PART I [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company began generating product revenue from VYKAT XR in Q2 2025, leading to a net loss of $48.5 million for the first six months of 2025 due to commercial launch costs, while total assets slightly increased to $332.3 million [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet reflects a slight increase in total assets to $332.3 million as of June 30, 2025, with new current assets from the VYKAT XR commercial launch Balance Sheet Summary (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $76,497 | $87,928 | | Marketable securities | $217,346 | $230,720 | | Total current assets | $316,789 | $293,889 | | Total assets | $332,306 | $330,972 | | **Liabilities & Equity** | | | | Total current liabilities | $20,943 | $18,747 | | Long-term debt, net | $49,845 | $49,828 | | Total liabilities | $92,166 | $85,859 | | Total stockholders' equity | $240,140 | $245,113 | - The company reported new current assets of **Accounts Receivable ($24.6 million)** and **Inventory ($2.4 million)** as of June 30, 2025, following the commercial launch of VYKAT XR[9](index=9&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) The company recorded its first product revenue of $32.7 million in Q2 2025, but increased selling, general, and administrative expenses led to a net loss of $48.5 million for the first six months of 2025 Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Product revenue, net | $32,657 | $— | $32,657 | $— | | Total operating expenses | $39,182 | $24,868 | $84,925 | $48,343 | | Research and development | $9,147 | $12,342 | $22,664 | $26,944 | | Selling, general and administrative | $28,238 | $10,889 | $57,497 | $19,361 | | Operating loss | $(6,525) | $(24,868) | $(52,268) | $(48,343) | | Net loss | $(4,708) | $(21,854) | $(48,481) | $(43,252) | | Net loss per share, basic and diluted | $(0.09) | $(0.57) | $(1.00) | $(1.16) | - The company began generating product revenue in Q2 2025, recording **$32.7 million** following FDA approval of VYKAT XR, which was accompanied by a significant increase in Selling, General and Administrative expenses to support the commercial launch[11](index=11&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities increased to $45.4 million for the first six months of 2025, while investing activities provided cash and financing activities contributed $18.9 million Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(45,360) | $(30,179) | | Net cash provided by (used in) investing activities | $15,022 | $(236,165) | | Net cash provided by financing activities | $18,907 | $153,687 | | **Net decrease in cash and cash equivalents** | **$(11,431)** | **$(112,657)** | - Net cash used in operating activities increased to **$45.4 million** in the first six months of 2025 from **$30.2 million** in the prior year period, primarily due to costs associated with the commercial launch of VYKAT XR[16](index=16&type=chunk) - Financing activities in the first half of 2025 provided **$18.9 million**, mainly from the exercise of stock options and warrants, compared to **$153.7 million** in the same period of 2024 which included proceeds from a common stock sale[16](index=16&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the FDA approval and commercial launch of VYKAT XR, the company's liquidity position, debt agreements, and revenue recognition policies - The company's lead product, **VYKAT XR**, received FDA approval on March 26, 2025, for treating hyperphagia in patients with Prader-Willi syndrome (PWS), with revenue recognition beginning in Q2 2025[18](index=18&type=chunk) - As of June 30, 2025, the company held **$76.5 million** in cash and cash equivalents and **$217.3 million** in marketable securities, which management deems sufficient to meet obligations for at least the next twelve months[19](index=19&type=chunk)[24](index=24&type=chunk) - The company has a loan agreement with Oxford for up to **$200 million**, with **$50 million** outstanding as of June 30, 2025, and an additional **$50 million** available upon FDA approval of VYKAT XR[20](index=20&type=chunk)[66](index=66&type=chunk) - Subsequent to the quarter end, in July 2025, the company closed an underwritten public offering of common stock, raising gross proceeds of **$230.0 million**[23](index=23&type=chunk)[103](index=103&type=chunk) - Product revenue is recognized upon transfer of control to its single specialty pharmacy customer, with net revenue including estimates for variable consideration totaling **$4.3 million** in provisions for the six months ended June 30, 2025[34](index=34&type=chunk)[35](index=35&type=chunk)[38](index=38&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's transition to a commercial-stage entity following VYKAT XR's FDA approval, highlighting initial product revenue of $32.7 million in Q2 2025, increased SG&A expenses for launch, and strengthened liquidity from a recent $230 million public offering [Results of Operations](index=31&type=section&id=Results%20of%20Operations) The company's results reflect the commercial launch of VYKAT XR, with new product revenue offset by significantly increased selling, general, and administrative expenses Comparison of Three Months Ended June 30, 2025 and 2024 (in thousands) | Item | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Product revenue, net | $32,657 | $— | $32,657 | 100% | | Research and development | $9,147 | $12,342 | $(3,195) | (26%) | | Selling, general and administrative | $28,238 | $10,889 | $17,349 | 159% | | Net loss | $(4,708) | $(21,854) | $17,146 | (78%) | - For Q2 2025, R&D expenses decreased by **$3.2 million (26%)** YoY due to lower costs for the NDA submission, while SG&A expenses increased by **$17.3 million (159%)** YoY, driven by hiring and program costs for the commercial launch of VYKAT XR[121](index=121&type=chunk)[122](index=122&type=chunk) Comparison of Six Months Ended June 30, 2025 and 2024 (in thousands) | Item | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Product revenue, net | $32,657 | $— | $32,657 | 100% | | Research and development | $22,664 | $26,944 | $(4,280) | (16%) | | Selling, general and administrative | $57,497 | $19,361 | $38,136 | 197% | | Net loss | $(48,481) | $(43,252) | $(5,229) | 12% | - For the first six months of 2025, SG&A expenses increased by **$38.1 million (197%)** YoY, reflecting a **$15.3 million** increase in personnel costs and a **$12.6 million** increase in commercial launch program costs[131](index=131&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position with substantial cash and marketable securities, further bolstered by available debt and a recent public offering - As of June 30, 2025, the company had **$76.5 million** in cash and cash equivalents and **$217.3 million** in marketable securities, with a working capital of **$295.8 million**[134](index=134&type=chunk) - The company has access to additional capital through its loan agreement with Oxford, with **$50 million** available through September 30, 2025, and further tranches available upon meeting certain milestones[135](index=135&type=chunk) - In July 2025, the company raised gross proceeds of **$230.0 million** from a public offering of common stock, further strengthening its capital position[137](index=137&type=chunk) - Management believes that existing cash, cash equivalents, and marketable securities are sufficient to meet working capital needs for the next twelve months[138](index=138&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that there have been no material changes to its exposure to market risk during the six months ended June 30, 2025, as compared to the disclosures in its 2024 Annual Report on Form 10-K - There have been no material changes to the company's market risk exposure during the first six months of 2025[148](index=148&type=chunk) [Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls were ineffective as of June 30, 2025, due to a material weakness in IT general controls, for which a remediation plan is being implemented - Management concluded that disclosure controls were not effective as of June 30, 2025, due to a material weakness in internal control[151](index=151&type=chunk) - The material weakness relates to ineffective design and operation of controls over certain **information technology general controls (ITGCs)**, including segregation of duties, program change management, and user access controls[152](index=152&type=chunk) - The company is implementing a remediation plan that includes hiring additional personnel, enhancing training, and improving oversight of IT controls[154](index=154&type=chunk)[157](index=157&type=chunk) PART II—OTHER INFORMATION [Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) The company states that it may be party to litigation in the ordinary course of business but currently believes these matters will not have a material adverse effect - The company is not currently involved in any legal proceedings that are expected to have a material adverse effect on its business[159](index=159&type=chunk) [Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks primarily from its dependence on the commercial success of VYKAT XR, alongside financial, operational, intellectual property, and regulatory challenges, including potential stock price volatility - The company is highly dependent on the commercial success of its sole FDA-approved product, **VYKAT XR**[164](index=164&type=chunk) - The company has a limited commercialization history, has incurred significant losses since inception, and may need additional funds to support operations[162](index=162&type=chunk)[167](index=167&type=chunk) - Market acceptance of **VYKAT XR** by physicians, patients, and payers is critical for commercial success and is not guaranteed[187](index=187&type=chunk) - The company relies on sole source suppliers for manufacturing and a single specialty pharmacy for initial U.S. distribution, posing supply chain and commercialization risks[236](index=236&type=chunk)[240](index=240&type=chunk) - The company faces risks from potential intellectual property infringement claims and challenges in maintaining and enforcing its own patent rights[245](index=245&type=chunk)[251](index=251&type=chunk) - Ongoing regulatory obligations, healthcare reform measures like the **Inflation Reduction Act**, and compliance with fraud and abuse laws present significant challenges[292](index=292&type=chunk)[307](index=307&type=chunk)[314](index=314&type=chunk)

PART I FINANCIAL INFORMATION [Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) The unaudited condensed consolidated financial statements for ADMA Biologics, Inc. as of June 30, 2025, show significant growth in revenues and net income compared to the same period in 2024, with total assets increasing to $558.4 million from $488.7 million at year-end 2024, driven by higher accounts receivable and inventories [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Presents the company's financial position, detailing assets, liabilities, and equity at specific dates Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Current Assets** | | | | Cash and cash equivalents | $90,285 | $103,147 | | Accounts receivable, net | $109,726 | $49,999 | | Inventories, net | $191,464 | $170,235 | | **Total Assets** | **$558,380** | **$488,678** | | **Current Liabilities** | $74,941 | $55,542 | | **Total Liabilities** | **$160,055** | **$139,660** | | **Total Stockholders' Equity** | **$398,325** | **$349,018** | - Total assets grew to **$558.4 million** as of June 30, 2025, from **$488.7 million** at the end of 2024, primarily due to a significant increase in accounts receivable and inventories[13](index=13&type=chunk) - The company initiated a treasury stock program, holding **$15.1 million** in treasury stock as of June 30, 2025, which was not present at the end of 2024[13](index=13&type=chunk) [Unaudited Condensed Consolidated Statements of Operations](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) Details the company's financial performance, including revenues, expenses, and net income over reporting periods Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | **$121,984** | **$107,191** | **$236,786** | **$189,066** | | Gross Profit | $67,227 | $57,453 | $128,323 | $96,561 | | Income from Operations | $42,798 | $39,201 | $77,678 | $61,022 | | **Net Income** | **$34,219** | **$32,062** | **$61,122** | **$49,868** | | Diluted EPS | $0.14 | $0.13 | $0.25 | $0.21 | - Revenues for the second quarter of 2025 increased to **$122.0 million**, a **13.8% increase** from **$107.2 million** in the same period of 2024[14](index=14&type=chunk) - Net income for the six months ended June 30, 2025, rose to **$61.1 million** from **$49.9 million** in the prior-year period, representing a **22.6% increase**[14](index=14&type=chunk) [Unaudited Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Summarizes cash inflows and outflows from operating, investing, and financing activities for the period Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,464 | $43,428 | | Net cash used in investing activities | ($7,247) | ($4,727) | | Net cash used in financing activities | ($7,079) | ($1,809) | | **Net (decrease) increase in cash** | **($12,862)** | **$36,892** | - Net cash from operating activities significantly decreased to **$1.5 million** in the first six months of 2025 from **$43.4 million** in the same period of 2024, primarily due to large increases in accounts receivable and inventories[18](index=18&type=chunk) - Cash used in financing activities increased, driven by **$8.4 million** in taxes paid on vested restricted stock units and a **$30.0 million** principal payment on a term loan, which was offset by a **$30.0 million** draw from a revolver[18](index=18&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Provides essential disclosures and explanations supporting the condensed consolidated financial statements - In May 2025, the Board authorized a share repurchase program of up to **$500.0 million** During the quarter, the company repurchased **816,237 shares** for **$15.1 million**[50](index=50&type=chunk)[51](index=51&type=chunk) - In May 2025, the company repaid **$30.0 million** of its term loan using a draw from its revolving credit facility, resulting in a debt extinguishment loss of **$1.2 million**[47](index=47&type=chunk) - Subsequent to the quarter end, in August 2025, the company entered into a new **$300 million** credit agreement with JPMorgan, consisting of a **$75 million** term loan and a **$225 million** revolving facility, to refinance its existing debt[86](index=86&type=chunk) - In July 2025, the company acquired real estate in Boca Raton, FL for **$12.6 million** to expand production operations and storage capacity[85](index=85&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) Management attributes the strong financial performance in the first half of 2025 to the continued commercial success and growing market acceptance of its IVIG product, ASCENIV, with revenues for the second quarter and first six months of 2025 increasing by 14% and 25% year-over-year, respectively [Overview](index=27&type=section&id=Overview) Introduces ADMA's business, products, and key strategic developments, including recent FDA approvals and acquisitions - ADMA is an end-to-end commercial biopharmaceutical company with three FDA-approved products: ASCENIV, BIVIGAM, and Nabi-HB, manufactured at its Boca Raton facility[95](index=95&type=chunk)[96](index=96&type=chunk) - The company operates ten FDA-licensed plasma collection centers, which supply plasma for its products and for sale to third parties[98](index=98&type=chunk) - In April 2025, the FDA approved an innovative yield enhancement production process for ASCENIV and BIVIGAM, which is expected to increase production yields by approximately **20%** and contribute to revenue and earnings growth starting in the second half of 2025[101](index=101&type=chunk) - In July 2025, the company acquired real estate in Boca Raton for **$12.6 million** to expand production and storage capabilities[103](index=103&type=chunk) [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Analyzes the company's financial performance, highlighting revenue, gross profit, and net income trends and drivers Q2 2025 vs Q2 2024 Results (in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Revenues | $121,984 | $107,191 | $14,793 | | Gross Profit | $67,227 | $57,453 | $9,774 | | Income from Operations | $42,798 | $39,201 | $3,597 | | Net Income | $34,219 | $32,062 | $2,157 | - Q2 2025 revenues increased **14% YoY**, primarily due to higher sales volume of ASCENIV Excluding a **$12.6 million** Medicaid rebate accrual adjustment in Q2 2024, the underlying revenue growth was **29%**[118](index=118&type=chunk) H1 2025 vs H1 2024 Results (in thousands) | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenues | $236,786 | $189,066 | $47,720 | | Gross Profit | $128,323 | $96,561 | $31,762 | | Income from Operations | $77,678 | $61,022 | $16,656 | | Net Income | $61,122 | $49,868 | $11,254 | - For the first six months of 2025, revenues grew **25% YoY** A voluntary withdrawal of three BIVIGAM lots reduced revenue by **$4.0 million** during this period[130](index=130&type=chunk) - Gross margin for H1 2025 improved to **54.2%** from **51.1%** in H1 2024, driven by a better product mix and manufacturing efficiencies[132](index=132&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) Assesses the company's financial flexibility, cash position, debt structure, and future funding outlook - As of June 30, 2025, the company had working capital of **$324.6 million**, including **$90.3 million** in cash and cash equivalents[146](index=146&type=chunk) - Management anticipates that current cash, receivables, and projected operating cash flow will be sufficient to fund operations through the first half of 2026 and beyond, with no current need to raise additional capital[148](index=148&type=chunk) - On August 5, 2025, the company refinanced its debt by entering a new **$300 million** credit facility with JPMorgan, replacing the previous Ares facility The new facility includes a **$75 million** term loan and a **$225 million** revolving credit line[157](index=157&type=chunk)[158](index=158&type=chunk) - Net cash from operations for the first six months of 2025 was **$1.5 million**, a significant decrease from **$43.4 million** in the prior year, mainly due to investments in inventory and an increase in accounts receivable[165](index=165&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) The company is exposed to interest rate risk due to its variable-rate senior credit facilities, with a hypothetical 100 basis point increase in interest rates resulting in an approximate $0.8 million negative impact on annualized earnings and cash flows - The company's primary market risk is from changes in interest rates on its senior credit facility[172](index=172&type=chunk) - As of June 30, 2025, a hypothetical **100 basis point (1%)** increase in interest rates would have an approximate **$0.8 million** negative impact on annual earnings and cash flows based on the **$75.0 million** outstanding variable-rate debt[172](index=172&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures.) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures as of June 30, 2025, concluding they were effective in ensuring timely and accurate reporting, with no material changes to internal control over financial reporting during the quarter - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[174](index=174&type=chunk) - There were no changes in the company's internal control over financial reporting during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[176](index=176&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings.) The company reports that it is not currently involved in any material pending legal proceedings that would have a material adverse effect on its financial position, results of operations, or cash flows - Management states that there are currently no material pending legal proceedings against the company[178](index=178&type=chunk) [Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors.) The company outlines several key risks to its business, including the potential inability to maintain profitability, reliance on third-party contractors for manufacturing and plasma supply, business interruptions, regulatory hurdles, customer concentration, stock price volatility, and limitations on the use of Net Operating Loss (NOL) carryforwards - The company may not be able to maintain profitability, despite achieving it for the first time in the year ended December 31, 2024[179](index=179&type=chunk)[182](index=182&type=chunk) - A few customers account for a significant portion of revenue and accounts receivable, with two customers representing about **72%** of consolidated revenues for the first six months of 2025[181](index=181&type=chunk)[216](index=216&type=chunk) - The business relies on third parties for filling, packaging, testing, and sourcing plasma, which introduces risks related to performance, quality, and supply chain disruptions[179](index=179&type=chunk)[185](index=185&type=chunk) - The company's new senior secured credit facility with JPMorgan contains covenants and is subject to acceleration in case of default, which could lead to the seizure of collateral[181](index=181&type=chunk)[231](index=231&type=chunk)[232](index=232&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=72&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) The company reports no unregistered sales of equity securities during the period, having repurchased 816,237 shares in June 2025 at an average price of $18.35 per share under its publicly announced share repurchase program, with approximately $485 million remaining available for future repurchases Share Repurchases in Q2 2025 | For the Month Ended | Total Number of Shares Purchased | Average Price Paid Per Share | Approximate Dollar Value of Shares that May Yet Be Purchased | | :--- | :--- | :--- | :--- | | April 30, 2025 | - | $- | $- | | May 31, 2025 | - | $- | $- | | June 30, 2025 | 816,237 | $18.35 | $485,002,210 | - The share repurchases were made pursuant to the program publicly announced on May 5, 2025, which has no expiration date[296](index=296&type=chunk)[297](index=297&type=chunk) [Other Information](index=73&type=section&id=Item%205.%20Other%20Information.) The company states that none of its directors or executive officers adopted or terminated any Rule 10b5-1 trading plans or other non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025 - No directors or executive officers adopted or terminated any Rule 10b5-1 trading plans during the second quarter of 2025[300](index=300&type=chunk)

