Financial Performance - Total revenue for Q3 2025 was $366.9 million, a 12% increase compared to Q3 2024[4] - Subscription business revenue reached $252.7 million, reflecting a 15% growth year-over-year[4] - Net income for Q3 2025 was $5.9 million, or $0.14 per basic share, compared to $1.4 million, or $0.03 per basic share, in Q3 2024[4] - For the first nine months of 2025, total revenue was $1,062.5 million, a 12% increase compared to the same period in 2024[10] - Net income for the first nine months of 2025 was $13.8 million, compared to a net loss of $(11.3) million in the same period of 2024[10] - Total revenue for Q3 2025 reached $366.9 million, a 12% increase from $327.5 million in Q3 2024[18] - Subscription business revenue was $252.7 million, up 15% from $219.0 million year-over-year[18] - Net income for Q3 2025 was $5.9 million, compared to a net income of $1.4 million in Q3 2024[18] - Operating income for the nine months ended September 30, 2025, was $6.7 million, a significant improvement from a loss of $9.9 million in the same period of 2024[18] - Total operating expenses increased to $54.2 million in Q3 2025, up from $47.6 million in Q3 2024, reflecting a 14% rise[18] Cash Flow and Assets - Operating cash flow was $29.2 million in Q3 2025, compared to $15.3 million in Q3 2024[4] - Cash and cash equivalents at the end of Q3 2025 were $154.8 million, slightly down from $160.3 million at the end of 2024[20] - Total assets increased to $880.2 million as of September 30, 2025, compared to $806.9 million at the end of 2024[20] - The company reported a net cash provided by operating activities of $29.2 million for Q3 2025, compared to $15.3 million in Q3 2024[21] - Net cash provided by operating activities for the three months ended September 30, 2025, was $29,238,000, compared to $15,296,000 in 2024[26] - Free cash flow for the nine months ended September 30, 2025, was $50,020,000, significantly higher than $16,727,000 in 2024[26] Customer Metrics - Total enrolled pets decreased by 2% to 1,654,414 as of September 30, 2025, compared to the previous year[4] - Subscription enrolled pets increased by 5% to 1,082,412 as of September 30, 2025[4] - Total pets enrolled at the end of September 30, 2025, was 1,654,414, a decrease of 2.0% from 1,688,903 in 2024[24] - Total subscription pets enrolled at the end of September 30, 2025, increased to 1,082,412, up 4.9% from 1,032,042 in 2024[24] - Monthly average revenue per pet increased to $79.84, a rise of 10.5% compared to $71.94 in 2024[24] - Average pet acquisition cost (PAC) rose to $278, an increase of 22.5% from $227 in 2024[24] - Average monthly retention rate improved slightly to 98.33%, compared to 98.29% in 2024[24] Adjusted Metrics - Adjusted EBITDA for Q3 2025 was $19.6 million, up from $14.5 million in Q3 2024[4] - Adjusted operating income for Q3 2025 was $39.1 million, representing a 27.3% increase compared to $30.8 million in Q3 2024[28] - Adjusted EBITDA for the nine months ended September 30, 2025, was $48.4 million, compared to $26.7 million in the same period of 2024[32] - Subscription adjusted operating income (non-GAAP) for the three months ended September 30, 2025, was $39,090,000, compared to $30,751,000 in 2024[27] - Subscription adjusted operating income margin improved to 15.5% in Q3 2025 from 14.0% in Q3 2024[28] Other Business Metrics - Other business revenue for Q3 2025 was $114.2 million, an increase from $108.5 million in Q3 2024[28] - Stock-based compensation expense for Q3 2025 was $9.5 million, an increase from $8.3 million in Q3 2024[21] - Deferred revenue as of September 30, 2025, was $279.7 million, up from $251.6 million at the end of 2024, indicating growth in customer commitments[20] - The cost of paying veterinary invoices as a percentage of subscription revenue decreased to 70.1% in Q3 2025 from 71.0% in Q3 2024[28] - Subscription cost of paying veterinary invoices (non-GAAP) was $177,067,000, representing 70.1% of subscription revenue, compared to 71.0% in 2024[26] Strategic Outlook - The company secured a new three-year $120 million credit facility with PNC Bank, which has a lower interest rate[6] - The company plans to continue investing in new product development and market expansion strategies to drive future growth[31] - Management emphasizes the importance of adjusted operating income as a key metric for assessing operational performance excluding acquisition costs[30]

Table of Contents 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 September 30, 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: 001-39778 ______________ Airbnb, Inc. (Exact Name of Registrant as Specified in Its Charter) _____ ...

