[Filing Overview](index=1&type=section&id=FilingOverview) This section provides an administrative overview of the Form 8-K filing, including registrant details and its emerging growth company status [Registrant and Filing Details](index=1&type=section&id=RegistrantAndFilingDetails) This section provides the administrative details of the Form 8-K filing, identifying ConnectM Technology Solutions, Inc. as the registrant, its incorporation state, and principal executive office contact information - Registrant: **ConnectM Technology Solutions, Inc.**[1](index=1&type=chunk) - State of Incorporation: **Delaware**[1](index=1&type=chunk) - Principal Executive Offices: **2 Mount Royal Avenue, Suite 550, Marlborough, Massachusetts 01752**[2](index=2&type=chunk) [Emerging Growth Company Status](index=1&type=section&id=EmergingGrowthCompanyStatus) ConnectM Technology Solutions, Inc. has indicated its status as an 'emerging growth company' as defined under the Securities Act of 1933 and the Securities Exchange Act of 1934 - ConnectM Technology Solutions, Inc. is an **'emerging growth company'**[3](index=3&type=chunk) [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item2.02) This section details the announcement of Q2 2025 financial results and the legal disclaimers associated with the furnished information [Q2 2025 Financial Disclosure Announcement](index=2&type=section&id=Q22025FinancialDisclosureAnnouncement) The Company announced the filing of its Quarterly Report on Form 10-Q for Q2 2025 and the issuance of a press release on September 23, 2025, which includes selected financial results for the quarter - On **September 23, 2025**, ConnectM Technology Solutions, Inc. issued a press release disclosing the filing of its **Q2 2025 Quarterly Report on Form 10-Q**, which contains selected financial results[4](index=4&type=chunk) - The press release is included as **Exhibit 99.1** to this Form 8-K[4](index=4&type=chunk) [Legal Disclaimers Regarding Information](index=2&type=section&id=LegalDisclaimers) The information provided in Item 2.02, including Exhibit 99.1, is furnished and not deemed 'filed' for purposes of Section 18 of the Exchange Act, thereby limiting its liability and preventing automatic incorporation by reference into other Company filings - Information in Item 2.02, including Exhibit 99.1, is **'furnished' and not 'filed'** for purposes of **Section 18 of the Exchange Act**[5](index=5&type=chunk) - This information is not subject to liabilities under **Section 18** and is not deemed incorporated by reference into other Company filings[5](index=5&type=chunk) [Item 9.01 Exhibits](index=2&type=section&id=Item9.01) This section provides a comprehensive list of all exhibits accompanying the Form 8-K filing [Exhibits List](index=2&type=section&id=ExhibitsList) This section lists the exhibits accompanying the Form 8-K filing, which include the press release detailing Q2 2025 financial results and the interactive data file | Exhibit No. | Description | | --- | --- | | 99.1 | Press release dated September 23, 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 authorization and signing of the Form 8-K report [Report Authorization](index=3&type=section&id=ReportAuthorization) The report is duly signed on behalf of ConnectM Technology Solutions, Inc. by its Chief Executive Officer, Bhaskar Panigrahi, on September 23, 2025, confirming its authorization - The report was signed on **September 23, 2025**[10](index=10&type=chunk) - Signed by **Bhaskar Panigrahi**, **Chief Executive Officer** of ConnectM Technology Solutions, Inc[10](index=10&type=chunk)

[FORM 8-K Filing Details](index=1&type=section&id=FORM%208-K%20Filing%20Details) This section details the administrative and identification information for ConnectM Technology Solutions, Inc.'s Form 8-K filing [Registrant and Filing Information](index=1&type=section&id=Registrant%20and%20Filing%20Information) This section outlines the administrative and identification details for the Form 8-K filing - The report date (date of earliest event reported) is **September 16, 2025**[1](index=1&type=chunk) - The registrant is **ConnectM Technology Solutions, Inc.**, incorporated in Delaware[1](index=1&type=chunk) - The principal executive offices are located at **2 Mount Royal Avenue, Suite 550, Marlborough, Massachusetts 01752**[2](index=2&type=chunk) [Emerging Growth Company Status](index=1&type=section&id=Emerging%20Growth%20Company%20Status) ConnectM Technology Solutions, Inc. has indicated its status as an emerging growth company but has not elected to use the extended transition period for new financial accounting standards - The registrant is an **emerging growth company**[3](index=3&type=chunk) - The registrant has not elected to use the extended transition period for complying with new or revised financial accounting standards[3](index=3&type=chunk) [Current Report Items](index=2&type=section&id=Current%20Report%20Items) This section details the specific items reported in the Form 8-K filing, including financial results and exhibits [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) ConnectM Technology Solutions, Inc. disclosed its Q2 2025 financial results via a press release, noting the furnished nature of this information - On **September 23, 2025**, ConnectM Technology Solutions, Inc. issued a press release disclosing the filing of its Quarterly Report on Form 10-Q for Q2 2025, including selected financial results[4](index=4&type=chunk) - The press release is included as **Exhibit 99.1** to this report[4](index=4&type=chunk) - The information in this Item 2.02 is furnished and not deemed 'filed' for purposes of Section 18 of the Exchange Act, limiting liability and incorporation by reference[5](index=5&type=chunk) [Item 9.01 Exhibits](index=2&type=section&id=Item%209.01%20Exhibits) This section lists the exhibits accompanying the Form 8-K filing, which include a press release detailing Q2 2025 financial results and the interactive data file Exhibits List | Exhibit No. | Description | | :------------ | :------------------------------------------ | | 99.1 | Press release dated September 23, 2025 | | 104 | Cover Page Interactive Data File | [Signatures](index=3&type=section&id=Signatures) This section confirms the official authorization and signing of the Form 8-K report [Report Authorization](index=3&type=section&id=Report%20Authorization) The Form 8-K report was duly signed on behalf of ConnectM Technology Solutions, Inc. by its Chief Executive Officer, Bhaskar Panigrahi, on September 23, 2025 - The report was signed on **September 23, 2025**[10](index=10&type=chunk) - **Bhaskar Panigrahi**, Chief Executive Officer, signed the report on behalf of ConnectM Technology Solutions, Inc.[10](index=10&type=chunk)

Executive Summary & First Quarter Highlights [Recent Developments and First Quarter Highlights](index=1&type=section&id=Recent%20Developments%20and%20First%20Quarter%20Highlights) Worthington Enterprises reported strong Q1 FY26 results, with significant increases in sales, earnings, and EBITDA, driven by Building Products and the Elgen acquisition | Metric | 1Q 2026 | Change YoY | | :-------------------------- | :-------- | :--------- | | Net sales | $303.7 million | +18% | | Net earnings | $34.8 million | +45% | | Adjusted EBITDA | $65.1 million | +34% | | EPS – diluted | $0.70 | from $0.48 | | Adjusted EPS – diluted | $0.74 | from $0.50 | | Operating cash flow | $41.1 million | Flat | | Free cash flow | $27.9 million | -12% | - Repurchased **100,000** common shares for **$6.3 million**[4](index=4&type=chunk) - Declared a quarterly dividend of **$0.19** per common share[4](index=4&type=chunk) - Acquired Elgen Manufacturing, a market-leading designer and manufacturer of HVAC parts and components, for **$91.2 million** on June 18, 2025[4](index=4&type=chunk) Financial Highlights (GAAP & Non-GAAP) [Key Financial Highlights](index=2&type=section&id=Key%20Financial%20Highlights) A comparative overview of Worthington Enterprises' key GAAP and Non-GAAP financial measures for Q1 FY26 versus FY25, showing significant improvements across most profitability metrics | (U.S. dollars in millions, except per share amounts) | 1Q 2026 | 1Q 2025 | | :---------------------------------- | :-------- | :-------- | | **GAAP Financial Measures** | | | | Net sales | $303.7 | $257.3 | | Operating income (loss) | $9.2 | $(4.7) | | Earnings before income taxes | $45.7 | $30.8 | | Net earnings | $34.8 | $24.0 | | EPS – diluted | $0.70 | $0.48 | | Net cash provided by operating activities | $41.1 | $41.1 | | **Non-GAAP Financial Measures** | | | | Adjusted operating income (loss) | $11.7 | $(3.5) | | Adjusted EBITDA | $65.1 | $48.4 | | Adjusted EPS – diluted | $0.74 | $0.50 | | Free cash flow | $27.9 | $31.5 | Consolidated Quarterly Results Analysis [Net Sales](index=2&type=section&id=Net%20sales) Net sales for Q1 FY26 increased significantly, primarily due to higher volumes in Building Products, including contributions from the Elgen acquisition | Metric | 1Q 2026 | 1Q 2025 | Change | % Change | | :-------- | :-------- | :-------- | :------- | :--------- | | Net sales | $303.7M | $257.3M | +$46.4M | +18.0% | - Increase driven by higher volumes in Building Products, including contributions from Elgen[6](index=6&type=chunk) [Operating Income](index=2&type=section&id=Operating%20income%20%28loss%29) Operating income improved from a prior-year loss to a positive figure in Q1 FY26, with adjusted operating income also growing strongly due to increased Building Products volumes | Metric | 1Q 2026 | 1Q 2025 | Change | | :-------------------------- | :-------- | :-------- | :------- | | Operating income (GAAP) | $9.2M | $(4.7)M | +$13.9M | | Adjusted operating income | $11.7M | $(3.5)M | +$15.3M | - Improvement driven by higher volumes within Building Products[7](index=7&type=chunk) [Equity Income](index=2&type=section&id=Equity%20in%20net%20income%20of%20unconsolidated%20affiliates) Equity income saw an increase in Q1, primarily boosted by higher contributions from WAVE, partially offset by a decrease from ClarkDietrich | Metric | 1Q 2026 | 1Q 2025 | Change | | :------------------------------------ | :-------- | :-------- | :------- | | Equity income | $36.7M | $35.5M | +$1.2M | - WAVE contributions up **$4.5 million**[8](index=8&type=chunk) - ClarkDietrich equity earnings decreased by **$2.8 million**[8](index=8&type=chunk) [Income Tax Expense](index=2&type=section&id=Income%20tax%20expense) Income tax expense increased in Q1 FY26, reflecting higher pre-tax earnings, despite a slight decrease in the estimated annual effective tax rate | Metric | 1Q 2026 | 1Q 2025 | Change | | :---------------- | :-------- | :-------- | :------- | | Income tax expense | $10.9M | $6.8M | +$4.1M | - Increase driven by higher pre-tax earnings[9](index=9&type=chunk) - Estimated annual effective tax rate was **23.8%** in 1Q FY26, compared to **24.5%** in 1Q FY25[9](index=9&type=chunk) Balance Sheet and Cash Flow Analysis [Cash and Debt Position](index=2&type=section&id=Cash%20and%20cash%20equivalents) Cash and cash equivalents decreased significantly from the previous quarter-end, mainly due to the Elgen acquisition, while total debt saw a slight increase | Metric | August 31, 2025 | May 31, 2025 | Change | | :------------------------ | :-------------- | :------------- | :------- | | Cash and cash equivalents | $167.1M | $250.1M | $(83.0)M | | Total debt | $306.0M | $302.9M | +$3.1M | - Cash decrease driven by the purchase of Elgen[10](index=10&type=chunk) - Total debt increase due to the remeasurement of the Company's euro denominated notes[11](index=11&type=chunk) - No borrowings under its revolving credit facility, leaving **$500.0 million** available[11](index=11&type=chunk) [Operating and Free Cash Flow](index=2&type=section&id=Operating%20cash%20flow) Operating cash flow remained consistent year-over-year, but free cash flow decreased due to increased capital expenditures, particularly for facility modernization projects | Metric | 1Q 2026 | 1Q 2025 | Change | | :-------------------------- | :-------- | :-------- | :------- | | Operating cash flow | $41.1M | $41.1M | Flat | | Free cash flow | $27.9M | $31.5M | $(3.6)M | | Capital expenditures | $13.2M | $9.6M | +$3.6M | - Free cash flow decreased driven by increased capital expenditures related to ongoing facility modernization projects (**$8.6 million**)[10](index=10&type=chunk) Quarterly Segment Results [Consumer Products Segment](index=3&type=section&id=Consumer%20Products) The Consumer Products segment reported a modest increase in net sales due to a favorable product mix, largely offset by lower volumes, leading to a decline in adjusted EBITDA | Metric | 1Q 2026 | 1Q 2025 | Change | | :---------------- | :-------- | :-------- | :------- | | Net sales | $118.9M | $117.6M | +$1.3M | | Adjusted EBITDA | $16.1M | $17.8M | $(1.7)M | | Adjusted EBITDA margin | 13.6% | 15.1% | -1.5% | - Net sales increase due to favorable product mix, largely offset by lower volumes[12](index=12&type=chunk) - Adjusted EBITDA decrease primarily due to lower volumes and increased SG&A expense[12](index=12&type=chunk) [Building Products Segment](index=3&type=section&id=Building%20Products) The Building Products segment achieved substantial growth in net sales and adjusted EBITDA, driven by higher volumes and the significant contribution from the Elgen acquisition | Metric | 1Q 2026 | 1Q 2025 | Change | % Change | | :---------------- | :-------- | :-------- | :------- | :--------- | | Net sales | $184.8M | $139.7M | +$45.1M | +32.2% | | Adjusted EBITDA | $57.8M | $39.7M | +$18.1M | +45.6% | | Adjusted EBITDA margin | 31.3% | 28.4% | +2.9% | - Net sales increase driven by higher volumes and **$20.9 million** contribution from Elgen[13](index=13&type=chunk) - Adjusted EBITDA increased primarily due to volume growth in wholly owned businesses[13](index=13&type=chunk) - Quarter included **$2.2 million** in incremental expenses related to the Elgen acquisition from purchase accounting step up in inventory to fair value[13](index=13&type=chunk) Outlook [Outlook Statement](index=3&type=section&id=Outlook%20Statement) Worthington Enterprises expresses confidence in its future positioning, emphasizing the strategic benefits of the Elgen acquisition and its commitment to long-term value creation - Strong start to the fiscal year and well positioned for the future[14](index=14&type=chunk) - Elgen acquisition strengthens presence in commercial HVAC and broadens reach within the building envelope[14](index=14&type=chunk) - Backed by a strong balance sheet, consistent free cash flow, and the Worthington Business System of innovation, transformation and acquisitions[14](index=14&type=chunk) - Teams remain focused on executing strategy and delivering long-term value for customers and shareholders[14](index=14&type=chunk) Company Information & Disclosures [About Worthington Enterprises](index=3&type=section&id=About%20Worthington%20Enterprises) Worthington Enterprises is a designer and manufacturer of market-leading brands across two primary business segments, operating with a people-first philosophy and a focus on innovation and growth - Designer and manufacturer of market-leading brands that improve everyday life by elevating spaces and experiences[16](index=16&type=chunk) - Operates with two primary business segments: Building Products (heating and cooling, cooking, construction, water solutions, building systems) and Consumer Products (tools, outdoor living, celebrations)[17](index=17&type=chunk) - Headquartered in Columbus, Ohio, employing approximately **6,000** people throughout North America and Europe[18](index=18&type=chunk) - Follows a people-first Philosophy with earning money for its shareholders as its first corporate goal, achieved by empowering employees to innovate, thrive and grow[18](index=18&type=chunk) [Conference Call Details](index=3&type=section&id=Conference%20Call) Worthington Enterprises will host a conference call on September 24, 2025, to discuss its fiscal 2026 first-quarter results - The Company will review fiscal 2026 first quarter results during its quarterly conference call on September 24, 2025, at **8:30 a.m. Eastern Time**[15](index=15&type=chunk) - Details regarding the conference call can be found on the Company website at www.WorthingtonEnterprises.com[15](index=15&type=chunk) [Safe Harbor Statement](index=3&type=section&id=Safe%20Harbor%20Statement) This statement clarifies that the release contains forward-looking statements, which are subject to inherent risks and uncertainties that could cause actual results to differ materially from projections - Selected statements constitute "forward-looking statements" reflecting current expectations, estimates or projections concerning future results or events[19](index=19&type=chunk) - Often identified by words or phrases such as "believe," "expect," "anticipate," "may," "could," "should," "would," "intend," "plan," "will," "likely," "estimate," "project," "position," "strategy," "target," "aim," "seek," "foresee" and similar words or phrases[20](index=20&type=chunk) - Inherently subject to risks and uncertainties that could cause actual results to differ materially from those projected[21](index=21&type=chunk) - Readers are cautioned not to place undue reliance on any forward-looking statements, and the Company disclaims any obligation to update them, except as required by applicable law[23](index=23&type=chunk) Detailed Financial Statements [Consolidated Statements of Earnings](index=7&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20EARNINGS) The consolidated statements of earnings present the company's revenues, expenses, and net income for the three months ended August 31, 2025, and 2024, showing a significant increase in net earnings year-over-year | (In thousands, except per common share amounts) | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------------------- | :--------------------------------- | :--------------------------------- | | Net sales | $303,707 | $257,308 | | Cost of goods sold | $221,423 | $194,813 | | Gross profit | $82,284 | $62,495 | | Selling, general and administrative expense | $70,565 | $66,036 | | Restructuring and other expense, net | $2,476 | $1,158 | | Operating income (loss) | $9,243 | $(4,699) | | Equity in net income of unconsolidated affiliates | $36,657 | $35,492 | | Earnings before income taxes | $45,681 | $30,790 | | Income tax expense | $10,860 | $6,782 | | Net earnings | $34,821 | $24,008 | | Diluted Earnings per share attributable to controlling interest | $0.70 | $0.48 | | Cash dividends declared per common share | $0.19 | $0.17 | [Consolidated Balance Sheets](index=8&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) The consolidated balance sheets provide a snapshot of the company's assets, liabilities, and equity as of August 31, 2025, compared to May 31, 2025, reflecting changes primarily driven by the Elgen acquisition and capital expenditures | (In thousands) | August 31, 2025 | May 31, 2025 | | :------------------------------------------------ | :-------------- | :------------- | | **Assets** | | | | Cash and cash equivalents | $167,122 | $250,075 | | Total current assets | $626,040 | $685,370 | | Investment in unconsolidated affiliates | $129,678 | $129,262 | | Goodwill | $412,304 | $376,480 | | Total property, plant and equipment, net | $286,743 | $270,226 | | Total assets | $1,738,137 | $1,695,152 | | **Liabilities and equity** | | | | Total current liabilities | $189,788 | $196,842 | | Long-term debt | $306,010 | $302,868 | | Total liabilities | $778,306 | $756,915 | | Total equity | $959,831 | $938,237 | | Total liabilities and equity | $1,738,137 | $1,695,152 | [Consolidated Statements of Cash Flows](index=9&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) The consolidated statements of cash flows detail the cash generated from operating, investing, and financing activities for the three months ended August 31, 2025, and 2024, showing a decrease in overall cash and cash equivalents primarily due to investing activities | (In thousands) | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------------------- | :--------------------------------- | :--------------------------------- | | Net cash provided by operating activities | $41,061 | $41,146 | | Net cash used by investing activities | $(105,430) | $(88,747) | | Net cash used by financing activities | $(18,584) | $(18,077) | | Decrease in cash and cash equivalents | $(82,953) | $(65,678) | | Cash and cash equivalents at end of period | $167,122 | $178,547 | [Segment Information](index=10&type=section&id=SEGMENT%20INFORMATION) This section provides a detailed breakdown of net sales, adjusted EBITDA, and equity income for the Consumer Products and Building Products segments, highlighting the strong performance of Building Products | (Dollars in thousands) | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------- | :--------------------------------- | :--------------------------------- | | **Net sales** | | | | Consumer Products | $118,938 | $117,596 | | Building Products | $184,769 | $139,712 | | Consolidated | $303,707 | $257,308 | | **Adjusted EBITDA** | | | | Consumer Products | $16,148 | $17,775 | | Building Products | $57,793 | $39,729 | | Consolidated | $65,060 | $48,437 | | **Adjusted EBITDA margin** | | | | Consumer Products | 13.6% | 15.1% | | Building Products | 31.3% | 28.4% | | Consolidated | 21.4% | 18.8% | | **Equity income by unconsolidated affiliate** | | | | WAVE | $32,386 | $27,901 | | ClarkDietrich | $5,934 | $8,744 | | Consolidated | $36,657 | $35,492 | Non-GAAP Financial Measures & Reconciliations [GAAP / Non-GAAP Reconciliations](index=10&type=section&id=GAAP%20%2F%20NON-GAAP%20RECONCILIATIONS) This section provides detailed reconciliations of non-GAAP financial measures such as Adjusted EPS, Adjusted EBITDA, and Free Cash Flow to their corresponding GAAP measures for the reported periods Consolidated Results – Adjusted Earnings per Share – Diluted | (Dollars in thousands, except per share amounts) | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------------------- | :--------------------------------- | :--------------------------------- | | GAAP Diluted EPS | $0.70 | $0.48 | | Restructuring and other expense, net (after tax) | $0.04 | $0.02 | | Non-GAAP Adjusted Diluted EPS | $0.74 | $0.50 | Consolidated Results – Adjusted EBITDA | (Dollars in thousands) | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------------------- | :--------------------------------- | :--------------------------------- | | Net earnings (GAAP) | $34,821 | $24,008 | | Interest expense, net | $63 | $489 | | Income tax expense | $10,860 | $6,782 | | EBIT | $46,071 | $31,524 | | Restructuring and other expense, net | $2,476 | $1,158 | | Adjusted EBIT | $48,547 | $32,682 | | Depreciation and amortization | $13,086 | $11,830 | | Stock-based compensation | $3,427 | $3,925 | | Adjusted EBITDA (non-GAAP) | $65,060 | $48,437 | Consolidated Results - Free Cash Flow | (Dollars in thousands) | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------------------- | :--------------------------------- | :--------------------------------- | | Net cash provided by operating activities (GAAP) | $41,061 | $41,146 | | Investment in property, plant, and equipment | $(13,195) | $(9,629) | | Free cash flow (non-GAAP) | $27,866 | $31,517 | | Free cash flow conversion (non-GAAP) | 75% | 125% | [Use of Non-GAAP Financial Measures and Definitions](index=12&type=section&id=USE%20OF%20NON-GAAP%20FINANCIAL%20MEASURES%20AND%20DEFINITIONS) This section explains that non-GAAP financial measures are used by management to evaluate ongoing performance, engage in financial planning, and determine incentive compensation, as they exclude items not reflective of ongoing operations - Non-GAAP financial measures typically exclude items that management believes are not reflective of, and thus should not be included when evaluating the performance of the Company's ongoing operations[39](index=39&type=chunk) - Management uses these non-GAAP financial measures to evaluate ongoing performance, engage in financial and operational planning, and determine incentive compensation[40](index=40&type=chunk) - **Adjusted operating income (loss)**: Operating income (loss) excluding restructuring and other expense, net[41](index=41&type=chunk) - **Adjusted net earnings**: Net earnings attributable to controlling interest excluding the after-tax effect of excluded items[42](index=42&type=chunk) - **Adjusted EPS - diluted**: Adjusted net earnings divided by diluted weighted-average common shares outstanding[43](index=43&type=chunk) - **Adjusted EBITDA**: Earnings before interest, taxes, depreciation, and amortization, excluding additional items like restructuring and other expense, net, and stock-based compensation[44](index=44&type=chunk) - **Adjusted EBITDA margin**: Calculated by dividing adjusted EBITDA by net sales[45](index=45&type=chunk) - **Free cash flow**: Net cash flows from operating activities less investment in property, plant, and equipment[46](index=46&type=chunk) - **Free cash flow conversion**: Free cash flow divided by net earnings[46](index=46&type=chunk) - **Exclusions from Non-GAAP Financial Measures**: Impairment charges and restructuring activities are excluded because they do not occur in the ordinary course of ongoing business operations, are unpredictable, or are non-cash[46](index=46&type=chunk)