[Part I. Financial Information](index=3&type=section&id=Part%20I.%20Financial%20Information) [Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20FINANCIAL%20STATEMENTS%20(UNAUDITED)) The unaudited condensed consolidated financial statements for the period ended June 30, 2025, show a significant decline in total assets and a worsening stockholders' deficit. The company reported a substantial decrease in revenue and an increased net loss compared to the prior year, primarily driven by a severe downturn in its sell-side advertising segment. Cash flow from operations remained negative, though improved from the prior year, with financing activities, particularly stock issuance, providing necessary liquidity. The notes highlight substantial doubt about the company's ability to continue as a going concern [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a decline in total assets and an increase in liabilities, leading to a worsened stockholders' deficit Condensed Consolidated Balance Sheets | Balance Sheet Items (in thousands) | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $6,727 | $8,535 | | **Total Assets** | **$23,326** | **$26,006** | | **Total Current Liabilities** | $13,675 | $13,350 | | **Total Liabilities** | **$47,907** | **$45,736** | | **Total Stockholders' Deficit** | **($24,581)** | **($19,730)** | - The company's financial position weakened, with total assets decreasing by **10.3%** and total liabilities increasing by **4.7%** from December 31, 2024, to June 30, 2025. This resulted in a **24.6%** increase in the total stockholders' deficit[9](index=9&type=chunk) [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The statements of operations reveal a significant revenue decline and an increased net loss, primarily from sell-side advertising Condensed Consolidated Statements of Operations | Income Statement (in thousands) | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Total Revenues** | **$10,144** | **$21,855** | **-53.6%** | | Sell-side advertising | $2,483 | $14,298 | -82.6% | | Buy-side advertising | $7,661 | $7,557 | +1.4% | | **Gross Profit** | **$3,561** | **$5,931** | **-40.0%** | | **Loss from Operations** | **($2,426)** | **($2,065)** | **+17.5%** | | **Net Loss** | **($4,196)** | **($3,141)** | **+33.6%** | | **Net Loss per Share (Basic)** | **($0.23)** | **($0.16)** | **+43.8%** | - For the six months ended June 30, 2025, total revenues plummeted by **58.5%** to **$18.3 million** from **$44.1 million** in the prior-year period. The net loss for the six-month period widened to **$10.1 million** from **$7.0 million**[11](index=11&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash flow from operations improved but remained negative, with financing activities providing necessary liquidity Condensed Consolidated Statements of Cash Flows | Cash Flows (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($5,398) | ($10,111) | | Net cash used in investing activities | ($38) | ($10) | | Net cash provided by financing activities | $5,584 | $6,074 | | **Net increase (decrease) in cash** | **$148** | **($4,047)** | - Cash used in operations for the first six months of 2025 improved to **-$5.4 million** from **-$10.1 million** in the prior year. Financing activities provided **$5.6 million** in cash, primarily from the issuance of **$5.9 million** in Class A Common Stock[22](index=22&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Key notes highlight going concern doubts, customer concentration, ongoing litigation, and significant long-term debt - **Going Concern:** Management has identified conditions that raise substantial doubt about the Company's ability to continue as a going concern. These include a net loss of **$10.1 million** for the six months ended June 30, 2025, an accumulated deficit of **$13.4 million**, low cash reserves of **$1.6 million**, maturing debt, and non-compliance with Nasdaq's listing requirements[65](index=65&type=chunk)[66](index=66&type=chunk) - **Customer Concentration:** For the three months ended June 30, 2025, two customers accounted for **31%** of revenues. This is a significant reduction in concentration from the same period in 2024, where one sell-side customer accounted for **58%** of revenues[50](index=50&type=chunk) - **Litigation:** The company is involved in litigation, including a lawsuit it filed against the author of a defamatory article that caused a significant sell-side customer to temporarily pause its connection, disrupting business. The company is also defending against a putative class-action lawsuit alleging violations of federal securities laws[121](index=121&type=chunk)[122](index=122&type=chunk) - **Long-Term Debt:** As of June 30, 2025, total long-term debt was **$41.2 million**. The company has received multiple amendments to its credit facilities to provide temporary relief from debt covenants and extend maturity dates, indicating ongoing liquidity challenges[70](index=70&type=chunk)[87](index=87&type=chunk)[88](index=88&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the severe 54% year-over-year revenue decline in Q2 2025 to a significant disruption in its sell-side business, caused by a defamatory blog post in May 2024 that led a key customer to temporarily halt activity. While buy-side revenue saw marginal growth, the collapse in sell-side revenue led to a wider net loss. The company is facing substantial liquidity challenges, evidenced by a 'going concern' warning, non-compliance with Nasdaq listing rules, and reliance on an Equity Reserve Facility for funding. Management has implemented cost-saving measures, including staff reductions, to mitigate the financial impact [Results of Operations](index=36&type=section&id=Results%20of%20Operations) Operational results show a sharp revenue drop due to sell-side disruption, despite cost-saving measures - The primary cause for the **83%** decrease in Q2 2025 sell-side advertising revenue was an unexpected business disruption from a defamatory blog post in May 2024, which caused partners and clients to pause activity. Sell-side volumes have not yet recovered to prior levels[173](index=173&type=chunk) Results of Operations | Revenue and Gross Profit (in thousands) | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Total Revenues** | **$10,144** | **$21,855** | **(54%)** | | Sell-side advertising | $2,483 | $14,298 | (83%) | | Buy-side advertising | $7,661 | $7,557 | 1% | | **Gross Profit** | **$3,561** | **$5,931** | **(40%)** | - Operating expenses for Q2 2025 decreased by **25%** to **$6.0 million**, primarily due to lower compensation costs resulting from a staff reduction effective July 1, 2024, and reduced professional fees[183](index=183&type=chunk)[184](index=184&type=chunk)[185](index=185&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity remains a major concern, with substantial doubt about going concern and reliance on equity financing - The company's ability to continue as a going concern is in substantial doubt due to significant net losses, low cash balance (**$1.6 million**), maturing debt, and Nasdaq delisting risk[191](index=191&type=chunk) - To address liquidity concerns, the company is relying on cash from operations, its Equity Reserve Facility, and potential future financing. It has also implemented cost reductions and obtained temporary relief from debt covenants[192](index=192&type=chunk) - During the first six months of 2025, the company sold **6,059,351** shares of Class A Common Stock for **$4.6 million** under its Equity Reserve Facility to fund operations[143](index=143&type=chunk) Liquidity and Capital Resources | Key Liquidity Metrics (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,593 | $1,445 | | Working capital deficit | ($6,948) | ($4,815) | [Recent Developments](index=31&type=section&id=Recent%20Developments) Recent developments include Nasdaq non-compliance notices for equity and bid price, with an extension granted - On October 18, 2024, the company was notified by Nasdaq of non-compliance with the minimum stockholders' equity requirement. Subsequently, on May 12, 2025, it received another notice for failing to meet the **$1.00** minimum bid price requirement[140](index=140&type=chunk)[141](index=141&type=chunk) - The company has been granted an extension until October 14, 2025, by a Nasdaq Hearings Panel to regain compliance with the stockholders' equity rule, subject to meeting certain interim conditions[141](index=141&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company, as a "smaller reporting company," is not required to provide the information for this item - As a smaller reporting company, the registrant is exempt from providing quantitative and qualitative disclosures about market risk[210](index=210&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were not effective as of June 30, 2025. This is due to a previously identified material weakness related to the technical evaluation of accounting matters. While remediation efforts are underway, including hiring additional personnel and engaging consultants, they were not fully effective by the end of the period - The CEO and CFO concluded that the Company's Disclosure Controls were not effective as of June 30, 2025[211](index=211&type=chunk) - A material weakness in controls over the technical evaluation of accounting matters, previously identified as of December 31, 2023, and 2024, has not been fully remediated[212](index=212&type=chunk)[215](index=215&type=chunk) - Remediation steps include engaging consultants and hiring additional qualified accounting personnel, but these controls have not been in place long enough to demonstrate operating effectiveness[215](index=215&type=chunk) [Part II. Other Information](index=43&type=section&id=Part%20II.%20Other%20Information) [Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) The company is actively involved in two significant legal matters. It has filed a lawsuit against the author of a defamatory article from May 2024 that negatively impacted its business. Concurrently, it is defending against a consolidated putative class-action lawsuit filed by stockholders alleging violations of federal securities laws - The company filed a lawsuit against the author of a defamatory article published on May 10, 2024, which caused a major sell-side customer to temporarily pause its connection[219](index=219&type=chunk) - A putative class-action lawsuit was filed against the company and certain officers in May 2024, alleging violations of federal securities laws related to public disclosures. The company believes the claims lack merit and intends to defend itself vigorously[220](index=220&type=chunk) [Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) The primary risk highlighted is the potential delisting of the company's Class A Common Stock from the Nasdaq Capital Market. The company is non-compliant with both the minimum stockholders' equity and minimum bid price requirements. Failure to regain compliance within the granted extension period could severely impact the stock's liquidity, the company's ability to raise capital, and investor confidence - A significant risk is the potential delisting from the Nasdaq Capital Market due to non-compliance with the minimum stockholders' equity requirement and the minimum bid price rule[222](index=222&type=chunk)[223](index=223&type=chunk) - Delisting could adversely affect the ability to raise additional financing, negatively impact the value and liquidity of the stock, and result in a loss of institutional investor interest[223](index=223&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - There were no unregistered sales of equity securities in the reporting period[224](index=224&type=chunk) [Other Information](index=45&type=section&id=Item%205.%20Other%20Information) On August 5, 2025, the company entered into a Sixth Amendment to its Credit Agreement with East West Bank (EWB). This amendment extended the maturity date of the credit facility from July 31, 2025, to August 31, 2025, in exchange for a principal payment of $200,000 - The company amended its credit agreement with EWB on August 5, 2025, extending the maturity date to August 31, 2025[230](index=230&type=chunk) - In connection with the maturity extension, the company agreed to make a principal payment of **$200,000** by August 15, 2025[230](index=230&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form10-Q ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended June 30, 2025 OR ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period to Commission file number 001-10962 Topgolf Callaway Brands Corp. (Exact name of registrant as specified in its charter) Delaware 95-3797580 (State or other jurisdiction of inc ...

[Glossary](index=3&type=section&id=GLOSSARY) The glossary defines key terms and acronyms used throughout the financial report, including ACL, CECL, CRE, and merger-related details - The glossary provides definitions for key terms and acronyms used throughout the financial report, such as ACL (Allowance for Credit Losses), CECL (Current Expected Credit Losses), CRE (Commercial Real Estate), and details related to the Columbia and Umpqua mergers, as well as the pending Pacific Premier merger[8](index=8&type=chunk) [Part I. Financial Information](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the Company's unaudited condensed consolidated financial statements and management's discussion and analysis [Item 1. Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of income, comprehensive income, changes in shareholders' equity, and cash flows, along with detailed notes explaining significant accounting policies and specific financial line items [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(unaudited)) This section provides a snapshot of the Company's financial position, detailing assets, liabilities, and equity at specific dates Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Total assets | $51,901,442 | $51,576,397 | | Total cash and cash equivalents | $1,942,170 | $1,878,255 | | Investment securities (fair value) | $8,748,143 | $8,354,849 | | Net loans and leases | $37,216,106 | $37,256,272 | | Total deposits | $41,742,657 | $41,720,732 | | Total liabilities | $46,559,560 | $46,458,173 | | Total shareholders' equity | $5,341,882 | $5,118,224 | - Total assets increased by **$325.0 million**, driven by higher cash and cash equivalents and investment securities, partially offset by a slight decrease in net loans and leases. Total shareholders' equity increased by **$223.7 million**, while total deposits saw a modest increase of **$21.9 million**[9](index=9&type=chunk) [Condensed Consolidated Statements of Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20(unaudited)) This section presents the Company's financial performance over periods, detailing revenues, expenses, and net income Condensed Consolidated Statements of Income (in thousands, except per share) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total interest income | $670,689 | $695,536 | $1,317,932 | $1,379,761 | | Total interest expense | $224,243 | $268,087 | $446,491 | $528,950 | | Net interest income | $446,446 | $427,449 | $871,441 | $850,811 | | Provision for credit losses | $29,449 | $31,820 | $56,852 | $48,956 | | Total non-interest income | $64,462 | $44,703 | $130,839 | $95,060 | | Total non-interest expense | $277,995 | $279,244 | $618,117 | $566,760 | | Net income | $152,423 | $120,144 | $239,032 | $244,224 | | Basic EPS | $0.73 | $0.58 | $1.14 | $1.17 | | Diluted EPS | $0.73 | $0.57 | $1.14 | $1.17 | - Net income for the three months ended June 30, 2025, increased by **$32.3 million** year-over-year, primarily due to higher net interest income and non-interest income, while total non-interest expense remained relatively stable. For the six months ended June 30, 2025, net income slightly decreased by **$5.2 million** compared to the prior year, mainly due to a significant increase in non-interest expense, partially offset by growth in net interest income and non-interest income[10](index=10&type=chunk) [Condensed Consolidated Statements of Comprehensive Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(unaudited)) This section details changes in equity from non-owner sources, including net income and other comprehensive income components Condensed Consolidated Statements of Comprehensive Income (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $152,423 | $120,144 | $239,032 | $244,224 | | Net change in unrealized gains (losses) for available for sale securities | $26,064 | $(29,282) | $122,489 | $(120,060) | | Net change in unrealized gains (losses) for junior subordinated debentures, at fair value | $(1,390) | $(284) | $5,678 | $4,491 | | Other comprehensive income (loss), net of tax | $24,688 | $(29,551) | $128,196 | $(115,540) | | Comprehensive income | $177,111 | $90,593 | $367,228 | $128,684 | - Comprehensive income significantly increased for both the three and six months ended June 30, 2025, compared to the prior year periods. This was primarily driven by a positive net change in unrealized gains for available-for-sale securities, which shifted from a substantial loss in 2024 to a significant gain in 2025[11](index=11&type=chunk) [Condensed Consolidated Statements of Changes in Shareholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity%20(unaudited)) This section outlines the movements in shareholders' equity, including net income, dividends, and other comprehensive income Changes in Shareholders' Equity (in thousands) | Metric | Balance at Dec 31, 2024 | Net Income (6M 2025) | Other Comprehensive Income (6M 2025) | Stock-based Compensation (6M 2025) | Stock Repurchased (6M 2025) | Cash Dividends (6M 2025) | Balance at Jun 30, 2025 | | :--------------------------------- | :---------------------- | :------------------- | :----------------------------------- | :--------------------------------- | :--------------------------- | :------------------------- | :---------------------- | | Common Stock Amount | $5,817,458 | - | - | $16,247 | $(8,601) | - | $5,826,488 | | Accumulated Deficit | $(237,254) | $239,032 | - | - | - | $(152,599) | $(150,822) | | Accumulated Other Comprehensive Loss | $(461,980) | - | $128,196 | - | - | - | $(333,784) | | Total Shareholders' Equity | $5,118,224 | $239,032 | $128,196 | $16,247 | $(8,601) | $(152,599) | $5,341,882 | - Total shareholders' equity increased by **$223.7 million** from December 31, 2024, to June 30, 2025. This increase was primarily driven by net income of **$239.0 million** and other comprehensive income of **$128.2 million**, partially offset by cash dividends paid of **$152.6 million** and stock repurchases of **$8.6 million**[13](index=13&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(unaudited)) This section reports cash inflows and outflows from operating, investing, and financing activities over specific periods Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $228,807 | $335,798 | | Net cash used in investing activities | $(233,940) | $(85,812) | | Net cash provided by (used in) financing activities | $69,048 | $(343,689) | | Net increase (decrease) in cash and cash equivalents | $63,915 | $(93,703) | | Cash and cash equivalents, end of period | $1,942,170 | $2,068,831 | - Net cash provided by operating activities decreased by **$107.0 million** for the six months ended June 30, 2025, compared to the prior year. Net cash used in investing activities significantly increased by **$148.1 million**, primarily due to higher purchases of available-for-sale investment securities. Net cash from financing activities shifted from a net outflow of **$343.7 million** in 2024 to a net inflow of **$69.0 million** in 2025, driven by increased borrowings and a net increase in deposit liabilities[14](index=14&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed disclosures