Financial Performance - Net investment income for the three months ended September 30, 2025 was $431,000, an increase of 7% from $403,000 in the same period of 2024[93]. - For the three months ended September 30, 2025, service fee and commission revenue was $37.173 million, a 37.1% increase from $27.136 million in the same period of 2024[165]. - For the nine months ended September 30, 2025, service fee and commission revenue reached $96.441 million, up 20.9% from $79.742 million in 2024[165]. - The company reported a loss from continuing operations of $2.411 million for the three months ended September 30, 2025, compared to a loss of $2.176 million for the same period in 2024, representing an increase of 10.8%[189]. - Loss from continuing operations before income tax expense was $11,113,000 for the nine months ended September 30, 2025, compared to a loss of $6,435,000 in 2024, representing an increase in loss of 72.5%[236]. Assets and Investments - As of September 30, 2025, the carrying value of limited liability investments totaled $0.6 million, with no impairments recorded during the three and nine months ended September 30, 2025 and 2024[90]. - The carrying value of the company's investments in private companies was $0.6 million as of September 30, 2025, with no adjustments recorded for observable price changes[92]. - Total intangible assets increased to $54.918 million as of September 30, 2025, up from $40.049 million at December 31, 2024[99]. - The fair value of limited liability investments increased from $2,859,000 at December 31, 2024, to $3,148,000 at September 30, 2025[253]. - The company recorded no impairments related to investments in private companies for the three and nine months ended September 30, 2025[255]. Goodwill and Intangible Assets - The company recorded goodwill of $10.6 million related to acquisitions during the nine months ended September 30, 2025, with total goodwill increasing to $69.544 million[95]. - Amortization of intangible assets for the nine months ended September 30, 2025 was $5.8 million, compared to $4.3 million for the same period in 2024[101]. - No goodwill impairment charges were recorded during the three and nine months ended September 30, 2025 and 2024[98]. Debt and Financing - Total debt as of September 30, 2025 was $72.671 million, with bank loans comprising $56.483 million of this total[108]. - The 2021 Ravix Loan had a principal amount of $6.0 million and was due to mature on October 1, 2027[109]. - The 2022 Ravix Loan, part of the acquisition of CSuite, included an additional principal amount of $6.0 million and was due to mature on November 16, 2028[111]. - The Company recorded a principal prepayment of $1.5 million on the 2021 Ravix term loan on July 23, 2024[114]. - The 2025 Ravix Loan was established with a principal amount of $9.1 million, maturing on February 7, 2031, and the 2022 Ravix Revolver was extended to February 7, 2027[116]. Revenue and Service Fees - Revenue from contracts with customers includes various service fees and commissions, with total revenue recognized from sales-type leases of $0.4 million for the three months ended September 30, 2025[164]. - Vehicle service agreement fees for the three months ended September 30, 2025, were $15.504 million, compared to $15.215 million in 2024, reflecting a 1.9% increase[165]. - Maintenance support service fees decreased to $1.203 million in Q3 2025 from $1.300 million in Q3 2024, a decline of 7.5%[165]. - Business services consulting fees increased significantly to $5.474 million in Q3 2025 from $4.026 million in Q3 2024, representing a 36.1% growth[165]. Tax and Valuation - The company maintained a valuation allowance for its gross deferred tax assets, reflecting uncertainty about generating taxable income necessary to utilize prior operating losses[186]. - As of September 30, 2025, the company carried net deferred income tax liabilities of $4.6 million, up from $4.4 million at December 31, 2024[187]. - The company recorded an income tax benefit of $(2.050) million for the three months ended September 30, 2025, compared to a tax expense of $21,000 for the same period in 2024[13]. Stock and Dividends - The Company declared cash dividends for Preferred Stock totaling $327,000 for the three months ended September 30, 2025, compared to $13,000 for the same period in 2024, representing a significant increase[211]. - The total accrued dividends for Preferred Stock as of September 30, 2025, amounted to $327,000, up from $166,000 as of December 31, 2024[205]. - The Company has three series of redeemable preferred stock outstanding, with a total redemption value of $16.25 million as of September 30, 2025[200]. Acquisitions and Noncontrolling Interests - The Company acquired a 20% noncontrolling interest in Southside Plumbing for $925,000 on August 14, 2025, with a net loss attributable to this interest of $34,000 for the nine months ended September 30, 2025[206][207]. - The redeemable noncontrolling interest balance as of September 30, 2025, was $925,000, reflecting the acquisition of Southside Plumbing[207]. Segment Performance - The Company operates through two reportable segments: Kingsway Search Xcelerator and Extended Warranty[219]. - Service fee and commission revenue from the KSX segment reached $18,975,000 for the three months ended September 30, 2025, compared to $9,293,000 in 2024, reflecting a 104% growth[231]. - Total segment operating income for the Extended Warranty segment was $401,000 for the three months ended September 30, 2025, down from $1,704,000 in 2024[235]. Fair Value Measurements - The fair value of limited liability investments is categorized in Level 3 of the fair value hierarchy, reflecting the use of valuation multiples based on performance metrics[243]. - The company employs a fair value hierarchy to categorize inputs for valuation techniques, with Level 1 being the highest priority[244]. - The estimated fair value of the seller phantom equity awards is $3,328,000 as of September 30, 2025[253].

Expedia Group Reports Third Quarter 2025 Results Exceeded guidance with 12% bookings and 9% revenue growth y/y; expanded Adj. EBITDA margins Room nights up 11% y/y, driven by B2B and B2C strength in the U.S. Repurchased $451 million of shares in the quarter; declares dividend of $0.40 per share Increases full year guidance SEATTLE, WA – November 6, 2025 – Expedia Group, Inc. (NASDAQ: EXPE) announced financial results today for the third quarter ended September 30, 2025. Third Quarter Highlights (All compari ...

Fundraising Activities - The company raised $2,447,760 from the issuance of 244,776 DeltaCat Re Tokens, with approximately $1,280,000 from third-party investors and $1,167,000 from Oxbridge Re Holdings Limited[154]. - The company completed a private placement on July 31, 2025, raising $3,611,910 from the issuance of 361,191 Participation Shares represented by digital tokens[159]. - The company has sold 287,915 ordinary shares under the ATM program for gross proceeds of $900,531 at an average price of $3.13 per share[165]. - The company entered into a new offering agreement on July 9, 2025, allowing for the sale of up to $5 million of ordinary shares[162]. Financial Performance - Net premiums earned for the quarter ended September 30, 2025 decreased to $555,000 from $595,000 for the same period in 2024, attributed to lower average rates on reinsurance contracts[186]. - Net premiums earned for the nine-month period ended September 30, 2025 increased to $1.73 million from $1.71 million for the same period in 2024, due to higher average rates on reinsurance contracts[187]. - Total revenue for the quarter ended September 30, 2025 was $645,000, compared to $205,000 for the same period in 2024[184]. - Total expenses for the nine-month period ended September 30, 2025 were $4.99 million, compared to $1.67 million for the same period in 2024[184]. - The net loss for the nine-month period ended September 30, 2025 was $2.19 million, or ($0.30) per share, compared to a net loss of $2.27 million, or ($0.37) per share, for the same period in 2024[185]. Losses and Expenses - The company recognized a full limit loss of $2.3 million from Hurricane Milton during the nine-month period ended September 30, 2025, impacting equity by $1.18 million after accounting for external tokenholders[188]. - General and administrative expenses for the quarter ended September 30, 2025 increased to $754,000 from $432,000 for the same period in 2024, primarily due to increased professional costs[192]. - General and administrative expenses for the nine-month period ended September 30, 2025 rose to $2.52 million from $1.49 million for the same period in 2024, driven by higher professional costs[193]. - The loss ratio for the nine-month period ended September 30, 2025 increased to 132.4%, compared to 0% in the prior period, due to losses from Hurricane Milton[196]. - The combined ratio for the nine-month period ended September 30, 2025 increased to 288.6% from 