million** at August 31, 2025, from **$152.7 million** at February 28, 2025, mainly due to a significant reduction in cash and the absence of short-term investments[10](index=10&type=chunk) [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section outlines the company's financial performance over specific periods, including net sales, expenses, and net earnings | Metric (in thousands, except per share) | 3 Months Ended Aug 31, 2025 | 3 Months Ended Aug 31, 2024 | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :------------------------------------ | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net sales | $98,676 | $99,038 | $195,872 | $202,146 |\n| Cost of goods sold | $68,574 | $69,259 | $135,541 | $141,463 |\n| Gross profit | $30,102 | $29,779 | $60,331 | $60,683 |\n| Selling, general and administrative | $17,719 | $16,557 | $34,665 | $33,727 |\n| Income from operations | $12,383 | $13,183 | $25,666 | $26,913 |\n| Other income (expense) | $5,761 | $1,034 | $5,993 | $2,045 |\n| Earnings before income taxes | $18,144 | $14,217 | $31,659 | $28,958 |\n| Income tax expense | $4,989 | $3,909 | $8,706 | $7,963 |\n| Net earnings | $13,155 | $10,308 | $22,953 | $20,995 |\n| Basic EPS | $0.51 | $0.40 | $0.89 | $0.81 |\n| Diluted EPS | $0.51 | $0.40 | $0.89 | $0.80 | - Net sales for the three months ended August 31, 2025, decreased by **0.3%** year-over-year to **$98.7 million**, while net sales for the six months decreased by **3.1%** to **$195.9 million**[12](index=12&type=chunk) - Net earnings for the three months ended August 31, 2025, increased by **27.6%** year-over-year to **$13.2 million**, and for the six months, increased by **9.3%** to **$23.0 million**[12](index=12&type=chunk) [Condensed Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) This section presents net earnings and other comprehensive income items, reflecting the total change in equity from non-owner sources | Metric (in thousands) | 3 Months Ended Aug 31, 2025 | 3 Months Ended Aug 31, 2024 | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :-------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net earnings | $13,155 | $10,308 | $22,953 | $20,995 |\n| Adjustment to pension, net of taxes | $343 | $(528) | $686 | $(156) |\n| Comprehensive income | $13,498 | $9,780 | $23,639 | $20,839 | - Comprehensive income for the three months ended August 31, 2025, increased by **38.0%** year-over-year to **$13.5 million**, and for the six months, increased by **13.4%** to **$23.6 million**[14](index=14&type=chunk) [Condensed Consolidated Statements of Changes in Shareholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity) This section details the changes in the company's shareholders' equity over time, including net earnings, dividends, and stock repurchases - Total Shareholders' Equity increased to **$305.4 million** at August 31, 2025, from **$302.0 million** at February 28, 2025[16](index=16&type=chunk) - Common stock repurchases for the six months ended August 31, 2025, amounted to **$8.6 million**, a significant increase from **$1.8 million** in the prior year[16](index=16&type=chunk) - Dividends paid for the six months ended August 31, 2025, were **$13.1 million**, consistent with **$13.0 million** in the prior year[16](index=16&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section reports the cash generated and used by the company across operating, investing, and financing activities | Metric (in thousands) | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :-------------------- | :-------------------------- | :-------------------------- | | Net cash provided by operating activities | $18,425 | $34,941 |\n| Net cash used in investing activities | $(31,954) | $(1,777) |\n| Net cash used in financing activities | $(21,585) | $(14,784) |\n| Net change in cash and cash equivalents | $(35,114) | $18,380 |\n| Cash and cash equivalents at end of period | $31,886 | $99,977 | - Net cash provided by operating activities decreased to **$18.4 million** for the six months ended August 31, 2025, from **$34.9 million** in the prior year, primarily due to increased inventories and changes in receivables[19](index=19&type=chunk) - Net cash used in investing activities significantly increased to **$32.0 million** in 2025 from **$1.8 million** in 2024, driven by business acquisitions[19](index=19&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information supporting the condensed consolidated financial statements [1. Significant Accounting Policies and General Matters](index=8&type=section&id=1.%20Significant%20Accounting%20Policies%20and%20General%20Matters) This note describes the key accounting principles and general considerations used in preparing the financial statements - The unaudited condensed consolidated financial statements are prepared in accordance with GAAP and SEC rules for interim statements, relying on management estimates and assumptions[22](index=22&type=chunk) - ASU 2023-09 (Income Tax Disclosures), effective fiscal 2026, will expand income tax disclosures but is not expected to materially impact financial statements[23](index=23&type=chunk) - ASU 2024-03 (Expense Disaggregation), effective fiscal 2028, will require additional income statement expense disclosures but is not expected to materially impact financial statements[24](index=24&type=chunk) [2. Revenue](index=9&type=section&id=2.