[Special Note About Forward-Looking Statements](index=5&type=section&id=SPECIAL%20NOTE%20ABOUT%20FORWARD-LOOKING%20STATEMENTS) [Forward-Looking Statements Disclaimer](index=5&type=section&id=Forward-Looking%20Statements%20Disclaimer) This section highlights that certain statements in the report are forward-looking, reflecting current views on future events and financial performance based on assumptions, and cautions against undue reliance due to inherent risks and uncertainties - Forward-looking statements reflect current views about future events and financial performance based on certain assumptions, including opinions, forecasts, intentions, plans, goals, projections, guidance, expectations, and beliefs[11](index=11&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, as they are subject to future events, risks, and uncertainties outside the company's control, which could cause actual results to differ materially[12](index=12&type=chunk) - Key factors that could impact future results include the ability to develop market acceptance for new products, future financial and operating results, liquidity, facility adequacy, customer orders, pricing, patent/trademark licensing, operating efficiencies, raw material availability, intellectual property protection, economic/political conditions, currency exchange rates, litigation outcomes, and regulatory compliance[13](index=13&type=chunk) [PART I](index=6&type=section&id=PART%20I) [Item 1. Business](index=6&type=section&id=Item%201.%20Business) Natural Alternatives International, Inc. (NAI) is a formulator, manufacturer, and marketer of nutritional supplements, primarily offering private-label contract manufacturing services and commercializing its patent estate related to beta-alanine, emphasizing quality, scientific research, and regulatory compliance across its U.S. and Swiss facilities - NAI's vision is to enrich the world through the best of nutrition, serving as a leading formulator, manufacturer, and marketer of nutritional supplements[14](index=14&type=chunk)[15](index=15&type=chunk) - The primary business activity is private-label contract manufacturing, alongside commercialization of its beta-alanine patent estate under CarnoSyn®, SR CarnoSyn®, and TriBsyn™ trademarks[16](index=16&type=chunk) - NAI operates manufacturing facilities in Vista and Carlsbad, California, and Manno, Switzerland, holding various certifications including TGA, NSF, Health Canada, Organic, SSCI, and Swissmedic pharmaceutical licenses[21](index=21&type=chunk)[22](index=22&type=chunk)[24](index=24&type=chunk)[25](index=25&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk) [General Business Overview](index=6&type=section&id=General%20Business%20Overview) - NAI provides comprehensive strategic partnerships, offering services like scientific research, clinical studies, proprietary ingredients, product formulation, testing, marketing support, packaging, regulatory review, and international product registration assistance[15](index=15&type=chunk) - The company commercializes its beta-alanine patent estate through direct raw material sales and supply agreements under CarnoSyn®, SR CarnoSyn®, and TriBsyn™ trademarks[16](index=16&type=chunk) [History and Facilities](index=6&type=section&id=History%20and%20Facilities) - Founded in 1980 and reorganized in 1989, NAI's principal executive offices are in Carlsbad, CA, with primary U.S. manufacturing in Vista, CA, and an additional facility in Carlsbad, CA[17](index=17&type=chunk) - NAIE, a wholly-owned Swiss subsidiary formed in 1999, operates a manufacturing facility in Manno, Switzerland, with capabilities in encapsulation, powders, tablets, packaging, quality control, and distribution[18](index=18&type=chunk) - NAI licensed beta-alanine patent rights in 1997, expanding to include sustained-release beta-alanine (SR CarnoSyn®) and a new form, TriBsyn™[19](index=19&type=chunk) - U.S. facilities are certified by TGA (Australia), NSF International (GMP and 'GMP for Sport'), Health Canada, and Natural Food Certifiers (Organic), with the Vista facility's TGA certification renewed through August 2025[21](index=21&type=chunk)[22](index=22&type=chunk)[23](index=23&type=chunk)[24](index=24&type=chunk)[25](index=25&type=chunk) - The Carlsbad, CA facility, acquired in August 2021 and fully operational in April 2023, is a dedicated high-volume powder blending and packaging facility, also certified Organic, NSF, NSF for Sport, and SSCI[28](index=28&type=chunk) - NAIE's Swiss facility holds pharmaceutical licenses from Swissmedic Authority (since 2004, with upgrades in 2007 and 2013) and FSSC 22000 certification (May 2024)[29](index=29&type=chunk) [Business Strategy](index=8&type=section&id=Business%20Strategy) - NAI's goals are long-term growth, profitability, and sales base diversification by leveraging certified facilities, expanding beta-alanine patent commercialization, and improving operational efficiencies[30](index=30&type=chunk)[33](index=33&type=chunk) - The company aims to enhance consumer confidence through education, utilizing its GMP and TGA certified operations, science-based formulations, clinical studies, and regulatory expertise as competitive advantages[30](index=30&type=chunk) - Significant opportunities exist in commercializing the beta-alanine patent estate, particularly for SR CarnoSyn® and the new TriBsyn™ product, targeting Wellness and Healthy Aging channels and new demographics like older adults, vegetarians, and vegans[32](index=32&type=chunk)[34](index=34&type=chunk) [Products, Principal Markets and Methods of Distribution](index=10&type=section&id=Products%2C%20Principal%20Markets%20and%20Methods%20of%20Distribution) - NAI's primary business is private-label contract manufacturing of nutritional supplements (vitamins, minerals, herbs) and other healthcare products for direct sales, e-commerce, and retail channels, in forms like capsules, tablets, chewable wafers, and powders[37](index=37&type=chunk) - Strategic partnering services include customized product formulation, clinical study support, manufacturing, marketing support, international regulatory compliance, product registration, and packaging/labeling design[38](index=38&type=chunk)[45](index=45&type=chunk) Net Sales Breakdown (in thousands) | Category | 2025 ($) | 2025 (%) | 2024 ($) | 2024 (%) | | :----------------------------- | :------- | :------- | :------- | :------- | | Private-label Contract Manufacturing | 121,779 | 94 | 105,358 | 93 | | Patent and Trademark Licensing | 8,081 | 6 | 8,438 | 7 | | **Total Net Sales** | **129,860** | **100** | **113,796** | **100** | [Research and Development](index=10&type=section&id=Research%20and%20Development) - NAI is committed to quality R&D, focusing on new science-based products and improving existing ones, including testing for stability, potency, efficacy, and safety, and participating in clinical research[40](index=40&type=chunk) Research and Development Expenses (in millions) | Fiscal Year | Expense ($) | | :------------ | :---------- | | 2025 | 1.8 | | 2024 | 1.9 | [Sources and Availability of Raw Materials](index=10&type=section&id=Sources%20and%20Availability%20of%20Raw%20Materials) - NAI uses various raw materials, including powders, excipients, capsules, and packaging components, with identity testing and quality evaluation protocols[43](index=43&type=chunk) - The company experienced supply chain challenges due to COVID-19, geopolitical issues (Ukraine-Russia, Israel-Hamas conflicts), and inflationary pressures, leading to increased costs for raw materials, packaging, labor, and transportation[44](index=44&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) - The commercialization of beta-alanine patents depends on the availability of this raw material, which is purchased from a single manufacturer in Japan[43](index=43&type=chunk)[93](index=93&type=chunk) [Customers](index=11&type=section&id=Customers) - NAI has three private-label contract manufacturing customers, each representing over **10% of consolidated net sales**, posing a significant concentration risk[48](index=48&type=chunk) - The company is actively seeking new private-label customers to mitigate risks associated with a limited customer base[48](index=48&type=chunk) [Competition](index=12&type=section&id=Competition) - The nutritional supplement industry is highly fragmented and competitive, with competition based on customized services, product quality and safety, innovation, price, and customer service[50](index=50&type=chunk)[51](index=51&type=chunk) - NAI believes it competes favorably due to its comprehensive customer solutions, certified manufacturing operations, commitment to quality and safety, and R&D activities[51](index=51&type=chunk) - Future competitive position depends on product acceptance, intellectual property protection, product expansion, inventory levels, manufacturing quality/price, personnel, regulatory changes, and industry growth[52](index=52&type=chunk) [Government Regulation](index=12&type=section&id=Government%20Regulation) - NAI's business is subject to extensive regulation by U.S. authorities (FDA, FTC, CPSC, USDA, EPA) and various state/local agencies, covering product claims, labels, ingredients, manufacturing, packaging, distribution, import/export, and storage[53](index=53&type=chunk)[55](index=55&type=chunk) - The FDA regulates dietary supplements under GMPs, DSHEA (1994), and the 2006 Act, requiring compliance with manufacturing standards, labeling, claims, and adverse event reporting[54](index=54&type=chunk)[56](index=56&type=chunk)[57](index=57&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) - International operations are subject to varying regulations, including EU rules and country-specific approvals, which may conflict with U.S. laws and require significant financial and operational resources for compliance[61](index=61&type=chunk) [Intellectual Property](index=14&type=section&id=Intellectual%20Property) - NAI owns **57 registered trademarks globally**, including **11 in the U.S.** (7 incontestable), and **46 foreign trademarks** covering 39 countries, including CarnoSyn®, SR CarnoSyn®, and TriBsyn™[62](index=62&type=chunk)[63](index=63&type=chunk) - The company holds **nine U.S. patents** and **eight corresponding non-U.S. patents** related to beta-alanine, with some extending through 2036, and pending applications for TriBsyn™[66](index=66&type=chunk) Intellectual Property Related Financials (in millions) | Item | Fiscal 2025 ($) | | :-------------------------------- | :-------------- | | Beta-alanine sales & licensing revenue | 8.1 | | IP litigation & patent compliance expenses | 0.4 | [Employees](index=15&type=section&id=Employees) - As of June 30, 2025, NAI employed **215 full-time U.S. employees** (3 executive officers, 45 R&D/QC, 13 sales/marketing, 154 manufacturing/admin) and **19 temporary personnel**[68](index=68&type=chunk) - NAIE employed an additional **78 full-time** and **21 temporary employees**, mostly in manufacturing and support[69](index=69&type=chunk) - Employees are not unionized, and the company reports a good relationship with its workforce[69](index=69&type=chunk) [Seasonality](index=16&type=section&id=Seasonality) - NAI is impacted by seasonal factors and trends, such as cultural events and vacation patterns, which vary by region[71](index=71&type=chunk) - While the impact on consolidated results is minimal, quarterly results may vary significantly due to the timing of private-label contract manufacturing and beta-alanine raw material orders[71](index=71&type=chunk) [Financial Information about Our Business Segments and Geographic Areas](index=16&type=section&id=Financial%20Information%20about%20Our%20Business%20Segments%20and%20Geographic%20Areas) - NAI operates in two reportable segments: Private-label contract manufacturing and Royalty, licensing, and raw material sales (primarily beta-alanine)[72](index=72&type=chunk)[75](index=75&type=chunk) - Private-label products are sold in the U.S. and international markets (Europe, Australia, Asia, Mexico, Canada), with Europe and Asia being primary international markets. Patent and trademark licensing activities are primarily U.S.-based[72](index=72&type=chunk) [Item 1A. Risk Factors](index=17&type=section&id=Item%201A.%20Risk%20Factors) This section outlines various risks that could materially adversely affect NAI's business, financial condition, and results of operations, spanning economic downturns, global instability, intense competition, operational challenges, customer concentration, regulatory compliance, intellectual property protection, corporate governance, and potential acquisition failures - A significant or prolonged economic downturn could materially adversely affect NAI's results by lowering consumer demand for products manufactured for customers and those sold under licensed patent rights[78](index=78&type=chunk) - Global economic instability, including supply chain issues, inflation, fuel/energy costs, and geopolitical conflicts (Ukraine-Russia, Israel-Hamas), impact raw material availability and pricing, increasing operational costs[79](index=79&type=chunk)[80](index=80&type=chunk)[81](index=81&type=chunk)[82](index=82&type=chunk) - The nutritional supplement industry is highly competitive with low entry barriers; NAI faces risks from larger competitors, new product introductions, and potential price reductions if consumers do not value higher quality[83](index=83&type=chunk)[84](index=84&type=chunk) - Operational risks include dependence on uninterrupted facility operations, potential power failures, cybersecurity vulnerabilities, human error, natural disasters, and the ability to attract and retain qualified management and manufacturing personnel[88](index=88&type=chunk)[89](index=89&type=chunk) - Customer concentration is a significant risk, with sales to the three largest customers representing approximately **59% of consolidated net sales in fiscal 2025**; the loss of any major customer or a significant decline in their orders could materially affect financial results[99](index=99&type=chunk) - Extensive government regulation (FDA, FTC, international agencies) poses risks of non-compliance, product withdrawals, recalls, fines, and increased costs, while potential new tariffs on imported goods could adversely impact raw material costs and customer competitiveness[108](index=108&type=chunk)[109](index=109&type=chunk)[112](index=112&type=chunk)[113](index=113&type=chunk) - NAI faces risks related to protecting its intellectual property (patents, trademarks, trade secrets), including litigation costs and potential infringement claims, and the ability to successfully commercialize new beta-alanine forms like SR CarnoSyn® and TriBsyn™[103](index=103&type=chunk)[104](index=104&type=chunk)[105](index=105&type=chunk)[118](index=118&type=chunk) [Item 1C. Cybersecurity](index=29&type=section&id=Item%201C.%20Cybersecurity) NAI maintains various information security processes as part of its enterprise risk management to identify, assess, and manage cybersecurity threats, employing technological defenses, an Incident Response Plan, and a governance structure involving the Audit Committee and senior management to oversee cybersecurity risks, though it acknowledges the continuous and evolving nature of these threats - NAI has implemented information security processes to identify, assess, and manage cybersecurity risks to its critical computer networks, third-party hosted services, and data, aligning with business objectives and operational needs[138](index=138&type=chunk) - Technological defenses include gateway consoles, limited access to key Information Systems, and multi-factor authentication via a third-party mobile identity management tool[140](index=140&type=chunk) - An established Incident Response Plan formalizes stages for reporting, identification, scope, response, and recovery of cybersecurity incidents, supported by crisis management and business continuity measures[141](index=141&type=chunk) - The Audit Committee of the Board of Directors oversees risk management, including cybersecurity, with senior management responsible for day-to-day management and reporting material issues to the Board[143](index=143&type=chunk)[144](index=144&type=chunk)[145](index=145&type=chunk) [Item 2. Properties](index=31&type=section&id=Item%202.%20Properties) NAI's facilities as of June 30, 2025, include leased manufacturing and distribution sites in Vista, CA, and Manno, Switzerland, along with owned corporate headquarters and a powder filling/packaging facility in Carlsbad, CA, which the company believes are adequate for foreseeable operating requirements Summary of Facilities as of June 30, 2025 | Location | Nature of Use | Square Feet | How Held | Lease Expiration Date | | :------------------ | :------------------------------------------------ | :---------- | :------- | :-------------------- | | Vista, CA USA | Manufacturing, warehousing, packaging, distribution | 162,000 | Leased | August 2034 | | Manno, Switzerland | Manufacturing, warehousing, packaging, distribution | 85,070 | Leased | December 2032 | | Manno, Switzerland | Warehousing | 30,892 | Leased | December 2026 | | Carlsbad, CA USA | Corporate headquarters | 20,981 | Owned | N/A | | Carlsbad, CA USA | Powder filling, packaging, distribution, storage | 67,453 | Owned | N/A | - The Vista, CA facility lease was extended through August 31, 2034, and the Carlsbad, CA powder facility, operational since April 2023, was temporarily closed in October 2023 due to customer inventory issues but reopened in May 2024[152](index=152&type=chunk) [Item 3. Legal Proceedings](index=31&type=section&id=Item%203.%20Legal%20Proceedings) NAI is involved in various legal proceedings in the ordinary course of business, and as of June 30, 2025, the company accrued **$1.4 million** for a tentative settlement of two class action and PAGA lawsuits filed by former employees in December 2023, with court approval estimated to take about one year - NAI is routinely involved in investigations, claims, and legal proceedings related to intellectual property, product liability, employment, tax, regulation, and contracts[148](index=148&type=chunk) - In December 2023, NAI was sued by three former employees in two class action and PAGA lawsuits, leading to a tentative settlement agreement on July 3, 2025, for a maximum contribution of **$1.25 million**[149](index=149&type=chunk) - The company accrued **$1.4 million** in its fiscal 2025 results for the settlement and estimated legal fees, with court approval for the settlement process expected to take approximately one year[149](index=149&type=chunk) [Item 4. Mine Safety Disclosures](index=32&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Natural Alternatives International, Inc [PART II](index=33&type=section&id=PART%20II) [Item 5. Market for Our Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=33&type=section&id=Item%205.%20Market%20for%20Our%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) NAI's common stock trades on the Nasdaq Global Market under 'NAII', with **169 stockholders of record** as of September 19, 2025; the company has never paid dividends and does not intend to in the foreseeable future, retaining earnings for growth, and stock repurchases were limited to shares acquired from employees for tax withholding upon restricted stock vesting - NAI's common stock trades on the Nasdaq Global Market under the symbol 'NAII'[155](index=155&type=chunk) Common Stock High and Low Sales Prices (Fiscal 2025 & 2024) | Quarter | Fiscal 2025 High ($) | Fiscal 2025 Low ($) | Fiscal 2024 High ($) | Fiscal 2024 Low ($) | | :-------------- | :------------------- | :------------------ | :------------------- | :------------------ | | First Quarter | 6.88 | 5.10 | 7.62 | 5.06 | | Second Quarter | 5.60 | 4.02 | 7.37 | 5.78 | | Third Quarter | 4.40 | 3.27 | 6.98 | 5.65 | | Fourth Quarter | 3.62 | 2.57 | 7.26 | 6.00 | - As of September 19, 2025, there were **169 stockholders of record**, and the closing sale price was **$3.12 per share**[156](index=156&type=chunk) - NAI has never paid dividends on its common stock and does not intend to in the foreseeable future, prioritizing retention of earnings for operations and future growth, also restricted by credit facility terms[157](index=157&type=chunk) - No unregistered securities were sold during fiscal year 2025[158](index=158&type=chunk) Common Stock Repurchases (Fiscal 2025) | Item | Shares Purchased | Average Cost ($) | Total Cost (in thousands) ($) | | :--------------------------------------- | :--------------- | :--------------- | :---------------------------- | | Shares purchased under Repurchase Plan | — | — | — | | Shares acquired for restricted stock vesting | 45,972 | 3.88 | 178 | | **Total** | **45,972** | | **178** | Equity Compensation Plan Information (as of June 30, 2025) | Plan Category | Number of Shares to be Issued Upon Exercise of Outstanding Options, Warrants, and Rights (a) | Weighted-Average Exercise Price of Outstanding Options, Warrants, and Rights (b) | Number of Shares Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Shares Reflected in Column (a)) (c) | | :---------------------------------------------- | :--------------------------------------------------------------------------------------- | :------------------------------------------------------------------------------- | :--------------------------------------------------------------------------------------------------------------------------------------- | | Equity compensation plans approved by stockholders | — | — | 158,877 | | Equity compensation plans not approved by stockholders | N/A | N/A | N/A | | **Total** | **—** | **—** | **158,877** | [Item 6. Selected Financial Data](index=33&type=section&id=Item%206.