and explanations for the condensed consolidated financial statements, covering significant accounting policies, specific asset and liability categories, credit loss methodologies, fair value measurements, and other material financial and operational information [Note 1 – Summary of Significant Accounting Policies](index=9&type=section&id=Note%201%20%E2%80%93%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the Company's key accounting principles, recent accounting pronouncements, and their impact on financial reporting - Columbia Banking System, Inc. (the Company) renamed its wholly-owned banking subsidiary to "Columbia Bank" (dba: Umpqua Bank) effective July 1, 2025, with branding to begin September 1, 2025, to align with the holding company's name and existing brands[15](index=15&type=chunk) - The Company adopted ASU No. 2023-09, 'Income Taxes (Topic 740): Improvements to Income Tax Disclosures,' on January 1, 2025, for annual reporting, aiming for greater transparency in income tax disclosures, particularly regarding rate reconciliation and taxes paid[17](index=17&type=chunk) - The Company is currently evaluating the impact of ASU No. 2024-03, 'Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures,' effective for fiscal years beginning after December 15, 2026, which requires enhanced disaggregation of income statement expenses in financial statement notes[18](index=18&type=chunk) [Note 2 – Debt Securities](index=10&type=section&id=Note%202%20%E2%80%93%20Debt%20Securities) This note details the composition, fair value, and unrealized gains/losses of the Company's debt securities portfolio Debt Securities (in thousands) | Category | June 30, 2025 Amortized Cost | June 30, 2025 Fair Value | Dec 31, 2024 Amortized Cost | Dec 31, 2024 Fair Value | | :------------------------------------------------- | :--------------------------- | :----------------------- | :--------------------------- | :----------------------- | | Available for sale: | | | | | | U.S. Treasury and agencies | $1,391,854 | $1,347,060 | $1,495,542 | $1,422,787 | | Obligations of states and political subdivisions | $1,041,810 | $1,014,883 | $1,055,535 | $1,026,053 | | Mortgage-backed securities and collateralized mortgage obligations | $6,637,696 | $6,291,229 | $6,307,252 | $5,825,775 | | Total available for sale securities | $9,071,360 | $8,653,172 | $8,858,329 | $8,274,615 | | Held to maturity: | | | | | | Mortgage-backed securities and collateralized mortgage obligations | $2,013 | $2,585 | $2,101 | $2,703 | | Total held to maturity securities | $2,013 | $2,585 | $2,101 | $2,703 | - As of June 30, 2025, the available-for-sale investment portfolio had gross unrealized losses of **$459.8 million**, primarily from mortgage-backed securities (**$379.3 million**). These losses are attributed to changes in market interest rates or widening market spreads, not credit quality, and no Allowance for Credit Losses (ACL) was deemed necessary[19](index=19&type=chunk)[20](index=20&type=chunk)[183](index=183&type=chunk) - Debt securities with a fair value of **$6.2 billion** were pledged as of June 30, 2025, an increase from **$5.2 billion** at December 31, 2024, to secure borrowing capacity, public deposits, and repurchase agreements[23](index=23&type=chunk) [Note 3 – Loans and Leases](index=12&type=section&id=Note%203%20%E2%80%93%20Loans%20and%20Leases) This note provides a breakdown of the Company's loan and lease portfolio by type, including pledged loans and purchased credit deterioration Major Types of Loans and Leases (in thousands) | Loan Type | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Commercial real estate | $19,600,479 | $19,547,672 | | Commercial | $9,944,830 | $9,968,096 | | Residential | $7,912,599 | $7,965,005 | | Consumer & other | $179,104 | $180,128 | | Total loans and leases | $37,637,013 | $37,680,901 | - Total loans and leases decreased slightly by **$43.9 million** from December 31, 2024, to June 30, 2025, primarily due to decreases in residential and commercial loan balances, partially offset by an increase in Commercial Real Estate (CRE) balances[24](index=24&type=chunk)[185](index=185&type=chunk) - As of June 30, 2025, loans totaling **$22.4 billion** were pledged to secure borrowings and available lines of credit, an increase from **$22.0 billion** at December 31, 2024[24](index=24&type=chunk) - The carrying balance of Purchased with Credit Deterioration (PCD) loans decreased to **$136.2 million** as of June 30, 2025, from **$178.5 million** at December 31, 2024[25](index=25&type=chunk) [Note 4 – Allowance for Credit Losses](index=13&type=section&id=Note%204%20%E2%80%93%20Allowance%20for%20Credit%20Losses) This note details the Allowance for Credit Losses (ACL) methodology, balances, and activity by portfolio segment, along with an analysis of asset quality, non-performing loans, collateral-dependent loans, and modifications made to borrowers experiencing financial difficulty, reflecting management's estimate of lifetime credit losses [Allowance for Credit Losses Overview](index=13&type=section&id=Allowance%20for%20Credit%20Losses%20Overview) This section provides an overview of the ACL balance, methodology, and economic assumptions used for estimation - The total ACL was **$439.0 million** as of June 30, 2025, a decrease of **$1.8 million** from **$440.8 million** at December 31, 2024, reflecting credit migration trends, changes in economic assumptions, and recalibration of CECL models[28](index=28&type=chunk)[140](index=140&type=chunk)[204](index=204&type=chunk) - The Bank used Moody's Analytics' May 2025 consensus economic forecast for ACL estimation, which projects lower U.S. real GDP growth (**1.5%** in 2026) and higher unemployment rates (**4.5%** in 2026) compared to the December 2024 forecast[29](index=29&type=chunk) - Management applied offsetting qualitative adjustments, primarily to commercial real estate and commercial loan portfolios, to address heightened economic uncertainty and sector-specific risks, maintaining overall ACL stability despite a less favorable economic outlook[30](index=30&type=chunk) [ACL Activity by Portfolio Segment](index=14&type=section&id=ACL%20Activity%20by%20Portfolio%20Segment) This section details the provision for credit losses and net charge-offs across different loan portfolio segments ACL Activity for Six Months Ended June 30, 2025 (in thousands) | Portfolio Segment | Balance, Beginning of Period | Provision for Credit Losses | Net Charge-offs | Balance, End of Period | | :-------------------- | :--------------------------- | :-------------------------- | :---------------- | :--------------------- | | Commercial Real Estate | $154,413 | $5,516 | $(106) | $159,823 | | Commercial | $218,668 | $57,866 | $(56,672) | $219,862 | | Residential | $44,700 | $(9,807) | $(303) | $34,590 | | Consumer & Other | $6,848 | $1,369 | $(1,585) | $6,632 | | Total ACLLL | $424,629 | $54,944 | $(58,666) | $420,907 | | Reserve for Unfunded Commitments | $16,168 | $1,908 | - | $18,076 | | Total ACL | $440,797 | $56,852 | $(58,666) | $438,983 | - For the six months ended June 30, 2025, the provision for credit losses was **$56.9 million**, with net charge-offs totaling **$58.7 million**. Commercial loans experienced the highest provision (**$57.9 million**) and net charge-offs (**$56.7 million**), while Residential loans saw a recapture of **$9.8 million**[32](index=32&type=chunk)[165](index=165&type=chunk)[166](index=166&type=chunk) [Asset Quality and Non-Performing Loans and Leases](index=15&type=section&id=Asset%20Quality%20and%20Non-Performing%20Loans%20and%20Leases) This section analyzes trends in past due, non-accrual, and collateral-dependent loans, reflecting overall asset quality Loans and Leases Past Due and Non-Accrual (in thousands) | Category | June 30, 2025 Total Past Due | June 30, 2025 Non-Accrual | Dec 31, 2024 Total Past Due | Dec 31, 2024 Non-Accrual | | :-------------------------- | :--------------------------- | :------------------------ | :--------------------------- | :------------------------ | | Commercial real estate | $70,298 | $30,739 | $65,536 | $39,332 | | Commercial | $45,332 | $66,809 | $50,591 | $57,146 | | Residential | $106,553 | $0 | $96,480 | $0 | | Consumer & other | $1,520 | $0 | $1,376 | $0 | | Total, net of deferred fees and costs | $223,705 | $97,548 | $177,981 | $96,478 | - Non-performing loans and leases increased to **$177.4 million** (**0.47%** of total loans) as of June 30, 2025, from **$166.9 million** (**0.44%**) at December 31, 2024, reflecting a move toward a normalized credit environment. Non-accrual loans and leases were **$97.5 million**, with **$67.8 million** covered by government guarantees[35](index=35&type=chunk)[140](index=140&type=chunk)[191](index=191&type=chunk)[203](index=203&type=chunk) Collateral-Dependent Loans and Leases (in thousands) | Collateral Type | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Residential Real Estate | $70,570 | $84,104 | | Commercial Real Estate | $27,904 | $37,671 | | General Business Assets | $53,297 | $40,442 | | Total | $151,771 | $162,217 | [Loan and Lease Modifications Made to Borrowers Experiencing Financial Difficulty](index=19&type=section&id=Loan%20and%20Lease%20Modifications) This section details modifications made to loans for financially distressed borrowers, including types and subsequent defaults Total Modified Loans and Leases Experiencing Financial Difficulty (in thousands) | Period | Total Modified Loans | % of Total Class of Financing Receivable | | :----------------------------- | :------------------- | :--------------------------------------- | | Three Months Ended June 30, 2025 | $67,865 | 0.18 % | | Six Months Ended June 30, 2025 | $113,125 | 0.30 % | | Three Months Ended June 30, 2024 | $26,508 | 0.07 % | | Six Months Ended June 30, 2024 | $60,817 | 0.16 % | - For the three months ended June 30, 2025, all modified loans and leases were current, with no subsequent defaults. However, for the six months ended June 30, 2025, **$4.1 million** in modified loans subsequently defaulted, compared to **$4.4 million** in the prior year period[46](index=46&type=chunk) - The most common modification types for the six months ended June 30, 2025, were Term Extension (**$34.3 million**) and Combo - Interest Rate Reduction and Term Extension (**$38.9 million**)[42](index=42&type=chunk) [Credit Quality Indicators](index=24&type=section&id=Credit%20Quality%20Indicators) This section describes the Bank's approach to assessing credit risk for loans using dual risk ratings and past due status - The Bank uses a dual risk rating approach for non-homogeneous loans, measuring Probability of Default (PD) and Loss Given Default (LGD) to assess credit risk. Homogeneous loans are rated based on past due status and may enter a higher risk rating scale if modified[48](index=48&type=chunk) [Loans and Leases by Credit Classification and Vintage Year](index=25&type=section&id=Loans%20and%20Leases%20by%20Credit%20Classification%20and%20Vintage%20Year) This section categorizes the loan portfolio by credit quality, highlighting concentrations in higher-risk classifications Total Loans and Leases by Credit Quality Indicator (June 30, 2025, in thousands) | Credit Quality Indicator | Commercial Real Estate | Commercial | Residential | Consumer & Other | Total | | :----------------------- | :--------------------- | :----------- | :---------- | :--------------- | :------------ | | Pass/Watch | $19,600,480 | $9,944,830 | $7,912,599 | $179,104 | $37,637,013 | | Special mention | $353,712 | $77,352 | $22,541 | $839 | $454,444 | | Substandard | $71,636 | $56,867 | $2,082,766 | $337 | $2,211,606 | | Doubtful | $3,746 | $11,385 | $3,462 | - | $18,593 | | Loss | $640 | $3,919 | $3,462 | - | $8,021 | - As of June 30, 2025, the majority of the loan portfolio was classified as Pass/Watch. Commercial Real Estate and Commercial portfolios showed the highest amounts in Special Mention and Substandard categories, indicating areas of elevated credit risk[49](index=49&type=chunk)[50](index=50&type=chunk)[51](index=51&type=chunk) [Note 5 – Goodwill and Other Intangible Assets](index=30&type=section&id=Note%205%20%E2%80%93%20Goodwill%20and%20Other%20Intangible%20Assets) This note details the carrying amounts and amortization of goodwill and other intangible assets, primarily from mergers - Goodwill remained stable at **$1.0 billion** as of June 30, 2025, and December 31, 2024, representing the excess of acquisition price over fair value of net assets from the Umpqua Merger[55](index=55&type=chunk) Other Intangible Assets, Net (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Gross Carrying Amount | $710,230 | $710,230 | | Accumulated Amortization | $(279,787) | $(225,982) | | Net Carrying Amount | $430,443 | $484,248 | - Other intangible assets, net, decreased by **$53.8 million** to **$430.4 million** as of June 30, 2025, from **$484.2 million** at December 31, 2024, due to amortization. Amortization expense was **$25.8 million** for the three months and **$53.8 million** for the six months ended June 30, 2025[57](index=57&type=chunk) [Note 6 – Borrowings](index=31&type=section&id=Note%206%20%E2%80%93%20Borrowings) This note outlines the Company's borrowing activities, including FHLB advances and their terms - FHLB advances increased to **$3.4 billion** as of June 30, 2025, from **$3.1 billion** at December 31, 2024. These advances have fixed interest rates ranging from **4.45%** to **4.52%** and all mature in 2025[59](index=59&type=chunk) [Note 7 – Commitments and Contingencies](index=31&type=section&id=Note%207%20%E2%80%93%20Commitments%20and%20Contingencies) This note outlines the Company's off-balance-sheet risks, including commitments to extend credit and standby letters of credit, details significant legal proceedings such as the iCap Entities, Professional Financial Investors, and MOVEit data breach lawsuits, and discusses merger-related termination fees and concentrations of credit risk [Financial Instruments with Off-Balance-Sheet Risk](index=31&type=section&id=Financial%20Instruments%20with%20Off-Balance-Sheet%20Risk) This section summarizes the Company's off-balance-sheet commitments, including credit extensions and standby letters of credit Summary of Commitments and Contingent Liabilities (in thousands) | Commitment Type | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Commitments to extend credit | $10,042,369 | $10,077,780 | | Forward sales commitments | $71,500 | $76,535 | | Commitments to originate residential mortgage loans held for sale | $58,919 | $46,208 | | Standby letters of credit | $321,187 | $216,422 | - Standby letters of credit increased significantly to **$321.2 million** as of June 30, 2025, from **$216.4 million** at December 31, 2024, with approximately **$295.2 million** expiring within one year[61](index=61&type=chunk)[63](index=63&type=chunk) [Legal Proceedings and Regulatory Matters](index=32&type=section&id=Legal%20Proceedings%20and%20Regulatory%20Matters) This section details significant legal actions and regulatory issues, including Ponzi schemes and data breach lawsuits - The Bank is involved in litigation related to the iCap Entities' alleged Ponzi schemes, with potential claims for approximately **$290.0 million**, which the Bank intends to vigorously defend against[66](index=66&type=chunk) - A class action lawsuit against the Bank concerning the Professional Financial Investors, Inc. Ponzi scheme resulted in a court-ordered settlement conference and a Notice of Settlement filed on March 27, 2025, contemplating a **$55.0 million** payment by the Bank, subject to final court approval[67](index=67&type=chunk) - Multiple lawsuits have been filed against the Bank following a MOVEit data security incident, which compromised names and social security numbers of **429,252** consumer and small business customers. All seven cases have been transferred to a multidistrict litigation (MDL)[68](index=68&type=chunk)[69](index=69&type=chunk)[70](index=70&type=chunk) - The Company has accrued **$55.0 million** for the Professional Financial Investors legal settlement and an additional **$1.2 million** for other legal matters as of June 30, 2025, recorded in other liabilities[71](index=71&type=chunk) [Contingencies](index=34&type=section&id=Contingencies) This section discusses potential future obligations, including merger-related termination fees - The Merger Agreement with Pacific Premier includes a termination fee of **$75.0 million** payable by either Columbia or Pacific Premier under certain circumstances[75](index=75&type=chunk) [Concentrations of Credit Risk](index=34&type=section&id=Concentrations%20of%20Credit%20Risk) This section highlights significant concentrations of credit risk, particularly in real estate-related loans - A significant concentration of credit risk exists in real estate-related loans, representing approximately **75%** of the Bank's loan and lease portfolio as of June 30, 2025, with multifamily properties accounting for **19%** and office properties for **8%**[76](index=76&type=chunk) [Note 8 – Derivatives](index=34&type=section&id=Note%208%20%E2%80%93%20Derivatives) This note describes the Company's use of derivative instruments for hedging interest rate and other market risks - The Bank uses derivatives, including forward interest rate contracts, interest rate futures, and interest rate swaps, primarily to hedge risks associated with interest rate lock commitments, residential mortgage loans held for sale, and Mortgage Servicing Rights (MSRs)[78](index=78&type=chunk)[79](index=79&type=chunk)[80](index=80&type=chunk)[81](index=81&type=chunk) Derivative Assets and Liabilities (in thousands) | Derivative Type | June 30, 2025 Asset Fair Value | June 30, 2025 Liability Fair Value | Dec 31, 2024 Asset Fair Value | Dec 31, 2024 Liability Fair Value | | :------------------------------ | :----------------------------- | :------------------------------- | :----------------------------- | :------------------------------- | | Interest rate lock commitments | $478 | $43 | $16 | $32 | | Interest rate futures | $2,791 | $0 | $0 | $3,033 | | Interest rate forward sales commitments | $26 | $597 | $695 | $74 | | Interest rate swaps | $88,000 | $200,714 | $107,385 | $277,042 | | Foreign currency derivatives | $494 | $403 | $542 | $438 | | Total | $91,789 | $201,757 | $108,638 | $280,619 | Total Derivative Gains (Losses) (in thousands) | Derivative Type | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Interest rate lock commitments | $156 | $(467) | $450 | $(314) | | Interest rate futures | $1,831 | $(1,611) | $5,043 | $(5,882) | | Interest rate forward sales commitments | $(337) | $467 | $(1,165) | $513 | | Interest rate swaps | $(1,330) | $424 | $(2,824) | $1,621 | | Foreign currency derivatives | $159 | $196 | $413 | $238 | | Total derivative gains (losses) | $479 | $(991) | $1,917 | $(3,824) | [Note 9 – Earnings Per Common Share](index=36&type=section&id=Note%209%20%E2%80%93%20Earnings%20Per%20Common%20Share) This note presents basic and diluted earnings per share calculations and the factors influencing them Earnings Per Common Share (in thousands, except per share) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $152,423 | $120,144 | $239,032 | $244,224 | | Basic EPS | $0.73 | $0.58 | $1.14 | $1.17 | | Diluted EPS | $0.73 | $0.57 | $1.14 | $1.17 | | Weighted average common shares outstanding - basic | 209,125 | 208,498 | 208,964 | 208,379 | | Weighted average common shares outstanding - diluted | 209,975 | 209,011 | 209,965 | 208,999 | - Diluted EPS for the three months ended June 30, 2025, increased to **$0.73** from **$0.57** in the prior year period. For the six months ended June 30, 2025, diluted EPS slightly decreased to **$1.14** from **$1.17** in the prior year period[89](index=89&type=chunk) - Restricted stock awards and units totaling **796 thousand** for the three months and **584 thousand** for the six months ended June 30, 2025, were not included in diluted EPS computation as their effect would be anti-dilutive[90](index=90&type=chunk) [Note 10 – Fair Value Measurement](index=37&type=section&id=Note%2010%20%E2%80%93%20Fair%20Value%20Measurement) This note details the fair value measurements of financial instruments, categorizing them into Level 1, 2, or 3 based on observability of inputs. It describes valuation techniques for recurring and nonrecurring fair value measurements, including unobservable inputs for Level 3 assets and liabilities, and discusses the fair value option for certain loans and debentures [Estimated Fair Values of Financial Instruments](index=37&type=section&id=Estimated%20Fair%20Values%20of%20Financial%20Instruments) This section provides a comparison of carrying values and estimated fair values for various financial instruments Estimated Fair Values of Financial Instruments (in thousands) | Financial Instrument | June 30, 2025 Carrying Value | June 30, 2025 Fair Value | Dec 31, 2024 Carrying Value | Dec 31, 2024 Fair Value | | :------------------------------------------ | :----------------------------- | :----------------------- | :----------------------------- | :----------------------- | | Cash and cash equivalents | $1,942,170 | $1,942,170 | $1,878,255 | $1,878,255 | | Investment securities available for sale | $8,653,172 | $8,653,172 | $8,274,615 | $8,274,615 | | Loans and leases, net | $37,216,106 | $36,059,937 | $37,256,272 | $35,689,803 | | Residential mortgage servicing rights | $102,863 | $102,863 | $108,358 | $108,358 | | Total deposits | $41,742,657 | $41,727,292 | $41,720,732 | $41,807,123 | | Borrowings | $3,350,000 | $3,350,086 | $3,100,000 | $3,101,866 | | Junior subordinated debentures, at fair value | $323,015 | $323,015 | $330,895 | $330,895 | [Fair Value of Assets and Liabilities Measured on a Recurring Basis](index=38&type=section&id=Fair%20Value%20of%20Assets%20and%20Liabilities%20Measured%20on%20a%20Recurring%20Basis) This section categorizes assets and liabilities measured at fair value into Level 1, 2, and 3 based on input observability Assets Measured at Fair Value on a Recurring Basis (June 30, 2025, in thousands) | Description | Total | Level 1 | Level 2 | Level 3 | | :------------------------------------------------- | :---------- | :-------- | :---------- | :-------- | | Equity and other investment securities | $92,958 | $74,499 | $18,459 | $0 | | Investment securities available for sale | $8,653,172 | $231,715 | $8,421,457 | $0 | | Loans held for sale, at fair value | $65,590 | $0 | $65,590 | $0 | | Loans and leases, at fair value | $177,949 | $0 | $177,949 | $0 | | Residential mortgage servicing rights, at fair value | $102,863 | $0 | $0 | $102,863 | | Derivatives | $91,789 | $0 | $91,317 | $478 | | Total assets measured at fair value | $9,184,321 | $306,214 | $8,774,766 | $103,341 | Liabilities Measured at Fair Value on a Recurring Basis (June 30, 2025, in thousands) | Description | Total | Level 1 | Level 2 | Level 3 | | :------------------------------------------ | :---------- | :-------- | :---------- | :-------- | | Junior subordinated debentures, at fair value | $323,015 | $0 | $0 | $323,015 | | Derivatives | $201,757 | $0 | $201,714 | $43 | | Total liabilities measured at fair value | $524,772 | $0 | $201,714 | $323,058 | - Residential mortgage servicing rights (MSR) and junior subordinated debentures are classified as Level 3, utilizing unobservable inputs like constant prepayment rates and credit spreads, respectively. Interest rate lock commitments are also Level 3 due to pull-through rate assumptions[97](index=97&type=chunk)[98](index=98&type=chunk)[99](index=99&type=chunk)[101](index=101&type=chunk)[102](index=102&type=chunk)[103](index=103&type=chunk) [Fair Value of Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis](index=43&type=section&id=Fair%20Value%20of%20Assets%20and%20Liabilities%20Measured%20at%20Fair%20Value%20on%20a%20Nonrecurring%20Basis) This section details nonrecurring fair value adjustments, primarily for impaired collateral-dependent loans and leases Losses from Nonrecurring Fair Value Adjustments (in thousands) | Asset Type | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Loans and leases | $25,857 | $30,704 | $54,539 | $58,878 | - Losses from nonrecurring fair value adjustments on collateral-dependent loans and leases totaled **$54.5 million** for the six months ended June 30, 2025, a decrease from **$58.9 million** in the prior year period. These adjustments reflect impairment where collateral value is less than the recorded investment[110](index=110&type=chunk)[111](index=111&type=chunk) [Fair Value Option](index=44&type=section&id=Fair%20Value%20Option) This section explains the Company's election of the fair value option for certain loans and subordinated debentures - The Bank elected the fair value option for certain residential mortgage loans held for sale and some junior subordinated debentures. Changes in fair value for loans held for sale are recognized in residential mortgage banking revenue, while for junior subordinated debentures, they are recognized in other comprehensive income[112](index=112&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) - For the six months ended June 30, 2025, loans held for investment under the fair value option recorded a net increase in fair value of **$7.2 million**, a significant improvement from a **$12.5 million** net decrease in the prior year period[113](index=113&type=chunk) [Note 11 – Income Taxes and Investment Tax Credits](index=44&type=section&id=Note%2011%20%E2%80%93%20Income%20Taxes%20and%20Investment%20Tax%20Credits) This note details deferred tax assets, effective tax rates, and tax credits from affordable housing investments - The Company had a net deferred tax asset of **$299.0 million** as of June 30, 2025, including **$1.5 million** in federal and state Net Operating Loss (NOL) carry-forwards expiring between 2030-2031[116](index=116&type=chunk) - The effective tax rate for the six months ended June 30, 2025, was **27.0%**, up from **26.0%** in the prior year period, primarily due to an increase in non-deductible compensation[117](index=117&type=chunk)[179](index=179&type=chunk) - The Company's investments in affordable housing partnerships, totaling **$226.0 million** as of June 30, 2025, generate federal income tax credits and other tax benefits, recognized as a reduction to income tax expense[120](index=120&type=chunk)[121](index=121&type=chunk)[122](index=122&type=chunk) [Note 12 – Segment Reporting](index=45&type=section&id=Note%2012%20%E2%80%93%20Segment%20Reporting) This note clarifies that the Company operates as a single banking segment, with performance assessed on a consolidated basis - The Company operates as a single operating and reportable segment, primarily focused on banking operations, including consumer and residential real estate loans, commercial lending, deposit products, and treasury and wealth management services across its market areas[123](index=123&type=chunk) - The Chief Executive Officer (CODM) assesses performance and allocates resources based on consolidated net income and total consolidated assets, using these metrics for budget monitoring and competitive analysis[124](index=124&type=chunk)[125](index=125&type=chunk) [Note 13 – Subsequent Event](index=46&type=section&id=Note%2013%20%E2%80%93%20Subsequent%20Event) This note discloses the all-stock acquisition of Pacific Premier, including key terms and regulatory approvals - On April 23, 2025, Columbia announced an all-stock acquisition of Pacific Premier, with Pacific Premier stockholders receiving **0.9150 shares** of Columbia common stock for each share owned, expected to result in Pacific Premier stockholders owning approximately **30%** of the combined company[127](index=127&type=chunk) - The acquisition received all required regulatory approvals by August 6, 2025, and is expected to close around August 31, 2025, following shareholder approvals on July 21, 2025[128](index=128&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=47&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and results of operations, highlighting key performance drivers, credit quality trends, liquidity, capital adequacy, and critical accounting estimates, along with an executive overview of recent strategic developments [Forward-Looking Statements](index=47&type=section&id=Forward-Looking%20Statements) This section identifies forward-looking statements and outlines significant risks and uncertainties that could impact future results - The report contains forward-looking statements regarding derivatives, ACL models, liquidity, securities portfolio, loan sales, non-performing loans, CRE portfolio, economic environment, interest rates, litigation, dividends, fair values, and the Pacific Premier merger, subject to substantial risks and uncertainties[129](index=129&type=chunk)[130](index=130&type=chunk)[131](index=131&type=chunk) - Key risks include changes in economic conditions, interest rate volatility, competitive pressures, bank failures, regulatory changes, cybersecurity breaches, and risks specifically related to the Pacific Premier merger, such as integration difficulties and failure to realize anticipated benefits[131](index=131&type=chunk)[134](index=134&type=chunk) [General Company Information](index=48&type=section&id=General) This section provides an overview of Columbia Banking System, its banking subsidiary, and primary service areas - Columbia Banking System, Inc. is a financial holding company that wholly owns Columbia Bank (formerly Umpqua Bank), providing a broad range of banking and financial services. The Bank's name change to Columbia Bank became effective July 1, 2025, with branding to follow on September 1, 2025[133](index=133&type=chunk) - The Bank's primary service areas are in Oregon, Washington, California, Idaho, Nevada, Arizona, Colorado, and Utah, with deposits insured by the FDIC[135](index=135&type=chunk) [Executive Overview](index=49&type=section&id=Executive%20Overview) The executive overview highlights the pending acquisition of Pacific Premier, key financial performance metrics for the quarter and year-to-date, credit quality trends including non-performing assets and ACL, and summaries of the Company's liquidity and capital positions [Pending Acquisition](index=49&type=section&id=Pending%20Acquisition) This section summarizes the strategic acquisition of Pacific Premier, including its terms and expected closing date - Columbia announced the acquisition of Pacific Premier in an all-stock transaction on April 23, 2025, with a target closing date of August 31, 2025, pending customary closing conditions. The acquisition is a strategic fit, strengthening Columbia's position in Southern California and enhancing product offerings[136](index=136&type=chunk) [Financial Performance Summary](index=49&type=section&id=Financial%20Performance%20Summary) This section provides a high-level summary of key financial metrics, including EPS, net interest margin, and income/expense Key Financial Performance Metrics | Metric | Q2 2025 | Q1 2025 | 6M 2025 | 6M 2024 | | :----------------------- | :------ | :------ | :------ | :------ | | Diluted EPS | $0.73 | $0.41 | $1.14 | $1.17 | | Net Interest Margin (tax-equivalent) | 3.75% | 3.60% | 3.67% | 3.54% | | Net Interest Income (in millions) | $446.4 | $424.9 | $871.4 | $850.8 | | Non-Interest Income (in millions) | $64.5 | $66.4 | $130.8 | $95.1 | | Non-Interest Expense (in millions) | $278.0 | $340.1 | $618.1 | $566.8 | - Q2 2025 diluted EPS increased to **$0.73** from **$0.41** in Q1 2025, driven by a **$62.1 million** decrease in non-interest expense (due to a one-time legal settlement accrual and severance in Q1) and a **$21.5 million** increase in net interest income[137](index=137&type=chunk) - Year-to-date diluted EPS for 6M 2025 decreased slightly to **$1.14** from **$1.17** in 6M 2024, primarily due to higher non-interest expense (legal settlement and severance), partially offset by increased non-interest income and net interest income[140](index=140&type=chunk) [Credit Quality Summary](index=50&type=section&id=Credit%20Quality%20Summary) This section summarizes trends in non-performing assets, loan quality, and the Allowance for Credit Losses Key Credit Quality Metrics | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Total loans and leases | $37.6 billion | $37.7 billion | | Non-performing assets | $180.3 million | $169.6 million | | Non-performing assets to total assets | 0.35% | 0.33% | | Non-performing loans and leases | $177.4 million | $166.9 million | | Non-performing loans and leases to total loans and leases | 0.47% | 0.44% | | Allowance for Credit Losses (ACL) | $439.0 million | $440.8 million | - Non-performing assets increased to **$180.3 million** (**0.35%** of total assets) as of June 30, 2025, from **$169.6 million** (**0.33%**) at December 31, 2024, with non-performing loans and leases rising to **$177.4 million** (**0.47%** of total loans)[140](index=140&type=chunk) - The ACL decreased by **$1.8 million** to **$439.0 million** as of June 30, 2025, reflecting credit migration trends, changes in economic assumptions, and decreases in loan portfolio balances[140](index=140&type=chunk) - Provision for credit losses for 6M 2025 increased to **$56.9 million** from **$49.0 million** in 6M 2024, driven by credit migration trends, charge-off activity, and changes in economic forecasts[141](index=141&type=chunk) [Liquidity Summary](index=51&type=section&id=Liquidity%20Summary) This section provides an overview of the Company's cash position and total available liquidity resources - Total cash and cash equivalents increased by **$63.9 million** to **$1.9 billion** as of June 30, 2025, from December 31, 2024[146](index=146&type=chunk) - Total available liquidity was **$18.6 billion** as of June 30, 2025, representing **36%** of total assets, **44%** of total deposits, and **132%** of estimated uninsured deposits[146](index=146&type=chunk) [Capital Summary](index=51&type=section&id=Capital%20Summary) This section summarizes the Company's capital adequacy ratios and dividend payments Capital Ratios | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Total risk-based capital ratio | 13.0% | 12.8% | | Common equity tier 1 (CET1) capital ratio | 10.8% | 10.5% | - Columbia paid a quarterly cash dividend of **$0.36** per common share on June 16, 2025[146](index=146&type=chunk) [Critical Accounting Estimates](index=51&type=section&id=Critical%20Accounting%20Estimates) This section discusses key accounting estimates requiring significant judgment, such as ACL and goodwill - The Company's critical accounting estimates, detailed in its Annual Report on Form 10-K, include the Allowance for Credit Losses (ACL) and goodwill, which require significant judgment and are sensitive to changing information[143](index=143&type=chunk) - No material changes in the methodology of these critical accounting estimates occurred during the six months ended June 30, 2025[143](index=143&type=chunk) [Results of Operations](index=51&type=section&id=Results%20of%20Operations) This section analyzes the Company's financial performance, detailing changes in net income, profitability ratios, net interest income, provision for credit losses, non-interest income, non-interest expense, and income taxes, comparing current periods to prior quarters and year-to-date periods [Net Income Performance](index=51&type=section&id=Net%20Income%20Performance) This section analyzes the drivers of net income changes for the current quarter and year-to-date periods - Net income for Q2 2025 was **$152.4 million**, up from **$86.6 million** in Q1 2025, primarily due to a **$62.1 million** decrease in non-interest expense (related to a legal settlement accrual and severance in Q1) and a **$21.5 million** increase in net interest income[145](index=145&type=chunk) - For 6M 2025, net income was **$239.0 million**, a slight decrease from **$244.2 million** in 6M 2024, mainly attributable to a **$51.4 million** increase in non-interest expense, partially offset by increases in non-interest income and net interest income[147](index=147&type=chunk) [Return on Average Assets, Common Shareholders' Equity and Tangible Common Shareholders' Equity](index=52&type=section&id=Return%20on%20Average%20Assets%2C%20Common%20Shareholders'%20Equity%20and%20Tangible%20Common%20Shareholders'%20Equity) This section presents key profitability ratios, including returns on average assets, equity, and tangible equity Return on Average Assets, Equity, and Tangible Equity | Metric | Q2 2025 | Q1 2025 | 6M 2025 | 6M 2024 | | :----------------------------------------- | :------ | :------ | :------ | :------ | | Return on average assets | 1.19% | 0.68% | 0.94% | 0.94% | | Return on average common shareholders' equity | 11.56% | 6.73% | 9.18% | 9.93% | | Return on average tangible common shareholders' equity | 16.03% | 9.45% | 12.80% | 14.69% | - Return on average tangible common shareholders' equity increased to **16.03%** in Q2 2025 from **9.45%** in Q1 2025, reflecting improved net income and the exclusion of intangible assets[149](index=149&type=chunk) Tangible Common Equity and Tangible Assets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Tangible common shareholders' equity | $3,882,205 | $3,604,742 | | Tangible assets | $50,441,765 | $50,062,915 | | Tangible common equity to tangible assets ratio | 7.70% | 7.20% | [Net Interest Income](index=53&type=section&id=Net%20Interest%20Income) This section analyzes changes in net interest income and net interest margin, driven by earning asset yields and funding costs - Net interest income for Q2 2025 was **$446.4 million**, an increase of **$21.5 million** from Q1 2025, driven by a **$23.4 million** increase in interest income from loans and investment securities, with stable funding costs[153](index=153&type=chunk) - The net interest margin (tax-equivalent) increased to **3.75%** in Q2 2025 from **3.60%** in Q1 2025, benefiting from higher earning asset yields, particularly on taxable investment securities (**4.22%** from **3.72%**) and the loan portfolio (**6.00%** from **5.92%**)[154](index=154&type=chunk) - For 6M 2025, net interest income increased by **$20.6 million** to **$871.4 million** compared to 6M 2024, primarily due to lower funding costs (interest-bearing liabilities cost decreased by **49 bps** to **2.79%**), partially offset by lower earning asset yields[155](index=155&type=chunk)[156](index=156&type=chunk) [Provision for Credit Losses](index=57&type=section&id=Provision%20for%20Credit%20Losses) This section discusses the provision for credit losses and net charge-offs, reflecting credit quality trends and economic forecasts - The provision for credit losses was **$29.4 million** in Q2 2025, up from **$27.4 million** in Q1 2025, reflecting credit migration trends, charge-off activity, and changes in economic forecasts[163](index=163&type=chunk) - Net charge-offs for Q2 2025 were **$29.3 million**, consistent with Q1 2025. FinPac portfolio net charge-offs decreased by **$2.6 million** to **$14.2 million**, while other commercial portfolio net charge-offs increased to **$15.2 million**[164](index=164&type=chunk) - For 6M 2025, the provision for credit losses increased to **$56.9 million** from **$49.0 million** in 6M 2024. Net charge-offs decreased to **$58.7 million** from **$74.4 million** in 6M 2024, with FinPac charge-offs improving by **$17.6 million**[165](index=165&type=chunk)[166](index=166&type=chunk) [Non-Interest Income](index=58&type=section&id=Non-Interest%20Income) This section analyzes the components and changes in non-interest income, including mortgage banking and fair value adjustments Non-Interest Income (in thousands) | Metric | Q2 2025 | Q1 2025 | Change (QoQ) | 6M 2025 | 6M 2024 | Change (YoY) | | :------------------------------------------ | :------ | :------ | :----------- | :------ | :------ | :----------- | | Total non-interest income | $64,462 | $66,377 | $(1,915) | $130,839 | $95,060 | $35,779 | | Residential mortgage banking revenue, net | $7,343 | $9,334 | $(1,991) | $16,677 | $10,482 | $6,195 | | Gain (loss) on certain loans held for investment, at fair value | $212 | $7,016 | $(6,804) | $7,228 | $(12,486) | $19,714 | | Other income | $11,070 | $6,282 | $4,788 | $17,352 | $17,953 | $(601) | - Total non-interest income decreased by **$1.9 million** QoQ to **$64.5 million** in Q2 2025, primarily due to a **$6.8 million** decrease in fair value gains on certain loans held for investment, partially offset by a **$4.8 million** increase in other income (higher trading income and swap customer fee revenue)[168](index=168&type=chunk)[169](index=169&type=chunk)[170](index=170&type=chunk) - Total non-interest income increased by **$35.8 million** YoY to **$130.8 million** in 6M 2025, mainly driven by a favorable **$19.7 million** change in fair value adjustments for certain loans held for investment and a **$6.2 million** increase in residential mortgage banking revenue (due to MSR hedge gains)[168](index=168&type=chunk)[171](index=171&type=chunk)[172](index=172&type=chunk) [Non-Interest Expense](index=59&type=section&id=Non-Interest%20Expense) This section details the components and changes in non-interest expense, including legal settlements and FDIC assessments Non-Interest Expense (in thousands) | Metric | Q2 2025 | Q1 2025 | Change (QoQ) | 6M 2025 | 6M 2024 | Change (YoY) | | :-------------------------- | :------ | :------ | :----------- | :------ | :------ | :----------- | | Total non-interest expense | $277,995 | $340,122 | $(62,127) | $618,117 | $566,760 | $51,357 | | Salaries and employee benefits | $154,883 | $145,239 | $9,644 | $300,122 | $299,604 | $518 | | Merger and restructuring expense | $8,186 | $14,379 | $(6,193) | $22,565 | $19,119 | $3,446 | | Legal settlement | $0 | $55,000 | $(55,000) | $55,000 | $0 | $55,000 | | FDIC assessments | $8,144 | $8,022 | $122 | $16,166 | $24,124 | $(7,958) | - Total non-interest expense decreased by **$62.1 million** QoQ to **$278.0 million** in Q2 2025, primarily due to the absence of a **$55.0 million** legal settlement accrual and **$14.6 million** in severance expense recorded in Q1 2025[173](index=173&type=chunk)[175](index=175&type=chunk)[176](index=176&type=chunk) - Total non-interest expense increased by **$51.4 million** YoY to **$618.1 million** in 6M 2025, mainly due to the **$55.0 million** legal settlement accrual in Q1 2025, partially offset by a **$7.9 million** decrease in FDIC assessments (due to a special assessment in 6M 2024)[173](index=173&type=chunk)[177](index=177&type=chunk)[178](index=178&type=chunk) [Income