%20Revenue) This note details the company's revenue recognition policies and sources - Substantially all revenue is derived from the sale of printed products in the continental U.S., recognized at a point in time upon transfer of control (generally shipment)[27](index=27&type=chunk) - Revenue from print-and-store arrangements was **$6.1 million** for the six months ended August 31, 2025, a decrease from **$6.9 million** in the prior year[28](index=28&type=chunk) - The Company operates in one reportable segment, 'Print,' and does not have material contract assets or liabilities[30](index=30&type=chunk) [3. Short-term Investments and Fair Value Measurements](index=10&type=section&id=3.%20Short-term%20Investments%20and%20Fair%20Value%20Measurements) This note explains the company's short-term investment holdings and fair value measurement practices - Short-term investments, classified as held-to-maturity U.S. Treasury Bills, were **$0** at August 31, 2025, down from **$5.5 million** at February 28, 2025[36](index=36&type=chunk)[37](index=37&type=chunk) - These investments were stated at amortized cost with a zero credit loss allowance due to their high credit rating and risk-free nature[36](index=36&type=chunk) [4. Receivables](index=10&type=section&id=4.%20Receivables) This note provides information on the company's accounts and other receivables, including credit policies and allowances - Accounts receivable are primarily from North American customers, with credit extended based on financial condition, requested amount, and payment history[38](index=38&type=chunk) | Metric | 3 Months Ended Aug 31, 2025 | 3 Months Ended Aug 31, 2024 | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :----- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Balance at beginning of period | $1,758 | $1,720 | $1,713 | $1,707 |\n| Bad debt expense, net of recoveries | $28 | $67 | $118 | $177 |\n| Accounts written off | $(127) | $(11) | $(172) | $(108) |\n| Balance at end of period | $1,659 | $1,776 | $1,659 | $1,776 | - Other receivables mainly consist of vendor rebate receivables, recognized as a reduction in cost of inventory when related inventory is sold[42](index=42&type=chunk) [5. Inventories](index=12&type=section&id=5.%20Inventories) This note details the valuation methods and composition of the company's inventories - Inventories are valued at the lower of FIFO cost or market, with **11.1%** (August 31, 2025) and **7.1%** (February 28, 2025) valued at LIFO[43](index=43&type=chunk) - Reserves for excess and obsolete inventory were **$1.9 million** at August 31, 2025, up from **$1.8 million** at February 28, 2025[43](index=43&type=chunk) | Component (in thousands) | August 31, 2025 | February 28, 2025 | | :-------- | :-------------- | :---------------- | | Raw material | $35,231 | $20,862 |\n| Work-in-process | $5,545 | $4,919 |\n| Finished goods | $21,302 | $13,016 |\n| Total | $62,078 | $38,797 | [6. Property, Plant and Equipment](index=12&type=section&id=6.%20Property%2C%20Plant%20and%20Equipment) This note outlines the company's property, plant, and equipment, including depreciation policies and net carrying amounts | Component (in thousands) | August 31, 2025 | February 28, 2025 | | :----------------------- | :-------------- | :---------------- | | Plant, machinery and equipment | $160,324 | $158,730 |\n| Land and buildings | $72,472 | $67,946 |\n| Computer equipment and software | $10,350 | $10,597 |\n| Other | $3,946 | $3,995 |\n| Property, plant and equipment | $247,092 | $241,268 |\n| Less accumulated depreciation | $189,128 | $188,682 |\n| Property, plant and equipment, net | $57,964 | $52,586 | - Property, plant and equipment, net, increased to **$58.0 million** at August 31, 2025, from **$52.6 million** at February 28, 2025[45](index=45&type=chunk) [7. Acquisitions](index=12&type=section&id=7.%20Acquisitions) This note describes recent business acquisitions, including purchase prices, goodwill, and intangible assets recognized - On April 11, 2025, the Company acquired Northeastern Envelope Company (NEC) and Envelope Superstore (ESS) for approximately **$34.9 million** in cash, strengthening production capabilities in the Northeast and Southeast U.S[48](index=48&type=chunk) - The NEC and ESS acquisition resulted in **$12.6 million** in goodwill and **$11.3 million** in definite-lived intangible assets (2-13 years), both tax-deductible[48](index=48&type=chunk) - On June 26, 2024, the Company acquired Printing Technologies (PTI) for approximately **$5.5 million** in cash, adding **$2.0 million** in tax-deductible intangible assets and diversifying product offerings[50](index=50&type=chunk) [8. Leases](index=16&type=section&id=8.