Exhibit 99.1 Contact: Ian Frazer Investor Relations Lennar Corporation (305) 485-4129 FOR IMMEDIATE RELEASE Jon Jaffe, Lennar's Co-Chief Executive Officer and President, added, "During the quarter, we achieved a starts pace and sales pace of 4.4 homes and 4.7 homes per community per month, respectively, as we used targeted incentives, including mortgage rate buydowns, to sustain momentum. Additionally, we carefully managed our inventory levels, ending the quarter with fewer than two completed, unsold homes ...

```markdown PART I This section details the company's business operations, risk factors, cybersecurity measures, and property holdings [Item 1. Business](index=5&type=section&id=Item%201.%20Business) American Battery Technology Company (ABTC) is an integrated critical battery materials company focused on increasing domestic U.S. production of lithium, nickel, cobalt, and manganese through primary resource exploration, new extraction technologies, and lithium-ion battery recycling. The company operates in both primary and secondary battery material supply segments, aiming for a closed-loop supply chain and environmentally responsible operations - ABTC is an integrated critical battery materials company focused on increasing domestic U.S. production of lithium, nickel, cobalt, and manganese[18](index=18&type=chunk) - The company employs a three-pronged approach: exploration of new primary resources, development of extraction technologies, and commercialization of an integrated lithium-ion battery recycling process[18](index=18&type=chunk) - ABTC operates in both primary and secondary battery material supply segments[23](index=23&type=chunk) [Introduction](index=5&type=section&id=Introduction) This section covers introduction - ABTC aims to increase domestic U.S. production of critical battery materials (lithium, nickel, cobalt, manganese) and establish a closed-loop supply chain through primary resource development and battery recycling[18](index=18&type=chunk) - The company's headquarters are in Reno, Nevada, with a mineral exploration office in Tonopah, Nevada, and a recycling plant in McCarran, Nevada[19](index=19&type=chunk) [Company History](index=5&type=section&id=Company%20History) This section details the company's company history - Incorporated as Oroplata Resources, Inc. in 2011, the company underwent several name changes, including LithiumOre Corp. and American Battery Metals Corporation, before becoming American Battery Technology Company in August 2021 to better reflect its current and future business[20](index=20&type=chunk) [Industry Overview](index=5&type=section&id=Industry%20Overview) This section provides an overview of industry overview - The global lithium-ion battery market surpassed **$100 billion in 2024** and is projected to exceed **$250 billion by 2030**, driving demand for battery materials like lithium, cobalt, nickel, and manganese[21](index=21&type=chunk) - The lithium-ion battery supply chain is segmented into material providers, chemical refiners, cell manufacturers, and end-use product manufacturers, with significant investment imbalances, particularly a lack of domestic U.S. battery material sourcing and refining capacity[23](index=23&type=chunk)[29](index=29&type=chunk) [Overview of Battery Materials Supply](index=7&type=section&id=Overview%20of%20Battery%20Materials%20Supply) This section provides an overview of battery materials supply - Primary battery material production is characterized by long development times, high capital costs, and concentration in geopolitically risky regions[30](index=30&type=chunk) - Secondary supply (recycling) is a newer market segment with limited investment, primarily using high-temperature thermal processes (pyrometallurgy) or mechanical crushing/simple hydrometallurgy, often losing materials like lithium and graphite, and concentrated in China and South Korea[34](index=34&type=chunk)[35](index=35&type=chunk)[36](index=36&type=chunk) [Our Business](index=8&type=section&id=Our%20Business) This section covers our business - ABTC has developed a two-phase universal lithium-ion battery recycling system: automated de-manufacturing followed by targeted chemical extraction to recover high-value metals[39](index=39&type=chunk)[40](index=40&type=chunk) - The company is also developing a sustainable lithium extraction process for battery cathode grade lithium hydroxide from Nevada-based sedimentary claystone primary resources[50](index=50&type=chunk) [Lithium-Ion Battery Recycling](index=8&type=section&id=Lithium-Ion%20Battery%20Recycling) This section describes the company's lithium-ion battery recycling operations - ABTC's recycling system is a two-phase process: automated de-manufacturing to separate components into scrap metals and black mass, followed by proprietary chemical extraction to refine lithium, nickel, cobalt, and manganese to battery cathode grade[40](index=40&type=chunk) - The unique recycling process offers benefits including decreased air/liquid pollutant emissions, high recovery and purity of high-value products, and lower capital costs compared to conventional methods[41](index=41&type=chunk)[47](index=47&type=chunk) [Industry Collaborations (Recycling)](index=9&type=section&id=Industry%20Collaborations%20(Recycling)) This section outlines industry collaborations (recycling) initiatives - ABTC won the Circularity Challenge hosted by BASF, Stanley Black & Decker, and Greentown Labs in 2019, leading to seed funding and partnership exploration with BASF[43](index=43&type=chunk) - In October 2021, ABTC received a **$2 million contract** from the US Advanced Battery Consortium (USABC) for commercial-scale development and demonstration of its integrated lithium-ion battery recycling system[44](index=44&type=chunk) [Competition (Recycling)](index=9&type=section&id=Competition%20(Recycling)) This section analyzes competition (recycling) in the market - ABTC competes with other recycling processors (primarily in the US, Europe, South Korea, China) and primary producers of battery materials[45](index=45&type=chunk)[46](index=46&type=chunk) - ABTC's process aims to extract additional value from feedstock by recovering more battery components (lithium, manganese) compared to competitors focusing mainly on nickel and cobalt[46](index=46&type=chunk) [Primary Resource Development & Refining](index=10&type=section&id=Primary%20Resource%20Development%20%26%20Refining) This section outlines primary resource development & refining initiatives - ABTC is developing a sustainable lithium extraction process for battery cathode grade lithium hydroxide from Nevada-based sedimentary claystone resources, avoiding inefficient evaporation ponds[50](index=50&type=chunk)[52](index=52&type=chunk) - The company is operating a multi-tonne per day integrated demonstration facility to prove commercial viability of its extraction and refining processes[51](index=51&type=chunk) [Industry Collaborations (Primary Resource)](index=10&type=section&id=Industry%20Collaborations%20(Primary%20Resource)) This section outlines industry collaborations (primary resource) initiatives - In October 2021, ABTC received a **$4.5 million grant** from the US Department of Energy to advance its lithium extraction technologies from claystone deposits, partially funding a multi-tonnes per day processing facility[53](index=53&type=chunk) [Competition (Primary Resource)](index=10&type=section&id=Competition%20(Primary%20Resource)) This section analyzes competition (primary resource) in the market - Primary lithium production is concentrated in the Americas, Australia, and Asia, with competition based on product quality and reliability of supply[54](index=54&type=chunk) [Employees](index=10&type=section&id=Employees) This section provides information on the company's employees - As of September 15, 2025, the Company had **157 full-time** and **6 part-time employees**[55](index=55&type=chunk) [Available Information](index=10&type=section&id=Available%20Information) This section details available information - The company files periodic reports (10-K, 10-Q, 8-K) with the SEC, which are available free of charge on its website[56](index=56&type=chunk) [Item 1A. Risk Factors](index=11&type=section&id=Item%201A.%20Risk%20Factors) Investing in ABTC securities involves significant risks, including substantial doubt about the company's ability to continue as a going concern and achieve profitability, the need for additional financing, challenges in scaling its unproven business model, and dependence on volatile metal prices. Operational risks include feedstock availability, safety concerns, and regulatory compliance, while ownership risks include potential dilution and internal control weaknesses - There is substantial doubt about the Company's ability to continue as a going concern and to achieve or sustain profitability[58](index=58&type=chunk)[61](index=61&type=chunk)[62](index=62&type=chunk) - The Company may require significant additional financing within the next 12 months to fund operations and develop its facilities, with no assurance of availability on acceptable terms[58](index=58&type=chunk)[63](index=63&type=chunk) - The success of recycling operations depends on securing adequate quantities of suitable lithium-ion battery feedstock at economically viable prices, which is subject to market volatility and competition[58](index=58&type=chunk)[69](index=69&type=chunk)[71](index=71&type=chunk) - The Company has identified a material weakness in its internal control over financial reporting (ICFR) and is working on remediation[65](index=65&type=chunk)[104](index=104&type=chunk) [Summary Risk Factors](index=11&type=section&id=Summary%20Risk%20Factors) This section covers summary risk factors - Substantial doubt about going concern and profitability[58](index=58&type=chunk) - Need for significant additional financing within 12 months[58](index=58&type=chunk) - Challenges in executing growth strategy and managing expansion, including scaling an unproven business model[58](index=58&type=chunk)[64](index=64&type=chunk) - Ability to source, recover, and recycle lithium-ion battery materials economically and efficiently may be limited[58](index=58&type=chunk) - Dependence on volatile global metal prices and product quality[58](index=58&type=chunk) - Safety concerns, changes in battery technology, slower EV adoption, or reduced government support could negatively impact results[58](index=58&type=chunk) - Operations are subject to development and execution risks, permitting limitations, and insurance coverage issues[58](index=58&type=chunk) - Potential for future equity issuances causing shareholder