Taxes](index=60&type=section&id=Income%20Taxes) This section discusses the effective tax rate and factors influencing income tax expense for the reporting periods - The effective tax rate for Q2 2025 was **25.1%**, compared to **30.1%** in Q1 2025. For 6M 2025, the effective tax rate was **27.0%**, up from **26.0%** in 6M 2024, primarily due to changes in non-deductible compensation[179](index=179&type=chunk) [Financial Condition](index=61&type=section&id=FINANCIAL%20CONDITION) This section provides an in-depth analysis of the Company's balance sheet, including trends in debt securities, loan and lease portfolios (with detailed breakdowns by type and credit quality), asset quality, allowance for credit losses, residential mortgage servicing rights, goodwill and other intangible assets, deposits, borrowings, and capital resources [Debt Securities](index=61&type=section&id=Debt%20Securities_FC) This section analyzes the investment debt securities portfolio, including changes in fair value and unrealized losses - Investment debt securities available for sale increased to **$8.7 billion** as of June 30, 2025, from **$8.3 billion** at December 31, 2024. This increase was driven by **$547.6 million** in securities purchases and a **$165.5 million** increase in fair value due to lower rates, partially offset by **$371.5 million** in paydowns, calls, and maturities[181](index=181&type=chunk) - The available-for-sale portfolio had gross unrealized losses of **$459.8 million** as of June 30, 2025, primarily from mortgage-backed securities, attributed to market interest rate changes rather than credit quality[183](index=183&type=chunk) [Loans and Leases](index=62&type=section&id=Loans%20and%20Leases_FC) This section details the composition and changes in the loan and lease portfolio, including concentrations and charge-offs - Total loans and leases outstanding decreased by **$43.9 million** to **$37.6 billion** as of June 30, 2025, compared to **$37.7 billion** at December 31, 2024. This contraction was mainly in residential and commercial loan balances, partially offset by growth in CRE construction and owner-occupied term CRE balances[185](index=185&type=chunk) Loan and Lease Portfolio Concentration Distribution | Loan Type | June 30, 2025 Amount | June 30, 2025 % | Dec 31, 2024 Amount | Dec 31, 2024 % | | :-------------------------- | :------------------- | :-------------- | :------------------- | :-------------- | | Commercial real estate | $19,600,480 | 52% | $19,567,672 | 52% | | Commercial | $9,944,830 | 26% | $9,968,096 | 26% | | Residential | $7,912,599 | 21% | $7,965,005 | 21% | | Consumer & other | $179,104 | 1% | $180,128 | 1% | | Total | $37,637,013 | 100% | $37,680,901 | 100% | - The loan to deposit ratio remained at **90%** for both June 30, 2025, and December 31, 2024[185](index=185&type=chunk) - CRE loans increased by **$32.8 million** to **$19.6 billion**, driven by construction and development loan utilization. Multifamily properties represented **19%** and office properties **8%** of the total loan portfolio[193](index=193&type=chunk)[194](index=194&type=chunk) - Commercial loans decreased by **$23.3 million** to **$9.9 billion**, mainly due to paydowns. Net charge-offs in the FinPac lease portfolio improved to **$14.2 million** in Q2 2025 from **$16.8 million** in Q1 2025, reflecting improvements in the transportation sector[197](index=197&type=chunk)[198](index=198&type=chunk) [Asset Quality and Non-Performing Assets](index=66&type=section&id=Asset%20Quality%20and%20Non-Performing%20Assets) This section analyzes trends in non-performing assets and key asset quality ratios, reflecting the credit environment Non-Performing Assets and Asset Quality Ratios (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Total non-performing assets | $180,252 | $169,559 | | Non-performing assets to total assets | 0.35% | 0.33% | | Total non-performing loans and leases | $177,434 | $166,893 | | Non-performing loans and leases to total loans and leases | 0.47% | 0.44% | | Non-accrual loans and leases to total loans and leases | 0.26% | 0.26% | | ACLLL to total loans and leases | 1.12% | 1.13% | | ACL to total non-performing loans and leases | 247% | 264% | - Non-performing assets increased to **$180.3 million** (**0.35%** of total assets) as of June 30, 2025, from **$169.6 million** (**0.33%**) at December 31, 2024, indicating a more normalized credit environment[203](index=203&type=chunk) - Non-accrual and 90+ days past due loans included **$37.1 million** and **$30.7 million**, respectively, in government guarantees as of June 30, 2025[203](index=203&type=chunk) [Allowance for Credit Losses](index=67&type=section&id=ALLOWANCE%20FOR%20CREDIT%20LOSSES_FC) This section details the ACL balance, economic forecasts, and allocation across portfolio segments - The ACL totaled **$439.0 million** as of June 30, 2025, a decrease of **$1.8 million** from December 31, 2024, driven by credit migration trends, changes in economic assumptions, and recalibration of CECL models[204](index=204&type=chunk) - The Bank used Moody's Analytics' May 2025 consensus economic forecast for ACL estimation, which reflects a deterioration in macroeconomic conditions compared to the prior period, leading to upward qualitative overlays in commercial and CRE portfolios[207](index=207&type=chunk) Allocation of ACLLL by Portfolio Segment (in thousands) | Portfolio Segment | June 30, 2025 Amount | June 30, 2025 % | Dec 31, 2024 Amount | Dec 31, 2024 % | | :-------------------- | :------------------- | :-------------- | :------------------- | :-------------- | | Commercial real estate | $159,823 | 52% | $154,413 | 52% | | Commercial | $219,862 | 26% | $218,668 | 26% | | Residential | $34,590 | 21% | $44,700 | 21% | | Consumer & other | $6,632 | 1% | $6,848 | 1% | | Total ACLLL | $420,907 | 100% | $424,629 | 100% | [Residential Mortgage Servicing Rights](index=68&type=section&id=Residential%20Mortgage%20Servicing%20Rights_FC) This section discusses the balance and fair value changes of residential mortgage servicing rights and their sensitivity to rates - The balance of Residential Mortgage Servicing Rights (MSR) decreased to **$102.9 million** as of June 30, 2025, from **$108.4 million** at December 31, 2024. This decline was primarily due to changes in fair value from valuation inputs and assumptions, partially offset by new MSR capitalized[210](index=210&type=chunk) - The MSR as a percentage of serviced loans was **1.31%** as of June 30, 2025, down from **1.36%** at December 31, 2024[211](index=211&type=chunk) - MSR fair value generally increases as market rates for mortgage loans rise and decreases when rates fall, due to their impact on prepayment speeds[211](index=211&type=chunk) [Goodwill and Other Intangible Assets](index=69&type=section&id=Goodwill%20and%20Other%20Intangible%20Assets_FC) This section details the stable goodwill balance and the amortization of other intangible assets - Goodwill remained unchanged at **$1.0 billion** as of June 30, 2025, and December 31, 2024[212](index=212&type=chunk) - Other intangible assets, net, decreased to **$430.4 million** as of June 30, 2025, from **$484.2 million** at December 31, 2024, due to amortization. These assets, primarily core deposits, are amortized on an accelerated basis over 10 years[213](index=213&type=chunk) [Deposits](index=69&type=section&id=Deposits_FC) This section analyzes deposit trends by category, including non-interest-bearing and uninsured deposits - Total deposits increased slightly by **$21.9 million** to **$41.7 billion** as of June 30, 2025, driven by a small business and retail deposits campaign and an increase in brokered deposits, partially offset by a decrease in customer deposits[214](index=214&type=chunk) Deposit Balances by Category (in thousands) | Deposit Type | June 30, 2025 Amount | June 30, 2025 % | Dec 31, 2024 Amount | Dec 31, 2024 % | | :-------------------------- | :------------------- | :-------------- | :------------------- | :-------------- | | Non-interest-bearing demand | $13,219,631 | 32% | $13,307,905 | 32% | | Interest-bearing demand | $8,334,553 | 20% | $8,475,693 | 20% | | Money market | $11,694,412 | 28% | $11,475,055 | 27% | | Savings | $2,275,500 | 5% | $2,360,040 | 6% | | Time, greater than $250,000 | $1,099,101 | 3% | $1,201,887 | 3% | | Time, $250,000 or less | $5,119,460 | 12% | $4,900,152 | 12% | | Total deposits | $41,742,657 | 100% | $41,720,732 | 100% | - Estimated uninsured deposits were **$14.1 billion** (**34%** of total deposits) as of June 30, 2025, with total available liquidity at **132%** of estimated uninsured deposits[215](index=215&type=chunk)[216](index=216&type=chunk) [Borrowings](index=70&type=section&id=Borrowings_FC) This section details changes in the Company's borrowings, including repurchase agreements and FHLB advances - Securities sold under agreements to repurchase decreased by **$45.2 million** to **$191.4 million** as of June 30, 2025[217](index=217&type=chunk) - FHLB advances increased to **$3.4 billion** as of June 30, 2025, from **$3.1 billion** at December 31, 2024, with all advances maturing in 2025 at fixed rates between **4.45%** and **4.52%**[217](index=217&type=chunk) [Junior and Other Subordinated Debentures](index=70&type=section&id=Junior%20and%20Other%20Subordinated%20Debentures_FC) This section discusses the balance and fair value changes of junior and other subordinated debentures - Junior and other subordinated debentures decreased to **$430.6 million** as of June 30, 2025, from **$438.6 million** at December 31, 2024, primarily due to a **$7.7 million** decline in fair value for debentures carried at fair value[218](index=218&type=chunk) - Substantially all junior subordinated debentures have adjustable interest rates based on a spread over three-month term SOFR, with a **$10.0 million** subordinated debenture maturing in December 2025[218](index=218&type=chunk) [Liquidity and Cash Flow](index=70&type=section&id=Liquidity%20and%20Cash%20Flow) This section assesses the Company's liquidity position, including core deposits, available lines, and cash flows - The Company maintains a robust liquidity position, with total core deposits of **$37.3 billion** and **$2.6 billion** in excess bond collateral as of June 30, 2025[221](index=221&type=chunk) Total Available Liquidity (in thousands) | Liquidity Source | June 30, 2025 | | :----------------------------------- | :------------ | | Total off-balance sheet liquidity | $14,238,265 | | Cash and cash equivalents, less reserve requirements | $1,745,806 | | Excess bond collateral | $2,568,184 | | Total available liquidity | $18,552,255 | - Off-balance sheet liquidity sources include **$7.5 billion** in FHLB lines, **$6.1 billion** from the Federal Reserve Discount Window, and **$600.0 million** in uncommitted lines of credit[224](index=224&type=chunk) - The Bank paid **$180.0 million** in dividends to the Company during the six months ended June 30, 2025, subject to statutory and regulatory limits[224](index=224&type=chunk) [Capital Resources](index=72&type=section&id=Capital%20Resources) This section details changes in shareholders' equity and regulatory capital ratios, confirming well-capitalized status - Shareholders' equity increased by **$223.7 million** to **$5.3 billion** as of June 30,

PART I FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents McEwen Inc.'s unaudited consolidated financial statements for the periods ended June 30, 2025, and December 31, 2024, including statements of operations, balance sheets, changes in shareholders' equity, and cash flows, along with detailed notes explaining the company's operations, accounting policies, and specific financial line items [Consolidated Statements of Operations and Comprehensive Income (Loss)](index=4&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Loss%29) This section details the company's unaudited consolidated statements of operations and comprehensive income (loss), presenting key financial performance metrics for the three and six months ended June 30, 2025 and 2024 Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) (in thousands of U.S. dollars, except per share) | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Revenue from gold and silver sales | $46,700 | $47,476 | $82,396 | $88,704 | | Production costs applicable to sales | $(27,733) | $(32,066) | $(47,338) | $(57,176) | | Gross profit | $12,281 | $10,758 | $22,351 | $16,769 | | Operating loss | $(3,375) | $(13,947) | $(11,015) | $(35,929) | | Net income (loss) | $3,040 | $(12,995) | $(3,230) | $(33,378) | | Net income (loss) per share (Basic and diluted) | $0.06 | $(0.26) | $(0.06) | $(0.67) | | Weighted average common shares outstanding (Basic) | 53,968 | 49,718 | 53,623 | 49,580 | - Net income significantly improved in Q2/25 to **$3.0 million** (**$0.06 per share**) from a net loss of **$13.0 million** (**$0.26 per share**) in Q2/24, primarily due to lower expenditures at McEwen Copper Inc. and an unrealized gain on marketable securities[9](index=9&type=chunk)[114](index=114&type=chunk) - Gross profit increased by **14%** in Q2/25 to **$12.3 million**, driven by a **14%** decrease in production costs applicable to sales[9](index=9&type=chunk)[114](index=114&type=chunk) [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) This section presents McEwen Inc.'s unaudited consolidated balance sheets, detailing assets, liabilities, and shareholders' equity as of June 30, 2025, and December 31, 2024 Consolidated Balance Sheets (Unaudited) (in thousands of U.S. dollars) | Metric | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :-------------- | :---------------- | | Cash and cash equivalents | $53,554 | $13,692 | | Marketable securities | $15,967 | $1,617 | | Total current assets | $107,668 | $41,192 | | Total assets | $735,622 | $664,623 | | Total current liabilities | $45,851 | $47,693 | | Long-term debt, net of issuance costs | $125,772 | $40,000 | | Total liabilities | $251,143 | $169,648 | | Total shareholders' equity | $484,479 | $494,975 | - Cash and cash equivalents significantly increased to **$53.6 million** at **June 30, 2025**, from **$13.7 million** at **December 31, 2024**, primarily due to proceeds from Senior Convertible Notes[11](index=11&type=chunk)[142](index=142&type=chunk) - Long-term debt increased to **$125.8 million** at **June 30, 2025**, from **$40.0 million** at **December 31, 2024**, following the issuance of **$110.0 million** in Convertible Senior Unsecured Notes[11](index=11&type=chunk)[49](index=49&type=chunk)[54](index=54&type=chunk) [Consolidated Statements of Changes in Shareholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity) This section outlines the unaudited consolidated statements of changes in shareholders' equity, reflecting movements in common stock, additional paid-in capital, and accumulated deficit for the six months ended June 30, 2025 Consolidated Statements of Changes in Shareholders' Equity (Unaudited) (in thousands of U.S. dollars and shares) | Metric | Balance, December 31, 2024 | Stock-based compensation | Investment in Goliath Resources Limited | Purchase of capped call options | Shares issued for debt refinancing | Net loss | Balance, June 30, 2025 | | :---------------------------------- | :------------------------- | :----------------------- | :-------------------------------- | :------------------------------ | :------------------------------- | :------- | :--------------------- | | Common Stock and Additional Paid-in Capital (Amount) | $1,804,702 | $1,380 | $6,068 | $(15,114) | $400 | — | $1,797,436 | | Accumulated Deficit | $(1,309,727) | — | — | — | — | $(3,230) | $(1,312,957) | | Total Shareholders' Equity | $494,975 | $1,380 | $6,068 | $(15,114) | $400 | $(3,230) | $484,479 | | Common Stock (Shares) | 53,054 | 123 | 868 | — | 53 | — | 54,098 | - Total shareholders' equity decreased from **$494.9 million** at **December 31, 2024**, to **$484.5 million** at **June 30, 2025**, primarily due to the purchase of capped call options (**$15.1 million**) and a net loss of **$3.2 million**, partially offset by stock-based compensation and investment in Goliath Resources[13](index=13&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This section provides the unaudited consolidated statements of cash flows, categorizing cash movements from operating, investing, and financing activities for the six months ended June 30, 2025 and 2024 Consolidated Statements of Cash Flows (Unaudited) (in thousands of U.S. dollars) | Cash Flow Activity | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Net loss | $(3,230) | $(33,378) | | Cash provided by (used in) operating activities | $(1,454) | $7,487 | | Cash used in investing activities | $(28,822) | $(11,124) | | Cash provided by financing activities | $70,250 | $20,038 | | Increase in cash, cash equivalents and restricted cash | $40,086 | $15,699 | | Cash, cash equivalents and restricted cash, end of period | $57,550 | $43,209 | - Cash provided by financing activities significantly increased to **$70.3 million** in **H1/25** (from **$20.0 million** in **H1/24**), primarily driven by **$110.0 million** in proceeds from Senior Convertible Notes, partially offset by financing costs and principal repayments[15](index=15&type=chunk)[141](index=141&type=chunk) - Cash used in investing activities increased to **$28.8 million** in **H1/25** (from **$11.1 million** in **H1/24**), mainly due to higher additions to mineral property interests and plant and equipment (**$24.2 million**) and advances to McEwen Copper (**$5.1 million**)[15](index=15&type=chunk)[140](index=140&type=chunk) [NOTE 1 NATURE OF OPERATIONS AND BASIS OF PRESENTATION](index=9&type=section&id=NOTE%201%20NATURE%20OF%20OPERATIONS%20AND%20BASIS%20OF%20PRESENTATION) This note describes McEwen Inc.'s primary business activities, including gold and silver production, mineral property development, and its ownership structure in key projects and investees - McEwen Inc. (formerly McEwen Mining Inc.) is engaged in the production and sale of gold and silver, and the development/exploration of copper, gold, and silver mineral properties across North and South America[16](index=16&type=chunk) - The Company owns **100%** interests in the Gold Bar mine (Nevada, US), Fox Complex (Ontario, Canada), Fenix Project (Sinaloa, Mexico), and various exploration properties. It also holds **46.4%** in McEwen Copper Inc. (Los Azules copper project, Argentina) and **49.0%** in Minera Santa Cruz S.A. (San José silver-gold mine, Argentina), both accounted for using the equity method[17](index=17&type=chunk) [NOTE 2 OPERATING SEGMENT REPORTING](index=9&type=section&id=NOTE%202%20OPERATING%20SEGMENT%20REPORTING) This note provides a breakdown of the company's financial performance by operating segment, including geographic revenue and segment profit (loss), as reviewed by the chief operating decision maker - The Company's operating segments are reviewed by the executive leadership team (CODM) at the geographic region level, by major mine/project, or by investee, with performance assessed based on segment income/loss or attributable equity income/loss[21](index=21&type=chunk)[23](index=23&type=chunk) Segment Profit (Loss) (in thousands of U.S. dollars) | Segment | Three months ended June 30, 2025 | Six months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2024 | | :-------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | USA | $9,419 | $19,699 | $7,276 | $11,736 | | Canada | $(4,354) | $(9,010) | $(1,648) | $(5,466) | | Mexico | $(2,575) | $(5,190) | $(2,974) | $(5,005) | | MSC | $3,596 | $4,106 | $4,701 | $5,979 | | McEwen Copper | $(6,978) | $(15,556) | $(16,816) | $(34,828) | | Total Segment Profit (Loss) | $(892) | $(5,951) | $(9,461) | $(27,584) | Geographic Revenue (in thousands of U.S. dollars) | Region | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | USA | $27,523 | $29,686 | $49,913 | $54,964 | | Canada | $19,177 | $17,790 | $32,483 | $32,540 | | Mexico | — | — | — | $1,200 | | Total Consolidated | $46,700 | $47,476 | $82,396 | $88,704 | [NOTE 3 OTHER INCOME](index=15&type=section&id=NOTE%203%20OTHER%20INCOME) This note details the components of other income, including unrealized and realized gains on investments and foreign currency fluctuations, for the periods presented Summary of Other Income (in thousands of U.S. dollars) | Category | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Unrealized and realized gain on investments | $4,715 | $461 | $6,450 | $259 | | Foreign currency gain (loss) | $2,221 | $(485) | $1,926 | $(394) | | Other income | $114 | $334 | $251 | $357 | | **Total other income** | **$7,050** | **$310** | **$8,627** | **$222** | - Total other income significantly increased to **$7.1 million** in **Q2/25** (from **$0.3 million** in **Q2/24**) and **$8.6 million** in **H1/25** (from **$0.2 million** in **H1/24**), primarily driven by substantial unrealized and realized gains on investments and foreign currency gains[30](index=30&type=chunk)[128](index=128&type=chunk)[136](index=136&type=chunk) [NOTE 4 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH](index=15&type=section&id=NOTE%204%20CASH%20AND%20CASH%20EQUIVALENTS%20AND%20RESTRICTED%20CASH) This note presents the breakdown of cash, cash equivalents, and restricted cash by