Financial Performance - Recorded net income of $1.0 billion for the third quarter of 2025[194] - Total revenues for the third quarter of 2025 increased by $131 million to $3.4 billion, driven by a 4% growth in combined production volumes and higher average oil prices[218] - For the nine months ended September 30, 2025, total revenues increased by $3.8 billion, or 57%, to $10.4 billion, primarily due to a 79% growth in combined production volumes[240] - The company reported revenues of $5.204 billion and a net income of $782 million for the nine months ended September 30, 2025[288] Production and Operational Metrics - Average production was 942.9 MBOE/d, with cash operating costs at $10.05 per BOE[194] - Oil production volumes for the third quarter reached 46,345 MBbls, up from 45,108 MBbls in the previous quarter, while natural gas production increased to 115,353 MMcf from 110,119 MMcf[217] - Approximately 53% of the production volume increase was attributed to Viper's Sitio Acquisition, with the remainder coming from new wells added during the period[219] - The company’s production data showed oil production of 134,288 MBbls and natural gas production of 326,050 MMcf for the nine months ended September 30, 2025, compared to 79,540 MBbls and 168,431 MMcf in 2024[236] - Daily oil production volumes increased by 201,605 barrels per day, or 69.4%, to 491,897 BO/d in 2025 from 290,292 BO/d in 2024[236] Expenses and Costs - Lease operating expenses increased to $490 million in the third quarter, with a per BOE cost of $5.65, compared to $440 million and $5.26 per BOE in the previous quarter[219] - Lease operating expenses increased to $1.338 billion for the nine months ended September 30, 2025, from $825 million in 2024, with a per BOE cost of $5.42 compared to $5.99[243] - General and administrative expenses totaled $70 million in the third quarter, consistent on a per BOE basis with the previous quarter at $0.80[224] - Gathering, processing, and transportation expenses decreased to $122 million in Q3 2025 from $145 million in Q2 2025, reflecting a net reduction due to contract integration[222] - Interest expense increased to $70 million in the third quarter, primarily due to new debt issued in July 2025 and other financing activities[229] Dividends and Share Repurchase - Paid dividends of $289 million during Q3 2025 and declared a base cash dividend of $1.00 per share for Q4 2025[194] - Increased common stock repurchase program authorization to $8.0 billion, repurchased $603 million of common stock, with approximately $3.1 billion available for future repurchases[194] - The board of directors declared a base cash dividend of $1.00 per share for the third quarter of 2025, as part of a commitment to return at least 50% of adjusted free cash flow to stockholders[279] - Since the inception of the stock repurchase program, the company has repurchased 36.1 million shares for a total cost of $5.0 billion, leaving approximately $3.0 billion available for future repurchases[281] Guidance and Future Expectations - Revised annual BOE guidance increased by approximately 2% to reflect successful closing of the Sitio merger[210] - Updated net production guidance for 2025 to 910 - 920 MBOE/d, up from 890 - 910 MBOE/d[211] - Anticipated Q4 2025 oil production guidance of 505 - 515 MBO/d, with total MBOE/d guidance of 927 - 963[211] - The company expects to drill approximately 445 to 465 gross horizontal wells and complete approximately 510 to 520 gross horizontal wells in 2025, with an average lateral length of approximately 11,500 feet[274] Debt and Liquidity - As of September 30, 2025, the company's total debt amounted to approximately $14.1 billion in senior notes, $1.5 billion under the 2025 Term Loan, $500 million under the Viper Term Loan, and $335 million under revolving credit facilities[270] - Liquidity at September 30, 2025, was approximately $2.4 billion, consisting of $106 million in cash and $2.3 billion available under the credit facility[260] - The company has a maximum credit amount available of $2.5 billion under its Credit Agreement, with $175 million in outstanding borrowings as of September 30, 2025[271] Gains and Losses - The company reported a net gain of $120 million on derivative instruments for the third quarter, a significant recovery from a loss of $197 million in the second quarter[225] - The net gain on derivative instruments increased to $149 million in 2025 from $101 million in 2024, reflecting a $177 million increase in cash received on natural gas contract settlements[253][254] - The company recorded