%20Selected%20Financial%20Data) As a smaller reporting company, Natural Alternatives International, Inc. is not required to provide Item 6 disclosure in this Annual Report [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=35&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides an overview of NAI's financial performance, highlighting a **14% increase in consolidated net sales in fiscal 2025**, primarily driven by private-label contract manufacturing, but reported a net loss due to factory underutilization, a valuation allowance against deferred tax assets, and a litigation settlement, anticipating a net loss in the first half of fiscal 2026 but expecting full-year net income while actively managing liquidity, capital resources, and inflationary pressures - Consolidated net sales increased by **14% in fiscal 2025** compared to fiscal 2024, primarily driven by a **16% increase in private-label contract manufacturing net sales**[167](index=167&type=chunk)[176](index=176&type=chunk) - Revenue concentration from the largest private-label contract manufacturing customer decreased from **42% in fiscal 2024 to 33% in fiscal 2025**[167](index=167&type=chunk)[176](index=176&type=chunk) - Patent and trademark licensing revenue decreased by **4% to $8.1 million in fiscal 2025**, primarily due to decreased material sales from existing customers, partially offset by lower volume rebates and increased royalty income[168](index=168&type=chunk)[177](index=177&type=chunk) - NAI incurred a net loss of **$13.6 million in fiscal 2025**, an **88% increase from $7.2 million in fiscal 2024**, primarily due to underutilization of factory capacities, a **$4.8 million valuation allowance** against domestic net deferred income tax assets, and a **$1.4 million litigation settlement accrual**[172](index=172&type=chunk)[176](index=176&type=chunk)[182](index=182&type=chunk) - The company anticipates a net loss in the first half of fiscal 2026 but expects to achieve net income in the second half and for the full fiscal year 2026[172](index=172&type=chunk) - Net cash provided by operating activities was **$5.9 million in fiscal 2025**, a significant improvement from net cash used of **$1.5 million in fiscal 2024**, driven by changes in accounts receivable and inventory[183](index=183&type=chunk)[213](index=213&type=chunk) - NAI's credit facility was amended on June 20, 2025, extending maturity to December 31, 2026, decreasing the maximum borrowing to **$10.0 million**, and waiving prior covenant defaults. The company expects non-compliance with modified covenants in H1 fiscal 2026 and is negotiating revisions[190](index=190&type=chunk) [Executive Overview](index=35&type=section&id=Executive%20Overview) - NAI's business strategy focuses on long-term growth, profitability, and sales diversification through new private-label customers and commercialization of its beta-alanine patent estate (CarnoSyn®, SR CarnoSyn®, TriBsyn™)[166](index=166&type=chunk) - The new TriBsyn™ product, a patent-pending carnosine booster, aims to penetrate the Wellness and Healthy Aging channel by increasing beta-alanine bioavailability and eliminating paresthesia, making it suitable for older adults, vegetarians, and vegans[169](index=169&type=chunk) - Litigation and patent compliance expenses for CarnoSyn® product offerings were **$0.4 million in fiscal 2025** and **$0.2 million in fiscal 2024**, primarily for patent and trademark estate maintenance and expansion[170](index=170&type=chunk) - Key strategic focuses for fiscal 2026 include leveraging certified facilities, expanding beta-alanine commercialization into Sports Nutrition, Wellness, Healthy Aging, and Medical foods, and improving operational efficiencies[173](index=173&type=chunk)[178](index=178&type=chunk) [Discussion of Critical Accounting Estimates](index=37&type=section&id=Discussion%20of%20Critical%20Accounting%20Estimates) - Revenue recognition involves significant judgment in estimating variable consideration, such as volume rebates, which can differ from actual sales due to changes in customer orders and raw material availability[174](index=174&type=chunk) [Results of Operations](index=37&type=section&id=Results%20of%20Operations) Consolidated Operating Results (in thousands, except percentages) | Item | Fiscal Year Ended June 30, 2025 ($) | Fiscal Year Ended June 30, 2025 (%) | Fiscal Year Ended June 30, 2024 ($) | Fiscal Year Ended June 30, 2024 (%) | Increase (Decrease) ($) | Increase (Decrease) (%) | | :------------------------------------------ | :---------------------------------- | :---------------------------------- | :---------------------------------- | :---------------------------------- | :---------------------- | :---------------------- | | Private-label contract manufacturing | 121,779 | 94% | 105,358 | 93% | 16,421 | 16% | | Patent and trademark licensing | 8,081 | 6% | 8,438 | 7% | (357) | (4)% | | **Total net sales** | **129,860** | **100%** | **113,796** | **100%** | **16,064** | **14%** | | Cost of goods sold | 120,571 | 93% | 106,931 | 94% | 13,640 | 13% | | Gross profit | 9,289 | 7% | 6,865 | 6% | 2,424 | 35% | | Other selling, general & administrative expenses | 16,549 | 13% | 15,399 | 14% | 1,150 | 7% | | Settlement of legal proceeding and associated expense | 1,400 | 1% | — | 0% | 1,400 | 100% | | Loss from operations | (8,660) | (7)% | (8,534) | (7)% | (126) | 1% | | Other loss, net | (2,080) | (2)% | (930) | (1)% | (1,150) | 124% | | Loss before income taxes | (10,740) | (8)% | (9,464) | (8)% | (1,276) | 13% | | Provision (benefit) for income taxes | 2,835 | 2% | (2,247) | (2)% | 5,082 | (226)% | | **Net loss** | **(13,575)** | **(10)%** | **(7,217)** | **(6)%** | **(6,358)** | **88%** | - Gross profit margin increased by **1.2 percentage points in fiscal 2025**, primarily due to a favorable product sales mix in private-label contract manufacturing, despite a marginal increase in manufacturing overhead costs[178](index=178&type=chunk)[180](index=180&type=chunk) - Selling, general and administrative expenses increased by **$1.2 million (7%) in fiscal 2025**, driven by higher compensation, legal expenses for patent/trademark registrations, rent, and sales commissions, plus a **$1.4 million legal settlement accrual**[179](index=179&type=chunk) - Other expense, net, increased by **$1.2 million in fiscal 2025** due to unfavorable foreign currency exchange volatility and higher interest expense from increased rates and credit facility usage[181](index=181&type=chunk) - An income tax provision of **$2.8 million** was recorded in fiscal 2025, compared to a **$2.2 million tax benefit in fiscal 2024**, mainly due to a **$4.8 million valuation allowance** against domestic net deferred income tax assets[182](index=182&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) - Net cash provided by operating activities was **$5.9 million in fiscal 2025**, a significant improvement from **$1.5 million used in fiscal 2024**, primarily due to timing of sales and collections for accounts receivable[183](index=183&type=chunk)[184](index=184&type=chunk) - Cash used in investing activities increased to **$3.6 million in fiscal 2025** (from **$3.0 million in fiscal 2024**) due to increased capital expenditures, including solar energy generation equipment[186](index=186&type=chunk) - Cash used in financing activities was **$2.0 million in fiscal 2025**, compared to **$2.9 million provided in fiscal 2024**, reflecting net payments on the line of credit[187](index=187&type=chunk) - As of June 30, 2025, NAI had **$12.3 million in cash and cash equivalents**, with **$9.9 million available borrowing capacity** on its credit facility and **$8.9 million outstanding** on a term loan[188](index=188&type=chunk)[190](index=190&type=chunk) - The company was not in compliance with credit agreement covenants for Q4 fiscal 2025, but received a prospective waiver. It anticipates non-compliance in H1 fiscal 2026 and is negotiating a revised credit facility[189](index=189&type=chunk)[190](index=190&type=chunk) [Off-Balance Sheet Arrangements](index=39&type=section&id=Off-Balance%20Sheet%20Arrangements) - As of June 30, 2025, NAI did not have any significant off-balance sheet debt or arrangements with unconsolidated entities that would materially affect its financial condition or results of operations[191](index=191&type=chunk) [Inflation](index=40&type=section&id=Inflation) - NAI experienced continued price increases for raw materials and operational costs in fiscal 2025, expecting these inflationary pressures to persist through fiscal 2026 due to limited supplies, higher labor/transportation costs, interest rates, tariffs, and global fuel/energy costs[192](index=192&type=chunk) [Recent Accounting Pronouncements](index=40&type=section&id=Recent%20Accounting%20Pronouncements) - A discussion of recent accounting pronouncements is included under Note A in the notes to the consolidated financial statements[193](index=193&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Natural Alternatives International, Inc. is not required to provide Item 7A disclosure in this Annual Report [PART III](index=42&type=section&id=PART%20III) [Item 8. Financial Statements and Supplementary Data](index=41&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the audited consolidated financial statements for Natural Alternatives International, Inc. for the fiscal years ended June 30, 2025, and 2024, including the balance sheets, statements of operations and comprehensive loss, stockholders' equity, and cash flows, with the independent registered public accounting firm issuing an unqualified opinion stating the financial statements are presented fairly in all material respects, and extensive notes detailing accounting policies, financial instrument fair values, inventory, property and equipment, leases, comprehensive income, debt, income taxes, employee benefits, stockholders' equity, commitments, economic dependency, derivatives, hedging, contingencies, and segment information - The independent registered public accounting firm, HASKELL & WHITE LLP, issued an unqualified opinion, stating that the consolidated financial statements present fairly, in all material respects, the company's financial position and results of operations in conformity with GAAP[197](index=197&type=chunk) - No critical audit matters were identified during the audit of the consolidated financial statements for the current period[201](index=201&type=chunk) [Report of Independent Registered Public Accounting Firm](index=41&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) - The audit was conducted in accordance with PCAOB standards, assessing risks of material misstatement and evaluating accounting principles and estimates[199](index=199&type=chunk)[200](index=200&type=chunk) - The company is not required to have, nor was the auditor engaged to perform, an audit of its internal control over financial reporting[199](index=199&type=chunk) [Consolidated Balance Sheets](index=42&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheets (in thousands) | Item | June 30, 2025 ($) | June 30, 2024 ($) | | :-------------------------------------------- | :---------------- | :---------------- | | **Assets** | | | | Cash and cash equivalents | 12,325 | 11,981 | | Accounts receivable, net | 14,644 | 16,891 | | Inventories, net | 24,871 | 24,249 | | Total current assets | 59,276 | 61,610 | | Property and equipment, net | 50,890 | 52,211 | | Operating lease right-of-use assets | 41,054 | 43,537 | | Deferred tax asset, net – noncurrent | — | 3,170 | | **Total assets** | **151,939** | **162,342** | | **Liabilities and Stockholders' Equity** | | | | Accounts payable | 15,352 | 12,740 | | Accrued liabilities | 3,105 | 2,847 | | Line of credit – current | 1,900 | 3,400 | | Total current liabilities | 28,804 | 23,465 | | Long-term liability – operating leases | 45,970 | 46,468 | | Mortgage note payable, net of current portion | 8,628 | 8,933 | | **Total liabilities** | **83,513** | **79,747** | | Total stockholders' equity | 68,426 | 82,595 | | **Total liabilities and stockholders' equity** | **151,939** | **162,342** | [Consolidated Statements of Operations and Comprehensive Loss](index=43&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Consolidated Statements of Operations and Comprehensive Loss (in thousands, except per share data) | Item | 2025 ($) | 2024 ($) | | :------------------------------------------ | :-------- | :-------- | | Net sales | 129,860 | 113,796 | | Cost of goods sold | 120,571 | 106,931 | | Gross profit | 9,289 | 6,865 | | Other selling, general and administrative expenses | 16,549 | 15,399 | | Settlement of legal proceeding and associated expense | 1,400 | — | | Loss from operations | (8,660) | (8,534) | | Total other expense | (2,080) | (930) | | Loss before income taxes | (10,740) | (9,464) | | Provision (benefit) for income taxes | 2,835 | (2,247) | | **Net loss** | **(13,575)** | **(7,217)** | | Comprehensive loss | (14,968) | (7,156) | | Net loss per common share: Basic | (2.28) | (1.23) | | Net loss per common share: Diluted | (2.28) | (1.23) | | Weighted average common shares outstanding: Basic | 5,946,520 | 5,870,974 | | Weighted average common shares outstanding: Diluted | 5,946,520 | 5,870,974 | [Consolidated Statements of Stockholders' Equity](index=44&type=section&id=Consolidated%20Statements%20of%20Stockholders%27%20Equity) Consolidated Statements of Stockholders' Equity (in thousands) | Item | June 30, 2023 | June 30, 2024 | June 30, 2025 | | :------------------------------------------ | :------------ | :------------ | :------------ | | Common Stock (Shares) | 9,314,406 | 9,480,906 | 9,504,906 | | Common Stock (Amount) | 91 | 93 | 93 | | Additional Paid-in Capital | 31,436 | 32,634 | 33,611 | | Retained Earnings | 80,183 | 72,966 | 59,391 | | Treasury Stock (Shares) | 3,240,593 | 3,280,721 | 3,326,693 | | Treasury Stock (Amount) | (22,855) | (23,076) | (23,254) | | Accumulated Other Comprehensive Income (Loss) | (83) | (22) | (1,415) | | **Total Stockholders' Equity** | **88,772** | **82,595** | **68,426** | | Net Loss | (7,217) | (13,575) | | [Consolidated Statements of Cash Flows](index=45&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated Statements of Cash Flows (in thousands) | Item | 2025 ($) | 2024 ($) | | :------------------------------------------ | :------- | :------- | | **Cash flows from operating activities** | | | | Net loss | (13,575) | (7,217) | | Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | | | | Settlement of legal proceeding and associated expense | 1,400 | — | | Depreciation and amortization | 4,560 | 4,647 | | Deferred income taxes | 3,613 | (2,907) | | Non-cash lease expenses | 7,254 | 6,083 | | Non-cash compensation | 977 | 1,200 | | Changes in operating assets and liabilities: | | | | Accounts receivable | 2,247 | (9,869) | | Inventories | (622) | 5,445 | | Accounts payable and accrued liabilities | 2,858 | 5,387 | | **Net cash provided by (used in) operating activities** | **5,932** | **(1,497)** | | **Cash flows from investing activities** | | | | Purchases of property and equipment | (3,614) | (3,017) | | **Net cash used in investing activities** | **(3,614)** | **(3,017)** | | **Cash flows from financing activities** | | | | (Payments) Borrowings on line of credit | (1,500) | 3,400 | | Repurchase of common stock | (178) | (221) | | Payments on long-term debt | (296) | (288) | | **Net cash (used in) provided by financing activities** | **(1,974)** | **2,891** | | Net increase (decrease) in cash and cash equivalents | 344 | (1,623) | | Cash and cash equivalents at end of year | 12,325 | 11,981 | [A. Organization and Summary of Significant Accounting Policies](index=46&type=section&id=A.%20Organization%20and%20Summary%20of%20Significant%20Accounting%20Policies) - NAI provides private-label contract manufacturing and commercializes its beta-alanine patent estate (CarnoSyn®, SR CarnoSyn®, TriBsyn™) through raw material and finished product sales, and licensing[216](index=216&type=chunk) - NAIE, a wholly-owned Swiss subsidiary, operates a manufacturing facility in Manno, Switzerland, with its functional currency being the U.S. Dollar[217](index=217&type=chunk)[218](index=218&type=chunk) - NAI adopted ASU 2023-07 (Segment Reporting) in fiscal 2025, which did not materially impact financial statements. It is evaluating ASU 2024-03 (Expense Disaggregation) and ASU 2023-09 (Income Tax Disclosures) for future adoption[219](index=219&type=chunk)[220](index=220&type=chunk)[221](index=221&type=chunk)[222](index=222&type=chunk) - Fair value measurements use a three-level hierarchy, with cash, cash equivalents, and marketable securities as Level 1, and derivative forward exchange contracts, line of credit, and term loan as Level 2[225](index=225&type=chunk)[226](index=226&type=chunk)[227](index=227&type=chunk)[228](index=228&type=chunk) - Revenue is recognized when performance obligations are fulfilled and control of products is transferred, with estimates for variable consideration like early payment discounts and volume rebates[241](index=241&type=chunk)[242](index=242&type=chunk)[244](index=244&type=chunk) - NAI uses derivative financial instruments to manage foreign currency exchange risk for Euro and Swiss Franc sales and interest rate fluctuations on its term note, with some designated as cash flow hedges[235](index=235&type=chunk)[236](index=236&type=chunk)[237](index=237&type=chunk)[238](index=238&type=chunk)[239](index=239&type=chunk) - A valuation allowance of **$4.8 million** was recorded in fiscal 2025 against net domestic deferred income tax assets due to cumulative U.S.-based operational losses, resulting in a net deferred tax asset of **$0**[255](index=255&type=chunk)[256](index=256&type=chunk) - Basic and diluted net loss per common share were both **$(2.28) in fiscal 2025** and **$(1.23) in fiscal 2024**, with restricted stock excluded from diluted EPS calculation due to anti-dilutive effect[264](index=264&type=chunk) - Credit risk is concentrated with three largest customers, whose receivables represented **67.8% of gross accounts receivable** at June 30, 2025[265](index=265&type=chunk) [B. Inventories](index=54&type=section&id=B.%20Inventories) Inventories, net (in thousands) | Item | June 30, 2025 ($) | June 30, 2024 ($) | | :-------------- | :---------------- | :---------------- | | Raw materials | 17,632 | 18,489 | | Work in progress | 3,943 | 3,362 | | Finished goods | 4,054 | 3,038 | | Reserves | (758) | (640) | | **Total** | **24,871** | **24,249** | - Inventories are valued at the lower of cost (first-in, first-out) or net realizable value, with reserves established for inventory not expected to be recovered, based on factors like quantity on hand, estimated sales time, shelf life, demand, and market conditions[231](index=231&type=chunk) [C. Property and Equipment](index=56&type=section&id=C.%20Property%20and%20Equipment) Property and Equipment (in thousands) | Item | Depreciable Life (Years) | 2025 ($) | 2024 ($) | | :---------------------------------- | :----------------------- | :-------- | :-------- | | Land | NA | 8,940 | 8,940 | | Building and building improvements | 7 – 39 | 24,650 | 24,723 | | Machinery and equipment | 3 – 12 | 41,311 | 43,631 | | Office equipment and furniture | 3 – 5 | 6,936 | 6,765 | | Vehicles | 3 | 237 | 237 | | Leasehold improvements | 1 – 20 | 24,788 | 23,223 | | Total property and equipment | | 106,862 | 107,519 | | Less: accumulated depreciation and amortization | | (55,972) | (55,308) | | **Property and equipment, net** | | **50,890** | **52,211** | - Depreciation and amortization expense was **$4.6 million** in both fiscal 2025 and fiscal 2024[270](index=270&type=chunk) - During fiscal 2025, NAI disposed of machinery and equipment with an original value of **$3.945 million**, resulting in a **$49,000 loss on disposal**[269](index=269&type=chunk) [D. Leases](index=56&type=section&id=D.%20Leases) - NAI leases manufacturing and support facilities in Vista, California, and Lugano, Switzerland, with no finance leases currently classified[271](index=271&type=chunk)[274](index=274&type=chunk) - The Vista, CA facility lease was extended by ten years and five months, effective April 1, 2024, increasing base rent and resulting in a **$25.9 million increase** in lease liability and right-of-use asset[272](index=272&type=chunk) - The weighted average remaining lease term for operating leases was **8.6 years in fiscal 2025** (**9.5 years in fiscal 2024**), with a weighted average discount rate of **5.94%** (**5.92% in fiscal 2024**)[274](index=274&type=chunk) Supplemental Cash Flows Information for Leases (in thousands) | Item | 2025 ($) | 2024 ($) | | :-------------------------------------------------------------------- | :------- | :------- | | Cash paid for amounts included in the measurement of operating lease liabilities | 4,302 | 2,966 | | Net increase in operating lease liabilities and right-of-use assets due to lease remeasurement | — | 25,692 | [E. Other Comprehensive (Loss) Income](index=58&type=section&id=E.%20Other%20Comprehensive%20(Loss)%20Income) Other Comprehensive (Loss) Income (in thousands) | Item | Year Ended June 30, 2025 ($) | Year Ended June 30, 2024 ($) | | :---------------------------------------------------------------- | :--------------------------- | :--------------------------- | | Balance as of June 30, 2024 | (22) | (83) | | OCI/OCL before reclassifications | (2,115) | 204 | | Amounts reclassified from OCI | 278 | (53) | | Tax effect of OCI activity | 444 | (90) | | Net current period OCI/OCL | (1,393) | 61 | | **Balance as of June 30, 2025** | **(1,415)** | **(22)** | [F. Debt](index=58&type=section&id=F.%20Debt) - NAI's credit facility with Wells Fargo was amended on June 20, 2025 (Sixth Amendment), extending maturity to December 31, 2026, decreasing maximum borrowing to **$10.0 million**, increasing interest rate to **3.25%**, and waiving prior covenant non-compliance[285](index=285&type=chunk) - The amended credit agreement includes new financial covenants, with NAI anticipating non-compliance in the first half of fiscal 2026 due to litigation expense and deferred tax asset valuation allowance, and is negotiating a revision[286](index=286&type=chunk)[290](index=290&type=chunk) - NAI has a **$10.0 million Term Note** with Wells Fargo, secured by its Carlsbad property, with payments amortized over 25 years and a final installment due September 1, 2028. The variable interest rate was fixed at **2.4%** for the first three years via an interest rate swap, which expired on September 3, 2024[289](index=289&type=chunk)[239](index=239&type=chunk) Future Debt Payments Under Term Note (in thousands) | Year | 2026 ($) | 2027 ($) | 2028 ($) | 2029 ($) | 2030 and Thereafter ($) | Total ($) | | :--------- | :------- | :------- | :------- | :------- | :---------------------- | :-------- | | Future Debt Payments | 305 | 315 | 325 | 7,988 | — | 8,933 | - As of June 30, 2025, NAI had **$1.9 million outstanding** on its credit facility and **$9.9 million available borrowing capacity**[291](index=291&type=chunk) [G. Income Taxes](index=60&type=section&id=G.%20Income%20Taxes) - In fiscal 2025, NAI recorded a U.S.-based domestic tax expense of **$2.7 million** and foreign tax expense of **$0.1 million**, compared to a U.S.