98% in the prior period, reflecting higher expenses and losses incurred[199]. Assets and Cash Flow - As of September 30, 2025, restricted cash and cash equivalents increased by $1.28 million or 21.7%, totaling $7.18 million compared to $5.9 million as of December 31, 2024[200]. - Total investments rose by $2,000 or 1.77%, reaching $115,000 from $113,000 as of December 31, 2024, primarily due to an increase in the value of equity securities[201]. - Unearned premiums reserve increased by $490,000 to $1.48 million from $991,000 at December 31, 2024, attributed to new reinsurance contracts for the 2025-2026 treaty year[203]. - Net cash used in operating activities for the nine months ended September 30, 2025, totaled $1,781,000, while net cash provided by financing activities was $3,001,000 from share issuance[210]. - The net impact of Hurricane Milton's loss on the company's equity was $1.18 million after accounting for losses borne by external tokenholders[223]. Operational Strategy - The company focuses on fully collateralized reinsurance contracts primarily for property catastrophes in the Gulf Coast region of the United States[146]. - The company aims to achieve long-term growth in book value per share by writing business that generates attractive underwriting profits relative to the risk[148]. - The company has initiated the development of tokenized reinsurance securities, with plans to issue additional series following the DeltaCat Re Token[147]. - Cash flows from operations are expected to meet liquidity requirements in the short term, with no plans to issue debt for the foreseeable future[207]. - The company has no off-balance sheet arrangements as of September 30, 2025[212]. - Each subsidiary exceeded the minimum net worth requirement of $500 as of September 30, 2025, allowing for potential dividend payments[208]. - The company’s investment portfolio is primarily comprised of cash and highly liquid securities, ensuring sufficient liquidity to meet current liabilities[206]. Seasonal Influences - The company’s operational results may be seasonal, influenced by the timing of hurricanes and tropical storms from June 1 to November 30[149]. - Amounts due to CatRe tokenholders decreased to $1.2 million from $1.73 million at December 31, 2024, due to shared losses from a reinsurance contract affected by Hurricane Milton[202]. - The company maintains a competitive position due to its low overhead expenses and expense efficiency compared to larger competitors[151].

Product Development and Clinical Trials - Sarepta Therapeutics has commercialized four FDA-approved products for Duchenne, including EXONDYS 51, VYONDYS 53, AMONDYS 45, and ELEVIDYS[134] - The ESSENCE trial for AMONDYS and VYONDYS did not show statistical significance on the primary endpoint, prompting discussions with the FDA regarding the next steps[136] - The SRP-9003 gene therapy program for LGMD has completed enrollment in a Phase 3 clinical trial, with safety and expression results announced in October 2025[138] - The FDA placed a clinical hold on investigational gene therapy trials for LGMD following a patient death, impacting multiple product candidates[138] - The company expects to share initial data for SRP-1003 (DM1) and SRP-1001 (FSHD) in the first quarter of 2026[139] Financial Performance - For the three months ended September 30, 2025, total revenues decreased by 15% to $399.4 million compared to $467.2 million in the same period of 2024[152] - The company reported a net loss of $179.9 million for the three months ended September 30, 2025, compared to a net income of $33.6 million in the same period of 2024[152] - For the nine months ended September 30, 2025, total revenues increased by 41% to $1.76 billion, driven by a 30% increase in net product revenues to $1.49 billion[153] - The net product revenue for ELEVIDYS increased by 81% to $788.3 million for the nine months ended September 30, 2025, due to expanded label approval[156] Expenses and Costs - The cost of sales for the three months ended September 30, 2025, increased by 64% to $150.8 million compared to $91.7 million in the same period of 2024[152] - Research and development expenses for the nine months ended September 30, 2025, were $1.20 billion, a 98% increase from $604.6 million in the same period of 2024[153] - The company incurred a restructuring charge of $40.5 million for the three and nine months ended September 30, 2025[152] - Total cost of sales (excluding amortization of in-licensed