a loss on extinguishment of debt of $32 million in Q3 2025, while in Q2 2025, it gained $56 million from repurchasing $252 million of senior notes[233] Taxation - The provision for income taxes increased to $894 million in 2025 from $685 million in 2024, largely due to higher pre-tax income from revenues associated with the Endeavor Acquisition[259] - The provision for income taxes for Q3 2025 was $287 million, up from $204 million in Q2 2025, primarily due to increased pre-tax income[234] - Production taxes for the nine months ended September 30, 2025, totaled $490 million, representing 4.7% of oil, natural gas, and natural gas liquids revenue, compared to $294 million and 4.4% in 2024[244]

Financial Performance - Revenue for Q3 FY25 was $111.6 million, compared to $132.9 million in Q3 FY24, reflecting a year-over-year decline of approximately 16%[4] - Non-GAAP net income for Q3 FY25 was $12.8 million, down from $23.3 million in Q3 FY24, representing a decrease of about 45%[4] - Non-GAAP adjusted EBITDA for Q3 FY25 was $23.1 million, with a margin of 20.7%, compared to $31.4 million and 23.7% in Q3 FY24[4] - The company expects full-year revenue guidance of $440 million to $460 million for FY25, with an adjusted EBITDA margin of 15% to 17%[10] - Revenue for the three months ended September 30, 2025, was $111,632,000, a decrease of 16% compared to $132,891,000 for the same period in 2024[28] - Operating loss for the three months ended September 30, 2025, was $(1,362,000), significantly improved from $(18,555,000) in the prior year[28] - Net loss attributable to the Company for the nine months ended September 30, 2025, was $(39,254,000), compared to $(63,833,000) for the same period in 2024, reflecting a 38.7% reduction[32] - Non-GAAP net income attributable to the Company for the three months ended September 30, 2025, was $12,790,000, compared to $23,307,000 in 2024, reflecting a decline of 45%[34] - GAAP net loss for Q3 2025 was $6,107, compared to a loss of $19,831 in Q3 2024[38] Cash Flow and Assets - Cash and cash equivalents decreased to $96,784,000 as of September 30, 2025, down from $130,564,000 at the end of 2024[30] - Total current liabilities decreased to $113,047,000 as of September 30, 2025, from $185,349,000 at the end of 2024, indicating improved liquidity management[30] - Total assets decreased to $628,819,000 as of September 30, 2025, from $667,760,000 at the end of 2024, indicating a contraction in the asset base[30] - The Company reported a net cash used in operating activities of $(4,615,000) for the nine months ended September 30, 2025, compared to $(56,569,000) in 2024, showing significant improvement[32] Workforce and Cost Management - The workforce reduction plan will impact approximately 250 employees, with expected annualized savings of $30 million to $35 million[8] - Stock-based compensation expense for the nine months ended September 30, 2025, was $32,069,000, down from $45,309,000 in the same period of 2024[32] User Metrics and Market Growth - Achieved 30% sequential growth, reaching 4.8 million monthly active users on the TiVo One platform[2] - Average Revenue Per User (ARPU) for the TiVo One platform was $8.75 as of September 30, 2025[9] - IPTV subscribers increased by 32% year-over-year, reaching 3.2 million households[9] - The AutoStage platform has expanded to over 13 million vehicles, indicating strong growth in the connected car market[3] Partnerships and Revenue Opportunities - The company signed multiple monetization partnerships, including agreements with Titan Ads and Comscore, to enhance revenue opportunities[9] Expense Management - Interest expense decreased to $934 in Q3 2025 from $1,123 in Q3 2024[38] - Provision for income taxes increased to $4,805 in Q3 2025 from $2,899 in Q3 2024[38] - Stock-based compensation decreased to $9,640 in Q3 2025 from $15,249 in Q3 2024[38] - Depreciation expense increased to $3,470 in Q3 2025 from $2,918 in Q3 2024[38] - Amortization of intangible assets decreased to $7,987 in Q3 2025 from $10,934 in Q3 2024[38] - Transaction, integration, and restructuring costs significantly reduced to $233 in Q3 2025 from $7,961 in Q3 2024[38] - Severance and retention costs decreased to $1,006 in Q3 2025 from $9,184 in Q3 2024[38]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ________________________________________________________________ FORM 10-Q ________________________________________________________________ ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 2025 ☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to . Commission File ...