%20Leases) This note details the company's lease arrangements, including right-of-use assets and lease liabilities - The Company leases facilities and equipment under operating leases, typically **1-5 years**, recorded as right-of-use assets and lease liabilities[53](index=53&type=chunk) | Metric (in thousands) | 3 Months Ended Aug 31, 2025 | 3 Months Ended Aug 31, 2024 | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :-------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Operating lease cost | $1,434 | $1,389 | $2,865 | $2,736 |\n| Operating cash flows from operating leases | $1,446 | $1,410 | $2,892 | $2,779 |\n| Right-of-use assets obtained | $1,793 | $847 | $4,092 | $1,495 | - Total future minimum lease payments under non-cancelable operating leases are **$11.7 million**, with a present value of lease liabilities of **$11.0 million**[59](index=59&type=chunk) [9. Goodwill and Intangible Assets](index=18&type=section&id=9.%20Goodwill%20and%20Intangible%20Assets) This note provides information on the company's goodwill and other intangible assets, including amortization and impairment testing - Goodwill is not amortized and is tested for impairment annually as of December 1; no impairment charge was required as of August 31, 2025[60](index=60&type=chunk)[62](index=62&type=chunk) | Intangible Asset | Weighted Average Remaining Life (years) | Gross Carrying Amount (Aug 31, 2025) | Accumulated Amortization (Aug 31, 2025) | Net (Aug 31, 2025) | Net (Feb 28, 2025) | | :--------------- | :------------------------------------ | :----------------------------------- | :-------------------------------------- | :----------------- | :----------------- | | Trademarks and trade names | 6.2 | $32,411 | $17,549 | $14,862 | $14,367 |\n| Customer lists | 7.5 | $93,133 | $67,791 | $25,342 | $18,413 |\n| Non-compete | 0.9 | $280 | $234 | $46 | $49 |\n| Technology | 4.3 | $650 | $255 | $395 | $441 |\n| Total | 7.0 | $126,474 | $85,829 | $40,645 | $33,270 | - Goodwill increased by **$12.6 million** to **$106.9 million** at August 31, 2025, primarily due to the acquisition of NEC and ESS[67](index=67&type=chunk)[68](index=68&type=chunk) [10. Accrued Expenses](index=20&type=section&id=10.%20Accrued%20Expenses) This note details the composition of the company's accrued expenses | Component (in thousands) | August 31, 2025 | February 28, 2025 | | :----------------------- | :-------------- | :---------------- | | Employee compensation and benefits | $12,372 | $11,505 |\n| Taxes other than income | $2,430 | $1,440 |\n| Accrued legal and professional fees | $483 | $521 |\n| Accrued utilities | $118 | $108 |\n| Income taxes payable | $586 | $567 |\n| Other accrued expenses | $1,273 | $1,198 |\n| Total | $17,262 | $15,339 | - Total accrued expenses increased to **$17.3 million** at August 31, 2025, from **$15.3 million** at February 28, 2025, mainly due to higher employee compensation and benefits and taxes other than income[70](index=70&type=chunk) [11. Credit Facility](index=20&type=section&id=11.%20Credit%20Facility) This note describes the company's credit arrangements and outstanding balances - As of August 31, 2025, the Company had **$0.2 million** outstanding under a standby letter of credit arrangement, secured by a cash collateral bank account[71](index=71&type=chunk) [12. Shareholders' Equity](index=20&type=section&id=12.%20Shareholders%27%20Equity) This note provides details on the company's shareholders' equity, including stock repurchase programs and dividends - The Board authorized a stock repurchase program with cumulative funds up to **$60.0 million**[72](index=72&type=chunk) - During the six months ended August 31, 2025, the Company repurchased **456,671 shares** of common stock at an average price of **$18.54**, with **$13.1 million** remaining available under the program[73](index=73&type=chunk) - Since the program's inception in October 2008, **2,791,015 common shares** have been repurchased at an average price of **$16.81 per share**[73](index=73&type=chunk) [13. Stock Based Compensation](index=20&type=section&id=13.%20Stock%20Based%20Compensation) This note explains the company's stock-based compensation plans and related expenses - The Company grants stock options, restricted stock, and RSUs to key executives, managerial employees, and non-employee directors under the 2021 Long-Term Incentive Plan[74](index=74&type=chunk) | Period | 3 Months Ended Aug 31, 2025 | 3 Months Ended Aug 31, 2024 | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :----- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Stock-based Compensation Expense (in thousands) | $0.8 | $0.7 | $1.3 | $2.5 | - As of August 31, 2025, there was **$0.1 million** of unrecognized compensation cost related to unvested stock options (**0.6 years** remaining service period) and **$0.7 million** for unvested restricted stock (**2.4 years** remaining service period)[78](index=78&type=chunk)[79](index=79&type=chunk) [14. Pension Plan](index=23&type=section&id=14.