currency, highlighting changes in liquidity over the reporting period Cash and Cash Equivalents and Restricted Cash (in thousands of U.S. dollars) | Currency | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :-------------- | :---------------- | | Held in USD | $55,279 | $15,578 | | Held in CAD | $1,628 | $1,501 | | Held in other currencies | $643 | $385 | | **Total cash and cash equivalents and restricted cash** | **$57,550** | **$17,464** | - Total cash, cash equivalents, and restricted cash increased by **$40.1 million** to **$57.6 million** at **June 30, 2025**, from **$17.5 million** at **December 31, 2024**[31](index=31&type=chunk)[138](index=138&type=chunk) [NOTE 5 MARKETABLE SECURITIES](index=15&type=section&id=NOTE%205%20MARKETABLE%20SECURITIES) This note outlines the company's marketable securities, detailing changes in equity securities and warrants, including additions, disposals, and unrealized gains Marketable Securities Activity (in thousands of U.S. dollars) | Category | As at December 31, 2024 | Additions/transfers during period | Disposals/transfers during period | Unrealized gain on securities held | As at June 30, 2025 | | :---------------------------------- | :---------------------- | :-------------------------------- | :-------------------------------- | :--------------------------------- | :---------------- | | Equity securities | $1,206 | $7,463 | $(168) | $5,386 | $13,887 | | Warrants | $411 | $982 | $(380) | $1,067 | $2,080 | | **Total marketable securities** | **$1,617** | **$8,445** | **$(548)** | **$6,453** | **$15,967** | - The Company's marketable securities increased significantly to **$15.9 million** at **June 30, 2025**, from **$1.6 million** at **December 31, 2024**, driven by additions and a substantial unrealized gain of **$6.5 million**[32](index=32&type=chunk) - Key investments include acquiring a **4%** interest in Goliath Resources Limited and a **6%** interest in Canadian Gold Corp through share exchanges and private placements, and exercising warrants in Inventus Mining Corp[32](index=32&type=chunk)[33](index=33&type=chunk)[35](index=35&type=chunk) [NOTE 6 RECEIVABLES, PREPAIDS AND OTHER CURRENT ASSETS](index=17&type=section&id=NOTE%206%20RECEIVABLES%2C%20PREPAIDS%20AND%20OTHER%20CURRENT%20ASSETS) This note provides a breakdown of receivables, prepaids, and other current assets, including government sales tax and other prepaid expenses Receivables, Prepaids and Other Current Assets (in thousands of U.S. dollars) | Category | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :-------------- | :---------------- | | Government sales tax receivable | $2,677 | $3,918 | | Prepaids and other assets | $4,094 | $3,568 | | **Total receivables, prepaids and other current assets** | **$6,771** | **$7,486** | [NOTE 7 INVENTORIES](index=17&type=section&id=NOTE%207%20INVENTORIES) This note details the composition of inventories, including material on leach pads, in-process inventory, stockpiles, precious metals, and materials and supplies Inventories (in thousands of U.S. dollars) | Category | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :-------------- | :---------------- | | Material on leach pads | $24,224 | $13,453 | | In-process inventory | $7,419 | $2,551 | | Stockpiles | $948 | $1,112 | | Precious metals | $1,207 | $2,312 | | Materials and supplies | $6,668 | $6,517 | | **Total inventories** | **$40,466** | **$25,945** | | Less: long-term portion | $16,332 | $7,834 | | **Current portion** | **$24,134** | **$18,111** | - Total inventories increased to **$40.5 million** at **June 30, 2025**, from **$25.9 million** at **December 31, 2024**, primarily driven by a significant increase in material on leach pads and in-process inventory[38](index=38&type=chunk) - The Company did not have any inventory write-downs during the six months ended June 30, 2025, compared to **$0.8 million** in write-downs in **H1/24**[38](index=38&type=chunk) [NOTE 8 MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT](index=17&type=section&id=NOTE%208%20MINERAL%20PROPERTY%20INTERESTS%20AND%20PLANT%20AND%20EQUIPMENT) This note describes the company's accounting policies for mineral property interests and plant and equipment, including impairment reviews and depreciation methods - The Company reviews long-lived assets for impairment quarterly; no indicators of impairment were noted for mineral property interests during the six months ended June 30, 2025[40](index=40&type=chunk)[41](index=41&type=chunk) - Depreciation and depletion for Gold Bar and San José properties are based on proven and probable reserves (Regulation S-K 1300), while the Fox Complex uses the units-of-production method over the estimated remaining life of the mine due to lack of S-K 1300 compliant reserves[39](index=39&type=chunk) [NOTE 9 EQUITY METHOD INVESTMENTS](index=19&type=section&id=NOTE%209%20EQUITY%20METHOD%20INVESTMENTS) This note provides detailed operating results for McEwen Copper Inc. and Minera Santa Cruz S.A., in which the company holds significant equity method investments McEwen Copper Inc. Operating Results (100% basis, in thousands of U.S. dollars) | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Advanced projects | $(12,236) | $(37,547) | $(33,507) | $(85,730) | | Net loss | $(15,026) | $(35,231) | $(33,497) | $(72,968) | | Portion attributable to McEwen Inc. (Loss) | $(6,978) | $(16,816) | $(15,556) | $(34,828) | Minera Santa Cruz S.A. (MSC) Operating Results (100% basis, in thousands of U.S. dollars) | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Revenue from gold and silver sales | $94,886 | $74,348 | $166,789 | $140,274 | | Gross profit | $20,671 | $11,405 | $25,376 | $20,520 | | Net income | $8,385 | $10,450 | $10,575 | $14,115 | | Portion attributable to McEwen Inc. (Income) | $3,596 | $4,701 | $4,106 | $5,979 | - McEwen Copper's net loss attributable to McEwen Inc. decreased significantly to **$7.0 million** in **Q2/25** (from **$16.8 million** in **Q2/24**) and **$15.6 million** in **H1/25** (from **$34.8 million** in **H1/24**), primarily due to reduced advanced project expenditures[43](index=43&type=chunk)[126](index=126&type=chunk)[133](index=133&type=chunk) - MSC's revenue from gold and silver sales increased to **$94.9 million** in **Q2/25** (from **$74.3 million** in **Q2/24**), driven by higher realized metal prices, despite a decrease in attributable net income to **$3.6 million** in **Q2/25** (from **$4.7 million** in **Q2/24**)[46](index=46&type=chunk)[127](index=127&type=chunk)[134](index=134&type=chunk) [NOTE 10 DEBT](index=21&type=section&id=NOTE%2010%20DEBT) This note details the company's debt structure, including convertible senior unsecured notes and term loan facilities, and related financing activities Debt Structure (in thousands of U.S. dollars) | Debt Type | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :-------------- | :---------------- | | Convertible senior unsecured notes due 2030 | $110,000 | — | | Term loan facility | $20,000 | $40,000 | | Debt issuance cost | $(4,228) | — | | **Long-term debt** | **$125,772** | **$40,000** | - The Company issued **$110.0 million** in **5.25%** convertible senior unsecured notes due **2030** in **February 2025**, with net proceeds of approximately **$90.7 million** after deducting offering costs and capped call transaction costs[54](index=54&type=chunk) - The **$40.0 million** term loan facility was refinanced in **January 2025**, extending principal repayments by **24 months**, and **$20.0 million** was voluntarily repaid in **February 2025**, reducing the outstanding balance to **$20.0 million**[50](index=50&type=chunk)[52](index=52&type=chunk) - In connection with the Convertible Notes, the Company purchased Capped Call Transactions for **$15.1 million** to reduce potential dilution, classified as a reduction to additional paid-in capital[63](index=63&type=chunk)[64](index=64&type=chunk) [NOTE 11 RECLAMATION AND REMEDIATION LIABILITIES](index=24&type=section&id=NOTE%2011%20RECLAMATION%20AND%20REMEDIATION%20LIABILITIES) This note outlines the company's reclamation and remediation liabilities across its properties, including changes in estimates and associated surety facilities Reclamation and Remediation Liabilities (in thousands of U.S. dollars) | Property | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :-------------- | :---------------- | | Gold Bar, Tonkin and Lookout Mountain (Nevada) | $23,200 | $22,400 | | Fox Complex (Canada) | $18,200 | $16,700 | | El Gallo mine (Mexico) | $6,500 | $7,000 | | **Total reclamation and remediation liabilities** | **$47,929** | **$46,063** | | Less: current portion | $6,875 | $4,988 | | **Long-term portion** | **$41,054** | **$41,075** | - Total reclamation and remediation liabilities increased to **$47.9 million** at **June 30, 2025**, from **$46.1 million** at **December 31, 2024**, primarily due to accretion of liability and foreign exchange revaluation[66](index=66&type=chunk) - The Company has surety facilities totaling **$46.5 million** to cover bonding obligations in Nevada and Canada, with **$4.0 million** recorded as restricted cash[85](index=85&type=chunk)[86](index=86&type=chunk)[221](index=221&type=chunk) [NOTE 12 SHAREHOLDERS' EQUITY](index=25&type=section&id=NOTE%2012%20SHAREHOLDERS%27%20EQUITY) This note details changes in shareholders' equity, including common stock issuances, stock-based compensation, and the impact of investment activities - In June 2024, the Company issued **1,533,000** flow-through common shares for gross proceeds of **$21.8 million**, with **$14.4 million** allocated to common shares and **$6.0 million** to tax benefits[67](index=67&type=chunk) - As of **June 30, 2025**, the Company incurred **$14.4 million** in eligible CEE and CDE expenditures, with remaining commitments expected to be fulfilled by the end of **2025**[68](index=68&type=chunk) - In **March 2025**, the Company issued **868,056** common shares to acquire units of Goliath Resources Limited as part of a non-brokered private placement[69](index=69&type=chunk) [NOTE 13 NET INCOME (LOSS) PER SHARE](index=25&type=section&id=NOTE%2013%20NET%20INCOME%20%28LOSS%29%20PER%20SHARE) This note explains the calculation of basic and diluted net income (loss) per share, including the treatment of potentially dilutive instruments - Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted average common shares outstanding, while diluted EPS uses the treasury stock method for options/warrants and the if-converted method for convertible notes[70](index=70&type=chunk) - For periods with a net loss, diluted EPS is computed the same as basic EPS because potentially dilutive instruments are anti-dilutive[71](index=71&type=chunk) - For **Q2/25**, diluted shares increased by **54,522** incremental shares, while for **H1/25** and **H1/24**, all outstanding stock options and warrants were anti-dilutive and excluded from diluted EPS calculations[72](index=72&type=chunk)[73](index=73&type=chunk)[74](index=74&type=chunk) [NOTE 14 RELATED PARTY TRANSACTIONS](index=27&type=section&id=NOTE%2014%20RELATED%20PARTY%20TRANSACTIONS) This note discloses transactions with related parties, including expenses, receivables, and investments involving affiliates of company executives Related Party Expenses (in thousands of U.S. dollars) | Related Party | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | REVlaw | $101 | $52 | $162 | $88 | Related Party Receivables (in thousands of U.S. dollars) | Related Party | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :-------------- | :---------------- | | Receivables from McEwen Copper Inc. | $7,242 | $286 | - The Company paid **$0.5 million** in **Q2/25** and **$1.1 million** in **H1/25** in interest to an affiliate of Robert R. McEwen (Chairman and CEO) for the term loan facility[76](index=76&type=chunk) - The Company participated in private placements of Canadian Gold Corp and exercised warrants in Inventus Mining Corp., both affiliates of company executives[78](index=78&type=chunk)[79](index=79&type=chunk) [NOTE 15 FAIR VALUE ACCOUNTING](index=29&type=section&id=NOTE%2015%20FAIR%20VALUE%20ACCOUNTING) This note describes the company's fair value measurements for financial instruments, categorizing them into Level 1, Level 2, and Level 3 inputs - Fair value measurements are categorized into **Level 1** (quoted prices in active markets for identical assets), **Level 2** (observable inputs other than Level 1 prices), and **Level 3** (unobservable inputs)[80](index=80&type=chunk)[81](index=81&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk) Fair Value of Marketable Securities (in thousands of U.S. dollars) | Category | Level 1 (June 30, 2025) | Level 2 (June 30, 2025) | Level 3 (June 30, 2025) | Total (June 30, 2025) | | :---------------------------------- | :---------------------- | :---------------------- | :---------------------- | :-------------------- | | Marketable securities | $13,887 | $2,080 | — | $15,967 | | Category | Level 1 (December 31, 2024) | Level 2 (December 31, 2024) | Level 3 (December 31, 2024) | Total (December 31, 2024) | | :---------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :------------------------ | | Marketable securities | $1,206 | $411 | — | $1,617 | [NOTE 16 COMMITMENTS AND CONTINGENCIES](index=29&type=section&id=NOTE%2016%20COMMITMENTS%20AND%20CONTINGENCIES) This note details the company's commitments and contingencies, including surety bonds for environmental obligations, streaming agreements, and flow-through share expenditures - The Company has **$46.5 million** in surety bonds for environmental reclamation obligations in Nevada and Canada, with an average annual financing fee of **2.4%** and a **7.3%** deposit[85](index=85&type=chunk)[86](index=86&type=chunk)[221](index=221&type=chunk) - Under a streaming agreement, the Company is obligated to sell **8%** of gold production from Black Fox mine and **6.3%** from Pike River property at the lesser of market price or **$561 per ounce** (with inflation adjustments)[87](index=87&type=chunk) - The Company incurred **$14.4 million** in flow-through eligible expenditures by **June 30, 2025**, and expects to fulfill remaining obligations by year-end **2025**[89](index=89&type=chunk) - The Company extended its precious metals purchase agreement with Auramet International LLC, receiving **$13.5 million** in **Q2/25** and **$38.2 million** in **H1/25** from sales on a Supplier Advance Basis[90](index=90&type=chunk) [NOTE 17 INCOME AND MINING TAXES](index=32&type=section&id=NOTE%2017%20INCOME%20AND%20MINING%20TAXES) This note presents the company's income and mining tax recovery, detailing current and deferred tax components for the reporting periods Income and Mining Tax Recovery (in thousands of U.S. dollars) | Category | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Current income and mining tax expense | $1,793 | $459 | $3,631 | $992 | | Deferred income and mining tax recovery | $(2,904) | $(2,835) | $(5,821) | $(5,925) | | **Total income and mining tax recovery** | **$(1,111)** | **$(2,376)** | **$(2,190)** | **$(4,933)** | - The income and mining tax recovery for **Q2/25** was **$1.1 million** (compared to **$2.4 million** in **Q2/24**) and **$2.2 million** for **H1/25** (compared to **$4.9 million** in **H1/24**), primarily reflecting the amortization of the flow-through shares premium[94](index=94&type=chunk)[129](index=129&type=chunk)[137](index=137&type=chunk) [NOTE 18 SUBSEQUENT EVENT](index=32&type=section&id=NOTE%2018%20SUBSEQUENT%20EVENT) This note discloses a significant subsequent event regarding the company's binding letter of intent to acquire Canadian Gold Corp - On **July 27, 2025**, the Company entered into a binding letter of intent to acquire all outstanding securities of Canadian Gold Corp, with shareholders receiving **0.0225 shares** of McEwen Inc. common stock for each Canadian Gold share[96](index=96&type=chunk)[111](index=111&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on McEwen Inc.'s financial condition and operational performance for the three and six months ended June 30, 2025, compared to the prior year. It covers consolidated results, liquidity, and detailed reviews of each operating segment, including production, costs, and exploration activities, while also defining and reconciling non-GAAP financial measures [OVERVIEW](index=33&type=section&id=OVERVIEW) This section provides an overview of McEwen Inc.'s business, including its core activities in gold and silver production, mineral property development, and its use of non-GAAP financial measures for performance evaluation - McEwen Inc. (formerly McEwen Mining Inc.) is engaged in gold and silver production and sales, alongside copper, gold, and silver mineral property development and exploration across North and South America[105](index=105&type=chunk) - The Company owns **100%** of the Gold Bar mine, Fox Complex, Fenix Project, and exploration properties, and holds **46.4%** in McEwen Copper Inc. and **49.0%** in Minera Santa Cruz S.A., both accounted for using the equity method[106](index=106&type=chunk) - The discussion includes non-GAAP measures such as cash costs, AISC, Adjusted EBITDA, and average realized price per ounce, which are used by management to evaluate performance and generate cash flows[100](index=100&type=chunk) [Q2/25 OPERATING AND FINANCIAL HIGHLIGHTS](index=35&type=section&id=Q2%2F25%20OPERATING%20AND%20FINANCIAL%20HIGHLIGHTS) This section summarizes McEwen Inc.'s key operating and financial achievements for the second quarter of 2025, including production, revenue, net income, and exploration successes - Consolidated production for **Q2/25** was **27,554 GEOs**, a decrease from **35,265 GEOs** in **Q2/24**, but the Company remains on track for its **2025** production guidance of **120,000 to 140,000 GEOs**[111](index=111&type=chunk) - **Q2/25** revenues from **100%**-owned operations were **$46.7 million**, a slight decrease from **$47.5 million** in **Q2/24**, primarily due to a **29%** decrease in GEOs sold, offset by a **40%** increase in realized gold prices[117](index=117&type=chunk)[123](index=123&type=chunk) - Net income for **Q2/25** was **$3.0 million** (**$0.06 per share**), a significant improvement from a net loss of **$13.0 million** (**$0.26 per share**) in **Q2/24**, driven by lower McEwen Copper losses and an unrealized gain on marketable securities[117](index=117&type=chunk) - Exploration activities led to the discovery of new high-grade mineralization at Froome West (Fox Complex) and infill drilling at Gold Bar Mine and Timberline properties[117](index=117&type=chunk) [Selected Consolidated Financial and Operating Results](index=39&type=section&id=Selected%20Consolidated%20Financial%20and%20Operating%20Results) This section presents a summary of McEwen Inc.'s key consolidated financial and operating metrics for the three and six months ended June 30, 2025 and 2024 Selected Consolidated Financial Results (in thousands, except per share) | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Revenue from gold and silver sales | $46,700 | $47,476 | $82,396 | $88,704 | | Gross profit | $12,281 | $10,758 | $22,351 | $16,769 | | Adjusted EBITDA | $17,309 | $7,227 | $26,018 | $13,550 | | Net income (loss) | $3,040 | $(12,995) | $(3,230) | $(33,378) | | Net income (loss) per share | $0.06 | $(0.26) | $(0.06) | $(0.67) | | Cash from (used in) operating activities | $478 | $2,507 | $(1,454) | $7,487 | | Additions to mineral property interests and plant and equipment | $9,649 | $6,684 | $24,183 | $11,206 | Selected Consolidated Operating Results | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | GEOs produced (Total) | 27,554 | 35,265 | 51,685 | 68,320 | | GEOs sold (Total) | 28,039 | 35,182 | 51,854 | 69,589 | | Average realized price ($/GEO) | $3,298 | $2,355 | $3,062 | $2,246 | | Cash costs per ounce ($/GEO sold) (100% owned) | $1,906 | $1,554 | $1,715 | $1,414 | | AISC per ounce ($/GEO sold) (100% owned) | $2,120 | $1,728 | $2,210 | $1,592 | | Gold : Silver ratio | 99 : 1 | 81 : 1 | 94 : 1 | 85 : 1 | [Consolidated Operations Review](index=40&type=section&id=Consolidated%20Operations%20Review) This section provides a detailed review of McEwen Inc.'s consolidated operational performance, analyzing revenue, production costs, and net income drivers for the reporting periods - **Q2/25** revenue from **100%**-owned operations decreased by **2%** to **$46.7 million**, driven by a **29%** decrease in GEOs sold, partially offset by a **40%** increase in realized gold prices[123](index=123&type=chunk) - Production costs applicable to sales decreased by **14%** in **Q2/25** to **$27.7 million**, primarily due to lower GEOs produced and sold, despite higher per-unit costs[124](index=124&type=chunk) - The Company recorded a net income of **$3.0 million** in **Q2/25**, a significant improvement from a **$13.0 million** net loss in **Q2/24**, mainly due to reduced losses from McEwen Copper and a **$4.7 million** gain on marketable securities[9](index=9&type=chunk)[126](index=126&type=chunk)[128](index=128&type=chunk) [LIQUIDITY AND CAPITAL RESOURCES](index=42&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) This section discusses McEwen Inc.'s liquidity position and capital resources, including changes in cash, operating and financing activities, and working