Financial Performance - Dyne Therapeutics reported a net loss of $108.0 million for Q3 2025, or $0.76 per share, compared to a net loss of $97.1 million, or $0.96 per share, in Q3 2024[16]. - Dyne's total operating expenses for Q3 2025 were $113.9 million, compared to $105.7 million in Q3 2024[22]. - Dyne's total assets increased to $867.1 million as of September 30, 2025, up from $691.2 million at the end of 2024[22]. Research and Development - Research and development expenses increased to $97.2 million in Q3 2025 from $92.8 million in Q3 2024, while general and administrative expenses rose to $16.7 million from $12.9 million[15]. - Dyne anticipates full enrollment of 60 participants in the Registrational Expansion Cohort of the ACHIEVE trial for z-basivarsen by early Q2 2026, a delay from previous guidance of Q4 2025[4]. - Topline data from the DELIVER trial of z-rostudirsen is expected in December 2025, supporting a potential U.S. Accelerated Approval submission in Q2 2026[11]. - Additional one-year clinical data from the ACHIEVE trial demonstrated sustained functional improvement across multiple measures, presented at the World Muscle Society Congress in October 2025[9]. Regulatory and Market Developments - The FDA granted Breakthrough Therapy Designation to z-rostudirsen for DMD, with a potential launch anticipated in Q1 2027[14]. - Dyne plans to submit a Biologics License Application (BLA) for z-basivarsen in early Q3 2027, assuming FDA grants Priority Review[12]. Cash Position - Cash, cash equivalents, and marketable securities totaled $791.9 million as of September 30, 2025, expected to fund operations into Q3 2027[14].

Financial Performance - Net sales for Q3 2025 reached $8.7 million, a 33% increase compared to $6.6 million in Q3 2024[4] - Year-to-date net sales totaled $22.8 million, reflecting a 26% increase from the first nine months of 2024[4] - Prescription device sales amounted to $6.8 million in Q3 2025, up 19% from $5.7 million in Q3 2024[5] - Health and wellness product sales surged by 121% to $1.9 million in Q3 2025, compared to $0.9 million in Q3 2024[5] - Gross profit for Q3 2025 was $7.5 million, representing an 86% gross margin, compared to $5.5 million and 84% gross margin in Q3 2024[5] - The company raised its full-year 2025 revenue guidance to between $31.5 million and $32.5 million[3] Expenses - Research and development expenses increased to $0.7 million in Q3 2025 from $0.5 million in Q3 2024, primarily due to costs for a new mobile application[6] - Selling, general and administrative expenses rose to $9.7 million in Q3 2025, up from $7.6 million in Q3 2024, driven by increased marketing investments[7] - Stock-based compensation for Q3 2025 was $415,000, a marginal increase from $400,000 in Q3 2024[28] - Acquisition-related expenses for Q3 2025 amounted to $501,000, with total expenses for the nine months reaching $828,000[28] - Depreciation and amortization expenses for Q3 2025 were $118,000, down from $185,000 in Q3 2024[28] - Non-recurring one-time charges for Q3 2025 totaled $280,000, with a total of $330,000 for the nine months[28] Net Loss - The net loss for Q3 2025 was $3.4 million, or $0.40 per share, compared to a net loss of $2.5 million, or $0.31 per share, in Q3 2024[10] - GAAP net loss for Q3 2025 was $3,405,000 compared to a loss of $2,497,000 in Q3 2024, representing an increase in loss of approximately 36.3%[28] - Adjusted EBITDA net loss for Q3 2025 was $2,043,000, slightly improved from a loss of $2,066,000 in Q3 2024[28] - For the nine months ended September 30, 2025, GAAP net loss was $10,931,000, compared to $8,658,000 for the same period in 2024, indicating a 26.2% increase in loss[28] Cash Position - Total cash as of September 30, 2025, was $13.2 million, an increase from $12.2 million at the end of 2024[14] Other Financial Metrics - Interest and other income for Q3 2025 was $146,000, compared to an expense of $154,000 in Q3 2024[28] - The company recorded a reserve for bad debt charge of $548,000 for the nine months ended September 30, 2025, which was not present in the previous year[28] - The company emphasizes the limitations of non-GAAP measures and recommends considering them alongside GAAP-based financial performance metrics[29]