-based domestic tax benefit of **$2.2 million in fiscal 2024**[292](index=292&type=chunk) - A **$4.8 million valuation allowance** was recognized in fiscal 2025 against net domestic deferred income tax assets, resulting in a net deferred tax asset of **$0**, due to cumulative U.S.-based operational losses[293](index=293&type=chunk) Geographical Breakdown of Loss Before Income Taxes (in thousands) | Region | 2025 ($) | 2024 ($) | | :------------ | :-------- | :-------- | | United States | (11,520) | (9,046) | | Foreign | 780 | (418) | | **Total** | **(10,740)** | **(9,464)** | Provision (Benefit) for Income Taxes (in thousands) | Item | 2025 ($) | 2024 ($) | | :---------------------------------- | :------- | :------- | | Current: Federal | (858) | (55) | | Current: State | (17) | 41 | | Current: Foreign | 161 | 66 | | Deferred: Federal | (1,198) | (2,007) | | Deferred: State | (68) | (223) | | Deferred: Foreign | — | (69) | | Valuation allowance | 4,815 | — | | **Total provision (benefit) for income taxes** | **2,835** | **(2,247)** | Net Deferred Tax Assets and Liabilities (in thousands) | Item | 2025 ($) | 2024 ($) | | :---------------------------------- | :------- | :------- | | Total gross deferred tax assets | 14,347 | 12,563 | | Deferred tax liabilities | (9,533) | (9,393) | | Valuation allowance | (4,814) | — | | **Net deferred tax assets** | **—** | **3,170** | - NAI has U.S. federal net operating loss carryforwards of **$8.0 million** (indefinite carryforward) and state NOLs of **$6.8 million** (expiring from fiscal 2032). Federal and state tax credits total **$0.8 million** (expiring from fiscal 2041)[296](index=296&type=chunk) Income Tax Provision (Benefit) Reconciliation (in thousands) | Item | 2025 ($) | 2024 ($) | | :------------------------------------------ | :------- | :------- | | Income taxes computed at statutory federal income tax rate | (2,256) | (2,033) | | State income taxes, net of federal income tax expense | (177) | (215) | | Permanent differences | 10 | (20) | | Foreign tax rate differential | (2) | 131 | | Tax credits | (61) | (170) | | Stock based compensation | 123 | 93 | | Global intangible low-taxed income (GILTI) | 233 | — | | Return to provision - differences | 150 | (33) | | Change in valuation allowance, net | 4,815 | — | | **Income tax provision (benefit) as reported** | **2,835** | **(2,247)** | | Effective tax rate | (26.4)% | (23.7)% | [H. Employee Benefit Plans](index=64&type=section&id=H.%20Employee%20Benefit%20Plans) - NAI has a 401(k) profit-sharing plan, matching **50% of the first 6% of participant contributions** since January 1, 2025, with total contributions of **$0.5 million in fiscal 2025** and **$0.6 million in fiscal 2024**[304](index=304&type=chunk) - A Non-Qualified Incentive Plan allows for deferred cash awards to directors, officers, employees, and consultants, with **$0.2 million granted in fiscal 2025** and **$0.9 million in fiscal 2024**[307](index=307&type=chunk)[309](index=309&type=chunk) Defined Benefit Pension Plan Funded Status (in thousands) | Item | 2025 ($) | 2024 ($) | | :------------------------------------------ | :------- | :------- | | Benefit obligation at end of year | 1,152 | 1,374 | | Fair value of plan assets at end of year | 1,042 | 1,232 | | Difference between benefit obligation and fair value of plan assets | (110) | (142) | | Unrecognized net actuarial loss in accumulated other comprehensive income | 217 | 282 | | **Net amount recognized** | **107** | **140** | Defined Benefit Pension Plan Net Periodic Benefit Cost (in thousands) | Item | 2025 ($) | 2024 ($) | | :------------------------ | :------- | :------- | | Interest cost | 46 | 49 | | Expected return on plan assets | (51) | (42) | | Recognized actuarial loss | 24 | 39 | | Settlement loss | 62 | — | | **Net periodic benefit expense** | **81** | **46** | Defined Benefit Pension Plan Asset Allocation (June 30) | Asset Category | 2025 (%) | 2024 (%) | Target Allocation (%) | | :---------------- | :------- | :------- | :-------------------- | | Equity securities | 60 | 72 | 53 | | Debt securities | 35 | 14 | 41 | | Cash alternatives | 4 | 14 | 2 | | Commodities | 1 | 0 | 4 | | **Total** | **100** | **100** | **100** | [I. Stockholders' Equity](index=68&type=section&id=I.%20Stockholders%27%20Equity) - The Board authorized a total of **$18.0 million** for the stock repurchase plan, but current credit agreement terms prohibit most stock repurchases[320](index=320&type=chunk) - Stock repurchases in fiscal 2025 were limited to **45,972 shares** acquired from employees for restricted stock vesting, totaling **$0.178 million**[322](index=322&type=chunk)[323](index=323&type=chunk) Restricted Stock Activity (2020 Plan) | Item | Number of Shares – 2020 Plan (2025) | Weighted Average Grant Date Fair Value (2025) ($) | Number of Shares – 2020 Plan (2024) | Weighted Average Grant Date Fair Value (2024) ($) | | :------------------------ | :---------------------------------- | :------------------------------------------------ | :---------------------------------- | :------------------------------------------------ | | Nonvested at June 30 | 173,985 | 6.38 | 283,107 | 7.50 | | Granted | 24,000 | 3.84 | 166,500 | 6.09 | | Vested | (133,122) | 8.31 | (104,075) | 11.39 | | Forfeited | — | — | (3,000) | 9.59 | | Available for grant at June 30 | 158,877 | | 182,877 | | - Total remaining unrecognized compensation cost for unvested restricted stock was **$0.9 million** at June 30, 2025, with a weighted average remaining service period of **1.6 years**[327](index=327&type=chunk) [J. Commitments](index=70&type=section&id=J.%20Commitments) - NAI leases **162,000 sq ft in Vista, CA**, under an operating lease extended through August 31, 2034, with an option to extend to August 31, 2039[328](index=328&type=chunk) - NAIE leases **116,000 sq ft in Manno, Switzerland**, for manufacturing and warehousing, with the main facility lease extended to December 31, 2032, and a warehouse lease automatically extended to December 31, 2026[329](index=329&type=chunk)[331](index=331&type=chunk) Minimum Rental Commitments (in thousands) | Year | 2026 ($) | 2027 ($) | 2028 ($) | 2029 ($) | 2030 ($) | Thereafter ($) | Total ($) | | :--------- | :------- | :------- | :------- | :------- | :------- | :------------- | :-------- | | Gross minimum rental commitments | 5,014 | 4,889 | 4,863 | 4,996 | 9,009 | 20,420 | 49,191 | - Rental expense totaled **$5.5 million for fiscal 2025** and **$5.4 million for fiscal 2024**[333](index=333&type=chunk) [K. Economic Dependency](index=72&type=section&id=K.%20Economic%20Dependency) - NAI has substantial economic dependency on a few key customers; sales to its three largest private-label contract manufacturing customers totaled **$77.16 million in fiscal 2025** and **$77.31 million in fiscal 2024**[334](index=334&type=chunk) Net Sales to Major Customers (in thousands) | Customer | Fiscal 2025 ($) | Fiscal 2024 ($) | | :--------- | :-------------- | :-------------- | | Customer 1 | 42,289 | 48,055 | | Customer 2 | 17,707 | 12,941 | | Customer 3 | 17,165 | 16,312 | | **Total** | **77,161** | **77,308** | - Accounts receivable from these major customers were **$9.9 million** at June 30, 2025, and **$12.3 million** at June 30, 2024[334](index=334&type=chunk) - NAI is dependent on a single supplier for beta-alanine and other raw materials, with Supplier 1 representing **18% of total raw material purchases in fiscal 2025** and **23% in fiscal 2024**[335](index=335&type=chunk) Raw Material Purchases from Major Supplier (in thousands) | Supplier | 2025 Raw Material Purchases ($) | 2025 % of Total Raw Material Purchases | 2024 Raw Material Purchases ($) | 2024 % of Total Raw Material Purchases | | :--------- | :------------------------------ | :------------------------------------- | :------------------------------ | :------------------------------------- | | Supplier 1 | 12,004 | 18% | 11,624 | 23% | | **Total** | **12,004** | **18%** | **11,624** | **23%** | [L. Derivatives and Hedging](index=72&type=section&id=L.%20Derivatives%20and%20Hedging) - NAI uses foreign exchange forward contracts to manage foreign currency exchange risk from forecasted Euro and Swiss Franc sales, with some designated as cash flow hedges[336](index=336&type=chunk)[337](index=337&type=chunk) - As of June 30, 2025, notional amounts for cash flow hedges were **$35.5 million (€31.2 million)** for Euro sales and **$6.8 million (CHF 5.4 million)** for Swiss Franc sales, expected to settle by June 2026[340](index=340&type=chunk) - A net loss of approximately **$1.6 million** (offset by **$0.4 million deferred taxes**) related to cash flow hedges was recorded in OCI as of June 30, 2025, with **$1.6 million** expected to be reclassified to earnings in the next 12 months[340](index=340&type=chunk) - NAI also uses foreign currency contracts not designated as cash flow hedges to hedge its Swiss Franc-denominated lease liability, with notional amounts of **$11.8 million (CHF 9.5 million)** as of June 30, 2025[343](index=343&type=chunk) - An interest rate swap fixed the variable interest rate on the **$10.0 million Term Note to 2.4%** for three years, expiring on September 3, 2024[344](index=344&type=chunk) [M. Contingencies](index=74&type=section&id=M.%20Contingencies) - NAI accrued **$1.4 million** for a tentative settlement of two class action and PAGA lawsuits filed by former employees in December 2023, including estimated legal fees, with court ap

[First Quarter Fiscal 2026 Results Overview](index=1&type=section&id=First%20Quarter%20Fiscal%202026%20Results%20Overview) MillerKnoll Inc. achieved strong Q1 FY2026 results, driven by robust execution, improving market conditions, and strategic growth initiatives [Executive Summary](index=1&type=section&id=Executive%20Summary) MillerKnoll Inc. reported strong Q1 FY2026 results, exceeding expectations through robust execution and strategic growth - MillerKnoll Inc. reported **strong Q1 FY2026 results**, exceeding expectations[1](index=1&type=chunk)[5](index=5&type=chunk) - Performance driven by strong execution, improving conditions in key markets, and strategic growth initiatives[5](index=5&type=chunk) - The business model delivered revenue and earnings growth while maintaining balance sheet strength[5](index=5&type=chunk) [Consolidated Financial Highlights](index=1&type=section&id=Consolidated%20Financial%20Highlights) MillerKnoll reported significant Q1 FY2026 increases in net sales and operating earnings, with adjusted diluted EPS growth despite a slight gross margin decrease Consolidated Financial Highlights (Dollars in millions, except per share data) | (Dollars in millions, except per share data) | August 30, 2025 | August 31, 2024 | % Chg. | | :------------------------------------------ | :-------------- | :-------------- | :----- | | Net sales | $955.7 | $861.5 | 10.9 % | | Gross margin % | 38.5 % | 39.0 % | (1.3)% | | Operating expenses | $314.6 | $321.1 | (2.0)% | | * Adjusted operating expenses | $308.0 | $286.9 | 7.4 % | | Operating earnings % | 5.6 % | 1.8 % | 211.1 %| | * Adjusted operating earnings % | 6.3 % | 5.8 % | 8.6 % | | (1) Earnings (loss) per share - diluted | $0.29 | $(0.02) | N/A | | *(1) Adjusted earnings per share - diluted | $0.45 | $0.36 | 25.0 % | - Net sales of **$955.7 million**, up **10.9%** as reported and **10.0% organically**, year-over-year[3](index=3&type=chunk) - Orders of **$885.4 million**, down **5.4%** as reported and **6.2% organically**, year-over-year, primarily due to order pull-forward in North America Contract segment in Q4 FY2025[3](index=3&type=chunk) - Gross margin decreased **50 basis points**, mainly from **$8.0 million** net tariff-related impact, partially offset by leverage on higher net sales[3](index=3&type=chunk) [Cash Flow, Debt, and Liquidity](index=2&type=section&id=Cash%20Flow%2C%20Debt%2C%20and%20Liquidity) MillerKnoll maintained strong liquidity, refinanced its Term Loan B to 2032, and reported $9.4 million in operating cash flow with a 2.92x net debt-to-EBITDA ratio - Liquidity as of August 30, 2025, was **$480.5 million**, including cash on hand and Revolving Credit Facility availability[8](index=8&type=chunk) - Issued **$550 million** Term Loan B, replacing existing debt and extending maturity to 2032[8](index=8&type=chunk) - Cash flow from operations was **$9.4 million**[8](index=8&type=chunk) - Net debt-to-EBITDA ratio was **2.92x**[8](index=8&type=chunk) Near Term Scheduled Debt Maturities (millions) | Fiscal Year | Amount (millions) | | :---------- | :---------------- | | 2026 | $12.4 | | 2027 | $23.3 | | 2028 | $25.8 | [Results by Segment](index=2&type=section&id=Results%20by%20Segment) All MillerKnoll segments reported Q1 FY2026 net sales growth, with varied order trends and operating margins influenced by market dynamics [North America Contract](index=2&type=section&id=North%20America%20Contract) North America Contract achieved significant net sales growth and increased operating margin, despite an order decline due to prior quarter pull-ahead - Q1 net sales of **$533.9 million**, up **12.1%** on both reported and organic basis, year-over-year[9](index=9&type=chunk) - Q1 orders of **$492.2 million**, down **8.2%** as reported and organically, year-over-year, primarily due to an estimated **$55 million to $60 million** order pull-ahead from Q4 FY2025 pricing actions[9](index=9&type=chunk) - Q1 operating margin of **10.7%** compared to **3.4%** in the prior year; adjusted operating margin of **11.4%**, up **200 basis points**, driven by fixed expense leverage on higher net sales, partially offset by higher net tariff-related impact[9](index=9&type=chunk) [International Contract](index=2&type=section&id=International%20Contract) International Contract saw strong net sales growth but declining orders, with improved operating margin and a slight adjusted margin decrease - Q1 net sales of **$167.5 million**, up **14.4%** as reported and **11.3% organically**, year-over-year[9](index=9&type=chunk) - Q1 orders of **$154.5 million**, down **6.5%** as reported and **9.2% organically**, year-over-year[9](index=9&type=chunk) - Q1 operating margin of **8.1%** compared to **6.5%** in the prior year; adjusted operating margin of **8.5%**, down **60 basis points** year-over-year, primarily from regional and product sales mix[9](index=9&type=chunk) [Global Retail](index=3&type=section&id=Global%20Retail) Global Retail reported net sales and order growth, but operating margin declined due to increased freight, tariffs, and new store opening costs - Q1 net sales of **$254.3 million**, up **6.4%** as reported and **4.9% organically**, year-over-year[13](index=13&type=chunk) - Q1 orders of **$238.7 million**, up **1.7%** as reported and **0.3% organically**, year-over-year, with North America region orders up **8%**[13](index=13&type=chunk) - Q1 operating margin of **0.6%** compared to **2.2%** in the prior year; adjusted operating margin of **1.2%**, down **190 basis points** year-over-year, primarily from increased freight costs, higher net tariff-related impact, and new retail store opening costs[13](index=13&type=chunk) - Opened two DWR stores (Sarasota, FL, and Las Vegas, NV) and two Herman Miller stores (Chicago, IL, and Philadelphia, PA) in Q1[13](index=13&type=chunk) [Second Quarter Fiscal 2026 Outlook](index=3&type=section&id=Second%20Quarter%20Fiscal%202026%20Outlook) MillerKnoll projects Q2 FY2026 net sales between $926 million and $966 million, with adjusted diluted EPS of $0.38 to $0.44, including tariff and new store costs Q2 FY2026 Financial Operating Results Expectations | Q2 FY2026 | Range | | :------------------------------ | :------------------------- | | Net sales | $926 million to $966 million | | Gross margin % | 37.6% to 38.6% | | Adjusted operating expenses* | $300 million to $310 million | | Interest and other expense, net | $16.2 million to $17.2 million | | Adjusted effective tax rate* | 22.0% to 24.0% | | Adjusted earnings per share - diluted* | $0.38 to $0.44 | - Guidance ranges include estimated incremental costs related to tariffs (net of expected mitigation efforts) between **$2 million to $4 million** before tax, and **$0.02 to $0.04** of net earnings per share[14](index=14&type=chunk) - Operating expense outlook reflects costs related to four new retail store openings in Q2 FY2026[14](index=14&type=chunk) [Condensed Consolidated Financial Statements](index=4&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents MillerKnoll's unaudited condensed consolidated financial statements, including statements of operations, cash flows, and balance sheets [Statements of Operations](index=4&type=section&id=Statements%20of%20Operations) The statements of operations highlight MillerKnoll's Q1 FY2026 financial performance, showing significant increases in net sales and operating earnings Condensed Consolidated Statements of Operations (Three Months Ended) | (Unaudited) (Dollars in millions, except per share and common share data) | August 30, 2025 | % | August 31, 2024 | % | | :---------------------------------------------------------------------- | :-------------- | :----- | :-------------- | :----- | | Net sales | $955.7 | 100.0 %| $861.5 | 100.0 %| | Cost of sales | 587.6 | 61.5 % | 525.2 | 61.0 % | | Gross margin | 368.1 | 38.5 % | 336.3 | 39.0 % | | Operating expenses | 314.6 | 32.9 % | 321.1 | 37.3 % | | Operating earnings | 53.5 | 5.6 % | 15.2 | 1.8 % | | Other expenses, net | 24.8 | 2.6 % | 16.9 | 2.0 % | | Earnings (loss) before income taxes and equity income | 28.7 | 3.0 % | (1.7) | (0.2)% | | Income tax expense (benefit) | 7.6 | 0.8 % | (1.1) | (0.1)% | | Equity income (loss), net of tax | — | — % | 0.1 | — % | | Net earnings (loss) | 21.1 | 2.2 % | (0.5) | (0.1)% | | Net earnings attributable to redeemable noncontrolling interests | 0.9 | 0.1 % | 0.7 | 0.1 % | | Net earnings (loss) attributable to MillerKnoll, Inc. | $20.2 | 2.1 % | $(1.2) | (0.1)% | | Earnings (loss) per share - basic | $0.29 | | ($0.02) | |\ | Weighted average basic common shares | 68,519,141 | | 70,206,373 | | | Earnings (loss) per share - diluted | $0.29 | | ($0.02) | | | Weighted average diluted common shares | 69,194,506 | | 70,206,373 | | [Statements of Cash Flows](index=6&type=section&id=Statements%20of%20Cash%20Flows) The statements of cash flows show decreased operating cash flow, increased investing cash use, and reduced financing cash use for Q1 FY2026 Condensed Consolidated Statements of Cash Flows (Three Months Ended, Dollars in millions) | (Unaudited) (Dollars in millions) | August 30, 2025 | August 31, 2024 | | :-------------------------------- | :-------------- | :-------------- | | Cash provided by (used in): | | | | Operating activities | $9.4 | $21.1 | | Investing activities | (30.5) | (22.3) | | Financing activities | (9.2) | (20.3) | | Effect of exchange rate changes | 3.8 | 0.8 | | Net change in cash and cash equivalents | (26.5) | (20.7) | | Cash and cash equivalents, beginning of period | 193.7 | 230.4 | | Cash and cash equivalents, end of period | $167.2 | $209.7 | [Balance Sheets](index=7&type=section&id=Balance%20Sheets) The balance sheets indicate a slight decrease in total assets and liabilities, with decreased cash and increased inventories from May to August 2025 Condensed Consolidated Balance Sheets (Dollars in millions) | (Unaudited) (Dollars in millions) | August 30, 2025 | May 31, 2025 | | :-------------------------------- | :-------------- | :----------- | | **ASSETS** | | | | Current Assets: | | | | Cash and cash equivalents | $167.2 | $193.7 | | Accounts receivable, net | 332.1 | 350.2 | | Unbilled accounts receivable | 33.2 | 26.9 | | Inventories, net | 465.8 | 447.5 | | Prepaid expenses and other | 91.5 | 90.4 | | Total current assets | 1,089.8 | 1,108.7 | | Net property and equipment | 502.6 | 496.1 | | Right of use assets | 412.1 | 411.2 | | Other assets | 1,936.5 | 1,934.2 | | Total Assets | $3,941.0 | $3,950.2 | | **LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS & STOCKHOLDERS' EQUITY** | | | | Current Liabilities: | | | | Accounts payable | $253.6 | $271.3 | | Short-term borrowings and current portion of long-term debt | 16.4 | 16.0 | | Short-term lease liability | 75.7 | 72.0 | | Accrued liabilities | 306.3 | 344.5 | | Total current liabilities | 652.0 | 703.8 | | Long-term debt | 1,327.5 | 1,310.6 | | Lease liabilities | 409.0 | 413.4 | | Other liabilities | 190.1 | 187.3 | | Total Liabilities | 2,578.6 | 2,615.1 | | Redeemable Noncontrolling Interests | 62.9 | 59.3 | | Stockholders' Equity | 1,299.5 | 1,275.8 | | Total Liabilities, Redeemable Noncontrolling Interests and Stockholders' Equity | $3,941.0 | $3,950.2 | [Non-GAAP Financial Measures and Other Supplemental Data](index=8&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Other%20Supplemental%20Data) This section provides definitions, adjustments, and reconciliations for non-GAAP financial measures, along with segment descriptions [Non-GAAP Definitions](index=8&type=section&id=Non-GAAP%20Definitions) This section defines key non-GAAP financial measures, presented to offer a comparative basis for investors alongside GAAP results - Non-GAAP measures are presented to provide financial information on a more comparative basis for investors, not as alternatives to GAAP[19](index=19&type=chunk) - Definitions provided for: Adjusted Effective Tax Rate, Adjusted Operating Earnings (Loss), Adjusted Operating Margin, Adjusted Earnings per Share, Adjusted Gross Margin, Adjusted Operating Expenses, Adjusted Bank Covenant EBITDA, and Organic Growth (Decline)[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk)[23](index=23&type=chunk)[24](index=24&type=chunk)[25](index=25&type=chunk) [Non-GAAP Adjustments and Segment Descriptions](index=9&type=section&id=Non-GAAP%20Adjustments%20and%20Segment%20Descriptions) This section details specific adjustments for non-GAAP measures and describes MillerKnoll's reportable segments - Adjustments include Amortization of Knoll purchased intangibles, Integration charges, Restructuring charges, Knoll pension plan termination charges, Debt extinguishment charges, Impairment charges, and Tax related items[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk) - Segment descriptions: North America Contract (furniture for office, healthcare, education in US/Canada, plus specific brands), International Contract (furniture in Europe, MEA, APAC, LatAm), Global Retail (modern design furnishings to third-party retailers and D2C, plus Holly Hunt brand), and Corporate (unallocated general corporate expenses)[30](index=30&type=chunk) [Non-GAAP Reconciliations](index=10&type=section&id=Non-GAAP%20Reconciliations) This section provides detailed reconciliations from GAAP to non-GAAP financial measures for various metrics on a consolidated and segment basis [Operating Earnings to Adjusted Operating Earnings by Segment](index=10&type=section&id=Operating%20Earnings%20to%20Adjusted%20Operating%20Earnings%20by%20Segment) This reconciliation details adjustments from GAAP to adjusted operating earnings for each segment and consolidated MillerKnoll, highlighting specific charges Reconciliation of Operating Earnings (Loss) to Adjusted Operating Earnings (Loss) by Segment (millions) | Segment / Metric | August 30, 2025 (millions) | August 31, 2024 (millions) | | :-------------------------------- | :------------------------- | :------------------------- | | **North America Contract** | | | | Operating earnings | $56.9 | $16.1 | | Adjustments | 4.2 | 28.8 | | Adjusted operating earnings | $61.1 | $44.9 | | **International Contract** | | | | Operating earnings | $13.5 | $9.5 | | Adjustments | 0.8 | 3.8 | | Adjusted operating earnings | $14.3 | $13.3 | | **Global