rights) for the nine months ended September 30, 2025, was $440.9 million, a 136% increase from $186.8 million in 2024[166] Cash and Investments - As of September 30, 2025, the company had $865.2 million in cash, cash equivalents, restricted cash, and investments, including $613.1 million in cash and cash equivalents[149] - Cash used in operating activities for the nine months ended September 30, 2025, was $(336.7) million, a 13% increase in cash outflow compared to $(297.8) million in 2024[200] - The company maintains a full valuation allowance against deferred tax assets, which could materially impact the effective tax rate if removed[188] - The company holds $450.0 million in 2027 Notes with a fixed interest rate of 1.25% and $602.0 million in 2030 Notes with a fixed interest rate of 4.875%[212] Strategic Plans and Partnerships - A strategic restructuring plan announced in July 2025 aims to reduce operating expenses and align costs with strategic priorities to enhance financial flexibility[138] - The company has established partnerships with Aldevron and Catalent to enhance gene therapy manufacturing capabilities[142] - The company plans to continue expanding its pipeline through internal research and development and strategic transactions[132] - The company plans to continue expanding its commercial distribution network in jurisdictions where its products are approved or seeking approval[144] Revenue Sources - Collaboration revenue for the nine months ended September 30, 2025, increased significantly to $175.5 million, a 266% increase compared to $48.0 million in the same period of 2024[160] - Contract manufacturing revenue for the nine months ended September 30, 2025, rose to $63.1 million, an 87% increase from $33.7 million in 2024[160] - Total collaboration and other revenues for the nine months ended September 30, 2025, reached $260.6 million, up 178% from $93.8 million in 2024[160] Operational Changes - The company suspended shipments of ELEVIDYS to non-ambulatory patients in the U.S. due to safety events, with a temporary hold on all shipments effective July 22, 2025[135] - Total selling, general and administrative expenses for the three months ended September 30, 2025, decreased by $36.3 million to $91.9 million, a 28% reduction compared to $128.2 million in 2024[176] - The restructuring plan announced in July 2025 resulted in a $40.5 million charge, primarily for employee termination benefits, affecting approximately 36% of the workforce[179] Debt and Financing - Loss on debt extinguishment for the three and nine months ended September 30, 2025, amounted to $138.6 million due to the partial refinancing of $700.0 million in convertible senior notes[184] - The company’s $600.0 million senior secured revolving credit facility remains undrawn as of September 30, 2025[191] - The company has a commitment of $250.0 million in guaranteed payments to Arrowhead, to be paid in five equal annual installments of $50.0 million starting February 2026[193] Inventory and Production - The company experienced a $319.6 million increase in inventory due to a build-up of ELEVIDYS inventory following label expansion in June 2024[205] - The company has increased production capacity for its commercial Duchenne PMO program from mid-scale to large-scale through existing CMOs[141] - Sarepta Therapeutics has entered into supply agreements with specialized contract manufacturing organizations to support production of its products and candidates[140]

Financial Performance - Net sales for the three months ended September 30, 2025, were $850,381,000, representing a 8.7% increase from $782,610,000 in the same period of 2024[13] - Gross profit for the six months ended September 30, 2025, was $670,570,000, up from $626,395,000 in 2024, indicating a growth of 7.1%[13] - Net income attributable to ADS for the three months ended September 30, 2025, was $156,017,000, compared to $130,382,000 in 2024, reflecting a 19.6% increase[13] - The company reported a comprehensive income of $155,381,000 for the three months ended September 30, 2025, compared to $131,128,000 in 2024, a rise of 18.4%[15] - Net income for the six months ended September 30, 2025, increased to $300,591 thousand, up from $293,496 thousand in 2024, representing a growth of 2.4%[18] - Net cash provided by operating activities rose to $509,843 thousand, compared to $350,326 thousand in the same period last year, reflecting a significant increase of 45.5%[18] - Net income for the three months ended