Revenue Performance - Revenue for Q3 2025 was $3.6 million, an increase of 56.5% compared to $2.3 million in Q3 2024[6] - Revenue for the three months ended September 30, 2025, was $3,579 million, a significant increase from $2,250 million in the same period of 2024, representing a growth of 59%[20] Operating Loss - GAAP operating loss for Q3 2025 was $33.2 million, improved from a loss of $37.9 million in Q3 2024[11] - Non-GAAP operating loss for Q3 2025 was $27.2 million, compared to a loss of $31.4 million in Q3 2024[11] - Operating loss for the nine months ended September 30, 2025, was $98,502 million, an improvement from a loss of $124,133 million in the same period of 2024[20] - The company reported a non-GAAP operating loss of $78,189 million for the nine months ended September 30, 2025, compared to a loss of $95,503 million in the same period of 2024[24] Net Income - The company reported a net income of $107,495 million for the three months ended September 30, 2025, compared to a loss of $37,396 million in the same period of 2024[25] - Basic net income (loss) per share for the three months ended September 30, 2025, was $1.86, compared to a loss of $0.70 in the same period of 2024[27] Cash and Assets - Cash, cash equivalents, and marketable securities totaled $48.9 million as of September 30, 2025[6] - Total current assets decreased to $66.4 million from $123.3 million as of December 31, 2024[18] - Cash and cash equivalents at the end of September 30, 2025, were $45,688 million, up from $30,462 million at the end of September 30, 2024[22] - Net cash used in operating activities for the nine months ended September 30, 2025, was $92,928 million, compared to $86,015 million in the same period of 2024[22] Business Developments - Aeva raised $100 million from Apollo Global Management to enhance commercial momentum[3] - The company advanced to late-stage contract negotiations for a large-scale series production award with a Top-10 global passenger OEM[5] - Initial orders were received for the Eve 1V motion sensing product line, expanding into manufacturing automation[5] - AevaScenes, the industry's first FMCW 4D LiDAR open dataset, was released to support research and adoption in autonomous vehicle perception[5] - The first vehicle builds for the Daimler Truck production program were completed, with orders for Atlas C Samples expected in 2026[5] Stock-Based Compensation - Stock-based compensation expense for the nine months ended September 30, 2025, was $16,528 million, slightly down from $17,130 million in the same period of 2024[20] Fair Value Changes - The company experienced a change in fair value of warrant liability, resulting in a gain of $68,524 million for the three months ended September 30, 2025, compared to a loss of $1,263 million in the same period of 2024[25]

Operations and Growth - As of September 30, 2025, the company operates 141 home health and hospice agencies and 61 senior living communities across 13 states[137] - The company added nine home health agencies, four hospice agencies, and four senior living communities during the nine months ended September 30, 2025[139] - The number of home health and hospice agencies increased to 141, up from 122, representing a 15.6% growth[194] - The number of home health and hospice agencies increased by 19, reaching a total of 141 agencies by September 30, 2025, representing a 15.6% growth[207] Revenue Growth - Total revenue for Q3 2025 was $229,039,000, an increase from $180,688,000 in Q3 2024, representing a growth of 26.8%[163] - Home Health and Hospice Services generated $173,545,000 in revenue for Q3 2025, up from $135,672,000 in Q3 2024, reflecting a growth of 28%[165] - Senior Living Services reported revenue of $53,880,000 for Q3 2025, compared to $45,016,000 in Q3 2024, marking an increase of 19.5%[165] - For the nine months ended September 30, 2025, total revenue reached $658,382,000, up from $506,348,000 in the same period of 2024, a growth of 30%[165] - Total revenue increased by $48.4 million, or 26.8%, to $229.0 million for the three months ended September 30, 2025, compared to $180.7 million in the same period of 2024[192] - Home health and hospice revenue grew by $37.9 million, or 27.9%, driven by a 36.2% increase in total home health admissions and a 16.6% increase in total hospice admissions[194] - Senior living revenue increased by $10.5 million, or 23.2%, attributed to a 7.4% rise in average monthly revenue per occupied unit and improved occupancy rates[195] - Total revenue for the nine months ended September 30, 2025, increased by $152.0 million, or 30.0%, compared to the same period in 2024, reaching $658,382,000[205] - Home health and hospice services revenue grew by $122.0 million, or 32.3%, to $499,455,000, driven by a 30.5% increase in total home health admissions and a 25.6% increase in Medicare home health admissions[208] - Senior living services revenue increased by $30.0 million, or 23.3%, to $158,927,000, primarily due to an 8.9% rise in average monthly revenue per occupied unit[209] Expenses and Costs - Total expenses for Q3 2025 were $218,801,000, compared to $169,894,000 in Q3 2024, resulting in an increase of 28.7%[163] - The cost of services as a percentage of total revenue increased to 81.0% in Q3 2025 from 80.0% in Q3 2024[163] - Total