dilution[59](index=59&type=chunk) - Material weakness identified in internal control over financial reporting (ICFR)[65](index=65&type=chunk) [Risks Relating to Our Business](index=13&type=section&id=Risks%20Relating%20to%20Our%20Business) This section covers risks relating to our business - The Company's continuation as a going concern is dependent on generating profit and securing debt or equity financing, which is not assured[61](index=61&type=chunk) - Scaling the proprietary recycling process and developing the Tonopah Flats mining project present risks due to the unproven business model and lack of prior mining operational history[64](index=64&type=chunk)[66](index=66&type=chunk) - Profitability is highly sensitive to volatile global metal prices and the ability to meet stringent product quality and customer specifications[75](index=75&type=chunk) - Operations face hazards typical of mineral properties, environmental remediation costs, and challenges in obtaining and maintaining permits and insurance[76](index=76&type=chunk)[77](index=77&type=chunk)[78](index=78&type=chunk)[79](index=79&type=chunk) - Dependence on key personnel and the ability to attract and retain talent is crucial for advancing multiple projects concurrently[82](index=82&type=chunk)[83](index=83&type=chunk) [Risks Relating to Ownership of Our Securities](index=12&type=section&id=Risks%20Relating%20to%20Ownership%20of%20Our%20Securities) This section covers risks relating to ownership of our securities - Future issuance of additional equity securities could dilute existing ownership and depress common stock market price[100](index=100&type=chunk)[102](index=102&type=chunk) - The Company does not anticipate paying dividends, so investment return depends on stock price appreciation[106](index=106&type=chunk) - Failure to remediate a material weakness in internal control over financial reporting could adversely affect business, operating results, and share price[104](index=104&type=chunk) - Geopolitical competition over critical minerals, changes in trade policies, and shifts in government funding priorities could restrict market access, increase costs, or limit growth[87](index=87&type=chunk)[88](index=88&type=chunk)[89](index=89&type=chunk)[90](index=90&type=chunk) - Mineral resource estimates are subject to inherent uncertainties, and there is no assurance that economically recoverable reserves exist or can be extracted[91](index=91&type=chunk)[93](index=93&type=chunk) - Evolving federal and state regulations on battery recycling and extended producer responsibility may create new compliance obligations and increase operating costs[95](index=95&type=chunk) - Inadequate protection of intellectual property or infringement claims could lead to significant costs and operational restrictions[98](index=98&type=chunk) - Increasing cybersecurity threats pose risks of system compromise, operational disruption, and data exposure[99](index=99&type=chunk) [Item 1B. Unresolved Staff Comments](index=23&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company has no unresolved staff comments to report - Not required[109](index=109&type=chunk) [Item 1C. Cybersecurity](index=23&type=section&id=Item%201C.%20Cybersecurity) ABTC has established processes for assessing, identifying, and managing cybersecurity risks, including application security assessments, vulnerability management, and incident response plans. The Chief Operating Officer leads a centrally-coordinated team responsible for cybersecurity, with oversight from the board of directors - ABTC has processes for assessing, identifying, and managing material cybersecurity risks, including unauthorized occurrences on physical and electronic information systems[110](index=110&type=chunk) - Risk management includes application security assessments, vulnerability management, ongoing risk assessments, and incident response plans[111](index=111&type=chunk) - A unified team led by the Chief Operating Officer is responsible for cybersecurity and data protection, with board oversight[112](index=112&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) [Risk Management and Strategy](index=23&type=section&id=Risk%20Management%20and%20Strategy) This section covers risk management and strategy - ABTC employs various mechanisms, controls, technologies, and systems to prevent, detect, or mitigate data loss, theft, misuse, or unauthorized access[110](index=110&type=chunk) - The company conducts application security assessments, vulnerability management, and ongoing risk assessments, and maintains incident response plans[111](index=111&type=chunk) - Employees with access to information systems are required to undertake annual data protection and cybersecurity training[111](index=111&type=chunk) [Governance](index=23&type=section&id=Governance) This section covers governance - A centrally-coordinated team, led by the Chief Operating Officer, is responsible for implementing and maintaining cybersecurity and data protection practices[112](index=112&type=chunk)[114](index=114&type=chunk) - Cybersecurity risks and mitigations are evaluated by senior leadership and reviewed by the board of directors[113](index=113&type=chunk) [Item 2. Properties](index=24&type=section&id=Item%202.%20Properties) ABTC's properties include its corporate headquarters in Reno, Nevada, a lithium-ion battery recycling plant in McCarran, Nevada, and the Tonopah Flats Lithium Project. The McCarran facility is being commissioned in phases for battery material recycling. The Tonopah project involves exploration and development of lithium-bearing claystone, with a recently published Amended Resource Estimate and Initial Assessment - ABTC operates a recycling plant in McCarran, Nevada, and is exploring lithium-bearing claystone mining claims in Tonopah, Nevada[117](index=117&type=chunk) - The McCarran recycling facility, previously used for lead-acid batteries, is being commissioned in two phases, with Phase 1 (recycling into black mass and metals) commissioned in Q4 FY2024 and Phase 2 (refining into battery-grade products) planned[119](index=119&type=chunk)[121](index=121&type=chunk) - The Tonopah Flats Lithium Project (TFLP) consists of **517 unpatented lode claims** covering approximately **10,680 acres**, with an Amended Resource Estimate and Initial Assessment published in April 2024[129](index=129&type=chunk)[131](index=131&type=chunk)[134](index=134&type=chunk)[144](index=144&type=chunk) [Corporate Headquarters](index=24&type=section&id=Corporate%20Headquarters) This section covers corporate headquarters - The Company leases executive offices of approximately **5,831 square feet** at 100 Washington Street, Suite 100, Reno, Nevada, with the lease expiring November 30, 2027[118](index=118&type=chunk) [Recycling Operations](index=24&type=section&id=Recycling%20Operations) This section covers recycling operations - The McCarran, Nevada facility houses ABTC's integrated battery recycling system, utilizing strategic de-manufacturing and targeted chemical extraction for high yields and low environmental footprint[120](index=120&type=chunk) - Phase 1 of the McCarran facility, commissioned in Q4 FY2024, recycles battery materials into copper, aluminum, steel, lithium intermediate, and black mass. Phase 2 will refine these into battery-grade products[121](index=121&type=chunk) - The Fernley, Nevada facility (**12.44 acres**) and associated land (**11.55 acres**) were classified as held for sale in Q4 FY2024, though the 11.55 acres were reclassified back to property, plant, and equipment as of June 30, 2025[122](index=122&type=chunk)[123](index=123&type=chunk) - ABTC purchased **13.87 acres** in McCarran, Nevada, for a supplemental feedstock storage facility[124](index=124&type=chunk) - Water rights in Fernley, Nevada, valued at **$3.8 million**, were classified as held for sale in Q3 FY2025[125](index=125&type=chunk) [Laboratory Facilities](index=25&type=section&id=Laboratory%20Facilities) This section covers laboratory facilities - ABTC operates laboratory facilities at the University of Nevada, Reno (**4,893 sq ft**) and Greentown Labs in Somerville, Massachusetts, to support R&D for recycling and metal extraction technologies[126](index=126&type=chunk)[127](index=127&type=chunk)[128](index=128&type=chunk) [Tonopah Flats Lithium Project ("TFLP")](index=25&type=section&id=Tonopah%20Flats%20Lithium%20Project%20(%22TFLP%22)) This section covers tonopah flats lithium project ("tflp") - ABTC holds rights to **517 unpatented lode claims** (approx. **10,680 acres**) near Tonopah, Nevada, for lithium exploration[129](index=129&type=chunk)[131](index=131&type=chunk)[144](index=144&type=chunk) - An Amended Resource Estimate and Initial Assessment (IA) for TFLP was published in April 2024, disclosing Measured, Indicated, and Inferred mineral resources in compliance with SK-1300[134](index=134&type=chunk)[147](index=147&type=chunk) - The IA estimates a **$10.05 billion after-tax net present value (NPV)** at a **5% discount rate** for a **50-year mine life**, processing **597 million tons** with an average **4,111 ppm LHM grade** and **65.7% recovery**[157](index=157&type=chunk) [Exploration Programs](index=25&type=section&id=Exploration%20Programs) This section outlines exploration programs and activities - ABTC acquired rights to **305 unpatented lode claims** in the Tonopah Mining District in July 2022 after preliminary surface sampling and an exploration drilling program[130](index=130&type=chunk) - A third exploration program began in July 2023, including core infill and step-out drilling to upgrade resource classification to 'measured and indicated'[133](index=133&type=chunk) - The 2025 drill program (Jan-Feb 2025) involved **2,056.5 meters** in eight core holes and shallow sonic drilling at six sites for geotechnical data, with results to be incorporated into an upcoming Preliminary Feasibility Study (PFS)[135](index=135&type=chunk)[143](index=143&type=chunk) [Geology, Infrastructure, and Permitting](index=28&type=section&id=Geology,%20Infrastructure,%20and%20Permitting) This section describes the geology, infrastructure, and permitting of the project - The Tonopah Flats Lithium Project is located seven miles northwest of Tonopah, Nevada, with access to Highway 6, power, and a local workforce[145](index=145&type=chunk) - ABTC owns **100% of the 517 unpatented Federal lode mining claims**, which grant rights to explore, develop, and mine minerals without production royalties to the U.S. government[144](index=144&type=chunk)[158](index=158&type=chunk) - Key BLM permits and bonding for exploration activities are in place, with a current reclamation bond of **$59,646** for