capital - Cash, cash equivalents, and restricted cash increased by **$40.1 million** to **$57.6 million** during **H1/25**[138](index=138&type=chunk) - Cash used in operating activities was **$1.5 million** in **H1/25**, reflecting a net loss of **$3.2 million** adjusted for non-cash items[139](index=139&type=chunk) - Cash provided by financing activities was **$70.3 million** in **H1/25**, primarily from **$110.0 million** in Senior Convertible Notes proceeds, partially offset by debt repayments and capped call option purchases[141](index=141&type=chunk) - Working capital increased by **$68.3 million** to **$61.8 million** at **June 30, 2025**, from a negative **$6.5 million** at **December 31, 2024**, driven by increased cash, marketable securities, and reduced liabilities[142](index=142&type=chunk) [Operations Review](index=44&type=section&id=Operations%20Review) This section provides a detailed review of the operational and financial performance of McEwen Inc.'s individual mining segments and equity investments [United States Segment](index=44&type=section&id=United%20States%20Segment) This section details the operating and financial results of the Gold Bar Mine in the United States segment, including production, costs, and exploration activities Gold Bar Mine Operating and Financial Results (in thousands of U.S. dollars, except per ounce) | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | GEOs Produced | 8,406 | 12,297 | 16,094 | 24,013 | | GEOs Sold | 8,350 | 12,510 | 16,285 | 24,700 | | Revenue from gold and silver sales | $27,523 | $29,686 | $49,913 | $54,964 | | Cash costs per ounce ($/GEO sold) | $1,679 | $1,532 | $1,419 | $1,313 | | AISC per ounce ($/GEO sold) | $1,792 | $1,634 | $1,986 | $1,404 | - Gold Bar Mine production decreased by **32%** to **8,406 GEOs** in **Q2/25** due to lower mined and stacked tonnes, as operations focused on the higher strip ratio Pick III deposit[146](index=146&type=chunk) - Cash costs and AISC per GEO sold increased in **Q2/25** to **$1,679** and **$1,792**, respectively, primarily due to the ongoing high-stripping phase at Pick III, with unit costs expected to decrease in **H2/25**[149](index=149&type=chunk) - Exploration activities at Gold Bar Mine focused on the Jug Handle target and at Timberline properties on infill drilling at Windfall and Lookout Mountain deposits[150](index=150&type=chunk)[151](index=151&type=chunk) [Canada Segment](index=46&type=section&id=Canada%20Segment) This section details the operating and financial results of the Fox Complex in the Canada segment, including production, costs, project advancements, and exploration activities Fox Complex Operating and Financial Results (in thousands of U.S. dollars, except per ounce) | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | GEOs Produced | 5,429 | 8,297 | 10,948 | 15,782 | | GEOs Sold (including stream) | 6,199 | 8,071 | 11,311 | 15,671 | | Revenue from gold and silver sales | $19,177 | $17,790 | $32,483 | $32,540 | | Cash costs per ounce ($/GEO sold) | $2,212 | $1,588 | $2,142 | $1,572 | | AISC per ounce ($/GEO sold) | $2,563 | $1,874 | $2,534 | $1,886 | - Fox Complex production decreased by **35%** to **5,429 GEOs** in **Q2/25** due to mining in lower-grade zones at Froome, with higher production expected in **H2/25**[157](index=157&type=chunk) - Cash costs and AISC per GEO sold increased to **$2,212** and **$2,563**, respectively, in **Q2/25**, driven by a **23%** decrease in GEOs sold and higher fixed costs spread over fewer ounces[160](index=160&type=chunk) - The Company invested **$5.6 million** in **Q2/25** to advance the Stock project, completing the mine portal and initiating ramp access, targeting commercial production in **2026**[155](index=155&type=chunk) - Exploration at Froome West discovered new high-grade gold mineralization (**36.0 g/t gold over 10 meters**), expected to extend Froome's mine life, and diamond drilling continued at the Grey Fox property[161](index=161&type=chunk)[162](index=162&type=chunk) [Mexico Segment](index=47&type=section&id=Mexico%20Segment) This section provides an update on the Fenix Project in the Mexico segment, an advanced-stage gold heap leach reprocessing project awaiting key permits - The Fenix Project, an advanced-stage gold heap leach reprocessing project, is awaiting key permits for a construction decision and remains under review[164](index=164&type=chunk) [Minera Santa Cruz Segment, Argentina](index=49&type=section&id=Minera%20Santa%20Cruz%20Segment%2C%20Argentina) This section details the operating and financial results of the San José Mine in Argentina, including production, revenue, costs, and McEwen Inc.'s attributable share of income San José Mine Operating and Financial Results (100% basis, in thousands of U.S. dollars, except per ounce) | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | GEOs Produced | 27,997 | 29,942 | 50,291 | 56,337 | | GEOs Sold | 27,530 | 29,699 | 49,507 | 59,501 | | Revenue from gold and silver sales | $94,885 | $74,348 | $166,788 | $140,275 | | Cash costs per ounce sold ($/GEO) | $2,310 | $1,624 | $2,428 | $1,615 | | AISC per ounce sold ($/GEO) | $2,842 | $2,032 | $2,933 | $1,978 | - San José Mine production decreased by **6%** to **27,997 GEOs** in **Q2/25** (**100%** basis) due to lower mill grades and reduced recovery rates, despite a **27%** increase in tonnes processed[168](index=168&type=chunk) - Revenue from gold and silver sales increased to **$94.9 million** in **Q2/25**, driven by **38%** higher realized gold prices and **13%** higher silver prices, offsetting the decrease in GEOs sold[169](index=169&type=chunk) - Cash costs and AISC per GEO sold increased to **$2,310** and **$2,842**, respectively, in **Q2/25**, reflecting increased operating costs due to inflation and higher contractor reliance, combined with lower ounces sold[170](index=170&type=chunk)[171](index=171&type=chunk) - McEwen Inc.'s **49%** attributable share of MSC operations resulted in an income of **$3.6 million** in **Q2/25**, and the Company received **$2.2 million** in dividends from MSC during **H1/25**[172](index=172&type=chunk)[173](index=173&type=chunk) [McEwen Copper Inc.](index=50&type=section&id=McEwen%20Copper%20Inc.) This section provides an update on McEwen Copper Inc. and its Los Azules copper project in Argentina, including feasibility study progress and investment initiatives - McEwen Copper, **46.4%** owned by the Company, is advancing the Los Azules copper project in Argentina, with a definitive feasibility study expected in **Q3/25**[174](index=174&type=chunk)[176](index=176&type=chunk) - During **H1/25**, McEwen Copper invested **$33.5 million** to complete final drilling activities for the Los Azules feasibility study, refining geotechnical characterization and the mine plan[111](index=111&type=chunk)[117](index=117&type=chunk) - McEwen Copper submitted an optimized application for Argentina's Regime of Incentive for Investments (RIGI) for the Los Azules Project, proposing a **$2.7 billion** investment to potentially gain tax and regulatory benefits[182](index=182&type=chunk) [Non-GAAP Financial Performance Measures](index=52&type=section&id=Non-GAAP%20Financial%20Performance%20Measures) This section defines and reconciles non-GAAP financial measures used by management, such as cash costs, AISC, and Adjusted EBITDA, to evaluate operational performance - Non-GAAP measures like cash costs, AISC, Adjusted EBITDA, and average realized price per ounce are used to evaluate operational efficiencies and cash flow generation, but do not have standardized definitions and should not be used in isolation[184](index=184&type=chunk)[186](index=186&type=chunk) Reconciliation of Cash Costs and All-In Sustaining Costs (100% owned operations, in thousands, except per ounce) | Metric | Three months ended June 30, 2025 | Six months ended June 30, 2025 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Production costs applicable to sales - cash costs | $27,733 | $47,338 | | All-in sustaining costs | $30,851 | $60,994 | | Ounces sold, including stream (GEO) | 14,549 | 27,596 | | Cash cost per ounce sold ($/GEO) | $1,906 | $1,715 | | AISC per ounce sold ($/GEO) | $2,120 | $2,210 | Reconciliation of Adjusted EBITDA (in thousands) | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Income (loss) before income and mining taxes | $1,929 | $(15,371) | $(5,420) | $(38,311) | | Adjusted EBITDA | $17,309 | $7,227 | $26,018 | $13,550 | | Adjusted EBITDA per share | $0.32 | $0.15 | $0.49 | $0.27 | [Critical Accounting Policies](index=55&type=section&id=Critical%20Accounting%20Policies) This section confirms that there were no significant changes to the company's critical accounting policies or estimates since the last fiscal year-end - There were no significant changes in the Company's critical accounting policies or estimates since **December 31, 2024**[199](index=199&type=chunk) [Forward-looking Statements](index=55&type=section&id=Forward-looking%20Statements) This section highlights the forward-looking nature of certain statements in the report, outlining the inherent uncertainties and assumptions underlying future projections - The report contains forward-looking statements regarding anticipated exploration results, production estimates, permits, strategic alternatives, and financial outcomes, which are subject to significant business, economic, and competitive uncertainties[200](index=200&type=chunk)[202](index=202&type=chunk) - Production guidance is based on various factors and assumptions, including gold/silver price forecasts, average grades, tonnes moved, recovery rates, and labor availability, which are frequently evaluated and reconciled[203](index=203&type=chunk)[205](index=205&type=chunk) [Risk Factors Impacting Forward-looking Statements](index=58&type=section&id=Risk%20Factors%20Impact%20Forward-looking%20Statements) This section identifies key risk factors that could materially impact the company's forward-looking statements, including financial, operational, and geopolitical risks - Key risk factors include the ability to raise funds, success of acquisitions, securing permits, maintaining NYSE listing, geopolitical events, fluctuations in commodity prices and exchange rates, and operational challenges[206](index=206&type=chunk)[207](index=207&type=chunk) [Item 3. Quantitative and Qualitative Disclosure about Market Risk](index=59&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosure%20about%20Market%20Risk) This section outlines McEwen Inc.'s exposure to various market risks, including foreign currency, equity price, commodity price, credit, and interest rate risks, and explains how these factors could impact the company's financial condition and results of operations [Foreign Currency Risk](index=59&type=section&id=Foreign%20Currency%20Risk) This section details the company's exposure to foreign currency fluctuations, particularly with the Mexican peso, Canadian dollar, and Argentine peso, and their impact on financial results - The Company is exposed to foreign currency risks from the Mexican peso and Canadian dollar directly, and indirectly from the Argentine peso through its investments in MSC and McEwen Copper[210](index=210&type=chunk) - In **Q2/25**, the Canadian dollar and Mexican peso appreciated by **5.1%** and **8.5%**, respectively, while the Argentine peso depreciated by **10.1%** against the U.S. dollar[211](index=211&type=chunk) [Equity Price Risk](index=59&type=section&id=Equity%20Price%20Risk) This section describes the company's exposure to equity price risk from its investments in other mining entities and the measures taken to mitigate potential dilution - The Company is exposed to equity price risk from its investments in other mining sector entities, which can be volatile and lack liquidity[214](index=214&type=chunk) - Based on **$15.9 million** in marketable securities at **June 30, 2025**, a **1%** change in fair value would result in an approximate **$0.2 million** gain or loss[214](index=214&type=chunk) - The issuance of Convertible Senior Notes and associated Capped Call Transactions in **February 2025** are intended to offset potential dilution from equity price movements[216](index=216&type=chunk) [Commodity Price Risk](index=60&type=section&id=Commodity%20Price%20Risk) This section explains the company's exposure to fluctuations in gold and silver market prices and their significant impact on revenues and cash flows - Changes in gold and silver market prices significantly affect the Company's operations and cash flows; a **10%** change in prices would impact **Q2/25** revenues by approximately **$4.7 million**[217](index=217&type=chunk) - The Company does not hedge its sales, making it fully exposed to commodity price fluctuations[219](index=219&type=chunk) [Credit Risk](index=60&type=section&id=Credit%20Risk) This section addresses the company's credit risk exposure from precious metals sales agreements and surety bonds for reclamation obligations - The Company is exposed to credit loss from precious metals sales agreements with financial institutions and refineries, though no significant credit exposure is anticipated[220](index=220&type=chunk) - Surety bonds totaling **$46.5 million** are in place for reclamation costs, exposing the Company to the risk of surety default or non-acceptance by governmental agencies[221](index=221&type=chunk) [Interest Rate Risk](index=60&type=section&id=Interest%20Rate%20Risk) This section assesses the company's interest rate risk, noting its insignificance due to fixed coupons on convertible notes and term loan facilities - The Company's interest rate risk exposure is considered insignificant due to fixed coupons on its **$110.0 million** convertible notes and **$20.0 million** term loan facility[222](index=222&type=chunk) [Item 4. Controls and Procedures](index=61&type=section&id=Item%204.%20Controls%20and%20Procedures) This section addresses McEwen Inc.'s internal controls over financial reporting and disclosure controls. It details ongoing remediation efforts for a previously identified material weakness in income taxes and concludes that, due to this weakness, disclosure controls were not effective as of June 30, 2025, though management believes the financial statements are fairly presented [Overview](index=61&type=section&id=Overview) This section provides an overview of the company's efforts to remediate a material weakness in internal control over financial reporting related to income taxes - The Company is remediating a material weakness in internal control over financial reporting related to income taxes, which should enable certifying officers to confirm the effectiveness of disclosure controls[224](index=224&type=chunk) - Remediation efforts include redesigning internal controls around income taxes, adding human resources, and engaging third-party assistance[224](index=224&type=chunk) [Evaluation of Disclosure Controls and Procedures](index=61&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section concludes that, due to a material weakness in internal control over financial reporting, the company's disclosure controls and procedures were not effective as of June 30, 2025 - Due to the material weakness in internal control over financial reporting, the Company's disclosure controls and procedures were not effective as of **June 30, 2025**[225](index=225&type=chunk) - Despite the control weakness, management believes the unaudited consolidated financial statements fairly present the Company's financial position, results of operations, and cash flows in accordance with U.S. GAAP[226](index=226&type=chunk) [Changes in Internal Control Over Financial Reporting](index=61&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) This section confirms that, apart from remediation efforts for the material weakness, there were no other material changes in the company's internal control over financial reporting during the quarter - Other than the described remediation efforts for the material weakness, there were no material changes in the Company's internal control over financial reporting during **Q2/25**[227](index=227&type=chunk) [Limitations on Controls and Procedures](index=61&type=section&id=Limitations%20on%20Controls%20and%20Procedures) This section acknowledges the inherent limitations of all control systems, emphasizing that they provide only reasonable assurance and can be subject to deterioration - All control systems have inherent limitations, providing only reasonable assurance, and their effectiveness can deteriorate due to changing conditions or compliance levels[228](index=228&type=chunk) PART II OTHER INFORMATION [Item 1. Legal Proceedings](index=62&type=section&id=Item%201.%20Legal%20Proceedings) McEwen Inc. reported no legal proceedings during the quarter ended June 30, 2025 - There were no legal proceedings to report for the quarter ended **June 30, 2025**[230](index=230&type=chunk) [Item 1A. Risk Factors](index=62&type=section&id=Item%201A.%20Risk%20Factors) The Company stated that there were no material changes to the risk factors previously disclosed in its Annual Report on Form 10-K for the fiscal year ended December 31, 2024 - No material changes were reported from the risk factors set forth in the Annual Report on Form 10-K for the fiscal year ended **December 31, 2024**[231](index=231&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=62&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) All unregistered sales of equity securities by McEwen Inc. or its subsidiaries during the quarter ended June 30, 2025, were previously reported in filings with the SEC - All unregistered sales of equity securities during the quarter ended **June 30, 2025**, were previously reported to the SEC[232](index=232&type=chunk) [Item 3. Defaults upon Senior Securities](index=62&type=section&id=Item%203.%20Defaults%20upon%20Senior%20Securities) McEwen Inc. reported no defaults upon senior securities during the quarter ended June 30, 2025 - There were no defaults upon senior securities to report for the quarter ended **June 30, 2025**[233](index=233&type=chunk) [Item 4. Mine Safety Disclosures](index=62&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) McEwen Inc. emphasizes safety as a core value, operating under a comprehensive health and safety management system. The Gold Bar mine is subject to MSHA regulation, and the Company is required to report certain mine safety violations, with relevant information included in Exhibit 95 - Safety is a core value at McEwen Inc., with a health and safety management system in place to ensure a safe environment and comply with mining regulations[234](index=234&type=chunk) - The Gold Bar mine is regulated by the Federal Mine Safety and Health Administration (MSHA), which conducts regular inspections and may issue citations[235](index=235&type=chunk) - The Company is required to report certain mine safety violations under Section 1503(a) of the Dodd-Frank Act and Item 104 of Regulation S-K, with details in Exhibit 95[236](index=236&type=chunk) [Item 5. Other Information](index=63&type=section&id=Item%205.%20Other%20Information) During the quarter ended June 30, 2025, McEwen Inc. had no undisclosed Form 8-K information, no material changes to director nominee recommendation procedures, and no adoption, modification, or termination of Rule 10b5-1 trading arrangements by directors or executive officers - No information required to be disclosed in a Form 8-K was undisclosed during **Q2/25**[240](index=240&type=chunk) - There were no material changes to procedures for stockholders to recommend board nominees during **Q2/25**[240](index=240&type=chunk) - No directors or executive officers adopted, modified, or terminated Rule 10b5-1 trading arrangements during **Q2/25**[240](index=240&type=chunk) [Item 6. Exhibits](index=64&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed or incorporated by reference with the Form 10-Q report, including agreements, articles of incorporation, bylaws, certifications, and mine safety disclosures - The exhibits include various agreements (e.g., Agreement and Plan of Merger, Loan Agreement), corporate governance documents (e.g., Articles of Incorporation, Bylaws), and certifications (e.g., Sarbanes-Oxley Act certifications)[241](index=241&type=chunk) - Mine safety disclosures and Inline XBRL Taxonomy Extension documents are also included as exhibits[241](index=241&type=chunk) [SIGNATURES](index=65&type=section&id=SIGNATURES) The report is duly signed on behalf of McEwen Inc. by Robert R. McEwen, Chairman and Chief Executive Officer, and Perry Ing, Interim Chief Financial Officer, as of August 6, 2025 - The report is signed by Robert R. McEwen, Chairman and Chief Executive Officer, and Perry Ing, Interim Chief Financial Officer, on **August 6, 2025**[245](index=245&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 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 Number: 001-40325 AppLovin Corporation (Exact name of registrant as specified in its charter) (State or other jurisdiction of ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 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 _____ Ascent Industries Co. (Exact name of registrant as specified in its charter) Delaware 57-0426694 (State or other jurisdiction of incorporation or organizat ...