%20Pension%20Plan) This note details the company's defined benefit pension plan, including costs and funding status - The Company has a noncontributory defined benefit pension plan covering approximately **12%** of employees; new employees hired after January 1, 2009, are excluded[85](index=85&type=chunk) | Component (in thousands) | 3 Months Ended Aug 31, 2025 | 3 Months Ended Aug 31, 2024 | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :----------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Service cost | $152 | $166 | $303 | $332 |\n| Interest cost | $648 | $649 | $1,298 | $1,298 |\n| Expected return on plan assets | $(710) | $(755) | $(1,420) | $(1,510) |\n| Amortization of unrecognized net loss | $366 | $436 | $732 | $872 |\n| Net periodic benefit cost | $456 | $496 | $913 | $992 | - The Company is not required to make a contribution to the pension plan for fiscal year 2026, but made a **$1.2 million** contribution in fiscal year 2025[87](index=87&type=chunk) [15. Earnings Per Share](index=24&type=section&id=15.%20Earnings%20Per%20Share) This note outlines the calculation of basic and diluted earnings per share - Basic EPS is computed by dividing net earnings by weighted average common shares outstanding; diluted EPS reflects potential dilution from stock options and RSUs using the treasury stock method[88](index=88&type=chunk) | Metric | 3 Months Ended Aug 31, 2025 | 3 Months Ended Aug 31, 2024 | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :----- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Basic weighted average common shares outstanding | 25,718,068 | 26,009,876 | 25,836,670 | 26,015,195 |\n| Effect of dilutive securities | 73,579 | 44,623 | 68,955 | 140,966 |\n| Diluted weighted average common shares outstanding | 25,791,647 | 26,054,499 | 25,905,625 | 26,156,161 |\n| Net earnings - basic | $0.51 | $0.40 | $0.89 | $0.81 |\n| Net earnings - diluted | $0.51 | $0.40 | $0.89 | $0.80 |\n| Cash dividends per share | $0.25 | $0.25 | $0.50 | $0.50 | - Unvested share-based payment awards with non-forfeitable dividend rights are treated as participating securities in EPS computation[89](index=89&type=chunk) [16. Concentrations of Risk](index=26&type=section&id=16.%20Concentrations%20of%20Risk) This note identifies significant concentrations of credit and supply chain risks faced by the company - The Company's credit risk is concentrated in cash and accounts receivable; **$31.4 million** of cash balances were not federally insured at August 31, 2025[92](index=92&type=chunk) - The Company purchases paper products from a limited number of suppliers, posing a risk if alternative sources are not available at comparable cost or quality[94](index=94&type=chunk) [17. Related Party Transactions](index=26&type=section&id=17.%20Related%20Party%20Transactions) This note discloses transactions with entities controlled by related parties - The Company leases a facility and sells products to entities controlled by a Board member, with a total right-of-use asset and related lease liability of **$1.5 million** at August 31, 2025[95](index=95&type=chunk) - For the six months ended August 31, 2025, total lease payments were approximately **$0.3 million** and product sales were **$2.1 million** to director-controlled entities[95](index=95&type=chunk) [18. Income Taxes](index=26&type=section&id=18.%20Income%20Taxes) This note provides information on the company's income tax expense, effective tax rate, and cash payments - The effective tax rate for the three and six months ended August 31, 2025 and 2024, remained flat at **27.5%**[97](index=97&type=chunk) - Cash payments for income taxes (net of refunds) were **$8.8 million** for the six months ended August 31, 2025, down from **$9.2 million** in the prior year[97](index=97&type=chunk) - The Company is evaluating the tax provisions of the One Big Beautiful Bill Act (OBBBA) but does not expect a material impact on its financial statements[98](index=98&type=chunk) [19. Other Contingencies](index=27&type=section&id=19.%20Other%20Contingencies) This note discusses other potential liabilities and legal matters - The Company does not believe the disposition of any current litigation matter will have a material adverse effect on its consolidated financial position or results of operations[101](index=101&type=chunk) - The Company recognized **$5.7 million** in cash proceeds from a legal settlement against Wright Printing Company, fully resolving the matter[102](index=102&type=chunk) - A liability reserve of approximately **$0.4 million** has been accrued related to a lawsuit concerning the lease of the former B&D Litho facility, with the case scheduled for trial in Q1 2026[103](index=103&type=chunk) [20. Segment Reporting](index=27&type=section&id=20.