approximately **4.98 acres** of surface disturbance[159](index=159&type=chunk)[162](index=162&type=chunk) [Mineral Resource Estimate](index=28&type=section&id=Mineral%20Resource%20Estimate) This section presents the mineral resource estimate - Mineral resources for Tonopah Flats are classified as Measured, Indicated, and Inferred, estimated by RESPEC in compliance with SK-1300, with an effective date of April 5, 2024[134](index=134&type=chunk)[147](index=147&type=chunk)[149](index=149&type=chunk)[151](index=151&type=chunk) Tonopah Flats – Summary of Lithium Mineral Resources (June 30, 2025) | Classification | Total kTons | LI (kTons) | LHM (kTons) | Grades/qualities | Cut-off grades | Metallurgical recovery | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Measured mineral resources | 721,000 | 510 | 3,060 | 702 ppm Li | 300 ppm Li | 65.7% for Li | | Indicated mineral resources | 2,439,000 | 1,380 | 8,340 | 565 ppm Li | 300 ppm Li | 65.7% for Li | | Measured and Indicated mineral resources | 3,160,000 | 1,890 | 11,400 | 596 ppm Li | 300 ppm Li | 65.7% for Li | | Inferred mineral resources | 2,931,000 | 1,610 | 9,750 | 550 ppm Li | 300 ppm Li | 65.7% for Li | - The estimate assumes a lithium hydroxide monohydrate (LHM) price of **$40,000/ton**, metallurgical recoveries of **65.7% for Li**, and a minimum grade of **300 ppm lithium** within claystone[151](index=151&type=chunk) [Capital and Operating Costs](index=29&type=section&id=Capital%20and%20Operating%20Costs) This section details capital and operating costs and expenditures - Total project capital is estimated at **$1.04 billion** for a **50-year mine life**, including **$785.4 million in initial capital** and **$258.8 million in sustaining capital**[154](index=154&type=chunk) Life of Mine Operating Cost Summary | | K USD LOM Cost | $/ton Processed | $/ton LHM | | :--- | :--- | :--- | :--- | | Mining Cost | $1,996,257 | $3 | $1,238 | | Process Cost | $6,937,244 | $12 | $4,302 | | Site G&A Cost | $190,039 | $0 | $118 | | Reclamation | $100,000 | $0 | $62 | | **Net Operating Cost** | **$9,223,540** | **$15** | **$5,720** | [Initial Economic Assessment ("IA")](index=30&type=section&id=Initial%20Economic%20Assessment%20(%22IA%22)) This section provides an initial economic assessment ("ia") - The IA, based on Measured and Indicated mineral resources, estimates a **$10.05 billion after-tax net present value (NPV)** at a **5% discount rate** and **$4.67 billion** at a **10% discount rate**[157](index=157&type=chunk) - The project has an estimated **69.8% Internal Rate of Return (IRR)** and a **2.3-year payback** of initial capital, with an average annual production of **33,000 tons of LHM**[157](index=157&type=chunk) - The IA is preliminary, and there is no certainty that its conclusions will be realized, as mineral resources not categorized as reserves do not have demonstrated economic viability[157](index=157&type=chunk) [Mineral Rights and Annual Property Holding Costs](index=30&type=section&id=Mineral%20Rights%20and%20Annual%20Property%20Holding%20Costs) This section covers mineral rights and annual property holding costs - Ownership of unpatented mining lode claims grants the right to explore, develop, and mine minerals without production royalties to the U.S. government, subject to BLM surface management[158](index=158&type=chunk) - Annual property holding costs total **$109,604**, including **$103,400 for Federal Claim Fees** and **$6,204 for County Recording Fees**[158](index=158&type=chunk) [Significant Encumbrances and Permitting](index=30&type=section&id=Significant%20Encumbrances%20and%20Permitting) This section addresses significant encumbrances and permitting - The Tonopah Flats property is **100% owned by ABTC** with no significant encumbrances or royalties[159](index=159&type=chunk) - Key BLM permits and bonding are in place for exploration activities, with a current reclamation bond of **$59,646**[159](index=159&type=chunk)[162](index=162&type=chunk) [Internal Controls](index=30&type=section&id=Internal%20Controls) This section discusses internal controls - Internal controls for reviewing and documenting exploration information, methods, and results were not materially impacted by the adoption of S-K 1300[160](index=160&type=chunk) [Item 3. Legal Proceedings](index=30&type=section&id=Item%203.%20Legal%20Proceedings) ABTC may be involved in routine legal proceedings, but currently, no pending matters are expected to have a material adverse effect on its operations or financial statements - The Company may be involved in routine legal proceedings, but currently, no pending matters are expected to have a material effect on operations or consolidated financial statements[161](index=161&type=chunk) [Item 4. Mine Safety Disclosures](index=30&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) ABTC's current exploration activities do not require a Mine Safety and Health Administration ID, and the company employs Best Management Practices for employee and contractor safety - ABTC's exploration activities do not currently require a Mine Safety and Health Administration ID[162](index=162&type=chunk) - The company employs Best Management Practices for employee and contractor safety[162](index=162&type=chunk) PART II This section discusses market information, financial condition, results of operations, and critical accounting policies [Item 5. Market for Registrant's Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities](index=32&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%20and%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) ABTC's common stock is listed on The Nasdaq Capital Market under the symbol 'ABAT'. As of September 15, 2025, there were approximately 124 shareholders of record. The company has never declared or paid cash dividends and does not intend to in the foreseeable future, retaining earnings for operations and business development - ABTC's common stock is listed on The Nasdaq Capital Market under the trading symbol 'ABAT'[165](index=165&type=chunk) - As of September 15, 2025, the company had approximately **124 shareholders of record**[166](index=166&type=chunk) - The company has never declared or paid cash dividends and does not intend to in the foreseeable future, prioritizing retention of earnings for operations and business development[167](index=167&type=chunk) [Item 6. [Reserved.]](index=32&type=section&id=Item%206.%20%5BReserved.%5D) This item is reserved and contains no information [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) ABTC is a growth-stage company focused on increasing domestic U.S. battery material production through recycling and primary resource development. The company saw significant revenue growth in fiscal year 2025, driven by its recycling facility operations, but continues to incur substantial losses and negative cash flows, raising going concern doubts. It relies heavily on grants and external financing for its capital-intensive projects - ABTC is a growth-stage company aiming to increase domestic U.S. production of battery materials through primary resource exploration, new extraction technologies, and lithium-ion battery recycling[169](index=169&type=chunk) - The company's revenue increased significantly from **$0.3 million in fiscal 2024 to $4.3 million in fiscal 2025**, reflecting the ramp-up of battery recycling facility operations[170](index=170&type=chunk)[178](index=178&type=chunk) - ABTC has been awarded multiple grants from the U.S. DOE and USABC, totaling over **$170 million**, to support the development of its recycling facilities and lithium hydroxide refinery[170](index=170&type=chunk)[171](index=171&type=chunk)[179](index=179&type=chunk) - The company incurred a **net loss of $46.8 million in FY2025** and used **$28.9 million in cash for operating activities**, leading to substantial doubt about its ability to continue as a going concern[181](index=181&type=chunk)[194](index=194&type=chunk)[246](index=246&type=chunk)[247](index=247&type=chunk) [Forward-Looking Statements](index=32&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements and associated risks - This section contains forward-looking statements regarding future operations, financial position, revenues, costs, and plans, which involve known and unknown risks and uncertainties[168](index=168&type=chunk) [Overview](index=33&type=section&id=Overview) This section provides an overview of overview - ABTC is a growth-stage company focused on increasing domestic U.S. production of critical battery materials (lithium, nickel, cobalt, manganese) through primary resource exploration, new extraction technologies, and lithium-ion battery recycling[169](index=169&type=chunk) - The company's first integrated lithium-ion battery recycling facility generated its first revenue in Q4 FY2024 and saw continued growth in FY2025, supported by USABC and DOE grants[170](index=170&type=chunk) - ABTC is commercializing its low-cost lithium hydroxide manufacturing process from Nevada claystone, supported by DOE grants, and has completed a pilot plant for demonstration[171](index=171&type=chunk)[172](index=172&type=chunk) - The company was selected for **$19.5 million** and an additional **$40.5 million in 48C tax credits** for its battery recycling facilities[174](index=174&type=chunk)[175](index=175&type=chunk) [Fiscal Fourth Quarter 2025 Financial Highlights](index=34&type=section&id=Fiscal%20Fourth%20Quarter%202025%20Financial%20Highlights) This section summarizes key fiscal fourth quarter 2025 financial highlights Fiscal Fourth Quarter 2025 Financial Highlights | Description | Amount ($M) | | :--- | :--- | | Revenue | 2.8 | | GAAP Cost of Goods Sold | 5.1 | | Less: Depreciation Expense | (1.0) | | Less: Stock-Based Compensation | (0.2) | | Non-GAAP Cash Cost of Goods Sold | 3.9 | | Government grant reimbursement | 1.4 | - Revenue nearly tripled QoQ, reflecting significant ramp-up of battery recycling facility operations[177](index=177&type=chunk) - ABTC conducted additional drill programs at Tonopah Flats Lithium Project and continued scaling its multi-tonne per day integrated pilot facility[178](index=178&type=chunk) - Received a Letter of Interest from the US Export-Import Bank for up to **$900 million** in low-interest debt financing for the Tonopah Flats Lithium Project[178](index=178&type=chunk) [Fiscal Year 2025 Financial Highlights](index=34&type=section&id=Fiscal%20Year%202025%20Financial%20Highlights) This section summarizes key fiscal year 2025 financial highlights Fiscal Year 2025 Financial Highlights | Description | Amount ($M) | | :--- | :--- | | Revenue | 4.3 | | GAAP Cost of Goods Sold | 14.9 | | Less: Depreciation Expense | (3.6) | | Less: Stock-Based Compensation | (0.8) | | Non-GAAP Cash Cost of Goods Sold | 10.5 | | Government grant reimbursement | 5.7 | | Cash on hand (June 30, 2025) | 12.5 (7.5 available, 5.0 restricted) | | Net cash position (Sept 15, 2025) | 25.4 | - Revenue increased from **$0.3 million in FY2024 to $4.3 million in FY2025**, reflecting ramp-up of facility operations[178](index=178&type=chunk) - Awarded a **$150 million grant** from the US DOE for an additional battery recycling facility[179](index=179&type=chunk) - Completed contractual requirements for a **$2.3 million DOE grant** for its lithium pilot facility and a **$0.5 million USABC grant** for battery recycling and cell manufacturing[179](index=179&type=chunk)[180](index=180&type=chunk) [Components of Statements of Operations](index=35&type=section&id=Components%20of%20Statements%20of%20Operations) This section details the components of statements of operations Consolidated Statements of Operations Highlights (Fiscal Years Ended June 30) | Metric | FY2025 ($) | FY2024 ($) | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenue | 4,290,224 | 343,500 | 3,946,724 | 1,149% | | Cost of goods sold | 14,864,633 | 3,304,707 | 11,559,926 | 350% | | Gross loss | (10,574,409) | (2,961,207) | (7,613,202) | 257% | | Total operating expenses | 31,448,920 | 44,808,466 | (13,359,546) | (30%) | | Net loss | (46,762,625) | (52,501,824) | 5,739,199 | (11%) | [Revenue](index=35&type=section&id=Revenue) This section analyzes the company's revenue - Net sales increased from **$0.3 million in FY2024 to $4.3 million in FY2025**, primarily from black mass and metal byproducts from recycling operations[182](index=182&type=chunk) [Cost of Goods Sold](index=35&type=section&id=Cost%20of%20Goods%20Sold) This section examines the cost of goods sold - Cost of goods sold increased from **$3.3 million in FY2024 to $14.9 million in FY2205**, driven by higher headcount, depreciation from the recycling facility, and production process finalization[183](index=183&type=chunk) - Management expects these costs to decrease as a percentage of revenue with scaling production and efficiency gains[183](index=183&type=chunk) - Non-GAAP cost of goods sold excludes depreciation and stock-based compensation for management's analytical purposes[184](index=184&type=chunk) [Operating Expenses](index=36&type=section&id=Operating%20Expenses) This section reviews the company's operating expenses - Total operating expenses decreased by **30% from $44.8 million in FY2024 to $31.4 million in FY2025**[186](index=186&type=chunk) - General and administrative expenses increased by **$5.0 million to $21.2 million in FY2025**, due to higher payroll, stock-based compensation, and property tax[186](index=186&type=chunk) - Research and development expenses decreased by **$5.8 million to $8.5 million in FY2025**, due to cost allocation to inventory/COGS as recycling operations scaled and higher grant reimbursements[187](index=187&type=chunk) - Exploration costs decreased by **$2.3 million to $1.8 million in FY2025**, due to lower payroll and a shift in focus from drilling to producing the Preliminary Feasibility Study (PFS)[188](index=188&type=chunk) - An impairment loss of **$10.2 million** on held-for-sale assets was recorded in FY2024, related to Fernley properties. As of June 30, 2025, certain water rights (**$3.8 million**) were also reclassified as held for sale[189](index=189&type=chunk) [Other (Expense) Income](index=36&type=section&id=Other%20(Expense)%20Income) This section covers other (expense) income items - Total other expense remained consistent at **$4.7 million** in both FY2025 and FY2024[190](index=190&type=chunk) - Key changes in FY2025 included a **$1.0 million change in fair value of derivative liability (gain)**, a **$1.4 million credit loss expense** on a subscription receivable, and a **$0.4 million decrease** in amortization of financing costs[190](index=190&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's liquidity and capital resources Liquidity Overview (June 30) | Metric | 2025 ($M) | 2024 ($M) | | :--- | :--- | :--- | | Cash | 12.5 | 7.0 | | Total Assets | 84.5 | 77.7 | | Total Current Liabilities | 13.7 | 15.8 | | Working Capital | 10.9 | 2.6 | | Working Capital (excl. held-for-sale assets) | 1.1 | (5.8) | [Going Concern](index=37&type=section&id=Going%20Concern) This section addresses the company's going concern status - The company's ability to continue as a going concern is dependent on generating profit and obtaining debt or equity financing, which is uncertain[194](index=194&type=chunk) - Substantial doubt about going concern exists for 12 months from the financial statements' issuance date[194](index=194&type=chunk) - The company sold **14,097,636 common shares for $18.6 million** through an ATM program in FY2025, which could provide liquidity[195](index=195&type=chunk)[196](index=196&type=chunk) [Cash Flows](index=37&type=section&id=Cash%20Flows) This section analyzes the company's cash flows Consolidated Statements of Cash Flows (Fiscal Years Ended June 30) | Cash Flow Activity | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Operating Activities | (28,921,158) | (16,736,231) | | Investing Activities | (2,548,476) | (12,969,219) | | Financing Activities | 36,942,152 | 34,387,087 | | Net Increase in Cash | 5,472,518 | 4,681,637 | - Cash used in operating activities increased to **$28.9 million in FY2025** (from **$16.7 million in FY2024**) due to increased scale of operations, headcount, and administrative costs[199](index=199&type=chunk) - Cash used in investing activities decreased to **$2.5 million in FY2025** (from **$13.0 million in FY2024**) as equipment purchases for the recycling plant build-out were higher in the prior year[200](index=200&type=chunk) - Cash provided by financing activities increased to **$36.9 million in FY2025** (from **$34.4 million in FY2024**), primarily from equity and debt financings[201](index=201&type=chunk)[202](index=202&type=chunk) [Off-Balance Sheet Arrangements](index=38&type=section&id=Off-Balance%20Sheet%20Arrangements) This section details off-balance sheet arrangements - As of June 30, 2025 and 2024, ABTC had no off-balance sheet arrangements[203](index=203&type=chunk) [Working Capital](index=38&type=section&id=Working%20Capital) This section reviews the company's working capital Working Capital (June 30) | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Current Assets | 29,532,110 | 18,406,048 | | Restricted Cash | (5,000,000) | - | | Current Liabilities | (13,668,605) | (15,798,298) | | **Working Capital** | **10,863,505** | **2,607,750** | - Positive working capital of **$10.9 million** at June 30, 2025, largely due to the current classification of held-for-sale assets[193](index=193&type=chunk) [Future Financings](index=38&type=section&id=Future%20Financings) This section discusses future financings plans - The Company will continue to rely on sales of common shares, debt, or other financing to fund operations beyond internal revenue and government awards[205](index=205&type=chunk) - Issuances of additional shares will result in dilution to existing stockholders[205](index=205&type=chunk) [Critical Accounting Estimates and Judgments](index=38&type=section&id=Critical%20Accounting%20Estimates%20and%20Judgments) This section outlines critical accounting estimates and judgments - Preparation of financial statements requires management to make estimates and assumptions, which are evaluated ongoingly and can materially differ from actual results[206](index=206&type=chunk)[254](index=254&type=chunk) - Critical accounting estimates include revenue recognition, share-based compensation, impairments of long-lived assets, and assets held-for-sale[207](index=207&type=chunk) [Fair Value Measurements](index=38&type=section&id=Fair%20Value%20Measurements) This section explains fair value measurements - Fair value measurements for derivative liabilities (Level 3) involved assumptions like volatility, risk-free rates, and duration[208](index=208&type=chunk) - Derivative liabilities and liability-classified equity-linked contracts were reclassified from long-term liabilities to equity as of December 31, 2024[208](index=208&type=chunk) [Revenue Recognition](index=39&type=section&id=Revenue%20Recognition) This section details the company's revenue recognition policies - Revenue is recognized when control of physical goods (recycled metals, black mass) transfers to the customer, typically upon release to the shipper[209](index=209&type=chunk)[271](index=271&type=chunk) - Revenue is based on contractually stated selling prices, net of sales tax, and adjusted for estimated claims and discounts[210](index=210&type=chunk)[272](index=272&type=chunk) [Long-Lived Assets](index=39&type=section&id=Long-Lived%20Assets) This section covers long-lived assets accounting - Long-lived assets are evaluated for impairment when events or changes indicate that the carrying value may not be recoverable, using projections of future cash flows[211](index=211&type=chunk) - No impairment loss was recognized on long-lived assets during FY2025 and FY2024[211](index=211&type=chunk) [Assets Held-for-Sale](index=39&type=section&id=Assets%20Held-for-Sale) This section describes assets held-for-sale classification - Assets are classified as held for sale when management commits to a plan to sell, the asset is available for immediate sale, and the sale is probable within one year[212](index=212&type=chunk) - Held-for-sale assets are reported at the lower of carrying value or fair value less cost to sell, with fair values estimated using market data and estimates[213](index=213&type=chunk) [Stock-Based Compensation](index=39&type=section&id=Stock-Based%20Compensation) This section discusses stock-based compensation accounting - Fair value of share-based payments is estimated using the Black-Scholes option pricing model, which involves subjective assumptions like volatility, risk-free rates, and expected term[214](index=214&type=chunk)[279](index=279&type=chunk) [New Accounting Pronouncements](index=39&type=section&id=New%20Accounting%20Pronouncements) This section outlines new accounting pronouncements and their impact - Adopted ASU 2023-07 (Improvements to Reportable Segment Disclosures) in FY2025[294](index=294&type=chunk) - Evaluating the effect of ASU 2023-09 (Improvements to Income Tax Disclosures), effective after December 15, 2024[295](index=295&type=chunk) - Evaluating the effect of ASU 2024-03 (Expense Disaggregation Disclosures), effective after December 15, 2026[296](index=296&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures about Market