Retail** | | | | Operating earnings | $1.4 | $5.3 | | Adjustments | 1.6 | 2.1 | | Adjusted operating earnings | $3.0 | $7.4 | | **Corporate** | | | | Operating (loss) | $(18.3) | $(15.7) | | Adjusted operating (loss) | $(18.3) | $(15.7) | | **MillerKnoll, Inc. (Consolidated)** | | | | Operating earnings | $53.5 | $15.2 | | Adjustments | 6.6 | 34.7 | | Adjusted operating earnings | $60.1 | $49.9 | [Earnings per Share to Adjusted Earnings per Share](index=12&type=section&id=Earnings%20per%20Share%20to%20Adjusted%20Earnings%20per%20Share) This reconciliation details adjustments from diluted EPS to adjusted diluted EPS, including amortization, integration, restructuring, and debt extinguishment charges Reconciliation of Earnings (Loss) per Share to Adjusted Earnings per Share (Three Months Ended) | Metric | August 30, 2025 | August 31, 2024 | | :------------------------------------------ | :-------------- | :-------------- | | Earnings (loss) per share - diluted | $0.29 | $(0.02) | | Add: Amortization of Knoll purchased intangibles | 0.09 | 0.08 | | Add: Integration charges | — | 0.40 | | Add: Restructuring charges | 0.01 | — | | Add: Debt extinguishment charges | 0.11 | — | | Add: Knoll pension plan termination charges | — | 0.01 | | Tax impact on adjustments | (0.05) | (0.11) | | Adjusted earnings per share - diluted | $0.45 | $0.36 | | Weighted average shares outstanding (used for calculating adjusted earnings per share) – diluted | 69,194,506 | 70,206,373 | [Gross Margin to Adjusted Gross Margin](index=12&type=section&id=Gross%20Margin%20to%20Adjusted%20Gross%20Margin) This reconciliation illustrates the adjustment from GAAP gross margin to adjusted gross margin, accounting for integration charges Reconciliation of Gross Margin to Adjusted Gross Margin (Three Months Ended, Dollars in millions) | Metric | August 30, 2025 | % | August 31, 2024 | % | | :------------------ | :-------------- | :----- | :-------------- | :----- | | Gross margin | $368.1 | 38.5 % | $336.3 | 39.0 % | | Integration charges | — | — % | 0.5 | 0.1 % | | Adjusted gross margin | $368.1 | 38.5 % | $336.8 | 39.1 % | [Operating Expenses to Adjusted Operating Expenses & Adjusted Bank Covenant EBITDA](index=12&type=section&id=Operating%20Expenses%20to%20Adjusted%20Operating%20Expenses%20%26%20Adjusted%20Bank%20Covenant%20EBITDA) This section reconciles operating expenses to adjusted operating expenses and presents the calculation of Adjusted Bank Covenant EBITDA and its ratio Reconciliation of Operating Expenses to Adjusted Operating Expenses (Three Months Ended, Dollars in millions) | Metric | August 30, 2025 | % | August 31, 2024 | % | | :------------------------------------------ | :-------------- | :----- | :-------------- | :----- | | Operating expenses | $314.6 | 32.9 % | $321.1 | 37.3 % | | Restructuring charges | 0.5 | 0.1 % | — | — % | | Integration charges | — | — % | 27.8 | 3.2 % | | Amortization of Knoll purchased intangibles | 6.1 | 0.6 % | 5.9 | 0.7 % | | Knoll pension plan termination charges | — | — % | 0.5 | 0.1 % | | Adjusted operating expenses | $308.0 | 32.2 % | $286.9 | 33.3 % | Reconciliation of Net Loss to Adjusted Bank Covenant EBITDA and Adjusted Bank Covenant EBITDA Ratio (Trailing Twelve Month Basis, Dollars in millions) | Metric | August 30, 2025 | | :-------------------------------------- | :-------------- | | Net loss | $(15.6) | | Income tax expense | 20.3 | | Depreciation expense | 102.9 | | Amortization expense | 38.5 | | Interest expense | 75.2 | | (*) Other adjustments | 183.7 | | Adjusted bank covenant EBITDA | $405.0 | | Total debt, less cash, end of trailing period | $1,184.5 | | Net debt to adjusted bank covenant EBITDA ratio | 2.92 | [Organic Sales Growth by Segment](index=14&type=section&id=Organic%20Sales%20Growth%20by%20Segment) This table presents organic sales growth for each segment and consolidated MillerKnoll, adjusted for currency translation effects Organic Sales Growth by Segment (Three Months Ended August 30, 2025, Dollars in millions) | Metric | North America Contract | International Contract | Global Retail | Total | | :---------------------- | :--------------------- | :--------------------- | :------------ | :------ | | Net sales, as reported | $533.9 | $167.5 | $254.3 | $955.7 | | % change from PY | 12.1 % | 14.4 % | 6.4 % | 10.9 % | | Adjustments | | | | | | (1) Currency translation effects | (0.1) | (4.6) | (3.6) | (8.3) | | Net sales, organic | $533.8 | $162.9 | $250.7 | $947.4 | | % change from PY | 12.1 % | 11.3 % | 4.9 % | 10.0 % | [Organic Order Growth by Segment](index=14&type=section&id=Organic%20Order%20Growth%20by%20Segment) This table details organic order growth for each segment and consolidated MillerKnoll, adjusted for currency translation effects Organic Order Growth by Segment (Three Months Ended August 30, 2025, Dollars in millions) | Metric | North America Contract | International Contract | Global Retail | Total | | :---------------------- | :--------------------- | :--------------------- | :------------ | :------ | | Orders, as reported | $492.2 | $154.5 | $238.7 | $885.4 | | % change from PY | (8.2)% | (6.5)% | 1.7 % | (5.4)% | | Adjustments | | | | | | (1) Currency translation effects | (0.1) | (4.5) | (3.3) | (7.9) | | Orders, organic | $492.1 | $150.0 | $235.4 | $877.5 | | % change from PY | (8.2)% | (9.2)% | 0.3 % | (6.2)% | [Effective Tax Rate to Adjusted Effective Tax Rate](index=15&type=section&id=Effective%20Tax%20Rate%20to%20Adjusted%20Effective%20Tax%20Rate) This reconciliation shows adjustments from the GAAP effective tax rate to the adjusted effective tax rate, accounting for non-GAAP impacts Reconciliation of Effective Tax Rate to Adjusted Effective Tax Rate (Three Months Ended, Dollars in millions) | Metric | August 30, 2025 | August 31, 2024 | | :------------------------------------------ | :-------------- | :-------------- | | Income tax expense (benefit), as reported (GAAP) | $7.6 | $(1.1) |\ | Effective Tax Rate | 26.5 % | 66.2 % | | Adjustments | | | | Restructuring charges | $0.1 | — | | Integration charges | — | 6.7 | | Amortization of Knoll purchased intangibles | 1.5 | 1.4 | | Knoll pension plan termination charges | — | 0.1 | | Debt extinguishment charges | 2.0 | — | | Income tax expense (benefit), adjusted | $11.2 | $7.1 | | * Adjusted Effective Tax Rate | 26.0 % | 21.5 % | [Consolidated Backlog](index=15&type=section&id=Consolidated%20Backlog) MillerKnoll's consolidated backlog decreased to $690.9 million in Q1 FY2026 from $758.0 million in Q1 FY2025 Consolidated MillerKnoll Backlog (Dollars in millions) | Metric | Q1 FY2026 | Q1 FY2025 | | :---------------- | :-------- | :-------- | | MillerKnoll backlog | $690.9 | $758.0 | [Company Information](index=3&type=section&id=Company%20Information) This section provides an overview of MillerKnoll, its brands, forward-looking statements, risk factors, and webcast information [About MillerKnoll](index=16&type=section&id=About%20MillerKnoll) MillerKnoll is a collective of dynamic brands focused on designing and building a sustainable, equitable, and beautiful future - MillerKnoll is a collective of dynamic brands, including Herman Miller, Knoll, Colebrook Bosson Saunders, DatesWeiser, Design Within Reach, Edelman, Geiger, HAY, Holly Hunt, Knoll Textiles, Maharam, Muuto, NaughtOne, and Spinneybeck|FilzFelt[43](index=43&type=chunk) - The company aims to redefine modern for the 21st century by building a more sustainable, equitable, and beautiful future[43](index=43&type=chunk) [Forward-Looking Statements and Risk Factors](index=16&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) This section outlines forward-looking statements and key risk factors, including trade policies, growth strategy, economic conditions, and cybersecurity threats - The communication includes forward-looking statements about future events, anticipated results, market conditions, business strategies, and risks[44](index=44&type=chunk) - Actual results could differ materially due to various risks and uncertainties, many beyond the company's control[44](index=44&type=chunk) - Key risk factors include changes to U.S. and international trade policies (tariffs), challenges in implementing growth strategy, consumer spending levels, global and national economic conditions (inflation, interest rates, geopolitical tensions), cybersecurity threats, public health crises, risks related to Knoll acquisition debt, availability and pricing of raw materials, financial strength of dealers/customers, pace of government procurement, and outcome of litigation/audits[46](index=46&type=chunk) [Webcast and Conference Call Information](index=3&type=section&id=Webcast%20and%20Conference%20Call%20Information) MillerKnoll hosted a conference call and webcast on September 23, 2025, to discuss Q1 FY2026 results, with an online archive available - Conference call and webcast held on Tuesday, September 23, 2025, at 5:00 PM ET to discuss Q1 FY2026 results[12](index=12&type=chunk) - Details and online archive available on the company's investor relations website: https://www.millerknoll.com/investor-relations/news-events/events-and-presentations[12](index=12&type=chunk)

[Cautionary Information Regarding Forward-Looking Statements](index=3&type=section&id=Cautionary%20Information%20Regarding%20Forward-Looking%20Statements) This Annual Report contains forward-looking statements regarding anticipated regulatory events, future financial position, business strategy, and clinical trials, which are subject to various risks, uncertainties, and assumptions - This Annual Report contains forward-looking statements regarding anticipated regulatory events, future financial position, business strategy, and clinical trials, which are subject to various risks, uncertainties, and assumptions[10](index=10&type=chunk) [Summary of Risk Factors](index=4&type=section&id=Summary%20of%20Risk%20Factors) This section provides an overview of the company's key risk factors, including financial, commercialization, intellectual property, and operational challenges [Risks Related to Our Business and Financial Position](index=4&type=section&id=Risks%20Related%20to%20Our%20Business%20and%20Financial%20Position) The company has a history of operating losses and no assurance of profitability, requiring additional funding which may not be available on acceptable terms. It faces risks related to debt obligations, potential litigation, and limitations on using net operating loss carryforwards - The company has incurred losses since inception, with a net loss of **$13.6 million** for the year ended June 30, 2025, and an accumulated deficit of **$333.5 million**[17](index=17&type=chunk)[98](index=98&type=chunk)[102](index=102&type=chunk) - The company may need to raise additional funding through public or private equity or debt financings, which could dilute existing stockholders or impose restrictive covenants[17](index=17&type=chunk)[103](index=103&type=chunk)[106](index=106&type=chunk) - As of June 30, 2025, the company had federal net operating loss carryforwards of **$516.7 million**, but previous ownership changes have significantly limited their usability, with **$324.7 million** expected to expire unused by 2037[113](index=113&type=chunk)[114](index=114&type=chunk)[86](index=86&type=chunk) [Risks Related to Commercialization](index=4&type=section&id=Risks%20Related%20to%20Commercialization) Commercialization risks include heavy dependence on product success, difficulty differentiating products from generics, potential delays in product launches, reliance on limited third-party manufacturers, intense competition, and government restrictions on pricing and reimbursement - The company is heavily dependent on the commercial success of its products but has not generated sufficient net revenue to achieve company-wide profitability[17](index=17&type=chunk)[116](index=116&type=chunk) - The company relies on third parties to manufacture its products, introducing risks of costs, delays, and inefficiencies that may prevent successful commercialization[17](index=17&type=chunk)[125](index=125&type=chunk) - Government restrictions on pricing and reimbursement, as well as other healthcare payor cost-containment initiatives, may negatively impact the company's ability to generate net revenue[17](index=17&type=chunk)[138](index=138&type=chunk) - Adzenys and Cotempla, classified as Schedule II controlled substances, are subject to extensive regulation by the DEA regarding their manufacture, use, sale, and distribution[17](index=17&type=chunk)[161](index=161&type=chunk) [Risks Related to Our Intellectual Property](index=5&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property) The company faces risks from intellectual property disputes, dependence on license agreements, potential expiration or loss of patent protection, and challenges in enforcing intellectual property rights globally - A dispute concerning the infringement or misappropriation of proprietary rights could be time-consuming and costly, potentially leading to damages or injunctions[18](index=18&type=chunk)[172](index=172&type=chunk) - The company is dependent on license and commercialization agreements, and the expiration or loss of patent protection (e.g., Adzenys patents expire in **2026/2032**, Cotempla in **2032/2038**) may adversely affect future net revenue[18](index=18&type=chunk)[173](index=173&type=chunk)[176](index=176&type=chunk) [Risks Related to Our Organization, Structure and Operations](index=5&type=section&id=Risks%20Related%20to%20Our%20Organization%2C%20Structure%20and%20Operations) Risks include significant investments required for business expansion, difficulties integrating acquired businesses, high customer concentration, dependence on key personnel, and potential product liability lawsuits - Efforts to expand and transform businesses, including acquisitions and partnerships, may require significant investments and could lead to increased financial pressure if unsuccessful[19](index=19&type=chunk)[187](index=187&type=chunk)[189](index=189&type=chunk) - In fiscal 2025, four significant customers accounted for **85% of gross revenue** and **89% of gross accounts receivable**, posing a material adverse effect if any are lost or delay payments[20](index=20&type=chunk)[193](index=193&type=chunk)[194](index=194&type=chunk) [PART I](index=6&type=section&id=PART%20I) This section provides an overview of the company's business, risk factors, properties, and legal proceedings [Business Overview](index=6&type=section&id=Item%201.%20Business) Aytu BioPharma is a pharmaceutical company focused on advancing innovative medicines for complex central nervous system (CNS) diseases, particularly Major Depressive Disorder (MDD) with the upcoming launch of EXXUA, and Attention Deficit Hyperactivity Disorder (ADHD). The company has strategically divested its Consumer Health business and suspended clinical development programs to concentrate on its revenue-generating prescription product portfolios and achieve profitability [Company Overview](index=6&type=section&id=Company%20Overview) Aytu BioPharma focuses on innovative CNS medicines, building a portfolio through in-licensing, acquisition, development, and commercialization, with EXXUA as a key growth driver - Aytu BioPharma, Inc. is a pharmaceutical company focused on advancing innovative medicines for complex central nervous system (CNS) diseases to improve the quality of life for patients[22](index=22&type=chunk) - The company's strategy involves in-licensing, acquiring, developing, and commercializing novel prescription therapeutics to build a portfolio of revenue-generating products[23](index=23&type=chunk) - Aytu anticipates launching EXXUA (gepirone) extended-release tablets for Major Depressive Disorder (MDD) in the **fourth calendar quarter of 2025**, expecting it to be a major growth catalyst[24](index=24&type=chunk) - The company has indefinitely suspended active development of clinical programs and divested unprofitable operations, including the Consumer Health business, to focus on accelerating commercial business growth and achieving positive operating cash flows[25](index=25&type=chunk) - The continuing operations are focused on EXXUA and current prescription pharmaceutical products, primarily the ADHD Portfolio (Adzenys XR-ODT and Cotempla XR-ODT) and the Pediatric Portfolio (Karbinal ER, Poly-Vi-Flor, and Tri-Vi-Flor)[26](index=26&type=chunk) - The company incurred a net loss of **$13.6 million** for the year ended June 30, 2025, and had an accumulated deficit of **$333.5 million**, expecting to become profitable through commercial business growth[27](index=27&type=chunk) [Recent Business Development](index=7&type=section&id=Recent%20Business%20Development) Recent developments include the divestiture of the Consumer Health business, product portfolio revenue, manufacturing transfers, suspension of clinical programs, and ongoing patent litigation - Aytu completed the wind down and divestiture of its Consumer Health business in the **first quarter of fiscal 2025** to prioritize its prescription business[29](index=29&type=chunk) Net Revenue by Product Portfolio (Fiscal Year 2025) | Product Portfolio | Net Revenue (in millions) | | :---------------- | :------------------------ | | ADHD Portfolio | $57.6 | | Pediatric Portfolio | $8.8 | | Total Net Revenue | $66.4 | - The Pediatric Portfolio grew to **$8.8 million** in fiscal 2025, a **20% increase** from fiscal 2024, reflecting positive effects from a recently implemented return-to-growth plan[30](index=30&type=chunk) - Manufacturing of Adzenys and Cotempla was transferred to a United States-based third-party contract manufacturer in **Q4 fiscal 2024** to reduce costs and improve profitability[31](index=31&type=chunk) - The company terminated license agreements for Healight and NT0502 and indefinitely suspended clinical development programs, including AR101, transferring all rights to EnzCo, LLC[32](index=32&type=chunk) - Aytu received a Paragraph IV Certification Notice Letter from Granules Pharmaceuticals, Inc. regarding a generic version of Adzenys, leading to a patent infringement lawsuit filed on **December 11, 2024**, with a trial scheduled for **December 7, 2026**[34](index=34&type=chunk) [Debt and Equity Financings](index=8&type=section&id=Debt%20and%20Equity%20Financings) The company secured recent equity financings totaling $16.6 million gross proceeds and manages debt obligations including a $13.0 million term loan and a $14.5 million revolving loan - In June 2025, Aytu raised gross proceeds of **$16.6 million** (**$14.8 million net**) from the issuance of common stock and prefunded warrants, intended for working capital, general corporate purposes, and EXXUA commercialization[35](index=35&type=chunk) - In June 2024, the exercise of Tranche B Warrants generated **$3.5 million** in proceeds, partially used to repay a **$15.0 million** term loan[36](index=36&type=chunk) - The company has an Eclipse Term Loan with an outstanding principal of **$13.0 million** (SOFR + **7.0%**) and an Eclipse Revolving Loan with a potential maximum borrowing base of **$14.5 million** (SOFR + **4.5%**), both maturing on **June 12, 2029**[38](index=38&type=chunk)[39](index=39&type=chunk) [Commercial Business Overview](index=9&type=section&id=Commercial%20Business%20Overview) Aytu's commercial operations focus on EXXUA for MDD, the ADHD Portfolio (Adzenys XR-ODT, Cotempla XR-ODT), and the Pediatric Portfolio, distributed in the US and internationally - Aytu operates through one business segment, focusing on EXXUA, the ADHD Portfolio, and the Pediatric Portfolio, primarily distributed in the United States through third-party channels[40](index=40&type=chunk)[41](index=41&type=chunk) - EXXUA is a novel first-in-class selective serotonin 5HT1a receptor agonist, FDA-approved for MDD, and is believed to be the only antidepressant acting on serotonin receptors without a sexual dysfunction warning[42](index=42&type=chunk)[24](index=24&type=chunk) - The ADHD Portfolio includes Adzenys XR-ODT and Cotempla XR-ODT, the first and only FDA-approved amphetamine and methylphenidate extended-release, orally disintegrating tablets for ADHD[43](index=43&type=chunk) - The Pediatric Portfolio comprises Karbinal ER (antihistamine) and Poly-Vi-Flor/Tri-Vi-Flor (fluoride-based multivitamin supplements) for infants and children[44](index=44&type=chunk) - The Aytu RxConnect patient support program offers affordable, predictable copays and hassle-free availability for commercially insured patients through a network of over **1,000 pharmacies**[46](index=46&type=chunk) - Aytu has international commercial agreements for Adzenys and Cotempla with Medomie Pharma Ltd (Israel/Palestinian Authority, **July 2023**) and Lupin Pharma Canada Ltd (Canada, **September 2024**)[47](index=47&type=chunk) [Strategy](index=10&type=section&id=Strategy) The company's strategy prioritizes increasing net revenue, enhancing financial performance through operational efficiencies, and portfolio optimization, with a focus on the EXXUA launch and existing product growth - The company's strategic priorities include increasing net revenue, enhancing financial performance through operational and manufacturing efficiencies, and portfolio prioritization[49](index=49&type=chunk) - Key strategic initiatives include successfully launching EXXUA in **Q4 2025**, growing existing commercial products (Adzenys, Cotempla, Karbinal, Poly-Vi-Flor, Tri-Vi-Flor), leveraging the Aytu RxConnect platform, and improving gross margins for the ADHD product franchise through manufacturing transfers[52](index=52&type=chunk) [Products and Markets](index=10&type=section&id=Products%20and%20Markets) Aytu's product portfolio targets the MDD market with EXXUA, the ADHD market with Adzenys and Cotempla, and the pediatric market with Karbinal ER and fluoride-based multivitamin supplements - The United States MDD market is significant, with over **340 million antidepressant prescriptions** written in 2024, but high patient dissatisfaction due to side effects like sexual dysfunction and weight gain[51](index=51&type=chunk)[54](index=54&type=chunk) - EXXUA is a novel first-in-class selective serotonin 5HT1a receptor agonist, FDA-approved for MDD, and is unique as the only antidepressant acting on serotonin receptors without a label warning about sexual dysfunction[53](index=53&type=chunk) - EXXUA demonstrated efficacy in two pivotal Phase 3 trials, with symptom improvement by **week 2-3** and a favorable tolerability profile, avoiding significant sexual dysfunction or weight gain[55](index=55&type=chunk)[56](index=56&type=chunk)[57](index=57&type=chunk) - ADHD is a common neurobehavioral disorder, with approximately **104 million prescriptions** for ADHD medications written in the United States in 2024, generating **$28.6 billion** in sales[58](index=58&type=chunk)[59](index=59&type=chunk) - Adzenys and Cotempla are the first and only extended-release orally disintegrating tablets (XR-ODT) for ADHD, offering ease of administration, taste-masking, and prevention of 'cheeking'[61](index=61&type=chunk)[62](index=62&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk) - Adzenys composition-of-matter patents expire in **2026** and **2032**, with a generic version by Actavis (Teva) approved to launch on **September 1, 2025**[63](index=63&type=chunk)[120](index=120&type=chunk) - Cotempla composition-of-matter patents expire in **2032**, and a method-of-use patent extends protection to **2038**, with a generic version by Teva approved to launch on **July 1, 