September 30, 2025, was $156.017 million, compared to $299.939 million for the same period in 2024, reflecting a decrease of approximately 48%[20] Assets and Liabilities - Total assets as of September 30, 2025, were $4,079,289,000, an increase from $3,690,360,000 as of March 31, 2025[11] - Current assets increased to $1,672,912,000 as of September 30, 2025, from $1,324,783,000 as of March 31, 2025, marking a growth of 26.3%[11] - Total liabilities as of September 30, 2025, were $2,150,178,000, compared to $2,054,572,000 as of March 31, 2025, showing an increase of 4.7%[11] - The company’s long-term debt obligations as of September 30, 2025, were $1,248,506,000, slightly down from $1,251,589,000 as of March 31, 2025[11] Stockholder Equity and Dividends - The total stockholders' equity at September 30, 2024, was $1,376,457 thousand, compared to $1,281,047 thousand at the beginning of the period, indicating a growth of 7.4%[19] - Common stock dividends paid were $28,085 thousand, up from $24,917 thousand in 2024, reflecting an increase of 12.0%[18] - The balance of total stockholders' equity as of September 30, 2025, was $1.846 billion, an increase from $1.543 billion as of April 1, 2025[20] - Common stock dividends declared were $0.18 per share, totaling $14.040 million for the three months ended September 30, 2025[20] Capital Expenditures and Cash Flow - Capital expenditures for the period were $111,018 thousand, slightly down from $112,182 thousand in 2024, indicating a decrease of 1.0%[18] - The company reported a net cash used in investing activities of $105,343 thousand, compared to $111,542 thousand in the previous year, showing a decrease of 5.6%[18] - Total capital expenditures for the three months ended September 30, 2025, were $58,420,000, compared to $54,467,000 in 2024, an increase of 7.0%[75] Segment Performance - The company operates in three reportable segments: Pipe, Infiltrator Water Technologies, and International, with additional reporting for Allied Products and Other[26] - The Pipe segment reported net sales of $426,811,000 for the three months ended September 30, 2025, compared to $420,989,000 in 2024, a slight increase of 0.4%[73] - The Infiltrator segment's net sales increased to $196,368,000 for the three months ended September 30, 2025, from $157,521,000 in 2024, marking a significant growth of 24.6%[73] - Segment Adjusted Gross Profit for the three months ended September 30, 2025, was $380,065,000, up from $325,932,000 in 2024, indicating a growth of 16.6%[74] Acquisitions and Investments - The acquisition of Orenco Systems, Inc. was completed on October 1, 2024, for a total consideration of approximately $236.3 million, net of cash acquired[38] - The preliminary fair value of consideration transferred for the acquisition of River Valley Pipe was approximately $18.8 million, funded from cash on hand[40] - The identifiable intangible assets from the acquisition of River Valley Pipe are valued at $2.970 million, including customer relationships and tradename[45] - The company entered into a definitive stock purchase agreement to acquire National Diversified Sales for approximately $1.0 billion, expected to close in Q1 2026[47] - The company incurred $0.5 million in transaction costs related to acquisitions during the six months ended September 30, 2025[43] Debt and Financing - The company issued $350 million in Senior Notes due 2027 with a 5.0% interest rate and $500 million in Senior Notes due 2030 with a 6.375% interest rate[59][60] - The company increased its Revolving Credit Facility from $350 million to $600 million, extending the maturity date to May 26, 2027[57] - The weighted average interest rate for equipment financing was 1.8% as of September 30, 2025, with a current portion of $1.7 million and a long-term portion of $2.4 million[61] Tax and Compensation - The effective tax rate for the three months ended September 30, 2025, was 25.2%, compared to 23.9% for the same period in 2024[65] - Total stock-based compensation expense for the three months ended September 30, 2025, was $8.6 million, an increase from $7.0 million in 2024[66] - The company granted 0.1 million shares of restricted stock with a grant date fair value of $13.8 million during the six months ended September 30, 2025[69] Market Presence and Outlook - The company’s products are utilized across various sectors, including non-residential, residential, infrastructure, and agriculture applications, indicating a broad market presence[25] - The