Risk](index=39&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This item is not applicable to the company - Not Applicable[216](index=216&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=40&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents ABTC's audited consolidated financial statements for the fiscal years ended June 30, 2025, and 2024, including balance sheets, statements of operations, stockholders' equity, and cash flows, along with comprehensive notes detailing accounting policies, liquidity, grants, assets, liabilities, and equity. The independent auditor's report highlights substantial doubt about the company's ability to continue as a going concern - The consolidated financial statements for FY2025 and FY2024 are presented in accordance with U.S. GAAP[220](index=220&type=chunk) - The independent auditor (KPMG LLP) expressed an opinion that the financial statements present fairly, but also noted substantial doubt about the company's ability to continue as a going concern due to recurring losses and negative operating cash flows[220](index=220&type=chunk)[221](index=221&type=chunk) - A critical audit matter identified was the valuation of held-for-sale assets, requiring subjective judgment and specialized knowledge[225](index=225&type=chunk)[227](index=227&type=chunk) [Report of Independent Registered Public Accounting Firm](index=41&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) This section presents the report of independent registered public accounting firm - KPMG LLP audited the consolidated financial statements for FY2025 and FY2024, expressing a fair presentation opinion[220](index=220&type=chunk) - The auditors noted substantial doubt about ABTC's ability to continue as a going concern due to recurring losses and negative operating cash flows[221](index=221&type=chunk) - The valuation of held-for-sale assets was identified as a critical audit matter due to subjective judgment and key assumptions[225](index=225&type=chunk)[227](index=227&type=chunk) [Consolidated Balance Sheets](index=43&type=section&id=Consolidated%20Balance%20Sheets) This section provides the company's consolidated balance sheets Consolidated Balance Sheets (June 30) | ASSETS | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Cash | 7,474,304 | 7,001,786 | | Restricted cash | 5,000,000 | – | | Total current assets | 29,532,110 | 18,406,048 | | Property and equipment, net | 45,469,853 | 46,314,966 | | Total assets | 84,457,791 | 77,675,132 | | LIABILITIES & STOCKHOLDERS' EQUITY | | | | Total current liabilities | 13,668,605 | 15,798,298 | | Total liabilities | 13,858,768 | 16,207,492 | | Total stockholders' equity | 70,599,023 | 61,467,640 | | Total liabilities and stockholders' equity | 84,457,791 | 77,675,132 | [Consolidated Statements of Operations](index=45&type=section&id=Consolidated%20Statements%20of%20Operations) This section presents the company's consolidated statements of operations Consolidated Statements of Operations (Fiscal Year Ended June 30) | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Revenue | 4,290,224 | 343,500 | | Cost of goods sold | 14,864,633 | 3,304,707 | | Gross loss | (10,574,409) | (2,961,207) | | Total operating expenses | 31,448,920 | 44,808,466 | | Net loss attributable to common stockholders | (46,762,625) | (52,501,824) | | Net loss per share, basic and diluted | (0.58) | (1.02) | | Weighted average shares outstanding, basic and diluted | 80,316,363 | 51,243,106 | [Consolidated Statement of Stockholders' Equity](index=46&type=section&id=Consolidated%20Statement%20of%20Stockholders'%20Equity) This section details changes in consolidated statement of stockholders' equity - Stockholders' equity increased from **$61.5 million in FY2024 to $70.6 million in FY2025**, despite a net loss, primarily due to additional paid-in capital from equity issuances[237](index=237&type=chunk)[240](index=240&type=chunk) - Key activities in FY2025 included issuance of common shares from vesting awards, employee stock purchase plan, At-The-Market Offering, and registered direct offerings[239](index=239&type=chunk)[240](index=240&type=chunk) - The number of common shares outstanding increased from **64,061,763 in FY2024 to 97,398,519 in FY2025**[232](index=232&type=chunk) [Consolidated Statements of Cash Flows](index=49&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This section outlines the company's consolidated statements of cash flows Consolidated Statements of Cash Flows (Fiscal Year Ended June 30) | Cash Flow Activity | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Net loss | (46,762,625) | (52,501,824) | | Net Cash Used in Operating Activities | (28,921,158) | (16,736,231) | | Net Cash Used in Investing Activities | (2,548,476) | (12,969,219) | | Net Cash Provided by Financing Activities | 36,942,152 | 34,387,087 | | Increase in Cash and Restricted Cash | 5,472,518 | 4,681,637 | | Cash and Restricted Cash – End of Period | 12,474,304 | 7,001,786 | [Notes to the Consolidated Financial Statements](index=51&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) This section provides notes to the consolidated financial statements [1. Organization and Nature of Operations](index=51&type=section&id=1.%20Organization%20and%20Nature%20of%20Operations) This section describes the company's organization and nature of operations - ABTC is an integrated critical battery materials company focused on increasing domestic U.S. production of lithium, nickel, cobalt, and manganese through primary resource exploration, new extraction technologies, and lithium-ion battery recycling[244](index=244&type=chunk) - The company was incorporated in Nevada in 2011 and generated its initial revenue in Q4 FY2024[245](index=245&type=chunk) [2. Liquidity and Going Concern](index=51&type=section&id=2.%20Liquidity%20and%20Going%20Concern) This section addresses liquidity and going concern issues - ABTC incurred a **net loss of $46.8 million** and used **$28.9 million cash in operations in FY2025**, resulting in an accumulated deficit of **$260.1 million**[246](index=246&type=chunk) - These uncertainties raise substantial doubt about the company's ability to continue as a going concern for the next 12 months[247](index=247&type=chunk) - Continuation is dependent on generating profit and obtaining additional debt or equity financing, which may dilute existing stockholders[247](index=247&type=chunk)[249](index=249&type=chunk) [3. Basis of Presentation, Summary of Significant Accounting Policies and Recent Accounting Pronouncements](index=52&type=section&id=3.%20Basis%20of%20Presentation,%20Summary%20of%20Significant%20Accounting%20Policies%20and%20Recent%20Accounting%20Pronouncements) This section covers basis of presentation, summary of significant accounting policies and recent accounting pronouncements - Consolidated financial statements are prepared in accordance with U.S. GAAP and include ABTC and its wholly-owned subsidiaries[251](index=251&type=chunk)[252](index=252&type=chunk) - Key accounting estimates include revenue recognition, stock-based compensation, valuation of long-lived assets, and assets held-for-sale[253](index=253&type=chunk) - The company adopted ASU 2023-07 in FY2025 and is evaluating the impact of ASU 2023-09 and ASU 2024-03[294](index=294&type=chunk)[295](index=295&type=chunk)[296](index=296&type=chunk) [4. Government Grant and Tax Credit Awards](index=59&type=section&id=4.%20Government%20Grant%20and%20Tax%20Credit%20Awards) This section details government grant and tax credit awards - Grants receivable represent qualifying costs incurred where conditions are met but funds are not yet received[297](index=297&type=chunk) - DOE grant for claystone lithium technology: **$4.5 million total budget**, **$2.3 million eligible reimbursement**, **100% invoiced** by June 30, 2025[298](index=298&type=chunk) - USABC grant for battery recycling: **$2.0 million total budget**, **$0.5 million eligible reimbursement**, **100% invoiced** by June 30, 2025[299](index=299&type=chunk) - DOE grant for lithium hydroxide refinery: **$115.5 million total budget**, **$57.7 million eligible reimbursement**, **$4.7 million invoiced** by June 30, 2025 (**8%**)[300](index=300&type=chunk) - DOE grant for next-gen battery recycling: **$20.0 million total budget**, **$10.0 million eligible reimbursement**, **$2.2 million invoiced** by June 30, 2025 (**22%**)[301](index=301&type=chunk) - 48C tax credits: **$19.5 million** for existing recycling facility (qualifying expenditures incurred) and **$40.5 million** for a new commercial recycling facility (no qualifying expenditures yet)[302](index=302&type=chunk)[303](index=303&type=chunk) - DOE grant for new lithium-ion battery recycling facility: **$150 million awarded**, **$0.6 million invoiced** by June 30, 2025 (**0.4%**)[304](index=304&type=chunk) Effects of Government Grants on Financial Statements (Fiscal Years Ended June 30) | Description | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Reduction to research and development expenses | (5,087,266) | (2,317,987) | | Reduction to property and equipment | (591,368) | (1,025,347) | | **Total reductions due to grant reimbursements received** | **(5,678,634)** | **(3,343,334)** | [5. Inventories](index=60&type=section&id=5.%20Inventories) This section describes the company's inventories - Inventory consists of raw materials (battery feedstock) and finished goods (black mass, other metals), valued at the lower of cost or net realizable value on a first-in, first-out basis[306](index=306&type=chunk) Inventory Components (June 30) | Component | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Raw materials | 216,052 | 66,088 | | Finished goods | 192,095 | 88,232 | | **Total inventories** | **408,147** | **154,320** | - Inventory was written down by **$2.9 million in FY2025** and **$0.6 million in FY2024** to its net realizable value[307](index=307&type=chunk) [6. Property and Equipment](index=61&type=section&id=6.%20Property%20and%20Equipment) This section outlines property and equipment details Property and Equipment, Net (June 30) | Component | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Land | 11,225,956 | 8,860,916 | | Building | 16,653,019 | 24,867,784 | | Equipment and vehicles | 24,363,000 | 14,313,970 | | Total | 52,241,975 | 48,042,670 | | Less: accumulated depreciation | (6,772,122) | (1,727,704) | | **Property and equipment, net** | **45,469,853** | **46,314,966** | - Depreciation expense was **$5.0 million in FY2025** and **$1.7 million in FY2024**[308](index=308&type=chunk) [7. Assets Held for Sale](index=61&type=section&id=7.