2026**[68](index=68&type=chunk)[120](index=120&type=chunk) - Karbinal ER is the only FDA-approved, **12-hour** carbinoxamine oral suspension, indicated for various allergic conditions in patients two years and older, positioned as a second-line treatment[70](index=70&type=chunk)[72](index=72&type=chunk) - Poly-Vi-Flor and Tri-Vi-Flor are prescription fluoride-based multivitamin supplements for infants and children with fluoride deficiency, containing proprietary L-methylfolate forms (Metafolin and Arcofolin) for enhanced bioavailability[74](index=74&type=chunk)[77](index=77&type=chunk)[79](index=79&type=chunk) [Manufacturing](index=15&type=section&id=Manufacturing) Aytu relies on Contract Manufacturing Organizations (CMOs) for product manufacturing and testing, with key supply agreements in place for EXXUA, ADHD, and Pediatric portfolio products - Aytu contracts with CMOs for product manufacturing and testing, overseeing activities with internal technical, manufacturing, and quality experience personnel[80](index=80&type=chunk) - Key supply agreements include Fabre-Kramer for EXXUA (through **September 2028**), a US-based CMO for Adzenys and Cotempla (through **November 2028**), Tris for Karbinal (through **August 2032**), and US-based CMOs for Poly-Vi-Flor and Tri-Vi-Flor[84](index=84&type=chunk) [Research and Development](index=15&type=section&id=Research%20and%20Development) Research and development activities have been indefinitely suspended to reallocate resources towards commercialization efforts, resulting in a significant reduction in R&D spending - Research and development activities have been indefinitely suspended to focus resources on commercialization efforts, leading to a significant decline in R&D spending[81](index=81&type=chunk) [Intellectual Property](index=15&type=section&id=Intellectual%20Property) Aytu actively seeks trademark protection for its brands in the United States and may license intellectual property from third parties to support its product portfolio - Aytu seeks trademark protection in the United States for its brands (e.g., Aytu, EXXUA, Adzenys, Cotempla, Karbinal, Poly-Vi-Flor, Tri-Vi-Flor) and may obtain licenses from third-party intellectual property holders[82](index=82&type=chunk) [Government Regulation](index=15&type=section&id=Government%20Regulation) The company's products are subject to extensive regulation by the FDA and other agencies, requiring rigorous testing, approval, and post-market compliance, especially for controlled substances like Adzenys and Cotempla - The company is subject to extensive regulation by the FDA and other federal, state, and local agencies, including requirements for testing, development, manufacturing, approval, labeling, and marketing of products[83](index=83&type=chunk) - FDA approval of a New Drug Application (NDA) is required before any new drug can be marketed in the United States, involving preclinical testing, clinical trials (Phase 1, 2, 3), and post-approval regulation[85](index=85&type=chunk)[86](index=86&type=chunk)[87](index=87&type=chunk)[89](index=89&type=chunk) - Adzenys and Cotempla are regulated as Schedule II controlled substances by the DEA, subjecting their manufacture, use, sale, and distribution to strict requirements, including annual registration and production quotas[88](index=88&type=chunk)[90](index=90&type=chunk) [Human Capital](index=17&type=section&id=Human%20Capital) As of June 30, 2025, Aytu employed 83 individuals, primarily in commercialization, fostering a team-oriented, entrepreneurial culture focused on attracting and retaining diverse talent - As of **June 30, 2025**, Aytu employed **83 individuals** (**82 full-time**), with **52 in commercialization**, **5 in operations**, and **26 in general and administrative activities**, all located in the United States[92](index=92&type=chunk) - The company's values emphasize a team-oriented, hard-working, and entrepreneurial culture, focusing on attracting, retaining, and developing diverse talent through competitive pay, benefits, and engagement[93](index=93&type=chunk) [Available Information](index=17&type=section&id=Available%20Information) Aytu provides free access to its SEC filings, including annual, quarterly, and current reports, on its corporate website - Aytu maintains a website (https://aytubio.com) where its SEC filings, including annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, are available free of charge[95](index=95&type=chunk) [Code of Ethics](index=17&type=section&id=Code%20of%20Ethics) The company has adopted a written code of ethics applicable to all officers, directors, and employees, publicly available on its corporate governance website - The company has adopted a written code of ethics applicable to officers, directors, and employees, publicly disclosed on its corporate governance website[96](index=96&type=chunk) [Risk Factors](index=18&type=section&id=Item%201A.%20Risk%20Factors) This section details the significant risks facing Aytu BioPharma, including its history of operating losses and uncertainty of future profitability, the need for additional funding, restrictions imposed by debt agreements, and potential limitations on net operating loss carryforwards. It also covers commercialization challenges such as intense competition, reliance on third-party manufacturers, government pricing controls, and the difficulty of differentiating products. Intellectual property risks, organizational challenges, customer concentration, and legal proceedings are also highlighted - The company has incurred significant losses since inception, with a net loss of **$13.6 million** for the year ended June 30, 2025, and an accumulated deficit of **$333.5 million**, with no assurance of future profitability[98](index=98&type=chunk)[102](index=102&type=chunk) - The company may require additional funding through equity or debt financings, which could lead to significant dilution for existing stockholders or impose further restrictive covenants[103](index=103&type=chunk)[105](index=105&type=chunk)[106](index=106&type=chunk) - As of June 30, 2025, the company has a **$13.0 million** term loan and up to **$16.0 million** in secured revolving loans, with failure to satisfy obligations potentially leading to acceleration of amounts due and enforcement of security interests[108](index=108&type=chunk)[110](index=110&type=chunk) - The company's ability to use its **$516.7 million** federal net operating loss carryforwards is limited by Section 382 of the IRC due to ownership changes, with **$324.7 million** expected to expire unused by 2037[113](index=113&type=chunk)[114](index=114&type=chunk) - Competition from generic versions of its products, such as Actavis' generic Adzenys (expected **September 1, 2025**) and Teva's generic Cotempla (expected **July 1, 2026**), could materially adversely impact net revenue and profitability[120](index=120&type=chunk) - Reliance on limited single-source suppliers and third-party manufacturers for products like Adzenys and Cotempla poses risks of supply chain disruptions, increased costs, and delays in commercialization[122](index=122&type=chunk)[125](index=125&type=chunk) - Government restrictions on pricing and reimbursement, including the PPACA and Health Care Reconciliation Act, may negatively impact the company's ability to generate net revenue and achieve profitability[138](index=138&type=chunk) - Four customers contributed over **10% of gross revenue** in fiscal 2025, accounting for **85% of gross revenue** and **89% of gross accounts receivable**, creating significant customer concentration risk[193](index=193&type=chunk)[194](index=194&type=chunk) - The company is currently involved in a patent infringement lawsuit against Granules Pharmaceuticals, Inc. regarding a generic version of Adzenys, with a trial scheduled for **December 7, 2026**[34](index=34&type=chunk)[238](index=238&type=chunk) - The company's stock price is highly volatile and may be influenced by numerous factors beyond its control, including product success, regulatory decisions, competition, and general economic conditions[211](index=211&type=chunk) [Unresolved Staff Comments](index=43&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) There are no unresolved staff comments to report for the fiscal year - No unresolved staff comments were reported[227](index=227&type=chunk) [Cybersecurity](index=44&type=section&id=Item%201C.%20Cybersecurity) Aytu BioPharma relies on internal and third-party IT systems, facing risks from cyber-attacks and data breaches. The company has implemented security measures, including employee training, system monitoring, MFA, cloud-based operations, and adherence to NIST Cybersecurity Framework 2.0. The Board of Directors and Audit Committee oversee cybersecurity risk management, led by the CFO. No material cybersecurity incidents occurred in fiscal 2025 - The company relies on internal and third-party information technology systems and networks, making them vulnerable to damage, disruption, or unauthorized access from cyber-attacks[228](index=228&type=chunk)[229](index=229&type=chunk) - Aytu has implemented various cybersecurity measures, including regular employee training, system monitoring, multi-factor authentication (MFA), cloud-based environments, and external vulnerability assessments[230](index=230&type=chunk) - The Board of Directors, through its Audit Committee, actively oversees cybersecurity risk management, receiving quarterly updates on posture, threats, and incidents[231](index=231&type=chunk) - The Chief Financial Officer leads cybersecurity operations, overseeing strategy, policies, and a team with over **20 years of experience** in the field[232](index=232&type=chunk) - Aytu adheres to the National Institute of Standards and Technology (NIST) Cybersecurity Framework 2.0 and has developed internal policies and a systems disaster recovery plan[233](index=233&type=chunk) - No cybersecurity incidents materially affected the company's business strategy, results of operations, or financial condition during fiscal 2025[234](index=234&type=chunk) [Properties](index=45&type=section&id=Item%202.%20Properties) Aytu BioPharma leases its corporate headquarters in Denver, CO, and an additional office in Berwyn, PA, continuously reviewing and evaluating its property portfolio to optimize business operations Company Properties (as of June 30, 2025) | Location | Type | Purpose | | :---------- | :------ | :------------------ | | Denver, CO | Leased | Corporate headquarters | | Berwyn, PA | Leased | Office | [Legal Proceedings](index=45&type=section&id=Item%203.%20Legal%20Proceedings) Aytu BioPharma is involved in ongoing legal proceedings, including a patent infringement lawsuit against Granules Pharmaceuticals, Inc. regarding a generic version of Adzenys, with a trial scheduled for December 7, 2026. The company was also a nominal plaintiff in the 'Revive Investing' lawsuit, which resulted in a jury verdict of no liability on January 29, 2025, and is currently under appeal - The company filed a patent infringement lawsuit on **December 11, 2024**, against Granules Pharmaceuticals, Inc. concerning a generic version of Adzenys, triggering a **30-month stay** on FDA approval; a trial is scheduled for **December 7, 2026**[238](index=238&type=chunk)[479](index=479&type=chunk) - In the 'Revive Investing' lawsuit, a jury returned a verdict of no liability on **January 29, 2025**, and the plaintiffs filed an appeal on **March 6, 2025**; the outcome is not expected to materially affect the company's financial condition[239](index=239&type=chunk)[480](index=480&type=chunk) [Mine Safety Disclosures](index=45&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Aytu BioPharma - This item is not applicable to the company[240](index=240&type=chunk) [PART II](index=46&type=section&id=PART%20II) This section covers the company's common equity market, financial condition, results of operations, market risks, financial statements, and internal controls [Market for Common Equity and Stockholder Matters](index=46&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Aytu BioPharma's common stock trades on Nasdaq under 'AYTU.' As of September 15, 2025, there were 9,911,913 shares outstanding and 183 record holders. The company has an equity compensation plan (2023 Equity Incentive Plan) with 397,409 shares available for future issuance. No dividends have been declared or paid, with current intent to retain earnings for business development - As of **September 15, 2025**, the company had **9,911,913 shares** of common stock outstanding and **183 holders of record**[5](index=5&type=chunk)[242](index=242&type=chunk)[451](index=451&type=chunk) - The company's common stock has been listed on the Nasdaq under the symbol 'AYTU' since **October 20, 2017**[3](index=3&type=chunk)[242](index=242&type=chunk) Equity Compensation Plan Information (as of June 30, 2025) | Category | 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 Issuance under Equity Compensation Plans (Excluding Securities Reflected in Column A) | | :------------------------------------------- | :---------------------------------------------------------------------------------------- | :-------------------------------------------------------------------------- | :--------------------------------------------------------------------------------------------------------------------------------- | | 2023 Equity Incentive Plan (Outstanding stock options) | 211,618 | $4.51 | 397,409 | | 2023 Equity Incentive Plan (Unvested restricted stock) | 32,912 | N/A | | | Equity compensation plans not approved by security holders | 4 | N/A | — | | **Total for all plans** | **244,534** | | **397,409** | - The company has never declared or paid any dividends on its capital stock and intends to retain all available funds and future earnings to fund business development[246](index=246&type=chunk) [Reserved](index=47&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information - This item is reserved[247](index=247&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=47&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on Aytu BioPharma's financial performance and condition for the year ended June 30, 2025, compared to 2024. It highlights the company's strategic shift to focus on CNS prescription products, particularly the upcoming EXXUA launch and growth in ADHD and Pediatric portfolios, while divesting non-core assets. Key financial results show a net loss of $13.6 million in fiscal 2025, an increase in total net revenue, but a decrease in gross profit percentage due to higher cost of goods sold. Operating expenses decreased across selling, marketing, general, administrative, and R&D, but impairment expense increased significantly. The company's liquidity is supported by recent equity financings and loan agreements, but it continues to assess the impact of economic uncertainties and new legislation [Objective](index=47&type=section&id=Objective) The MD&A aims to provide relevant information for assessing and understanding the company's results of operations, cash flows, and financial condition for the year ended June 30, 2025 - The Management's Discussion and Analysis (MD&A) aims to provide relevant information for assessing and understanding the company's results of operations and cash flows for the year ended **June 30, 2025**, and its financial condition[248](index=248&type=chunk) [Overview](index=47&type=section&id=Overview) Aytu BioPharma focuses on CNS medicines, building a revenue-generating portfolio, with EXXUA's upcoming launch as a key catalyst in the over $22 billion US MDD market - Aytu BioPharma is a pharmaceutical company focused on advancing innovative medicines for complex central nervous system diseases, aiming to build a portfolio of revenue-generating products through in-licensing, acquiring, developing, and commercializing novel prescription therapeutics[249](index=249&type=chunk) - The company anticipates launching EXXUA for Major Depressive Disorder (MDD) in the **fourth calendar quarter of 2025**, expecting it to be a major growth catalyst in the over **$22 billion** United States prescription MDD market[250](index=250&type=chunk) - The Consumer Health business was divested in the **first quarter of fiscal 2025**, and the company now operates as a single operating and reporting segment focused on prescription pharmaceutical products, including the ADHD and Pediatric Portfolios[251](index=251&type=chunk)[252](index=252&type=chunk) - The company incurred a net loss of **$13.6 million** for the year ended June 30, 2025, and had an accumulated deficit of **$333.5 million**, but expects to become profitable through continued commercial business growth[253](index=253&type=chunk) [Significant Developments](index=48&type=section&id=Significant%20Developments) Significant developments include ongoing inflationary pressures, a patent infringement lawsuit, strong net revenue from ADHD and Pediatric portfolios, manufacturing transfers, suspension of R&D programs, recent equity financing, new loan agreements, and assessment of new legislation - The company continues to experience inflationary pressures, economic uncertainty, and supply chain disruptions due to global geopolitical factors, but has maintained adequate supply for its ADHD and pediatric products[255](index=255&type=chunk) - A patent infringement lawsuit against Granules Pharmaceuticals, Inc. regarding a generic version of Adzenys is ongoing, with a trial scheduled for **December 7, 2026**[256](index=256&type=chunk) - Aytu recorded net revenue of **$66.4 million** for fiscal 2025, with the ADHD Portfolio generating **$57.6 million** and the Pediatric Portfolio growing **20%** to **$8.8 million**[258](index=258&type=chunk) - Manufacturing of Adzenys and Cotempla was transferred to a United States-based third-party manufacturer in **Q4 fiscal 2024** to reduce costs[259](index=259&type=chunk) - The company indefinitely suspended clinical development programs, including AR101, and terminated related license agreements to focus on revenue-generating products and profitability[260](index=260&type=chunk) - In June 2025, the company raised **$14.8 million** in net proceeds from a public offering of common stock and prefunded warrants, intended for working capital and EXXUA commercialization[261](index=261&type=chunk) - The company has a **$13.0 million** Eclipse Term Loan (SOFR + **7.0%**) and an Eclipse Revolving Loan with a potential maximum borrowing base of **$14.5 million** (SOFR + **4.5%**), both maturing on **June 12, 2029**[264](index=264&type=chunk) - The enactment of the One Big Beautiful Bill Act (OBBBA) on **July 4, 2025**, may adversely affect the company's business, financial condition, and future plans, with an ongoing assessment of its potential impact[265](index=265&type=chunk) [Results of Operations](index=50&type=section&id=Results%20of%20Operations) Aytu's fiscal 2025 results show a net loss of $13.6 million, an increase in net revenue to $66.4 million, but a decrease in gross profit percentage due to higher cost of goods sold. Operating expenses decreased across most categories, except for a significant impairment expense Consolidated Statements of Operations (Year Ended June 30, 2025 vs. 2024) | Metric | 2025 (in thousands) | 2024 (in thousands) | Change (in thousands) | | :----------------------------------------- | :------------------ | :------------------ | :-------------------- | | Net revenue | $66,382 | $65,183 | $1,199 | | Cost of goods sold | $20,551 | $16,129 | $4,422 | | Gross profit | $45,831 | $49,054 | $(3,223) | | Selling and marketing | $20,906 | $22,083 | $(1,177) | | General and administrative | $17,379 | $19,954 | $(2,575) | | Research and development | $1,326 | $2,769 | $(1,443) | | Amortization of intangible assets | $3,683 | $3,683 | $0 | | Restructuring costs | $2,101 | $2,156 | $(55) | | Impairment expense | $8,263 | $0 | $8,263 | | Total operating expenses | $53,658 | $50,645 | $3,013 | | Loss from operations | $(7,827) | $(1,591) | $(6,236) | | Other (expense) income, net | $(512) | $870 | $(1,382) | | Interest expense | $(3,703) | $(5,059) | $1,356 | | Derivative warrant liabilities loss | $(1,703) | $(4,004) | $2,301 | | Loss on extinguishment of debt | $0 | $(594) | $594 | | Loss from continuing operations before income tax expense | $(13,745) | $(10,378) | $(3,367) | | Income tax expense | $(437) | $(2,142) | $1,705 | | Net loss from continuing operations | $(14,182) | $(12,520) | $(1,662) | | Net income (loss) from discontinued operations, net of tax | $620 | $(3,324) | $3,944 | | **Net loss** | **$(13,562)** | **$(15,844)** | **$2,282** | | Basic and diluted - net loss per share | $(2.16) | $(2.86) | $0.70 | Net Revenue by Product Portfolio (Year Ended June 30, 2025 vs. 2024) | Product Portfolio | 2025 (in thousands) | 2024 (in thousands) | Change (in thousands) | | :---------------- | :------------------ | :------------------ | :-------------------- | | ADHD Portfolio | $57,576 | $57,784 | $(208) | | Pediatric Portfolio | $8,769 | $7,280 | $1,489 | | Other | $37 | $119 | $(82) | | **Total net revenue** | **$66,382** | **$65,183** | **$1,199** | - Gross profit decreased by **$3.2 million** (**7%**) in fiscal 2025, with the gross profit percentage falling to **69%** from **75%** in fiscal 2024, primarily due to increased cost of goods sold for ADHD Portfolio inventory[268](index=268&type=chunk) - Selling and marketing expense decreased by **$1.2 million** (**5%**) in fiscal 2025, but is expected to increase in fiscal 2026 due to the anticipated EXXUA launch[269](index=269&type=chunk) - General and administrative expense decreased by **$2.6 million** (**13%**) in fiscal 2025 due to cost reduction efforts, but is expected to increase in fiscal 2026 due to EXXUA launch support[270](index=270&type=chunk) - Research and development expense decreased by **$1.4 million** (**52%**) in fiscal 2025 due to the suspension of development programs, with further slight decreases expected[271](index=271&type=chunk) - Impairment expense of **$8.3 million** was recognized in fiscal 2025, primarily due to the increased focus on EXXUA and the ADHD Portfolio[274](index=274&type=chunk) - Interest expense decreased by **$1.4 million** (**27%**) in fiscal 2025, mainly due to the extinguishment of a **$15.0 million** term loan and more favorable terms on the new **$13.0 million** Eclipse Term Loan[277](index=277&type=chunk) - A derivative warrant liabilities loss of **$1.7 million** was recognized in fiscal 2025, driven by an increase in the fair value of June 2025 Prefunded Warrants, partially offset by a decrease in other warrants' fair value[278](index=278&type=chunk) - Income tax expense from continuing operations was **$0.4 million** in fiscal 2025, compared to **$2.1 million** in fiscal 2024, primarily driven by Section 382 limitations on net operating loss utilization[280](index=280&type=chunk) - Net income from discontinued operations was **$0.6 million** in fiscal 2025, compared to a net loss of **$3.3 million** in fiscal 2024, related to the wind down and divestiture of the Consumer Health business[281](index=281&type=chunk) [Liquidity and Capital Resources](index=53&type=section&id=Liquidity%20and%20Capital%20Resources) Aytu's liquidity is supported by recent equity financings and loan agreements, with net cash provided by financing activities totaling $15.4 million in fiscal 2025, despite net cash used in operating and investing activities Consolidated Statements of Cash Flows (Year Ended June 30, 2025 vs. 2024) | Cash Flow Activity (in thousands) | 2025 | 2024 | | :------------------------------------------ | :-------- | :-------- | | Net cash used in operating activities | $(1,937) | $(1,388) | | Net cash used in investing activities | $(2,560) | $(329) | | Net cash provided by (used in) financing activities | $15,443 | $(1,262) | | **Net change in cash and cash equivalents** | **$10,946** | **$(2,979)** | | Cash and cash equivalents at beginning of period | $20,006 | $22,985 | | **Cash and cash equivalents at end of period** | **$30,952** | **$20,006** | - Net cash used in operating activities totaled **$1.9 million** in fiscal 2025, primarily due to increases in accounts receivable and prepaid expenses, partially offset by positive cash earnings[284](index=284&type=chunk) - Net cash used in investing activities was **$2.6 million** in fiscal 2025, primarily from a **$3.0 million** cash payment for acquired intangible assets related to the EXXUA Commercialization Agreement[287](index=287&type=chunk) - Net cash provided by financing activities was **$15.4 million** in fiscal 2025, primarily from **$14.8 million** in net proceeds from equity offerings and **$6.7 million** from the Eclipse Revolving Loan[288](index=288&type=chunk) - The company finances operations through common stock and warrant sales, borrowings under its revolving credit facility, and cash generated from operations[290](index=290&type=chunk) - A shelf registration statement on Form S-3, effective **October 15, 2024**, covers up to **$100.0 million** in securities, with the full amount remaining available[291](index=291&type=chunk) - In June 2025, the company raised **$14.8 million** in net proceeds from a public offering of common stock and prefunded warrants, intended for working capital and EXXUA commercialization[292](index=292&type=chunk) - The company has a **$13.0 million** Eclipse Term Loan (SOFR + **7.0%**) and an Eclipse Revolving Loan with a potential maximum borrowing base of **$14.5 million** (SOFR + **4.5%**), both maturing on **June 12, 2029**[294](index=294&type=chunk) - Contractual obligations include loan agreements, milestone payments for licensed products, and manufacturing purchase commitments[295](index=295&type=chunk) - A **$3.1 million** settlement liability related to the termination of the Tuzistra License Agreement was paid in full during the **first quarter of fiscal 2026**[296](index=296&type=chunk) - The AR101 Rumpus Asset Purchase Agreement was terminated on **August 5, 2025**, transferring all rights to EnzCo, with no remaining obligations or penalties[298](index=298&type=chunk) [Critical Accounting Estimates](index=55&type=section&id=Critical%20Accounting%20Estimates) Critical accounting estimates involve significant judgment in revenue recognition for 'Gross to Net' adjustments, annual impairment assessments of long-lived assets, and fair value measurement of liability classified warrants - Revenue recognition involves significant judgment in estimating 'Gross to Net' adjustments for product sales, considering legal interpretations, historical experience, payor channel mix, and inventory levels[303](index=303&type=chunk)[304](index=304&type=chunk) - The company assesses impairment of long-lived assets annually and when circumstances indicate carrying value may not be recoverable, leading to an **$8.3 million** impairment charge in fiscal 2025 due to shifted commercial focus[306](index=306&type=chunk)[307](index=307&type=chunk) - Liability classified warrants are carried at fair value using Black-Scholes or Monte Carlo models, with changes in fair value recorded as a gain or loss[309](index=309&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=57&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Aytu BioPharma is not required to provide information under this item - The company is not required to provide information under this item as it is a smaller reporting company[310](index=310&type=chunk) [Financial Statements and Supplementary Data](index=58&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the audited consolidated financial statements of Aytu BioPharma, Inc. and its subsidiaries for the fiscal years ended June 30, 2025, and 2024, including the Report of Independent Registered Public Accounting Firm, Consolidated Balance Sheets, Statements of Operations, Stockholders' Equity, Cash Flows, and accompanying Notes. It also includes critical audit matters related to variable consideration and significant accounting policies - Grant Thornton LLP audited the consolidated financial statements for the periods ended **June 30, 2025**, and **2024**, and issued an unqualified opinion[315](index=315&type=chunk) - A critical audit matter identified was the variable consideration related to certain gross to net adjustments, particularly for the ADHD Portfolio savings offers, due to inherent limitations in management's visibility into source data and reliance on external data[321](index=321&type=chunk)[322](index=322&type=chunk) Consolidated Balance Sheets (as of June 30, 2025 and 2024) | ASSETS (in thousands) | 2025 | 2024 | | :------------------------------------ | :------ | :------ | | Cash and cash equivalents | $30,952 | $20,006 | | Accounts receivable, net | $31,155 | $23,526 | | Inventories | $11,434 | $12,141 | | Prepaid expenses and other current assets | $5,638 | $5,097 | | Current assets of discontinued operations | $0 | $1,121 | | **Total current assets** | **$79,179** | **$61,891** | | Property and equipment, net | $532 | $693 | | Operating lease right-of-use assets | $1,061 | $829 | | Intangible assets, net | $42,201 | $52,453 | | Other non-current assets | $1,204 | $2,185 | | Non-current assets of discontinued operations | $0 | $44 | | **Total non-current assets** | **$44,998** | **$56,204** | | **Total assets** | **$124,177** | **$118,095** | | LIABILITIES (in thousands) | 2025 | 2024 | | Accounts payable | $10,601 | $10,314 | | Accrued liabilities | $38,164 | $38,143 | | Revolving credit facility | $9,063 | $2,395 | | Current portion of debt | $1,857 | $1,857 | | Other current liabilities | $3,379 | $8,962 | | Current liabilities of discontinued operations | $0 | $557 | | **Total current liabilities** | **$63,064** | **$62,228** | | Debt, net of current portion | $10,895 | $10,877 | | Derivative warrant liabilities | $26,334 | $12,745 | | Other non-current liabilities | $4,918 | $4,529 | | **Total non-current liabilities** | **$42,147** | **$28,151** | | STOCKHOLDERS' EQUITY (in thousands) | 2025 | 2024 | | Common stock | $1 | $1 | | Additional paid-in capital | $352,500 | $347,688 | | Accumulated deficit | $(333,535) | $(319,973) | | **Total stockholders' equity** | **$18,966** | **$27,716** | | **Total liabilities and stockholders' equity** | **$124,177** | **$118,095** | Consolidated Statements of Operations (Year Ended June 30, 2025 vs. 2024) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :----------------------------------------- | :------------------ | :------------------ | | Net revenue | $66,382 | $65,183 | | Cost of goods sold | $20,551 | $16,129 | | Gross profit | $45,831 | $49,054 | | Operating expenses: | | | | Selling and marketing | $20,906 | $22,083 | | General and administrative | $17,379 | $19,954 | | Research and development | $1,326 | $2,769 | | Amortization of intangible assets | $3,683 | $3,683 | | Restructuring costs | $2,101 | $2,156 | | Impairment expense | $8,263 | $0 | | Total operating expenses | $53,658 | $50,645 | | Loss from operations | $(7,827) | $(1,591) | | Other (expense) income, net | $(512) | $870 |\ | Interest expense | $(3,703) | $(5,059) | | Derivative warrant liabilities loss | $(1,703) | $(4,004) | | Loss on extinguishment of debt | $0 | $(594) | | Loss from continuing operations before income tax expense | $(13,745) | $(10,378) | | Income tax expense | $(437) | $(2,142) | | Net loss from continuing operations | $(14,182) | $(12,520) | | Net income (loss) from discontinued operations, net of tax | $620 | $(3,324) | | **Net loss** | **$(13,562)** | **$(15,844)** | | Basic and diluted - net loss per share | $(2.16) | $(2.86) | Consolidated Statements of Cash Flows (Year Ended June 30, 2025 vs. 2024) | Cash Flow Activity (in thousands) | 2025 | 2024 | | :------------------------------------------ | :-------- | :-------- | | Net cash used in operating activities | $(1,937) | $(1,388) | | Net cash used in investing activities | $(2,560) | $(329) | | Net cash provided by (used in) financing activities | $15,443 | $(1,262) | | **Net change in cash and cash equivalents** | **$10,946** | **$(2,979)** | | Cash and cash equivalents at beginning of period | $20,006 | $22,985 | | **Cash and cash equivalents at end of period** | **$30,952** | **$20,006** | - The company's continuing operations now operate in a single operating and reportable segment following the divestiture of the Consumer Health business on **July 31, 2024**[338](index=338&type=chunk)[373](index=373&type=chunk) - The company is subject to credit risk from accounts receivable, with four large wholesale distributors accounting for **85% of gross revenue** and **89% of gross accounts receivable** in fiscal 2025[361](index=361&type=chunk)[363](index=363&type=chunk) Intangible Assets (as of June 30, 2025) | Asset Type | Gross Carrying Amount (in thousands) | Accumulated Amortization (in thousands) | Net Carrying Amount (in thousands) | Weighted Average Remaining Life (in years) | | :------------------------ | :----------------------------------- | :-------------------------------------- | :--------------------------------- | :----------------------------------------- | | Product technology rights | $22,200 | $(5,592) | $16,608 | 12.7 | | Technology rights | $30,200 | $(7,607) | $22,593 | 12.7 | | Commercialization rights | $3,000 | $0 | $3,000 | N/A (expected to be 12.7 upon launch) | | **Total** | **$55,400** | **$(13,199)** | **$42,201** | **12.7** | - The company recorded a full impairment of Karbinal (**$2.7 million**) and Poly-Vi-Flor/Tri-Vi-Flor (**$5.6 million**) intangible assets in **June 2025** due to a shifted focus on EXXUA and the ADHD Portfolio[401](index=401&type=chunk)[402](index=402&type=chunk) - As of **June 30, 2025**, the company had federal net operating losses of **$516.7 million**, with **$190.0 million** carried forward indefinitely and **$324.7 million** expected to expire by 2037 due to Section 382 limitations[439](index=439&type=chunk) - As of **June 30, 2025**, the company had **14,130,669 warrants** and prefunded warrants outstanding, with **10,293,983** being prefunded warrants with no expiration date[464](index=464&type=chunk)[469](index=469&type=chunk) - The company incurred **$2.1 million** in restructuring costs in fiscal 2025, primarily related to the closure of its Grand Prairie, Texas manufacturing site, and does not anticipate additional significant restructuring costs[472](index=472&type=chunk) - The EXXUA Commercialization Agreement includes an upfront cash payment of **$3.0 million**, a second **$3.0 million** payment (potentially **$5.0 million** if sales exceed **$35.0 million**) within **45 days** of the one-year anniversary of launch, and milestone payments ranging from **$5.0 million** to over **$100.0 million** based on sales[473](index=473&type=chunk) - The AR101 Rumpus Asset Purchase Agreement was terminated on **August 5, 2025**, transferring all rights to EnzCo, with no remaining obligations or penalties[487](index=487&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=98&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) There have been no changes in or disagreements with accountants on accounting and financial disclosure for the fiscal year - No changes in or disagreements with accountants on accounting and financial disclosure were reported[489](index=489&type=chunk) [Controls and Procedures](index=98&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures as of June 30, 2025, and concluded they were effective at reasonable assurance levels. The company acknowledges inherent limitations in internal control systems but reports no material changes in internal control over financial reporting during Q4 fiscal 2025 - Management concluded that disclosure controls and procedures were effective as of **June 30, 2025**, at reasonable assurance levels[491](index=491&type=chunk) - No changes to internal control over financial reporting occurred during the **fourth quarter of fiscal 2025** that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[493](index=493&type=chunk) [Other Information](index=99&type=section&id=Item%209B.%20Other%20Information) No directors or executive officers adopted or terminated Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025 - No directors or executive officers adopted or terminated a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement' during the quarter ended **June 30, 2025**[499](index=499&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=99&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This item is not applicable to Aytu BioPharma - This item is not applicable[500](index=500&type=chunk) [PART III](index=100&type=section&id=PART%20III) This section incorporates by reference information regarding directors, executive compensation, security ownership, related transactions, and principal accountant fees from the company's proxy statement [Directors, Executive Officers and Corporate Governance](index=100&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information required for this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A for the 2026 annual meeting of stockholders - Information required by this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A relating to its **2026 annual meeting of stockholders**[503](index=503&type=chunk) [Executive Compensation](index=100&type=section&id=Item%2011.%20Executive%20Compensation) Information required for this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A for the 2026 annual meeting of stockholders - Information required by this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A relating to its **2026 annual meeting of stockholders**[504](index=504&type=chunk) [Security Ownership and Related Stockholder Matters](index=100&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information required for this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A for the 2026 annual meeting of stockholders - Information required by this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A relating to its **2026 annual meeting of stockholders**[505](index=505&type=chunk) [Certain Relationships, Related Transactions, and Director Independence](index=100&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information required for this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A for the 2026 annual meeting of stockholders - Information required by this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A relating to its **2026 annual meeting of stockholders**[506](index=506&type=chunk) [Principal Accountant Fees and Services](index=100&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information required for this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A for the 2026 annual meeting of stockholders - Information required by this item is incorporated by reference from the company's Definitive Proxy Statement on Schedule 14A relating to its **2026 annual meeting of stockholders**[507](index=507&type=chunk) [PART IV](index=101&type=section&id=PART%20IV) This section details the financial statements, supplementary data, and a comprehensive list of exhibits filed as part of the Annual Report [Exhibits and Financial Statement Schedules](index=101&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the financial statements filed as part of the Annual Report, including the Report of Independent Registered Public Accounting Firm, Consolidated Balance Sheets, Statements of Operations, Stockholders' Equity, Cash Flows, and accompanying Notes. It also provides a comprehensive list of exhibits, including merger agreements, certificates of incorporation, loan and security agreements, and equity incentive plans - The section includes the Report of Independent Registered Public Accounting Firm, Consolidated Balance Sheets, Statements of Operations, Stockholders' Equity, Cash Flows, and Notes to the Consolidated Financial Statements[510](index=510&type=chunk) - A comprehensive list of exhibits is provided, detailing various agreements and corporate documents, including merger agreements, certificates of incorporation, loan and security agreements, and equity incentive plans[511](index=511&type=chunk)[512](index=512&type=chunk)[513](index=513&type=chunk)[514](index=514&type=chunk)[515](index=515&type=chunk) [Form 10–K Summary](index=105&type=section&id=Item%2016.%20Form%2010%E2%80%93K%20Summary) This item is not applicable to Aytu BioPharma - This item is not applicable[517](index=517&type=chunk) [Signatures](index=106&type=section&id=SIGNATURES) The report is formally signed by the Chief Executive Officer, Chief Financial Officer, and other directors on September 23, 2025 - The report is signed by Joshua R. Disbrow, Chief Executive Officer, and Ryan J. Selhorn, Chief Financial Officer, along with other directors, on **September 23, 2025**[521](index=521&type=chunk)[523](index=523&type=chunk)

[Executive Summary & Business Outlook](index=1&type=section&id=Executive%20Summary%20%26%20Business%20Outlook) Aytu BioPharma reported fiscal 2025 results, detailed EXXUA launch plans, and discussed strategic direction [Full Year Fiscal 2025 Highlights](index=1&type=section&id=Full%20Year%20Fiscal%202025%20Highlights) FY2025 net revenue increased 2% to $66.4 million, with a net loss of $13.6 million and $9.2 million adjusted EBITDA Full Year Fiscal 2025 Key Financial Highlights | Metric | FY2025 | FY2024 | Change | | :----- | :----- | :----- | :----- | | Net Revenue | $66.4 million | $65.2 million | +2% | | ADHD Portfolio Net Revenue | $57.6 million | $57.8 million | -0.3% | | Pediatric Portfolio Net Revenue | $8.8 million | $7.3 million | +20.5% | | Net Loss | $(13.6) million | $(15.8) million | Improved | | Adjusted EBITDA | $9.2 million | $10.8 million | -14.8% | | Cash & Cash Equivalents (June 30, 2025) | $31.0 million | N/A | N/A | [Q4 Fiscal 2025 Highlights](index=1&type=section&id=Q4%20Fiscal%202025%20Highlights) Q4 FY2025 net revenue grew 4% to $15.1 million, with a net loss of $19.8 million and $2.0 million adjusted EBITDA Q4 Fiscal 2025 Key Financial Highlights | Metric | Q4 FY2025 | Q4 FY2024 | Change | | :----- | :----- | :----- | :----- | | Net Revenue | $15.1 million | $14.6 million | +4% | | ADHD Portfolio Net Revenue | $13.1 million | $13.8 million | -5.1% | | Pediatric Portfolio Net Revenue | $2.0 million | $0.8 million | +150% | | Net Loss | $(19.8) million | $(4.6) million | Worsened | | Adjusted EBITDA | $2.0 million | $2.0 million | 0% | [EXXUA Commercial Launch Update](index=2&type=section&id=EXXUA%20Calendar%20Fourth%20Quarter%202025%20Commercial%20Launch%20Remains%20on%20Track) EXXUA launch is on track for Q4 calendar 2025, targeting the significant U.S. MDD market - EXXUA launch is on track for Q4 calendar 2025, expected to be a major growth catalyst in the over **$22 billion** U.S. MDD market[1](index=1&type=chunk)[5](index=5&type=chunk) - Key launch activities include finalizing product manufacturing, labeling, serialization, engaging key opinion leaders, refining sales territories and physician targeting, preparing promotional materials, and assessing commercial and government payors[6](index=6&type=chunk)[9](index=9&type=chunk) [Management Discussion](index=2&type=section&id=Management%20Discussion) CEO highlighted EXXUA's strategic fit, portfolio stability, and 9th consecutive quarter of positive adjusted EBITDA - EXXUA is a "perfect strategic fit" and will be a "centerpiece of Aytu's commercial efforts" due to its significant potential, uniqueness, sales force's CNS focus, and alignment with the Aytu RxConnect platform[7](index=7&type=chunk) - The company achieved its **9th consecutive quarter of positive adjusted EBITDA**, demonstrating stability in existing ADHD and Pediatric portfolios and focus on operational efficiencies[7](index=7&type=chunk) [Financial Performance Analysis](index=2&type=section&id=Financial%20Performance%20Analysis) Detailed analysis of net revenue by product portfolio and comprehensive financial results for FY2025 and Q4 [Net Revenue by Product Portfolio](index=2&type=section&id=Net%20Revenue%20by%20Product%20Portfolio) Detailed breakdown of net revenue contributions from ADHD and Pediatric portfolios for Q4 and full fiscal year 2025 Net Revenue by Product Portfolio (in thousands) | Portfolio | Q4 FY2025 (in thousands) | Q4 FY2024 (in thousands) | FY2025 (in thousands) | FY2024 (in thousands) | | :---------------- | :----------------------- | :----------------------- | :-------------------- | :-------------------- | | ADHD Portfolio | $13,107 | $13,758 | $57,576 | $57,784 | | Pediatric Portfolio | $2,017 | $841 | $8,769 | $7,280 | | Other | $11 | $(6) | $37 | $119 | | **Total Net Revenue** | **$15,135** | **$14,593** | **$66,382** | **$65,183** | [Full Year Fiscal 2025 Financial Results](index=3&type=section&id=Full%20Year%20Fiscal%202025%20Financial%20Results) FY2025 net revenue increased 2% to $66.4 million, with gross profit decline and improved net loss despite impairments - Net revenue increased **2% to $66.4 million**, driven by Pediatric Portfolio growth (**49% increase in units sold**) offsetting a slight decrease in ADHD prescriptions[10](index=10&type=chunk)[11](index=11&type=chunk)[12](index=12&type=chunk) - Gross profit percentage decreased from **75% to 69%** due to increased cost of sales in ADHD inventory, attributed to overhead allocation from a closed manufacturing facility to reduced production, which is expected to normalize[13](index=13&type=chunk) - Operating expenses (excluding amortization, restructuring, impairment) decreased by **$5.2 million to $39.6 million**, reflecting continued cost reduction and operational efficiencies[14](index=14&type=chunk) Full Year Fiscal 2025 Key Financial Results | Metric | FY2025 | FY2024 | Change | | :----- | :----- | :----- | :----- | | Net Loss | $(13.6) million | $(15.8) million | Improved | | Net Loss per Share (Basic & Diluted) | $(2.16) | $(2.86) | Improved | | Adjusted EBITDA | $9.2 million | $10.8 million | -14.8% | | Cash and Cash Equivalents (June 30) | $31.0 million | $20.0 million | +55% | - Net loss was impacted by **$8.3 million impairment expense** on the Pediatric Portfolio due to shifted focus to psychiatric products and EXXUA launch, **$1.7 million derivative warrant liabilities loss**, and **$2.1 million restructuring costs** related to the Grand Prairie facility closure[16](index=16&type=chunk) [Q4 Fiscal 2025 Financial Results](index=4&type=section&id=Q4%20Fiscal%202025%20Financial%20Results) Q4 net revenue grew 4% to $15.1 million, with gross profit decline and widened net loss due to impairment and liabilities - Q4 net revenue increased **4% to $15.1 million**, driven by the Pediatric Portfolio's return-to-growth plan, while ADHD portfolio revenue decreased due to fewer prescriptions[18](index=18&type=chunk)[19](index=19&type=chunk) - Gross profit percentage decreased from **76% to 68%** in Q4[19](index=19&type=chunk) - Operating expenses (excluding amortization, restructuring, impairment) decreased by **$1.8 million to $8.7 million**, reflecting ongoing cost reduction and operational efficiencies[20](index=20&type=chunk) Q4 Fiscal 2025 Key Financial Results | Metric | Q4 FY2025 | Q4 FY2024 | Change | | :----- | :----- | :----- | :----- | | Net Loss | $(19.8) million | $(4.6) million | Worsened | | Net Loss per Share (Basic & Diluted) | $(2.92) | $(0.82) | Worsened | | Adjusted EBITDA | $2.0 million | $2.0 million | 0% | - Q4 net loss was significantly impacted by **$8.3 million impairment expense** on the Pediatric Portfolio and **$9.9 million derivative warrant liabilities loss**, primarily due to an increase in the fair value of prefunded warrants and the company's stock price[22](index=22&type=chunk) [Corporate Information & Product Details](index=4&type=section&id=Corporate%20Information%20%26%20Product%20Details) Overview of Aytu BioPharma, EXXUA product details, and investor communication information [Conference Call Details](index=4&type=section&id=Conference%20Call%20Details) Details for the fiscal 2025 results conference call and webcast, including replay information - Conference call and webcast held on September 23, 2025, at 4:30 p.m. Eastern time, with replay available until October 7, 2025[24](index=24&type=chunk)[25](index=25&type=chunk) [About Aytu BioPharma](index=5&type=section&id=About%20Aytu%20BioPharma) Aytu BioPharma focuses on innovative CNS medicines, including EXXUA, ADHD, and pediatric products - Aytu BioPharma focuses on advancing innovative medicines for complex central nervous system diseases[1](index=1&type=chunk)[26](index=26&type=chunk) - Key prescription products include EXXUA (MDD), Adzenys XR-ODT and Cotempla XR-ODT (ADHD), and legacy pediatric products[26](index=26&type=chunk) [About EXXUA](index=5&type=section&id=About%20EXXUA) EXXUA is a novel oral selective serotonin 5HT1a receptor agonist for major depressive disorder (MDD) in adults - EXXUA is a novel oral selective serotonin 5HT1a receptor agonist indicated for the treatment of major depressive disorder (MDD) in adults[27](index=27&type=chunk)[28](index=28&type=chunk) [Indications and Important Safety Information for EXXUA](index=5&type=section&id=INDICATIONS%20and%20IMPORTANT%20SAFETY%20INFORMATION%20for%20EXXUA) EXXUA is indicated for MDD in adults, with warnings for suicidal thoughts and contraindications - EXXUA is indicated for MDD in adults, but not approved for pediatric patients[28](index=28&type=chunk)[29](index=29&type=chunk) - Boxed WARNING: Antidepressants, including EXXUA, increased the risk of suicidal thoughts and behaviors in pediatric and young adult patients in short-term studies, requiring close monitoring[29](index=29&type=chunk) - Contraindications include prolonged QTc interval, use with strong CYP3A4 inhibitors, severe liver problems, and concurrent use with MAOIs[29](index=29&type=chunk)[31](index=31&type=chunk) - Serious side effects may include QT prolongation (irregular heartbeats) and serotonin syndrome when taken with certain other medicines[29](index=29&type=chunk)[30](index=30&type=chunk) [Supplementary Information](index=6&type=section&id=Supplementary%20Information) Details on non-GAAP reconciliation, forward-looking statements, and investor contact information [Adjusted EBITDA Non-GAAP Reconciliation](index=6&type=section&id=Footnote%201) Adjusted EBITDA is a non-GAAP measure used for performance analysis, reconciled to GAAP net loss - Adjusted EBITDA is a non-GAAP financial indicator used to analyze and compare companies based on operating performance, with net loss being the most directly comparable GAAP measure[32](index=32&type=chunk) [Forward-Looking Statements](index=6&type=section&id=Forward-Looking%20Statements) Press release contains forward-looking statements subject to risks and uncertainties detailed in SEC filings - The press release contains forward-looking statements, which are subject to risks and uncertainties that could cause actual results to differ materially[33](index=33&type=chunk) - Risks include overall financial and operational performance, changes in financial position, market acceptance of products, financing ability, regulatory challenges, and future collaborations[33](index=33&type=chunk) [Contacts for Investors](index=6&type=section&id=Contacts%20for%20Investors) Investor contacts provided for Aytu BioPharma's CFO and Lytham Partners for inquiries - Investor contacts are Ryan Selhorn (CFO, Aytu BioPharma) and Robert Blum (Lytham Partners)[34](index=34&type=chunk) [Consolidated Financial Statements](index=7&type=section&id=Consolidated%20Financial%20Statements) Presentation of Aytu BioPharma's consolidated statements of operations, balance sheets, and EBITDA reconciliation [Consolidated Statements of Operations](index=7&type=section&id=Aytu%20BioPharma,%20Inc.%20Consolidated%20Statements%20of%20Operations) Presents revenues, costs, expenses, and net loss for Q4 and full fiscal year 2025 and 2024 Consolidated Statements of Operations (in thousands) | Metric (in thousands) | Q4 FY2025 | Q4 FY2024 | FY2025 | FY2024 | | :------------------------------------ | :-------- | :-------- | :------- | :------- | | Net revenue | $15,135 | $14,593 | $66,382 | $65,183 | | Cost of goods sold | $4,881 | $3,541 | $20,551 | $16,129 | | Gross profit | $10,254 | $11,052 | $45,831 | $49,054 | | Total operating expenses | $17,877 | $13,325 | $53,658 | $50,645 | | Net loss | $(19,818) | $(4,617) | $(13,562) | $(15,844) | | Basic and diluted - net loss per share | $(2.92) | $(0.82) | $(2.16) | $(2.86) | [Consolidated Balance Sheets](index=8&type=section&id=Aytu%20BioPharma,%20Inc.%20Consolidated%20Balance%20Sheets) Snapshot of assets, liabilities, and equity as of June 30, 2025 and 2024, showing increases in assets and liabilities Consolidated Balance Sheets (in thousands) | Metric (in thousands) | June 30, 2025 | June 30, 2024 | | :------------------------------------ | :------------ | :------------ | | **ASSETS** | | | | Cash and cash equivalents | $30,952 | $20,006 | | Accounts receivable, net | $31,155 | $23,526 | | Inventories | $11,434 | $12,141 | | Total current assets | $79,179 | $61,891 | | Intangible assets, net | $42,201 | $52,453 | | Total assets | $124,177 | $118,095 | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Total current liabilities | $63,064 | $62,228 | | Derivative warrant liabilities | $26,334 | $12,745 | | Total liabilities | $105,211 | $90,379 | | Total stockholders' equity | $18,966 | $27,716 | | Total liabilities and stockholders' equity | $124,177 | $118,095 | [Reconciliation of Net Loss to Adjusted EBITDA](index=9&type=section&id=Aytu%20BioPharma,%20Inc.%20Reconciliation%20of%20Net%20Loss%20to%20Adjusted%20EBITDA) Reconciliation of GAAP net loss to non-GAAP Adjusted EBITDA for Q4 and full fiscal year 2025 and 2024 Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Metric (in thousands) | Q4 FY2025 | Q4 FY2024 | FY2025 | FY2024 | | :------------------------------------ | :-------- | :-------- | :------- | :------- | | Net loss - GAAP | $(19,818) | $(4,617) | $(13,562) | $(15,844) | | Interest expense | $730 | $1,253 | $3,703 | $5,059 | | Income tax expense | $437 | $841 | $437 | $2,142 | | Depreciation and amortization | $1,278 | $1,398 | $5,191 | $5,910 | | Stock-based compensation expense | $113 | $243 | $576 | $2,374 | | Derivative warrant liabilities loss (gain) | $9,860 | $(1,463) | $1,703 | $4,004 | | Impairment expense | $8,263 | $0 | $8,263 | $0 | | Net (income) loss from discontinued operations, net of tax | $(62) | $1,239 | $(620) | $3,324 | | **Adjusted EBITDA - non-GAAP** | **$2,039** | **$2,029** | **$9,186** | **$10,833** |

[Micron Technology, Inc. Reports Results for FQ4 and FY25](index=1&type=section&id=Micron%20Technology%2C%20Inc.%20Reports%20Results) Micron Technology, Inc. reports financial results for FQ4 and FY25, detailing performance and future outlook [Executive Summary and Highlights](index=1&type=section&id=Executive%20Summary%20and%20Highlights) Micron achieved record FQ4 and FY25 results, driven by AI data center growth, positioning it for future AI opportunities - Micron achieved **record fiscal Q4 and full-year revenue in 2025**, primarily driven by AI data center growth[1](index=1&type=chunk)[2](index=2&type=chunk) - The company reached **all-time highs across its data center business** and is entering fiscal 2026 with strong momentum and its most competitive portfolio to date[2](index=2&type=chunk) - Micron, as the **only U.S.-based memory manufacturer**, is **uniquely positioned** to capitalize on the AI opportunity ahead[2](index=2&type=chunk) [Summary Financial Performance](index=1&type=section&id=Summary%20Financial%20Performance) This section summarizes Micron's quarterly and annual financial performance, detailing key revenue, margin, and cash flow metrics [Quarterly Financial Results (FQ4 2025)](index=1&type=section&id=Quarterly%20Financial%20Results%20(FQ4%202025)) Micron reported robust FQ4 2025 financial performance, with significant revenue growth, improved margins, and strong net income and EPS | Metric | FQ4-25 (GAAP) | FQ3-25 (GAAP) | FQ4-24 (GAAP) | FQ4-25 (Non-GAAP) | FQ3-25 (Non-GAAP) | FQ4-24 (Non-GAAP) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | $11,315M | $9,301M | $7,750M | $11,315M | $9,301M | $7,750M | | Gross margin % | 44.7% | 37.7% | 35.3% | 45.7% | 39.0% | 36.5% | | Operating income | $3,654M | $2,169M | $1,522M | $3,955M | $2,490M | $1,745M | | Net income | $3,201M | $1,885M | $887M | $3,469M | $2,181M | $1,342M | | Diluted EPS | $2.83 | $1.68 | $0.79 | $3.03 | $1.91 | $1.18 | - Operating cash flow for FQ4 2025 was **$5.73 billion**, up from $4.61 billion for the prior quarter and $3.41 billion for the same period last year[4](index=4&type=chunk) [Annual Financial Results (FY 2025)](index=1&type=section&id=Annual%20Financial%20Results%20(FY%202025)) Micron achieved substantial FY25 revenue growth to **$37.38 billion**, with significant improvements in margins, net income, and strong cash flow | Metric | FY-25 (GAAP) | FY-24 (GAAP) | FY-25 (Non-GAAP) | FY-24 (Non-GAAP) | | :--- | :--- | :--- | :--- | :--- | | Revenue | $37,378M | $25,111M | $37,378M | $25,111M | | Gross margin % | 39.8% | 22.4% | 40.9% | 23.7% | | Operating income | $9,770M | $1,304M | $10,846M | $1,935M | | Net income | $8,539M | $778M | $9,470M | $1,472M | | Diluted EPS | $7.59 | $0.70 | $8.29 | $1.30 | - Operating cash flow for FY 2025 was **$17.53 billion**, a significant increase from **$8.51 billion** in the prior year[4](index=4&type=chunk) - Adjusted free cash flow for the full year of 2025 was **$3.72 billion**, compared to **$386 million** for the prior year[5](index=5&type=chunk)[22](index=22&type=chunk) - Micron ended the year with cash, marketable investments, and restricted cash of **$11.94 billion**[5](index=5&type=chunk) - A quarterly dividend of **$0.115 per share** was declared on September 23, 2025, payable on October 21, 2025[5](index=5&type=chunk) [Quarterly Business Unit Financial Results (FQ4 2025)](index=2&type=section&id=Quarterly%20Business%20Unit%20Financial%20Results%20(FQ4%202025)) Cloud Memory Business Unit led FQ4 2025 growth with substantial revenue and strong margins, with other units also showing sequential improvements | Business Unit | FQ4-25 Revenue | FQ3-25 Revenue | FQ4-24 Revenue | FQ4-25 Gross Margin | FQ4-25 Operating Margin | | :--- | :--- | :--- | :--- | :--- | :--- | | Cloud Memory | $4,543M | $3,386M | $1,449M | 59% | 48% | | Core Data Center | $1,577M | $1,530M | $2,048M | 41% | 25% | | Mobile and Client | $3,760M | $3,255M | $3,019M | 36% | 29% | | Automotive and Embedded | $1,434M | $1,127M | $1,230M | 31% | 20% | - Cloud Memory Business Unit revenue increased **34.2% QoQ** and **213.5% YoY**, with a **59% gross margin** and **48% operating margin** in FQ4 2025[6](index=6&type=chunk) - Mobile and Client Business Unit revenue grew **15.5% QoQ**, with gross margin improving from **24% to 36%** in FQ4 2025[6](index=6&type=chunk) [Business Outlook](index=3&type=section&id=Business%20Outlook) This section outlines Micron's financial guidance for the upcoming fiscal quarter, including revenue and margin projections [FQ1 2026 Guidance](index=3&type=section&id=FQ1%202026%20Guidance) Micron projects strong FQ1 2026 performance, forecasting revenue of approximately **$12.50 billion** and gross margins exceeding **50%** | Metric | FQ1-26 (GAAP Outlook) | FQ1-26 (Non-GAAP Outlook) | | :--- | :--- | :--- | | Revenue | $12.50B ± $300M | $12.50B ± $300M | | Gross margin | 50.5% ± 1.0% | 51.5% ± 1.0% | | Operating expenses | $1.49B ± $20M | $1.34B ± $20M | | Diluted EPS | $3.56 ± $0.15 | $3.75 ± $0.15 | - Micron is forecasting **$1.2 billion** in sequential revenue growth for FQ1 2026, with gross margins exceeding **50%**[1](index=1&type=chunk)[7](index=7&type=chunk) [Company Information and Disclosures](index=3&type=section&id=Company%20Information%20and%20Disclosures) Micron provides FQ4 earnings webcast details, investor information, and an overview of its leadership in memory and storage for AI [Investor Relations and Company Profile](index=3&type=section&id=Investor%20Relations%20and%20Company%20Profile) Micron provides details for its FQ4 earnings webcast and general investor information, alongside a brief overview of its role as a leader in memory and storage solutions, emphasizing its contribution to AI and compute-intensive applications - Micron will host a conference call on Tuesday, **September 23, 2025**, at **2:30 p.m. Mountain Time** to discuss its fourth quarter financial results and provide forward-looking guidance for its first quarter, with a live webcast available at investors.micron.com[8](index=8&type=chunk) - Micron is an **industry leader** in **innovative memory and storage solutions**, delivering a rich portfolio of high-performance DRAM, NAND, and NOR memory and storage products through its Micron® and Crucial® brands[10](index=10&type=chunk) - The company's innovations **fuel the data economy**, enabling advances in **artificial intelligence (AI)** and compute-intensive applications[10](index=10&type=chunk) [Forward-Looking Statements and Non-GAAP Definitions](index=3&type=section&id=Forward-Looking%20Statements%20and%20Non-GAAP%20Definitions) This section clarifies forward-looking statements, SEC filing risks, and defines GAAP and Non-GAAP financial measures and adjustments - This press release contains **forward-looking statements** regarding Micron's industry, strategic position, and financial and operating results, which are subject to **risks and uncertainties** detailed in SEC filings (Form 10-K and 10-Q)[12](index=12&type=chunk) - **Non-GAAP measures** represent GAAP excluding the impact of certain activities (e.g., **stock-based compensation**, **restructure and asset impairments**, **gains/losses from debt prepayments and settlements**, and **estimated tax effects**) which management excludes in analyzing operating results and understanding trends[12](index=12&type=chunk)[24](index=24&type=chunk) - Management uses Non-GAAP information for **evaluating performance** and **allocating resources**, believing it **increases transparency** and provides useful supplemental information for investors[22](index=22&type=chunk) [Consolidated Financial Statements (GAAP)](index=4&type=section&id=Consolidated%20Financial%20Statements%20(GAAP)) This section presents Micron's GAAP consolidated statements of operations, balance sheets, and cash flows [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) The GAAP Consolidated Statements of Operations detail Micron's revenue, cost of goods sold, gross margin, operating expenses, and net income for FQ4 and FY25 | Metric | FQ4-25 | FQ3-25 | FQ4-24 | FY-25 | FY-24 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | $11,315M | $9,301M | $7,750M | $37,378M | $25,111M | | Cost of goods sold | $6,261M | $5,793M | $5,013M | $22,505M | $19,498M | | Gross margin | $5,054M | $3,508M | $2,737M | $14,873M | $5,613M | | Operating income | $3,654M | $2,169M | $1,522M | $9,770M | $1,304M | | Net income | $3,201M | $1,885M | $887M | $8,539M | $778M | | Diluted EPS | $2.83 | $1.68 | $0.79 | $7.59 | $0.70 | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) The GAAP Consolidated Balance Sheets present Micron's financial position as of August 28, 2025, showing increased total assets and shareholders' equity | Metric | August 28, 2025 | May 29, 2025 | August 29, 2024 | | :--- | :--- | :--- | | Total current assets | $28,841M | $27,919M | $24,372M | | Property, plant, and equipment | $46,590M | $44,773M | $39,749M | | Total assets | $82,798M | $78,397M | $69,416M | | Total liabilities | $28,633M | $27,649M | $24,285M | | Total equity | $54,165M | $50,748M | $45,131M | - Total assets increased by **$13.38 billion** YoY to **$82.80 billion** as of August 28, 2025, while total equity increased by **$9.03 billion** YoY to **$54.17 billion**[16](index=16&type=chunk) [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The GAAP Consolidated Statements of Cash Flows highlight a substantial increase in net cash from operating activities for FY25 | Metric | FY-25 | FY-24 | | :--- | :--- | | Net cash provided by operating activities | $17,525M | $8,507M | | Expenditures for property, plant, and equipment | $(15,857)M | $(8,386)M | | Net cash used for investing activities | $(14,087)M | $(8,309)M | | Net cash used for financing activities | $(850)M | $(1,842)M | | Net increase (decrease) in cash, cash equivalents, and restricted cash | $2,594M | $(1,604)M | | Cash, cash equivalents, and restricted cash at end of period | $9,646M | $7,052M | - Net cash provided by operating activities for FY25 was **$17.53 billion**, more than double the **$8.51 billion** in FY24[18](index=18&type=chunk) [Reconciliation of GAAP to Non-GAAP Measures](index=7&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) This section details the reconciliation of GAAP to Non-GAAP financial measures for historical results and future outlook [Non-GAAP Financial Reconciliations](index=7&type=section&id=Non-GAAP%20Financial%20Reconciliations) This section provides detailed reconciliations of GAAP to Non-GAAP financial metrics for quarterly and annual periods, illustrating specific adjustment impacts Adjustments to Net Income | Adjustment Type | FQ4-25 Impact | FY-25 Impact | | :--- | :--- | :--- | | Stock-based compensation | $262M | $975M | | Restructure and asset impairments | $38M | $39M | | Loss on debt prepayments | $9M | $59M | | Patent license charges | $0M | $57M | | Estimated tax effects | $(42)M | $(200)M | | **Total Adjustments to Net Income** | **$267M** | **$930M** | Adjusted Free Cash Flow | Metric | FQ4-25 | FQ3-25 | FQ4-24 | FY-25 | FY-24 | | :--- | :--- | :--- | :--- | :--- | :--- | | GAAP net cash provided by operating activities | $5,730M | $4,609M | $3,405M | $17,525M | $8,507M | | Investments in capital expenditures, net | $(4,927)M | $(2,660)M | $(3,082)M | $(13,804)M | $(8,121)M | | **Adjusted free cash flow** | **$803M** | **$1,949M** | **$323M** | **$3,721M** | **$386M** | - Non-GAAP adjustments are made to exclude items such as **stock-based compensation**, **gains and losses from settlements**, **gains and losses from debt prepayments**, **restructure and asset impairments**, and **estimated tax effects**, to provide a clearer understanding of operating results and earnings trends[24](index=24&type=chunk) [Non-GAAP Outlook Reconciliations](index=9&type=section&id=Non-GAAP%20Outlook%20Reconciliations) This section details specific adjustments applied to GAAP guidance to arrive at the Non-GAAP outlook for FQ1 2026 Non-GAAP Adjustments for FQ1 2026 Outlook | Adjustment Type | Impact (Millions) | | :--- | :--- | | Stock-based compensation – cost of goods sold | $111 | | Stock-based compensation – research and development | $98 | | Stock-based compensation – sales, general, and administrative | $50 | | Tax effects of the above items and other tax adjustments | $(39) | | **Total Non-GAAP Adjustments** | **$220** | - Non-GAAP diluted EPS outlook for FQ1 2026 is **$3.75 ± $0.15**, reflecting adjustments for stock-based compensation and tax effects from the GAAP outlook of **$3.56 ± $0.15**[26](index=26&type=chunk) - The guidance **does not incorporate** the impact of any potential business combinations, divestitures, additional restructuring activities, or other significant transactions[26](index=26&type=chunk)

Exhibit 99.2 WALLBOX N.V. AND SUBSIDIARIES Interim Condensed Consolidated Financial Statements June 30, 2025 and 2024 WALLBOX N.V. Index to Interim Condensed Consolidated Financial Statements | Interim Condensed Consolidated statements of financial position as of June 30, 2025 and December 31, 2024 | 2 | | --- | --- | | Interim Condensed Consolidated statements of profit or loss and other comprehensive income for the six months ended June 30, 2025 and | 3 | | 2024 | | | Interim Condensed Consolidated statem ...

[Filing Information](index=1&type=section&id=Filing%20Information) This section provides the administrative and securities registration details for the Form 8-K filing [General Information](index=1&type=section&id=General%20Information) This section provides the administrative details of the Form 8-K filing for CEA Industries Inc., including its incorporation state, commission file number, and principal executive office address - Company Name: **CEA INDUSTRIES INC.**[1](index=1&type=chunk) - Jurisdiction of Incorporation: **Nevada**[1](index=1&type=chunk) - Principal Executive Office: **385 South Pierce Avenue, Suite C, Louisville, Colorado 80027**[1](index=1&type=chunk) [Securities and Filing Status](index=1&type=section&id=Securities%20and%20Filing%20Status) This part details the securities registered by CEA Industries Inc. on the Nasdaq Capital Market and confirms its status regarding emerging growth company provisions Registered Securities | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :--- | :--- | :--- | | Common Stock, par value $0.00001 | BNC | Nasdaq Capital Market | | Warrants to purchase Common Stock | BNCWW | Nasdaq Capital Market | - The registrant is an **Emerging Growth Company**[2](index=2&type=chunk) [Current Report on Form 8-K Items](index=2&type=section&id=Current%20Report%20on%20Form%208-K%20Items) This section outlines the specific items reported in the Form 8-K, including financial results 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) CEA Industries Inc. filed this 8-K to announce its financial and operational results for the first quarter ended July 31, 2025, which were disclosed in a press release dated September 22, 2025 - CEA Industries Inc. issued a press release on **September 22, 2025**, announcing financial and operational results for the first quarter ended **July 31, 2025**[3](index=3&type=chunk) - The press release is furnished as **Exhibit 99.1** to this Current Report on Form 8-K[3](index=3&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 exhibits accompanying the Form 8-K, primarily the press release detailing the financial results and the interactive data file Exhibits | Exhibit No. | Description | | :--- | :--- | | 99.1 | Press Release, dated September 22, 2025 | | 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | [Signatures](index=3&type=section&id=SIGNATURES) This section provides the formal authorization and signing details for the Current Report on Form 8-K [Report Authorization](index=3&type=section&id=Report%20Authorization) This section formally authorizes the filing of the report on behalf of CEA Industries Inc., signed by its Chief Executive Officer - The report was signed on behalf of **CEA INDUSTRIES INC.** by **David Namdar, Chief Executive Officer**[8](index=8&type=chunk) - The report was dated **September 23, 2025**[8](index=8&type=chunk)