%20Segment%20Reporting) This note details the company's operating segments and how performance is evaluated - The Company operates as a single reportable segment called 'Print,' manufacturing custom or semi-custom printed products primarily for independent distributors in the U.S[105](index=105&type=chunk) - The Chief Operating Decision Maker (CODM) evaluates performance and allocates resources on a consolidated basis using consolidated net income and total assets[104](index=104&type=chunk)[107](index=107&type=chunk) | Metric (in thousands) | 3 Months Ended Aug 31, 2025 | 3 Months Ended Aug 31, 2024 | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :-------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Segment operating net sales | $98,676 | $99,038 | $195,872 | $202,146 |\n| Segment cost of goods sold | $68,574 | $69,259 | $135,541 | $141,463 |\n| Segment SG&A expenses | $17,719 | $16,557 | $34,665 | $33,727 |\n| Consolidated net earnings | $13,155 | $10,308 | $22,953 | $20,995 | [21. Subsequent Events](index=28&type=section&id=21.%20Subsequent%20Events) This note discloses significant events that occurred after the balance sheet date - On September 22, 2025, the Board declared a quarterly cash dividend of **$0.25 per share**, payable November 7, 2025, with an expected payout of approximately **$6.5 million**[110](index=110&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and operational results, highlighting key performance drivers, business challenges, and liquidity. It includes a cautionary statement regarding forward-looking information and detailed analysis of net sales, cost of goods sold, SG&A expenses, and other income for the three and six months ended August 31, 2025, compared to the prior year, along with a discussion of capital resources and future outlook [Cautionary Statement Regarding Forward-Looking Statements](index=29&type=section&id=Cautionary%20Statement%20Regarding%20Forward-Looking%20Statements) This section outlines the inherent risks and uncertainties associated with forward-looking statements in the report - All statements in the report, other than historical facts, are forward-looking and subject to known and unknown risks, uncertainties, and other factors[113](index=113&type=chunk)[114](index=114&type=chunk) - The Company disclaims any duty to update these statements, which are based on current views and assumptions[115](index=115&type=chunk) - Key risks include general economic conditions, inflation, supply chain disruptions, ability to control operational costs, dependence on key suppliers, rising raw material costs, cybersecurity, and ability to integrate acquisitions[116](index=116&type=chunk) [Overview](index=29&type=section&id=Overview) This section provides a brief introduction to Ennis, Inc.'s business and product distribution - Ennis, Inc. (organized in 1909) prints and manufactures a broad line of business forms and other business products[117](index=117&type=chunk) - Products are distributed throughout the United States primarily through independent distributors, including commercial printers, direct mail, and software companies[117](index=117&type=chunk) [Business Overview](index=30&type=section&id=Business%20Overview) This section details Ennis, Inc.'s market position, operational footprint, and raw material sourcing - Ennis is believed to be the largest provider of business forms, pressure-seal forms, labels, tags, envelopes, and presentation folders to independent distributors in the United States[119](index=119&type=chunk)[122](index=122&type=chunk) - The Company operates **55 manufacturing plants** across **20 states**, with approximately **96%** of products being custom or semi-custom[120](index=120&type=chunk) - Raw materials, primarily paper, are purchased from a limited number of major suppliers at favorable prices due to high volume[124](index=124&type=chunk) [Recent Acquisitions](index=30&type=section&id=Recent%20Acquisitions) This section describes the company's recent strategic acquisitions and their impact - On April 11, 2025, the Company acquired Northeastern Envelope Company (NEC) and Envelope Superstore (ESS) for approximately **$34.9 million** in cash[48](index=48&type=chunk)[126](index=126&type=chunk) - NEC and ESS generated approximately **$26.0 million** in sales for their fiscal year ended December 31, 2024, and the acquisition strengthens production capabilities in the Northeast U.S[126](index=126&type=chunk) [Our Business Challenges](index=32&type=section&id=Our%20Business%20Challenges) This section discusses the industry trends and operational challenges facing the company - The industry faces consolidation of traditional supply channels, product obsolescence, paper supplier capacity adjustments, and increased pricing due to demand/supply imbalance[128](index=128&type=chunk) - The Company is transforming its product portfolio to address declining demand for traditional documents by investing in new technology, developing strategic relationships, and pursuing acquisitions in niche markets[128](index=128&type=chunk) - Recent mill closures and consolidations could lead to paper price fluctuations; the Company invested in buffer stock for carbonless