%20Assets%20Held%20for%20Sale) This section discusses assets held for sale - An impairment loss of **$10.2 million** was recorded in FY2024 for two parcels of land and a building in Fernley, Nevada, classified as held-for-sale[309](index=309&type=chunk) - As of June 30, 2025, **11.55 acres of land (valued at $2.4 million)** were reclassified back to property, plant, and equipment, while the remaining **12.44 acres and building ($6.0 million)** remain held-for-sale[309](index=309&type=chunk) - Certain water rights with a carrying value of **$3.8 million** were reclassified to assets held for sale as of March 31, 2025[310](index=310&type=chunk) [8. Mining Properties](index=62&type=section&id=8.%20Mining%20Properties) This section details the company's mining properties - ABTC exercised its option to purchase unpatented lode claims in Tonopah, Nevada, in July 2022[312](index=312&type=chunk) - The company is still in the exploration stage, expensing all mineral exploration costs, and has not yet established proven and probable reserves[312](index=312&type=chunk) - A third exploration program began in July 2023 to upgrade resource classification, and an Amended Resource Estimate and Initial Assessment for TFLP was completed in April 2024[313](index=313&type=chunk)[315](index=315&type=chunk) [9. Intangible Assets](index=62&type=section&id=9.%20Intangible%20Assets) This section covers intangible assets - Intangible assets consist of water rights valued at **$0.7 million**, acquired with the McCarran recycling facility, which have an indefinite useful life[316](index=316&type=chunk) Intangible Assets (June 30) | Asset | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Water rights | 766,694 | 4,519,038 | [10. Leases](index=62&type=section&id=10.%20Leases) This section describes the company's leases - ABTC recognizes operating lease right-of-use (RoU) assets and lease liabilities based on the present value of lease payments over the lease term[318](index=318&type=chunk) - The company leases its principal office in Reno (expiring Nov 2027) and lab space, using an estimated incremental borrowing rate of **8.0%** for discount rate[319](index=319&type=chunk)[320](index=320&type=chunk) Operating Lease Information (June 30) | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Operating lease cost | 361,169 | 436,476 | | Operating lease right-of-use asset | 296,157 | 42,103 | | Operating lease liabilities | 306,026 | 54,303 | | Weighted average lease term (years) | 2.42 | N/A | | Weighted average discount rate | 8.00% | N/A | [11. Accounts Payable and Accrued Liabilities](index=63&type=section&id=11.%20Accounts%20Payable%20and%20Accrued%20Liabilities) This section details accounts payable and accrued liabilities Accounts Payable and Accrued Liabilities (June 30) | Component | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Trade payables | 417,195 | 4,255,398 | | Fixed assets in trade payables | 283,278 | 996,970 | | Accrued expenses | 5,122,514 | 2,244,266 | | Marketing agreement settlement | - | 1,800,000 | | **Total accounts payable and accrued liabilities** | **5,822,987** | **9,296,634** | - Total accounts payable and accrued liabilities decreased from **$9.3 million in FY2024 to $5.8 million in FY2025**[324](index=324&type=chunk) - A **$1.8 million marketing agreement settlement** with Mercuria Energy America, LLC was accrued in FY2024 and fully paid by June 30, 2025[325](index=325&type=chunk) [12. Notes Payable](index=64&type=section&id=12.%20Notes%20Payable) This section covers notes payable - In August 2023, ABTC entered a Securities Purchase Agreement for up to **$51.0 million** in senior secured convertible notes, with **$25.0 million** initially received[326](index=326&type=chunk) - The notes were amended in September 2024 to allow principal payment in common shares and defer remaining principal, resulting in a **$0.7 million loss on extinguishment**[328](index=328&type=chunk) - A new series of **$12.0 million senior secured convertible notes (2024 Notes)** was issued in November 2024, maturing September 1, 2025, requiring **$5.0 million in restricted cash**[329](index=329&type=chunk) - The amendment to the Purchase Agreement was accounted for as a troubled debt restructuring, with a revised effective interest rate of **50.73%**[330](index=330&type=chunk) Net Carrying Amounts of Notes (June 30, 2025) | Component | Amount ($) | | :--- | :--- | | Principal outstanding | 8,000,000 | | Debt discount | (2,551,043) | | Amortization of debt discount | 2,280,798 | | **Net carrying value** | **7,729,755** | [13. Derivative Liabilities](index=65&type=section&id=13.%20Derivative%20Liabilities) This section discusses derivative liabilities - Embedded conversion features on convertible notes and outstanding warrants were treated as derivative liabilities due to insufficient authorized shares to settle equity-linked contracts[334](index=334&type=chunk) - In November 2024, shareholders approved an increase in authorized common stock to **250,000,000 shares**, allowing reclassification of derivative liabilities to equity[339](index=339&type=chunk) - The company recognized an **$0.8 million gain** on change in fair value of derivative liabilities prior to reclassification to equity, with **$2.1 million reclassed**[339](index=339&type=chunk) Derivative Liabilities Activity (Fiscal Year Ended June 30, 2025) | Activity | Warrant Derivative Liabilities ($) | Conversion Option Derivative Liability ($) | Total Derivative Liabilities ($) | | :--- | :--- | :--- | :--- | | Balance, June 30, 2024 | - | - | - | | Change in fair value | (657,174) | (138,061) | (795,235) | | Fair value of issuances | 2,632,467 | - | 2,632,467 | | Fair value of extinguishments | (87,421) | - | (87,421) | | Fair value of reclassifications | (1,887,872) | 138,061 | (1,749,811) | | **Balance, June 30, 2025** | **-** | **-** | **-** | [14. Stockholders' Equity](index=67&type=section&id=14.%20Stockholders'%20Equity) This section details stockholders' equity - The Board of Directors is authorized to issue preferred stock in various series (A, B, C, D), none of which were outstanding as of June 30, 2025 and 2024[341](index=341&type=chunk)[342](index=342&type=chunk)[343](index=343&type=chunk)[344](index=344&type=chunk)[345](index=345&type=chunk)[346](index=346&type=chunk) - Shareholders approved an increase in authorized common stock from **80,000,000 to 250,000,000 shares** in November 2024[347](index=347&type=chunk) - FY2025 activities included issuing **3,407,702 common shares** from vesting awards, **389,349 shares** under the 2024 ESPP, and **14,097,636 shares** through an At-The-Market Offering[239](index=239&type=chunk)[348](index=348&type=chunk)[355](index=355&type=chunk) - The company issued **8,773,586 common shares** and warrants in December 2024 through registered direct offerings, raising **$15.0 million net of offering costs**[357](index=357&type=chunk) Potentially Dilutive Shares Outstanding (June 30) | Type | 2025 | 2024 | | :--- | :--- | :--- | | Convertible notes | 9,501,948 | 769,342 | | Warrants | 17,380,150 | 6,928,758 | | Share awards outstanding | 8,583,466 | 3,428,604 | | **Total potentially dilutive** | **35,465,564** | **11,126,704** | [15. Share Purchase Warrants](index=70&type=section&id=15.%20Share%20Purchase%20Warrants) This section covers share purchase warrants - In FY2025, **14,360,308 total warrants** were issued, including those from private placements and registered direct offerings[367](index=367&type=chunk) Share Purchase Warrants Activity (June 30) | Activity | Number of Warrants | Weighted Average Exercise Price ($) | | :--- | :--- | :--- | | Balance, June 30, 2023 | 5,729,360 | 14.53 | | Granted | 1,407,135 | 4.96 | | Exercised | (100,002) | 1.13 | | Expired | (107,735) | 3.75 | | Balance, June 30, 2024 | 6,928,758 | 12.95 | | Granted | 14,360,308 | 1.56 | | Rescinded | (1,750,000) | 1.00 | | Exercised | (416,670) | 1.13 | | Expired | (1,742,246) | 10.46 | | **Balance, June 30, 2025** | **17,380,150** | **5.28** | | Exercisable, June 30, 2025 | 16,810,482 | 5.26 | [16. Equity Compensation Awards](index=70&type=section&id=16.%20Equity%20Compensation%20Awards) This section discusses equity compensation awards - The 2021 Retention Plan authorizes issuing shares to employees and non-employees, generally vesting over four years[369](index=369&type=chunk)[370](index=370&type=chunk) - In FY2025, **9.5 million share awards** were granted, compared to **3.3 million in FY2024**[370](index=370&type=chunk) Share Award Activity (June 30) | Activity | Units | Weighted Average Grant Date Fair Value per Unit ($) | | :--- | :--- | :--- | | Unvested share awards at June 30, 2023 | 1,736,376 | 8.25 | | Granted | 3,290,268 | 3.51 | | Vested | (1,306,480) | 5.29 | | Forfeitures | (291,560) | 5.94 | | Unvested share awards at June 30, 2024 | 3,428,604 | 5.02 | | Granted | 9,454,729 | 1.03 | | Vested | (3,135,227) | 2.59 | | Forfeitures | (1,164,640) | 1.94 | | **Unvested awards at June 30, 2025** | **8,583,466** | **1.93** | - Total stock-based compensation expense was **$14.7 million in FY2025** and **$14.6 million in FY2024**[372](index=372&type=chunk) - As of June 30, 2025, **$14.3 million of unamortized expenses** remain, to be recognized over a weighted-average period of **2.99 years**[373](index=373&type=chunk) [17. Income Taxes](index=72&type=section&id=17.%20Income%20Taxes) This section details the company's income taxes - No income tax provisions were recognized in FY2025 and FY2024 due to the company's net loss position[374](index=374&type=chunk) - A valuation allowance of **$41.7 million (FY2025)** and **$32.2 million (FY2024)** has been recorded against deferred tax assets, as realization is not considered more likely than not[374](index=374&type=chunk) - As of June 30, 2025, the company has accumulated federal and state net operating loss carryforwards of approximately **$141.8 million** and **$15.6 million**, respectively[375](index=375&type=chunk) - Utilization of NOLs and credits may be subject to annual limitations due to ownership changes[376](index=376&type=chunk) [18. Segment and Other Information](index=74&type=section&id=18.%20Segment%20and%20Other%20Information) This section provides segment and other information - The Chief Executive Officer is the chief operating decision maker (CODM), and the company operates as a single business operating segment[379](index=379&type=chunk) - Revenue from three major customers accounted for **74% of total revenue in FY2025**[380](index=380&type=chunk) - Substantially all long-lived assets and operating lease right-of-use assets were located in the United States[380](index=380&type=chunk) [19. Supplemental Statement of Cash Flow Disclosures](index=74&type=section&id=19.%20Supplemental%20Statement%20of%20Cash%20Flow%20Disclosures) This section includes supplemental statement of cash flow disclosures Supplemental Cash Flow Disclosures (Fiscal Years Ended June 30) | Item | 2025 ($) | 2024