```markdown [Second Quarter 2025 and Year-to-Date Highlights](index=1&type=section&id=Second%20Quarter%202025%20and%20Year-to-Date%20Highlights) Genco declared a **$0.15** Q2 2025 dividend, acquired a Capesize vessel, reported a **$6.8 million** net loss, and upsized its credit facility - Declared a **$0.15 per share dividend** for Q2 2025, marking the **24th consecutive quarterly dividend**. The cumulative dividend paid reached **$6.915 per share**[3](index=3&type=chunk) - Agreed to acquire a **2020-built, scrubber-fitted 182,000 dwt Capesize vessel**, to be named the Genco Courageous, with delivery expected between September and October 2025[3](index=3&type=chunk) Q2 2025 Key Financial Metrics | Metric | Value | | :--- | :--- | | Net Loss | $6.8 million | | Net Loss per Share (basic & diluted) | $0.16 | | Adjusted Net Loss | $6.2 million | | Adjusted Loss per Share (basic & diluted) | $0.14 | | Adjusted EBITDA | $14.3 million | | Voyage Revenues | $80.9 million | | Average Daily Fleet-wide TCE | $13,631 | - Estimated Time Charter Equivalent (TCE) for Q3 2025 to date is **$15,926** for **70%** of the owned fleet's available days[3](index=3&type=chunk) - Amended its credit facility in July to establish a **$600 million Revolving Credit Facility (RCF)**, significantly increasing borrowing capacity[3](index=3&type=chunk) [CEO Commentary](index=2&type=section&id=CEO%20Commentary) CEO Wobensmith highlighted Genco's value strategy, focusing on dividends, strategic vessel acquisition, and expanded borrowing capacity - The company is executing a **value strategy** focused on returning capital to shareholders and expanding earnings power[4](index=4&type=chunk) - The acquisition of a new Capesize vessel is part of a strategy to modernize the asset base, with approximately **$200 million invested** in the Capesize sector over the last two years[4](index=4&type=chunk) - The company's borrowing capacity was expanded by **50%** to a new **$600 million revolving credit facility** to support growth[4](index=4&type=chunk) - Management observes a pick-up in Capesize and Supramax rates and believes the company is well-positioned to capitalize on improving drybulk fundamentals due to its commercial platform and operating leverage[4](index=4&type=chunk) [Comprehensive Value Strategy](index=2&type=section&id=Comprehensive%20Value%20Strategy) Genco's value strategy focuses on dividends, deleveraging, and opportunistic fleet growth, maintaining strong liquidity and low leverage - The company's strategy is centered on three pillars: **Dividends, Deleveraging, and Growth**[7](index=7&type=chunk)[8](index=8&type=chunk) - As of June 30, 2025, the company had a strong liquidity position of **$335.6 million**, comprising **$35.8 million in cash** and **$299.8 million in revolver availability**[8](index=8&type=chunk) - Maintained low financial leverage with a **net loan-to-value (LTV) of 7%** as of June 30, 2025, which is pro forma **13%** after the agreed vessel acquisition[8](index=8&type=chunk)[9](index=9&type=chunk) [Growth and Capital Structure](index=3&type=section&id=Growth%20and%20Capital%20Structure) Genco pursues growth via a **$63.6 million** Capesize acquisition, backed by a new **$600 million** revolving credit facility with improved terms [Vessel Acquisition](index=3&type=section&id=Vessel%20Acquisition) Genco agreed to acquire a **2020-built, 182,000 dwt Capesize vessel** for **$63.6 million**, its fourth high-specification Capesize acquisition since October 2023 - Agreed to acquire a **2020-Imabari built 182,000 dwt scrubber-fitted Capesize vessel** for a purchase price of **$63.6 million**[11](index=11&type=chunk) - This is the **fourth high-specification, fuel-efficient Capesize vessel** acquired since October 2023, expanding the company's presence in a key sector[12](index=12&type=chunk) [New $600 Million Revolving Credit Facility](index=3&type=section&id=New%20%24600%20Million%20Revolving%20Credit%20Facility) Genco upsized its credit facility to a **$600 million revolving credit facility**, increasing borrowing capacity by **50%** with improved pricing and extended maturity - Closed a **$600 million revolving credit facility**, increasing borrowing capacity by **50% ($200 million)**[14](index=14&type=chunk)[20](index=20&type=chunk) - Key terms include an extended maturity to **July 2030**, improved pricing with a margin of **1.75% to 2.15% over SOFR**, and a **100% revolving structure** for flexibility[15](index=15&type=chunk)[20](index=20&type=chunk) - As of the press release date, Genco has **$100 million of debt outstanding** and **$500 million of undrawn revolver availability**[15](index=15&type=chunk) [Dividend Policy](index=3&type=section&id=Dividend%20Policy) Genco declared a **$0.15 per share** Q2 2025 dividend, enabled by adjusting the voluntary reserve to maintain payouts and provide capital flexibility - Declared a cash dividend of **$0.15 per share** for Q2 2025, payable around August 25, 2025[17](index=17&type=chunk) - The dividend was enabled by reducing the Q2 voluntary reserve from **$19.50 million to $7.91 million**, as the standard formula would not have produced a dividend[17](index=17&type=chunk) Q2 2025 Dividend Calculation (in millions) | Description | Amount ($) | | :--- | :--- | | Net revenue | 46.90 | | Operating expenses | (32.41) | | **Operating cash flow** | **14.49** | | Less: voluntary quarterly reserve | (7.91) | | **Cash flow distributable as dividends** | **6.58** | | **Dividend per share** | **0.15** | - The voluntary quarterly reserve for Q3 2025 is expected to be **$19.50 million**, but the Board maintains flexibility to adjust it to pay dividends or for other uses like vessel acquisitions and debt repayments[22](index=22&type=chunk)[24](index=24&type=chunk) [Commercial and Fleet Strategy](index=5&type=section&id=Genco%27s%20Active%20Commercial%20Operating%20Platform%20and%20Fleet%20Deployment%20Strategy) Genco employs a flexible portfolio approach for revenue, favoring short-term fixtures, with **70%** of Q3 2025 available days fixed at **$15,926** TCE - The company utilizes a portfolio approach for revenue generation, combining short-term spot market fixtures and longer-term coverage, with a current weighting towards short-term fixtures for optionality[27](index=27&type=chunk) Estimated Net TCE - Q3 2025 to Date | Vessel Type | TCE ($) | % Fixed | | :--- | :--- | :--- | | Capesize | 20,951 | 69% | | Ultra/Supra | 13,326 | 70% | | **Total** | **15,926** | **70%** | [Financial Review](index=6&type=section&id=Financial%20Review) Genco reported a Q2 2025 net loss of **$6.8 million** and a H1 2025 net loss of **$18.7 million**, primarily due to lower TCE rates and reduced revenues [Second Quarter 2025 Financial Review](index=6&type=section&id=Financial%20Review%3A%202025%20Second%20Quarter) Genco reported a Q2 2025 net loss of **$6.8 million** and an average daily TCE of **$13,631**, with lower revenues and higher G&A expenses offsetting reduced operating costs Q2 2025 vs Q2 2024 Performance | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net (Loss) Income | ($6.8M) | $23.5M | | Adjusted Net (Loss) Income | ($6.2M) | $19.9M | | Revenues | $80.9M | $107.0M | | Average Daily TCE | $13,631 | $19,938 | | Adjusted EBITDA | $14.3M | $39.8M | - Daily vessel operating expenses (DVOE) decreased to **$6,213 per vessel per day** from **$6,855** in Q2 2024, mainly due to the timing of stores/spares purchases and lower repair costs[36](index=36&type=chunk) - General and administrative expenses increased to **$7.4 million** from **$6.3 million** year-over-year due to higher legal/professional fees and nonvested stock amortization[38](index=38&type=chunk) [Six Months 2025 Financial Review](index=7&type=section&id=Financial%20Review%3A%20Six%20Months%202025) For H1 2025, Genco reported a net loss of **$18.7 million** and an average daily TCE of **$12,750**, driven by decreased revenues and lower charter rates compared to H1 2024 H1 2025 vs H1 2024 Performance | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net (Loss) Income | ($18.7M) | $42.3M | | Revenues | $152.2M | $224.5M | | Average Daily TCE | $12,750 | $19,564 | | Adjusted EBITDA | $22.2M | $81.6M | - Daily vessel operating expenses (DVOE) for the first half of 2025 decreased slightly to **$6,401** from **$6,558** in H1 2024[45](index=45&type=chunk) [Liquidity and Capital Resources](index=8&type=section&id=Liquidity%20and%20Capital%20Resources) Genco maintains solid liquidity despite decreased H1 2025 operating cash flow of **$8.3 million**, with plans to expand its **42-vessel fleet** and significant capital expenditures for upgrades [Cash Flow Analysis](index=8&type=section&id=Cash%20Flow) H1 2025 net cash from operations decreased to **$8.3 million** due to lower charter rates and higher drydocking costs, while investing and financing activities also saw significant shifts Cash Flow Summary (Six Months Ended June 30) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $8.3M | $61.3M | | Net Cash (Used in) Provided by Investing Activities | ($6.7M) | $65.1M | | Net Cash Used in Financing Activities | ($9.9M) | ($130.9M) | [Fleet and Capital Expenditures](index=8&type=section&id=Capital%20Expenditures) Genco's **42-vessel fleet** (average age **12.7 years**) will expand to **43** with a new acquisition, with significant capital expenditures budgeted for upgrades through 2026 - The current fleet consists of **42 vessels** with an average age of **12.7 years**. The planned acquisition will expand the fleet to **43 vessels** and lower the average age to **12.5 years**[54](index=54&type=chunk)[55](index=55&type=chunk) Estimated Capital Expenditures (Balance of 2025 & 2026, in millions) | Quarter | Total Costs ($) | Estimated Offhire Days | | :--- | :--- | :--- | | Q3 2025 | 21.52 | 228 | | Q4 2025 | 3.24 | 55 | | Q1 2026 | 11.12 | 100 | | Q2 2026 | - | - | | Q3 2026 | 10.27 | 100 | | Q4 2026 | 5.15 | 68 | [Summary Consolidated Financial and Other Data](index=10&type=section&id=Summary%20Consolidated%20Financial%20and%20Other%20Data) This section presents unaudited financial statements and operational data, including Q2 2025 voyage revenues of **$80.9 million** and a net loss of **$6.8 million**, with total assets of **$1.04 billion** Consolidated Income Statement Data (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Voyage Revenues | $80,939 | $107,047 | $152,208 | $224,482 | | Total Operating Expenses | $85,201 | $80,733 | $166,239 | $176,075 | | Operating (Loss) Income | ($4,262) | $26,314 | ($14,031) | $48,407 | | Net (Loss) Income | ($6,809) | $23,493 | ($18,771) | $42,436 | | Net (Loss) EPS - basic | ($0.16) | $0.54 | ($0.43) | $0.98 | Consolidated Balance Sheet Data (in thousands) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $35,439 | $43,690 | | Total Current Assets | $78,972 | $97,990 | | Vessels, net | $897,156 | $915,022 | | **Total Assets** | **$1,040,250** | **$1,056,602** | | Total Current Liabilities | $48,547 | $40,660 | | Long-term debt, net | $92,968 | $82,175 | | **Total Liabilities** | **$147,208** | **$128,374** | | **Total Equity** | **$893,042** | **$928,228** | EBITDA Reconciliation (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | EBITDA | $13,647 | $43,294 | $21,568 | $82,531 | | Adjusted EBITDA | $14,298 | $39,767 | $22,213 | $81,626 | ```

Part I — FINANCIAL INFORMATION [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) The company's financial statements for the period ended June 30, 2025, reflect a shift to profitability from continuing operations, with net income of $5.8 million for the quarter compared to a net loss of $2.6 million in the prior year period, while total assets remained stable at approximately $1.42 billion, and cash flow from operations significantly increased to $57.7 million for the first six months of 2025 [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance Sheet Summary (as of June 30, 2025 vs. December 31, 2024) | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $151,060 | $135,782 | | Assets held for sale | $48,336 | $11,422 | | Goodwill | $867,205 | $863,152 | | Total assets | $1,419,005 | $1,421,268 | | **Liabilities & Equity** | | | | Total current liabilities | $117,921 | $110,726 | | Long-term debt, net | $520,294 | $522,442 | | Total liabilities | $675,027 | $670,442 | | Total stockholders' equity | $743,978 | $750,826 | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Loss%29) Statement of Operations Summary (unaudited, in thousands) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $148,015 | $140,523 | $290,288 | $278,375 | | Operating income | $15,802 | $7,703 | $30,007 | $3,407 | | Net income (loss) from continuing operations | $5,761 | $(2,552) | $6,695 | $(18,562) | | Net income (loss) | $8,153 | $(3,376) | $440 | $(19,700) | | Diluted EPS (Total) | $0.04 | $(0.02) | $0.00 | $(0.11) | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Summary (Six months ended June 30, in thousands) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $57,659 | $37,216 | | Net cash used in investing activities | $(13,745) | $(8,526) | | Net cash used in financing activities | $(29,576) | $(34,190) | | Net increase (decrease) in cash | $15,278 | $(6,138) | [Notes to Unaudited Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The notes detail significant corporate actions, including the strategic decision to sell the marketing technology solutions, now classified as discontinued operations, and the 2024 disposition of Fitness Solutions, while also providing breakdowns of revenue, goodwill, debt, and equity activities, including an active stock repurchase program, and a subsequent event note details a debt refinancing in July 2025 that extended maturities and reduced interest margins - The company provides integrated SaaS solutions for service-based SMBs across three core verticals: EverPro (Home Services), EverHealth (Health Services), and EverWell (Wellness Services)[26](index=26&type=chunk) - On March 5, 2025, the Board committed to a plan to sell the company's marketing technology solutions, which are now classified as discontinued operations, with assets and liabilities presented as held for sale[33](index=33&type=chunk) Discontinued Operations (Marketing Technology Solutions) Summary (in thousands) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $34,536 | $36,870 | $63,168 | $69,131 | | Operating income (loss) | $2,399 | $(824) | $(6,325) | $(1,138) | | Assets held for sale (net) | $35,618 | - | $35,618 | $40,930 (as of Dec 31, 2024) | - In 2024, the company sold its Fitness Solutions, recognizing losses of **$5.0 million** and a goodwill impairment of **$6.4 million** for the six months ended June 30, 2024, though this divestiture did not qualify for discontinued operations reporting[44](index=44&type=chunk) - The company's stock repurchase program was increased to a total authorization of **$250.0 million** and extended through December 31, 2026, with **$51.1 million** remaining available under the program as of June 30, 2025[78](index=78&type=chunk)[80](index=80&type=chunk)[81](index=81&type=chunk) - Subsequent to the quarter end, on July 29, 2025, the company amended its credit facilities to refinance its term loan, extending the maturity to July 2031 and reducing the applicable interest margin by **25 basis points**[116](index=116&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the 5.3% revenue growth in Q2 2025 to the successful delivery of its core software to SMBs in home services, health, and wellness, highlighting a Pro Forma Revenue Growth Rate of 7.4% for the quarter, normalizing for divestitures, while profitability improved significantly with operating income rising to $15.8 million from $7.7 million year-over-year, driven by revenue growth and cost management initiatives, and Adjusted EBITDA from continuing operations increased to $45.0 million for the quarter, with strong liquidity of $151.1 million in cash and $155.0 million available under the revolver supporting strategic investments and the ongoing share repurchase program [Overview](index=33&type=section&id=Overview) - The company's strategy is a "land and expand" model, starting customers with core Business Management Software and then cross-selling adjacent solutions like Billing & Payments and Customer Experience tools[122](index=122&type=chunk) - Approximately **97%** of revenue was recurring or re-occurring for the six months ended June 30, 2025, with the annualized net revenue retention rate also approximately **97%** for the quarter ended June 30, 2025[126](index=126&type=chunk) [Key Business and Financial Metrics](index=36&type=section&id=Key%20Business%20and%20Financial%20Metrics) - The Pro Forma Revenue Growth rate, which adjusts for acquisitions and divestitures, was **7.4%** for both the three and six months ended June 30, 2025, indicating underlying business growth[137](index=137&type=chunk) Adjusted EBITDA Reconciliation (Continuing Operations, in thousands) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) from continuing operations | $5,761 | $(2,552) | $6,695 | $(18,562) | | Adjustments (Interest, Taxes, D&A, etc.) | $39,196 | $41,985 | $83,207 | $96,645 | | **Adjusted EBITDA from continuing operations** | **$44,957** | **$39,433** | **$89,902** | **$78,083** | [Results of Operations](index=42&type=section&id=Results%20of%20Operations) - Total revenues from continuing operations increased by **$7.5 million (5.3%)** for Q2 2025 and **$11.9 million (4.3%)** for YTD 2025 compared to the prior year, primarily driven by growth in business management software and billing/payment solutions[163](index=163&type=chunk) - Operating expenses as a percentage of revenue decreased from **94.5%** to **89.3%** in Q2 2025 year-over-year, reflecting improved margins and lower depreciation, amortization, and impairment charges[162](index=162&type=chunk) - Depreciation and amortization expense decreased by **$3.3 million** in Q2 2025, primarily due to a reduced rate of replacement assets from fewer recent business acquisitions[169](index=169&type=chunk) - The loss from discontinued operations for YTD 2025 increased to **$6.3 million**, driven by a **$9.0 million** impairment charge related to the marketing technology disposal group[173](index=173&type=chunk) [Liquidity and Capital Resources](index=49&type=section&id=Liquidity%20and%20Capital%20Resources) - As of June 30, 2025, the company had **$151.1 million** in cash and cash equivalents and **$155.0 million** of available borrowing capacity under its Revolver[176](index=176&type=chunk) - Net cash from operating activities increased to **$57.7 million** for the first six months of 2025, up from **$37.2 million** in the same period of 2024, due to lower costs from transformation initiatives and improved cash collections[178](index=178&type=chunk)[179](index=179&type=chunk) - The company repurchased and retired **3.1 million shares** for **$31.8 million** in the first six months of 2025 under its stock repurchase program[199](index=199&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=54&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports that there have been no material changes to its disclosures regarding market risk from those described in its Annual Report on Form 10-K - There have been no material changes to the company's market risk disclosures since the last Annual Report on Form 10-K[206](index=206&type=chunk) [Controls and Procedures](index=54&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that as of June 30, 2025, the company's disclosure controls and procedures were not effective due to a previously disclosed material weakness in internal control over financial reporting, which the company is actively working to remediate - Management concluded that disclosure controls and procedures were not effective as of June 30, 2025, due to a previously identified material weakness in internal control over financial reporting[207](index=207&type=chunk) - The company is continuing its efforts to remediate the material weakness, with no changes during the quarter identified that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[208](index=208&type=chunk) Part II — OTHER INFORMATION [Legal Proceedings](index=55&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings arising in the ordinary course of business, and management does not expect the ultimate resolution of these matters to have a material adverse effect on the company's financial condition or operating results, with specific details on a putative class action lawsuit provided in Note 17 of the financial statements - The company is subject to various legal proceedings but does not believe their resolution will have a material adverse effect on its business or financial results[210](index=210&type=chunk) [Risk Factors](index=55&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the company's risk factors from those disclosed in its Annual Report on Form 10-K - No material changes to the risk factors disclosed in the Annual Report on Form 10-K have occurred[211](index=211&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=55&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's stock repurchase activity under its publicly announced program, with approximately 2.0 million shares repurchased for a total of $20.6 million during the second quarter of 2025 Share Repurchases (Q2 2025) | Period | Total Shares Purchased | Average Price Paid | Total Cost (in thousands) | | :--- | :--- | :--- | :--- | | April 2025 | 616,214 | $9.91 | ~$6,107 | | May 2025 | 615,384 | $10.18 | ~$6,265 | | June 2025 | 812,523 | $9.96 | ~$8,092 | | **Total Q2 2025** | **~2,044,121** | **-** | **~$20,600** | [Other Information](index=55&type=section&id=Item%205.%20Other%20Information) On June 12, 2025, CEO Eric Remer entered into a Rule 10b5-1 trading plan for the potential sale of up to 1.0 million shares of company common stock, effective until September 10, 2026, or upon certain other events - CEO Eric Remer established a Rule 10b5-1 trading plan on June 12, 2025, for the sale of up to **1.0 million shares** of common stock[215](index=215&type=chunk) [Exhibits](index=57&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including amendments to credit agreements, officer certifications, and XBRL data files