paper due to the closure of the sole U.S. producer[129](index=129&type=chunk) [Critical Accounting Estimates](index=32&type=section&id=Critical%20Accounting%20Estimates) This section addresses the key accounting estimates that require significant management judgment - No material changes to critical accounting estimates (pension plan, goodwill/intangible impairment, credit losses, inventory allowances) occurred during the quarter ended August 31, 2025, as described in the Annual Report on Form 10-K[132](index=132&type=chunk) [Recent Accounting Pronouncements](index=32&type=section&id=Recent%20Accounting%20Pronouncements) This section refers to new accounting standards and their potential impact on the financial statements - Refer to Note 1 of the accompanying unaudited condensed consolidated financial statements for a discussion of recent accounting pronouncements[133](index=133&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance over specific periods [Consolidated Summary](index=34&type=section&id=Consolidated%20Summary) This section provides a high-level overview of key financial metrics for the periods presented | Metric | 3 Months Ended Aug 31, 2025 | 3 Months Ended Aug 31, 2024 | 6 Months Ended Aug 31, 2025 | 6 Months Ended Aug 31, 2024 | | :----- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net sales | $98,676 | $99,038 | $195,872 | $202,146 |\n| Cost of goods sold | $68,574 | $69,259 | $135,541 | $141,463 |\n| Gross profit margin | 30.5% | 30.1% | 30.8% | 30.0% |\n| Selling, general and administrative | $17,719 | $16,557 | $34,665 | $33,727 |\n| Income from operations | $12,383 | $13,183 | $25,666 | $26,913 |\n| Other income | $5,761 | $1,034 | $5,993 | $2,045 |\n| Net earnings | $13,155 | $10,308 | $22,953 | $20,995 | [Three months ended August 31, 2025 vs. 2024](index=34&type=section&id=Three%20months%20ended%20August%2031%2C%202025%20compared%20to%20three%20months%20ended%20August%2031%2C%202024) This section compares the company's financial performance for the three-month periods - Net Sales decreased by **$0.3 million** (**-0.3%**) to **$98.7 million**, with weaker volume demand (**$5.9 million** decrease) partially offset by recent acquisitions (**$5.5 million** increase)[138](index=138&type=chunk) - Gross Profit increased to **$30.1 million** (**30.5%** of revenue) from **$29.8 million** (**30.1%** of revenue), reflecting cost management and pricing actions[139](index=139&type=chunk) - Other Income significantly increased to **$5.8 million** from **$1.0 million**, primarily due to **$5.7 million** in legal settlement proceeds[143](index=143&type=chunk) - Net Earnings increased to **$13.2 million** from **$10.3 million**, with diluted EPS of **$0.51**, positively impacted by **$0.03** from acquisitions and **$0.14** from the lawsuit settlement[145](index=145&type=chunk) [Six months ended August 31, 2025 vs. 2024](index=36&type=section&id=Six%20months%20ended%20August%2031%2C%202025%20compared%20to%20six%20months%20ended%20August%2031%2C%202024) This section compares the company's financial performance for the six-month periods - Net Sales decreased by **$6.2 million** (**-3.1%**) to **$195.9 million**, with weaker volume demand (**$17.3 million** decrease) partially offset by recent acquisitions (**$11.0 million** increase)[147](index=147&type=chunk) - Gross Profit decreased slightly to **$60.3 million** from **$60.7 million**, but gross profit margin increased to **30.8%** from **30.0%**[148](index=148&type=chunk) - Other Income significantly increased to **$6.0 million** from **$2.0 million**, primarily due to **$5.7 million** in legal settlement proceeds[152](index=152&type=chunk) - Net Earnings increased by **$2.0 million** to **$23.0 million**, with diluted EPS of **$0.89**, positively impacted by **$0.03** from acquisitions and **$0.14** from the lawsuit settlement[154](index=154&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's ability to generate and manage cash, including working capital and cash flows [Working Capital](index=37&type=section&id=Working%20Capital) This section analyzes the company's short-term assets and liabilities, indicating its operational liquidity | Metric (in thousands) | August 31, 2025 | February 28, 2025 | | :-------------------- | :-------------- | :---------------- | | Working capital | $97,760 | $119,436 |\n| Cash | $31,886 | $67,000 |\n| Short-term investments | $— | $5,475 | - Working capital decreased by **$21.6 million** (**-18.1%**) to **$97.8 million** at August 31, 2025, primarily due to the **$34.9 million** acquisition of NEC and ESS and a strategic increase in inventory levels[156](index=156&type=chunk) - The current ratio decreased from **4.6:1.0** at February 28, 2025, to **3.4:1.0** at August 31, 2025[156](index=156&type=chunk) [Cash flows from operating activities](index=37&type=section&id=Cash%20flows%20from%20operating%20activities) This section details the cash generated or used by the company's primary business operations - Net cash provided by