company anticipates that sales will be higher in the first and second quarters of each fiscal year due to favorable weather conditions[27] - The company is currently evaluating the impact of new accounting standards on its financial statements, which may affect future reporting[31] Other Financial Metrics - Total inventories as of September 30, 2025, amounted to $423.778 million, down from $488.269 million as of March 31, 2025[51] - Payments on finance lease obligations increased to $17,171 thousand from $11,756 thousand, representing a rise of 46.2%[18] - A 1.0% increase in interest rates on variable-rate debt would increase annual forecasted interest expense by approximately $4.1 million based on borrowings as of September 30, 2025[133] - If the Revolving Credit Facility is fully drawn, each 1.0% increase or decrease in the applicable interest rate would change interest expense by approximately $10.1 million for the twelve months ended September 30, 2025[133]

Financial Performance - For the nine months ended September 30, 2025, the Company reported revenue of $1,049,125, a decrease of 9.4% compared to $1,157,380 for the same period in 2024[28] - Operating loss for the nine months ended September 30, 2025, was $(1,358,625), compared to $(817,589) for the same period in 2024, indicating a significant increase in losses[28] - Employee compensation expenses rose to $834,855 for the nine months ended September 30, 2025, up 11.8% from $746,582 in 2024[28] - Two significant European licensees filed for bankruptcy, accounting for approximately 44% of the Company's revenue during the nine months ended September 30, 2025[46] - The Company has not recorded income tax expense since inception due to ongoing operating losses[47] Revenue Recognition - The Company recognized revenue based on the satisfaction of performance obligations, with a variable royalty fee structure typically ranging from 10-15% of the selling price[38] - During the first nine months of 2025, five licensees accounted for approximately 23%, 22%, 21%, 18%, and 11% of fee income, compared to four licensees accounting for 32%, 31%, 10%, and 10% in 2024[44] - Fee income from Gauzy and Vision Systems represented 13% of the Company’s total fee income for the nine months ended September 30, 2025[58] - Accounts receivable from Gauzy and Vision Systems represented 17% of the Company’s total royalty receivables as of September 30, 2025[58] Share-Based Compensation - The Company recorded share-based compensation of $175,204 during the nine months ended September 30, 2025, related to stock options granted[52] - The fair value of the stock options granted was $1.265, with an expected volatility of 76% and a risk-free interest rate of 3.97%[53] - As of September 30, 2025, the Company had 1,630,434 warrants and 1,281,489 options outstanding[53] - No options or warrants were exercised during the nine-month period ended September 30, 2025[49] Lease Obligations - The Company’s operating lease has a remaining term of 6.3 years as of September 30, 2025, with total lease payments amounting to $1,497,000[55][57] - The incremental borrowing rate for the operating lease increased from 5.5% in 2024 to 7.0% in 2025[55] - Cash rent paid for the nine months ended September 30, 2025, was $163,000, compared to $174,000 for the same period in 2024[55] - The initial term of the operating lease expires on December 31, 2027, with potential renewal options extending to December 31, 2031[55] Other Financial Information - The Company had $37,736 in unbilled revenue included in royalty receivables as of September 30, 2025[40] - The Company received $47,357 in Employee Retention Credits during the nine months ended September 30, 2025, compared to $35,152 in 2024[59] - There has been no material change in the disclosure regarding market risk since the last annual report[86]