[Form 8-K General Information](index=1&type=section&id=Form%208-K%20General%20Information) This section details the registrant, filing date, trading symbol, market listing, and operational status of Research Solutions, Inc - The registrant is **Research Solutions, Inc.**, incorporated in Nevada, with Commission File Number **1-39256** and IRS Employer Identification No. **11-3797644**[1](index=1&type=chunk) - The report date is **August 19, 2025**[1](index=1&type=chunk) Trading Information | Title of each Class | Trading Symbol(s) | Name of each Exchange on which registered | | :------------------ | :---------------- | :---------------------------------------- | | Common stock, $0.001 par value | RSSS | The Nasdaq Capital Market | - The company became **fully remote** in November 2019 and does not currently have principal executive offices; its mailing address is **10624 E. Eastern Ave., Ste. A-614, Henderson, NV 89052**[3](index=3&type=chunk) [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) This section announces Research Solutions, Inc.'s financial results for Q4 and FY2025, furnished as Exhibit 99.1, and clarifies its legal status - On **August 19, 2025**, the Registrant announced its financial results for the fourth quarter and fiscal year ended **June 30, 2025**[4](index=4&type=chunk) - A copy of the press release is being furnished as **Exhibit 99.1** to this Current Report on Form 8-K[4](index=4&type=chunk) - The information in this Item 2.02 and Exhibit 99.1 is intended to be furnished and shall **not be deemed 'filed'** for purposes of Section 18 of the Securities Exchange Act of 1934[5](index=5&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section lists the exhibits accompanying the Form 8-K filing, including the press release and interactive data file Exhibits | Exhibit Number | Description | | :------------- | :--------------------------------------------------------------------------------------------------- | | 99.1 | Press Release issued August 19, 2025 entitled "Research Solutions Reports Preliminary Fourth Quarter and Fiscal Year 2025 Results" | | 104 | Cover Page Interactive Data File (embedded as Inline XBRL document) | [Signature](index=3&type=section&id=SIGNATURE) This section formally concludes the Form 8-K filing, confirming its authorization and signature by the Chief Financial Officer - The report was signed on behalf of **Research Solutions, Inc.** by **William Nurthen, Chief Financial Officer**[10](index=10&type=chunk)[11](index=11&type=chunk) - The signing date is **August 19, 2025**[11](index=11&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year 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 _______________ Commission File Number: 001-41220 CFSB Bancorp, Inc. (Exact Name of Registrant as Specified in its Charter) United States of America 8 ...

FORM 10-Q Cover Page [Registrant Information](index=1&type=section&id=Registrant%20Information) This section provides FedEx Corporation's identification details, registered securities, filing status, and common shares outstanding - FedEx Corporation is incorporated in Delaware with its principal executive offices in Memphis, Tennessee[3](index=3&type=chunk) Securities Registered on New York Stock Exchange | Title of each class | Trading Symbol | Name of each exchange on which registered | | :------------------ | :------------- | :-------------------------------------- | | Common Stock, par value $0.10 per share | FDX | New York Stock Exchange | | 1.625% Notes due 2027 | FDX 27 | New York Stock Exchange | | 0.450% Notes due 2029 | FDX 29A | New York Stock Exchange | | 1.300% Notes due 2031 | FDX 31 | New York Stock Exchange | | 3.500% Notes due 2032 | FDX 32 | New York Stock Exchange | | 0.950% Notes due 2033 | FDX 33 | New York Stock Exchange | | 4.125% Notes due 2037 | FDX 37 | New York Stock Exchange | - The registrant is a large accelerated filer[6](index=6&type=chunk) Common Stock Outstanding Shares | Metric | Value | | :----- | :---- | | Common Stock Outstanding Shares at September 16, 2025 | 235,955,461 | PART I. FINANCIAL INFORMATION [ITEM 1. Financial Statements](index=5&type=section&id=ITEM%201.%20Financial%20Statements) This section presents FedEx Corporation's unaudited condensed consolidated financial statements, including balance sheets, income statements, comprehensive income, cash flows, and stockholders' investment, with accompanying notes [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This statement provides a snapshot of FedEx's financial position, detailing assets, liabilities, and common stockholders' investment Condensed Consolidated Balance Sheet Highlights (in millions) | Category | August 31, 2025 | May 31, 2025 | | :-------------------------------- | :-------------- | :----------- | | Total current assets | $19,344 | $18,386 | | Net property and equipment | $41,384 | $41,642 | | Total other long-term assets | $27,688 | $27,599 | | **Total Assets** | **$88,416** | **$87,627** | | Total current liabilities | $15,524 | $15,411 | | Long-term debt, less current portion | $20,291 | $19,151 | | Total other long-term liabilities | $24,830 | $24,991 | | **Total Liabilities** | **$60,645** | **$59,553** | | Total common stockholders' investment | $27,771 | $28,074 | | **Total Liabilities and Common Stockholders' Investment** | **$88,416** | **$87,627** | [Condensed Consolidated Statements of Income](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) This statement outlines the company's financial performance, including revenue, operating expenses, operating income, net income, and earnings per share Condensed Consolidated Statements of Income Highlights (in millions, except per share amounts) | Metric | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------- | :--------------------------------- | :--------------------------------- | | Revenue | $22,244 | $21,579 | | Operating expenses | $21,058 | $20,499 | | Operating income | $1,186 | $1,080 | | Income before income taxes | $1,134 | $1,056 | | Provision for income taxes | $310 | $262 | | Net income | $824 | $794 | | Basic earnings per common share | $3.48 | $3.24 | | Diluted earnings per common share | $3.46 | $3.21 | | Dividends declared per common share | $2.90 | $2.76 | - Revenue increased by **3.1%** year-over-year, from **$21,579 million** in Q1 2024 to **$22,244 million** in Q1 2025[20](index=20&type=chunk) - Operating income grew by **9.8%** year-over-year, from **$1,080 million** in Q1 2024 to **$1,186 million** in Q1 2025[20](index=20&type=chunk) - Diluted EPS increased by **7.8%** year-over-year, from **$3.21** in Q1 2024 to **$3.46** in Q1 2025[20](index=20&type=chunk) [Condensed Consolidated Statements of Comprehensive Income](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) This statement presents net income and other comprehensive income (loss) components, including foreign currency translation adjustments and amortization of prior service credit Condensed Consolidated Statements of Comprehensive Income Highlights (in millions) | Metric | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------- | :--------------------------------- | :--------------------------------- | | Net income | $824 | $794 | | Other comprehensive income (loss) | ($9) | $27 | | Comprehensive income | $815 | $821 | - Comprehensive income decreased by **0.7%** year-over-year, from **$821 million** in Q1 2024 to **$815 million** in Q1 2025, primarily due to a foreign currency translation loss in 2025 compared to a gain in 2024[22](index=22&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This statement details cash inflows and outflows from operating, investing, and financing activities, showing the net change in cash and cash equivalents Condensed Consolidated Statements of Cash Flows Highlights (in millions) | Activity | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------- | :--------------------------------- | :--------------------------------- | | Cash provided by operating activities | $1,716 | $1,187 | | Cash used in investing activities | ($619) | ($802) | | Cash used in financing activities | ($460) | ($969) | | Net increase (decrease) in cash and cash equivalents | $664 | ($558) | | Cash and cash equivalents at end of period | $6,166 | $5,943 | - Cash provided by operating activities increased by **$529 million (44.6%)** year-over-year[25](index=25&type=chunk) - Cash used in investing activities decreased by **$183 million (22.8%)** year-over-year, primarily due to lower capital expenditures[25](index=25&type=chunk) - Cash used in financing activities decreased by **$509 million (52.5%)** year-over-year, driven by debt issuances and lower common stock repurchases[25](index=25&type=chunk) [Condensed Consolidated Statements of Changes In Common Stockholders' Investment](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20In%20Common%20Stockholders%27%20Investment) This statement details changes in common stockholders' investment components, including common stock, additional paid-in capital, retained earnings, AOCL, and treasury stock Changes in Common Stockholders' Investment (in millions) | Component | August 31, 2025 | August 31, 2024 | | :-------------------------------- | :-------------- | :-------------- | | Common Stock (Ending Balance) | $32 | $32 | | Additional Paid-in Capital (Ending Balance) | $4,327 | $4,134 | | Retained Earnings (Ending Balance) | $41,538 | $38,767 | | Accumulated Other Comprehensive Loss (Ending Balance) | ($1,371) | ($1,332) | | Treasury Stock (Ending Balance) | ($16,755) | ($14,425) | | **Total Common Stockholders' Investment Balance** | **$27,771** | **$27,176** | - Total common stockholders' investment increased by **$595 million (2.2%)** year-over-year[27](index=27&type=chunk) - Cash dividends declared were **$2.90 per share** in Q1 2025 and **$2.76 per share** in Q1 2024[27](index=27&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide additional disclosures for the condensed consolidated financial statements, covering segments, accounting policies, credit losses, comprehensive income, financing, EPS, retirement plans, segment performance, commitments, and contingencies [NOTE 1: DESCRIPTION OF BUSINESS SEGMENTS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=11&type=section&id=NOTE%201%3A%20DESCRIPTION%20OF%20BUSINESS%20SEGMENTS%20AND%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note describes FedEx's business segments, significant accounting policies, business optimization costs, separation