operating activities decreased to **$18.4 million** for the six months ended August 31, 2025, from **$34.9 million** in the prior year, primarily due to increased inventories and changes in receivables[157](index=157&type=chunk) - This decrease was mainly due to an increase in inventories (**$20.8 million** cash used) and an increase in accounts receivable (**$2.0 million** cash used), partially offset by an increase in accounts payable and accrued expenses (**$7.3 million** cash provided)[157](index=157&type=chunk) [Cash flows from investing activities](index=37&type=section&id=Cash%20flows%20from%20investing%20activities) This section outlines the cash used for or generated from investment-related activities, such as acquisitions and capital expenditures - Net cash used in investing activities significantly increased to **$32.0 million** for the six months ended August 31, 2025, from **$1.8 million** in the prior year, primarily driven by **$34.9 million** used for business acquisitions[158](index=158&type=chunk) - Capital expenditures were **$2.8 million** in 2025, down from **$3.6 million** in 2024[158](index=158&type=chunk) [Cash flows from financing activities](index=37&type=section&id=Cash%20flows%20from%20financing%20activities) This section describes the cash flows related to debt, equity, and dividend payments - Net cash used in financing activities increased by **$6.8 million** to **$21.6 million** for the six months ended August 31, 2025, compared to **$14.8 million** in the prior year[159](index=159&type=chunk) - This increase was mainly due to higher common stock repurchases (**$8.6 million** in 2025 vs. **$1.8 million** in 2024), while dividend payments remained consistent at approximately **$13.1 million**[159](index=159&type=chunk) [Credit Facility](index=37&type=section&id=Credit%20Facility) This section provides information on the company's available credit lines and their utilization - As of August 31, 2025, **$0.2 million** was outstanding under a standby letter of credit arrangement[160](index=160&type=chunk) - The Company anticipates sufficient cash, short-term investments, and operating cash flows to fund future expenditures, including acquisitions[160](index=160&type=chunk) [Pension Plan](index=37&type=section&id=Pension%20Plan) This section discusses the funding and obligations related to the company's defined benefit pension plan - The Company is not required to make a contribution to the pension plan for fiscal year 2026, but made a **$1.2 million** contribution in fiscal year 2025[161](index=161&type=chunk) - At August 31, 2025, the Company had a funded pension asset of **$1.4 million**[161](index=161&type=chunk) [Inventories](index=37&type=section&id=Inventories) This section explains the company's inventory management strategy and its impact on liquidity - The Company strategically increased inventory levels to mitigate risks from paper industry consolidation and the closure of the sole U.S. carbonless paper mill[165](index=165&type=chunk) - Long-term supply agreements with key paper vendors establish pricing but do not impose minimum purchase obligations, though rebate programs are contingent on minimum purchase volumes[165](index=165&type=chunk) [Capital Expenditures](index=39&type=section&id=Capital%20Expenditures) This section details the company's spending on property, plant, and equipment - Capital expenditures for operational maintenance are expected to range between **$4.0 million** and **$7.0 million** over the next twelve months, consistent with historical levels[155](index=155&type=chunk)[166](index=166&type=chunk) - For the six months ended August 31, 2025, **$2.8 million** was spent on capital expenditures, funded from the cash balance[166](index=166&type=chunk) [Contractual Obligations](index=39&type=section&id=Contractual%20Obligations) This section outlines the company's long-term commitments and liabilities - No significant changes in contractual obligations since February 28, 2025, that would materially impact results or financial condition[167](index=167&type=chunk) - The Company does not have off-balance sheet arrangements or special-purpose entities[167](index=167&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section discusses the Company's exposure to market risks, primarily focusing on interest rate risk. It notes that while there was no outstanding debt as of August 31, 2025, future borrowings would expose the Company to interest rate fluctuations, which may be managed through interest rate swaps [Market Risk](index=40&type=section&id=Market%20Risk) This section details the company's exposure to financial market fluctuations, particularly interest rate changes - The Company is exposed to interest rate risk on short-term and long-term financial instruments with variable interest rates[170](index=170&type=chunk) - Interest rate swaps may be utilized to manage overall borrowing costs and reduce exposure to adverse fluctuations in interest rates, but derivative instruments are not used for trading purposes[170](index=170&type=chunk) - As of August 31, 2025, the Company had no outstanding debt, but would be exposed to interest rate risk if it borrows in the future[170](index=170&type=chunk) [Item 4. Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the Company's disclosure controls and procedures, affirming their effectiveness as of August 31, 2025, based on evaluation by the CEO and CFO. It also states that there have been no material changes in internal control over financial reporting during the period [Evaluation of Disclosure Controls and Procedures](index=40&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section describes the assessment of the effectiveness of the company's disclosure controls - Management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures as of August 31, 2025[172](index=172&type=chunk) - Based on this evaluation, disclosure controls and procedures are concluded to be effective in providing reasonable assurance that required information is recorded, processed, summarized, and reported timely[172](index=172&type=chunk) [Changes in Internal Control Over Financial Reporting](index=40&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) This section reports any material changes in the company's internal control over financial reporting - No changes in internal control over financial reporting occurred during the three and six months ended August 31, 2025, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[173](index=173&type=chunk) PART II: OTHER INFORMATION This section includes legal proceedings, risk factors, equity sales, and exhibits [Item 1. Legal Proceedings](index=40&type=section&id=Item%201.%20Legal%20Proceedings) This section addresses the Company's involvement in legal matters, stating that ongoing litigation is not expected to have a material adverse effect on its financial position or operations. It specifically mentions a lawsuit regarding the former B&D Litho facility, for which a liability reserve of $0.4 million has been accrued - The Company is involved in various litigation matters in the ordinary course of business, but does not believe any current matter will have a material adverse effect on its consolidated financial position or results of operations[175](index=175&type=chunk) - A lawsuit in Arizona concerning the lease of the former B&D Litho facility has resulted in a preliminary ruling against the Company for failure to maintain certain equipment and surfaces[176](index=176&type=chunk) - A liability reserve of approximately **$0.4 million** has been accrued for this claim, with the case scheduled for trial in Q1 2026[176](index=176&type=chunk) [Item 1A. Risk Factors](index=40&type=section&id=Item%201A.%20Risk%20Factors) This section states that there have been no material changes to the Company's risk factors since those discussed in its Annual Report on Form 10-K for the fiscal year ended February 28, 2025 - No material changes in Risk Factors have occurred since those previously discussed in the Annual Report on Form 10-K for the fiscal year ended February 28, 2025[177](index=177&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=42&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the Company's stock repurchase program, including the latest funding authorization and the number of shares repurchased during the period, as well as the remaining authorized amount - The Board authorized an additional **$20.0 million** for the share repurchase program in July 2022, bringing the cumulative authorized funds to **$60.0 million**[179](index=179&type=chunk) - During the six months ended August 31, 2025, the Company repurchased **456,671 shares** of common stock at an average price of **$18.54**, with **$13.1 million** remaining available under the program[180](index=180&type=chunk) - As of August 31, 2025, **$13.1 million** remained available for repurchases under the program[180](index=180&type=chunk) [Item 6. Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the 10-Q report, including corporate organizational documents, certifications from the CEO and CFO, and XBRL-formatted financial data - Exhibits include Restated Articles of Incorporation, Amendment to Articles of Incorporation, and Fourth Amended and Restated Bylaws[182](index=182&type=chunk) - Certifications pursuant to Rule 13a-14(a) from the Chief Executive Officer and Chief Financial Officer are filed herewith[182](index=182&type=chunk)[183](index=183&type=chunk) - The report includes Inline XBRL formatted financial information for the quarter ended August 31, 2025[182](index=182&type=chunk) [SIGNATURES](index=43&type=section&id=SIGNATURES) This section contains the official signatures of the company's principal executive and financial officers - The report is signed by Keith S. Walters, Chairman, Chief Executive Officer and President, and Vera Burnett, Chief Financial Officer, Treasurer and Principal Financial and Accounting Officer, on October 3, 2025[187](index=187&type=chunk)