cost of services rose by $41.0 million, or 28.4%, with costs as a percentage of revenue increasing from 80.0% to 81.0%[196] - Total cost of services rose by $125.7 million, or 31.0%, to $531,450,000, with costs as a percentage of revenue increasing to 80.8% from 80.1%[210] - General and administrative expenses increased by $6.3 million, or 48.2%, from $13.0 million to $19.3 million, with the percentage of revenue rising from 7.2% to 8.4%[200][201] - General and administrative expenses increased by $15.4 million, or 42.4%, totaling $51.7 million, attributed to higher payroll and professional services related to acquisitions[214] - Rent—cost of services for Q3 2025 was $12,063,000, compared to $10,906,000 in Q3 2024, reflecting a 10.6% increase[171] - Rent expense increased by 10.6% to $12.1 million, while rent as a percentage of total revenue decreased from 6.0% to 5.3%[199] - Depreciation and amortization expense increased by $0.6 million, or 38.2%, due to higher property and equipment balances from acquisition activities[202] Income and Profitability - Income from operations decreased to $10,238,000 in Q3 2025 from $10,794,000 in Q3 2024, a decline of 5.2%[163] - Net income attributable to the company for Q3 2025 was $6,200,000, down from $6,100,000 in Q3 2024, reflecting a slight decrease of 1.6%[163] - Consolidated net income for Q3 2025 was $6,886,000, compared to $6,657,000 in Q3 2024, indicating a 3.4% increase[171] - The company reported an adjusted EBITDAR from operations of $44,378,000 for Q3 2025, compared to $37,135,000 in Q3 2024, indicating a growth of 19.5%[165] - Segment Adjusted EBITDAR from Operations for Q3 2025 was $44,378,000, up from $37,135,000 in Q3 2024, representing a 35.5% increase[166] - Consolidated Adjusted EBITDA for the nine months ended September 30, 2025, was $50,095,000, compared to $39,523,000 for the same period in 2024, reflecting a 27% growth[170] - Consolidated Adjusted EBITDAR for the nine months ended September 30, 2025, was $85,600,000, compared to $77,423,000 in 2024, a rise of 10.5%[171] Medicare and Reimbursement - Average Medicare revenue per 60-day completed episode for home health services rose to $3,793 in 2025 from $3,687 in 2024, an increase of 2.9%[149] - The proposed Medicare reimbursement reduction of -6.4% in the 2026 Home Health Prospective Payment System could lead to a decrease of $1.135 billion across all home health providers[144] - The Hospice Payment Final Rule for 2026 includes a payment update percentage of 2.6%, resulting in an estimated increase of $750 million in payments across all hospice providers[145] - The company monitors Medicare reimbursement closely due to adjustments related to billing documentation and payment caps, impacting revenue recognition[156] - The average Medicare revenue per 60-day completed episode increased by 5.1% to $3,782[207] Cash Flow and Financing - Net cash provided by operating activities increased by $8.6 million to $27,336,000, driven by a $5.6 million increase in net income[225] - Cash at the end of the period decreased to $2,336,000 from $4,464,000, reflecting a net decrease in cash of $21,910,000[224] - Net cash provided by financing activities decreased by approximately $20.3 million for the nine months ended September 30, 2025, compared to the same period in 2024[227] - The company had $219.8 million of available borrowing capacity on its Amended Revolving Credit Facility as of September 30, 2025[221] - The company has a borrowing capacity of $250.0 million under the Amended Credit Agreement with a syndicate of banks[230] - A 1.0% interest rate change would result in an annual change of approximately $0.3 million in interest expense based on outstanding long-term debt as of September 30, 2025[230] - The company continues to make draws and payments on its Amended Revolving Credit Facility[228] - There have been no material changes to total obligations outside of normal business operations during the reporting period[229] - The company has right-of-use assets obtained in exchange for new operating lease obligations[228] Acquisition and Integration - The company anticipates lower and fluctuating consolidated and segment margins during years of acquisition growth due to the integration of newly acquired operations[141] - Acquisition-related costs for Q3 2025 amounted to $3,047,000, significantly higher than $494,000 in Q3 2024[171] Non-GAAP Financial Measures - The company emphasizes the use of Non-GAAP Financial Measures to provide a clearer view of operational performance, excluding interest, taxes, and depreciation[177]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-40288 Design Therapeutics, Inc. (Exact Name of Registrant as Specified in its Charter) 6005 Hidden Valley Road, Suite 110 Car ...