Product Development - The company introduced over 100 new products in the fiscal year ended June 30, 2025, and 16 new products during the three months ended September 30, 2025, expanding its portfolio to approximately 2,800 products[89] - The company has a patent portfolio consisting of 951 patents and 71 patent applications in the United States, along with 1,067 foreign patents as of September 30, 2025[89] - Research and development expenses are critical for long-term success, with ongoing investments in new technologies and products[109] Financial Performance - Total revenue for the three months ended September 30, 2025, was $182.5 million, an increase of $0.6 million, or 0.3%, compared to $181.9 million for the same quarter last year[124] - Gross profit for the three months ended September 30, 2025, was $42.8 million, a decrease of $1.7 million, or 3.8%, compared to $44.5 million for the same quarter last year[125] - Operating loss for the three months ended September 30, 2025, was $(4.6) million, compared to $(0.3) million for the same quarter last year[122] - Net loss for the three months ended September 30, 2025, was $(2.1) million, compared to $(2.5) million for the same quarter last year[122] Market Impact - The company’s revenue is significantly affected by the PC market, which has experienced a modest global decline, impacting revenue and results of operations[96] - The company is diversifying its product portfolio to reduce reliance on the PC market and improve gross margins through cost control measures[97] Expenses and Costs - The company’s gross margin is influenced by manufacturing costs, capacity utilization, and pricing from third-party foundries[98] - Operating expenses are expected to fluctuate as a percentage of revenue due to cost control measures in response to the declining PC market[108] - Research and development expenses were $24.1 million, an increase of $1.7 million, or 7.4%, compared to $22.5 million for the same quarter last year[126] - Selling, general and administrative expenses increased to $23.3 million for the three months ended September 30, 2025, up by $1.0 million or 4.4% from $22.3 million in the same quarter last year[127] Joint Venture and Investments - The company expects to receive $150 million from the sale of approximately 20.3% of its equity interest in a joint venture, with the first installment of RMB 676 million (or $94.5 million) already received[94] - As of June 30, 2025, the company's ownership interest in the joint venture was reduced to 39.2% after several transactions[93] - An impairment loss of $76.8 million was recorded within equity method investment loss in the fourth quarter of fiscal year 2025[120] - Equity method investment income increased to $1.4 million in Q3 2025, compared to a loss of $1.0 million in Q3 2024, reflecting a change of $2.4 million or 237.9%[132] Cash Flow - Cash, cash equivalents, and restricted cash totaled $223.9 million as of September 30, 2025, up from $153.5 million as of June 30, 2025[142] - Net cash provided by operating activities was $10.2 million in Q3 2025, a decrease of $0.8 million from $11.0 million in Q3 2024[143] - Net cash provided by investing activities increased to $81.9 million in Q3 2025, compared to a cash outflow of $6.7 million in Q3 2024, reflecting a change of $88.7 million[145] - Net increase in cash, cash equivalents, and restricted cash was $70.4 million in Q3 2025, compared to an increase of $0.7 million in Q3 2024[143] Taxation - The effective tax rate is highly dependent on the geographic distribution of worldwide profits or losses and changes in tax laws[114] - A potential 15% corporate income tax may apply to Bermuda companies starting from tax years beginning on or after January 1, 2025, affecting the company's financial position[115] Other Income and Expenses - Other income (loss), net improved to $2.5 million in Q3 2025, compared to a loss of $0.7 million in Q3 2024, representing a change of $3.1 million or 479.7%[128] - Interest income decreased to $0.9 million in Q3 2025, down by $0.4 million or 29.5% from $1.3 million in Q3 2024 due to lower interest rates[130] - Interest expenses decreased to $0.4 million in Q3 2025, down by $0.5 million or 55.7% from $0.8 million in Q3 2024, primarily due to a lower outstanding loan balance[131] - Income tax expense rose to approximately $1.9 million in Q3 2025, an increase of $0.9 million or 85.3% from $1.0 million in Q3 2024[133] Market Risks - No material changes in market risks were reported compared to the previous disclosures in the Annual Report for the year ended June 30, 2025[150]

News Release IREN Reports Q1 FY26 Results Secured $9.7bn AI Cloud Contract with Microsoft Targeting $3.4bn AI Cloud ARR by End of 2026, Expansion to 140k GPUs1 NEW YORK, November 6, 2025 (GLOBE NEWSWIRE) - IREN Limited (NASDAQ: IREN) ("IREN" or "the Company") today reported its financial results for the three months ended September 30, 2025. Highlights Q1 FY26 Financial Results * Includes unrealized gains, primarily on prepaid forwards and capped calls in connection with convertible notes Project Update Bri ...