Revenue Performance - Revenue for Q3 2025 was $94.0 million, a 102% increase from Q3 2024, including $33.7 million from the terminated Genentech Agreement[3] - The MRD business contributed 60% of total revenue, growing 52% year-over-year, with MRD revenue at $56.8 million[4] - clonoSEQ test volume increased by 38% to 27,111 tests delivered compared to Q3 2024[3] - Immune Medicine revenue for Q3 2025 was $3.4 million, excluding revenue from the Genentech Agreement[4] - Revenue from the MRD segment increased to $56,788 million for the three months ended September 30, 2025, up 51.5% from $37,470 million in 2024[24] - Immune Medicine segment revenue rose to $37,185 million for the three months ended September 30, 2025, compared to $8,965 million in 2024, representing a growth of 314.5%[24] Profitability - Adjusted EBITDA for Q3 2025 was $28.0 million, compared to a loss of $14.3 million in Q3 2024[7] - Net income for Q3 2025 was $9.5 million, a significant improvement from a net loss of $32.1 million in the same period last year[6] - Adjusted EBITDA for the three months ended September 30, 2025, was $27,953 million, a significant improvement from a loss of $14,300 million in the same period of 2024[23] - Adjusted EBITDA for the Immune Medicine segment was $23,706 million for the three months ended September 30, 2025, compared to a loss of $5,212 million in 2024[24] - The company reported a net loss of $2,042 million in the MRD segment for the three months ended September 30, 2025, an improvement from a net loss of $15,068 million in the same period of 2024[24] Guidance and Forecast - Full year 2025 MRD revenue guidance raised to $202 million to $207 million, reflecting an annual growth of 39% to 42%[8] Expenses and Cash Flow - Total operating expenses for Q3 2025 were $83.7 million, a 6% increase from $79.1 million in Q3 2024[5] - Full year total company cash burn is expected to be between $45 million and $50 million, updated from the previous range[9] - Cash, cash equivalents, and marketable securities totaled $216.8 million as of September 30, 2025[7] - The company’s cash and cash equivalents increased from $47,920 million as of December 31, 2024, to $55,034 million as of September 30, 2025, an increase of approximately 14.0%[22] Balance Sheet - Total assets decreased from $539,376 million as of December 31, 2024, to $490,610 million as of September 30, 2025, a decline of approximately 9.0%[22] - Total current liabilities decreased from $98,053 million as of December 31, 2024, to $83,361 million as of September 30, 2025, a reduction of approximately 15.0%[22] - Shareholders' equity increased slightly from $202,485 million as of December 31, 2024, to $204,253 million as of September 30, 2025[22]

Financial Performance - First Quarter 2026 net revenue reached $29.8 million, aligning with the high end of guidance[5] - First Quarter 2026 Non-GAAP EPS was $0.04, while GAAP EPS reported a loss of ($0.04)[5] - Q2 FY2026 revenue guidance is set between $28 million and $32 million, with a midpoint of $30 million[11] - Non-GAAP EPS guidance for Q2 FY2026 is projected between $0.02 and $0.04, with a midpoint of $0.03[11] - Net revenue for the three months ended September 30, 2025, was $29,794,000, a decrease of 13.5% compared to $34,423,000 for the same period in 2024[22] - Gross profit for the same period was $13,346,000, resulting in a gross margin of 44.8%[22] - The company reported a net loss of $1,401,000, which is an improvement from a net loss of $2,502,000 in the same quarter last year[22] - Non-GAAP net income for the three months ended September 30, 2025, was $1,478,000, compared to $2,337,000 for the same period in 2024[24] - Non-GAAP gross profit was $13,507,000, with a non-GAAP gross margin of 45.3%[24] Asset and Liability Management - Total current assets decreased from $77.4 million in June 2025 to $74.4 million in September 2025[21] - Total liabilities decreased from $49.3 million in June 2025 to $45.1 million in September 2025[21] - Stockholders' equity increased slightly from $74.4 million in June 2025 to $74.5 million in September 2025[21] Market Engagement and Product Development - Increased Drone OEM engagements from 10 in Q4 to 17 in Q1, indicating strong demand in the UAS market[6] - Launched EdgeFabric.ai™ platform to enhance Edge AI deployment, facilitating integration and management of visual AI workloads[6] - Introduced Kompress.ai, an AI-powered optimization platform aimed at improving performance and energy efficiency in industrial environments[11] Revenue Breakdown - Embedded IoT Solutions generated $11,467,000 in revenue, while IoT System Solutions contributed $16,459,000 for the quarter[26] - Revenue from the Americas region was $20,651,000, representing an increase from $17,420,000 in the same quarter last year[26] Operating Expenses - Total operating expenses for the quarter were $14,873,000, slightly higher than $14,671,000 in the previous quarter[22] - Research and development expenses were $4,598,000, compared to $4,956,000 in the same quarter last year[22] - The company incurred restructuring, severance, and related charges of $93,000 during the quarter[22]