costs, and details on stock repurchases and dividends - FedEx's primary operating companies are Federal Express (express transportation, small-package ground delivery) and FedEx Freight (less-than-truckload freight transportation)[30](index=30&type=chunk) - Business optimization costs for Q1 2026 were **$67 million** (**$52 million** net of tax, or **$0.22 per diluted share**), down from **$128 million** in Q1 2025, primarily related to professional services and severance for Network 2.0 and the Europe workforce reduction plan[42](index=42&type=chunk) - The Europe workforce reduction plan is expected to impact approximately **1,400 employees** and generate annualized savings of approximately **$150 million** starting in calendar 2026, with pre-tax costs of about **$250 million** incurred through fiscal 2026[44](index=44&type=chunk)[45](index=45&type=chunk) - Costs related to the planned spin-off of FedEx Freight were **$43 million** (**$33 million** net of tax, or **$0.14 per diluted share**) in Q1 2026, with the transaction expected to be completed by June 2026[46](index=46&type=chunk)[47](index=47&type=chunk) - FedEx's Board approved a change in fiscal year end from May 31 to December 31, effective June 1, 2026, incurring **$4 million** in costs in Q1 2026[48](index=48&type=chunk) - During Q1 2026, **2.2 million shares** were repurchased for **$500 million** at an average price of **$232.25 per share**; **$1.6 billion** remained available under the 2024 stock repurchase program as of August 31, 2025[59](index=59&type=chunk)[61](index=61&type=chunk) - A quarterly cash dividend of **$1.45 per share** was declared on August 7, 2025, payable October 1, 2025[62](index=62&type=chunk) [NOTE 2: CREDIT LOSSES](index=14&type=section&id=NOTE%202%3A%20CREDIT%20LOSSES) This note details FedEx's credit loss exposure, primarily from trade receivables, and the methodology for determining the allowance for credit losses - Credit losses were **$219 million** for the three-month period ended August 31, 2025, an increase from **$129 million** for the same period in 2024[68](index=68&type=chunk) - The allowance for credit losses increased to **$492 million** at August 31, 2025, from **$438 million** at May 31, 2025[68](index=68&type=chunk) [NOTE 3: ACCUMULATED OTHER COMPREHENSIVE LOSS](index=15&type=section&id=NOTE%203%3A%20ACCUMULATED%20OTHER%20COMPREHENSIVE%20LOSS) This note presents changes in Accumulated Other Comprehensive Loss (AOCL), net of tax, primarily driven by foreign currency translation and retirement plan adjustments Changes in AOCL (in millions) | Component | August 31, 2025 | August 31, 2024 | | :-------------------------------- | :-------------- | :-------------- | | Foreign currency translation loss (end of period) | ($1,427) | ($1,393) | | Retirement plans adjustments (end of period) | $56 | $61 | | **AOCL at end of period** | **($1,371)** | **($1,332)** | - AOCL increased to a loss of **$1,371 million** at August 31, 2025, from a loss of **$1,332 million** at August 31, 2024, primarily due to foreign currency translation adjustments[69](index=69&type=chunk) [NOTE 4: FINANCING ARRANGEMENTS](index=15&type=section&id=NOTE%204%3A%20FINANCING%20ARRANGEMENTS) This note details FedEx's financing arrangements, including long-term debt issuances, credit agreements, and compliance with financial covenants - On July 30, 2025, FedEx issued **€850 million** of senior unsecured debt (**€500 million** of 3.50% notes due 2032 and **€350 million** of 4.125% notes due 2037), using a portion of proceeds to repay **€500 million** of 0.45% notes due August 2025[71](index=71&type=chunk) Long-Term Debt Carrying and Fair Values (in millions) | Metric | August 31, 2025 | May 31, 2025 | | :-------------------------------- | :-------------- | :----------- | | Long-term debt (carrying value) | $20,400 | $19,900 | | Long-term debt (estimated fair value) | $18,200 | $17,200 | | Annualized weighted-average interest rate | 3.6% | N/A | - FedEx maintains a **$1.75 billion** three-year credit agreement (expiring March 2027) and a **$1.75 billion** five-year credit agreement (expiring March 2029), with no amounts outstanding as of August 31, 2025[74](index=74&type=chunk) - The ratio of debt to adjusted EBITDA was **1.9** at August 31, 2025, well within the covenant limit of not more than **3.5 to 1.0**[75](index=75&type=chunk) [NOTE 5: COMPUTATION OF EARNINGS PER SHARE](index=17&type=section&id=NOTE%205%3A%20COMPUTATION%20OF%20EARNINGS%20PER%20SHARE) This note provides the detailed calculation of basic and diluted earnings per common share for the reported periods Earnings Per Share Calculation (in millions, except per share amounts) | Metric | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------- | :--------------------------------- | :--------------------------------- | | Net earnings allocable to common shares | $823 | $793 | | Weighted-average common shares (basic) | 236 | 244 | | Basic earnings per common share | $3.48 | $3.24 | | Weighted-average diluted shares | 238 | 247 | | Diluted earnings per common share | $3.46 | $3.21 | | Anti-dilutive options excluded | 7.1 | 4.3 | [NOTE 6: RETIREMENT PLANS](index=17&type=section&id=NOTE%206%3A%20RETIREMENT%20PLANS) This note outlines costs associated with FedEx's defined benefit pension, defined contribution, and postretirement healthcare plans Retirement Plans Costs (in millions) | Plan Type | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------- | :--------------------------------- | :--------------------------------- | | Defined benefit pension plans | $47 | $70 | | Defined contribution plans | $306 | $287 | | Postretirement healthcare plans | $22 | $22 | | **Total retirement plans costs** | **$375** | **$379** | - FedEx made voluntary contributions of **$200 million** to its U.S. Pension Plan during Q1 2026, with no required contributions for fiscal 2026 as the plan is fully funded[79](index=79&type=chunk) [NOTE 7: BUSINESS SEGMENTS AND DISAGGREGATED REVENUE](index=18&type=section&id=NOTE%207%3A%20BUSINESS%20SEGMENTS%20AND%20DISAGGREGATED%20REVENUE) This note provides detailed financial information for FedEx's reportable segments, disaggregated revenue by service type and geographic region, and segment capital expenditures Segment Operating Results (Three Months Ended August 31, 2025, in millions) | Segment | Revenue | Operating Expenses | Operating Income | | :-------------------------------- | :------ | :----------------- | :--------------- | | Federal Express Segment | $19,116 | $17,978 | $1,138 | | FedEx Freight Segment | $2,257 | $1,897 | $360 | | Corporate, other, and eliminations | $871 | $1,183 | ($312) | | **Consolidated Total** | **$22,244** | **$21,058** | **$1,186** | Segment Operating Results (Three Months Ended August 31, 2024, in millions) | Segment | Revenue | Operating Expenses | Operating Income | | :-------------------------------- | :------ | :----------------- | :--------------- | | Federal Express Segment | $18,305 | $17,352 | $953 | | FedEx Freight Segment | $2,329 | $1,890 | $439 | | Corporate, other, and eliminations | $945 | $1,257 | ($312) | | **Consolidated Total** | **$21,579** | **$20,499** | **$1,080** | Revenue by Service Type (Three Months Ended August 31, in millions) | Service Type | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | Federal Express segment: | | | | Total U.S. domestic package revenue | $12,694 | $11,798 | | Total international export package revenue | $3,612 | $3,566 | | International domestic | $1,135 | $1,112 | | Total package revenue | $17,441 | $16,476 | | Total freight revenue | $1,426 | $1,558 | | Other | $249 | $271 | | **Total Federal Express Segment** | **$19,116** | **$18,305** | | **FedEx Freight Segment** | **$2,257** | **$2,329** | | Other and eliminations | $871 | $945 | | **Total Revenue** | **$22,244** | **$21,579** | Geographic Revenue Information (Three Months Ended August 31, in millions) | Region | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | U.S. | $15,975 | $15,496 | | International | $6,269 | $6,083 | | **Total Revenue** | **$22,244** | **$21,579** | Segment Capital Expenditures (Three Months Ended August 31, in millions) | Segment | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | Federal Express Segment | $568 | $703 | | FedEx Freight Segment | $32 | $35 | | Corporate, other, and eliminations | $23 | $29 | | **Consolidated Total** | **$623** | **$767** | [NOTE 8: COMMITMENTS](index=22&type=section&id=NOTE%208%3A%20COMMITMENTS) This note outlines FedEx's future purchase commitments for aircraft and other items, and minimum lease payments under noncancelable operating and finance leases Purchase Commitments as of August 31, 2025 (in millions) | Fiscal Year | Aircraft and Aircraft Related | Other | Total | | :-------------------------------- | :---------------------------- | :---- | :---- | | 2026 (remainder) | $808 | $626 | $1,434 | | 2027 | $1,119 | $712 | $1,831 | | 2028 | $993 | $545 | $1,538 | | 2029 | $413 | $461 | $874 | | 2030 | $205 | $35 | $240 | | Thereafter | $1,073 | $90 | $1,163 | | **Total** | **$4,611** | **$2,469** | **$7,080** | Aircraft Purchase Commitments as of August 31, 2025 | Aircraft Type | 2026 (remainder) | 2027 | 2028 | 2029 | 2030 | Total | | :-------------------------------- | :--------------- | :--- | :--- | :--- | :--- | :---- | | Cessna SkyCourier 408 | 15 | 4 | — | — | — | 19 | | ATR 72-600F | 3 | 4 | 4 | 4 | 2 | 17 | | B767F | 6 | — | — | — | — | 6 | | B777F | — | 5 | 5 | — | — | 10 | | **Total Aircraft** | **24** | **13** | **9** | **4** | **2** | **52** | Future Minimum Lease Payments as of August 31, 2025 (in millions) | Fiscal Year | Operating Leases | Finance Leases | Total Leases | | :-------------------------------- | :--------------- | :------------- | :----------- | | 2026 (remainder) | $2,332 | $85 | $2,417 | | 2027 | $3,041 | $116 | $3,157 | | 2028 | $2,663 | $115 | $2,778 | | 2029 | $2,260 | $112 | $2,372 | | 2030 | $1,842 | $95 | $1,937 | | Thereafter | $8,086 | $619 | $8,705 | | **Total lease payments** | **$20,224** | **$1,142** | **$21,366** | | Less imputed interest | ($3,492) | ($347) | ($3,839) | | **Present value of lease liability** | **$16,732** | **$795** | **$17,527** | [NOTE 9: CONTINGENCIES](index=23&type=section&id=NOTE%209%3A%20CONTINGENCIES) This note addresses various legal proceedings and claims against FedEx and its subsidiaries, and confirms no material environmental matters requiring disclosure - FedEx is subject to various legal proceedings and claims, including lawsuits alleging employer/joint employer status for service provider drivers, wage-and-hour violations, and responsibility for third-party losses from vehicle accidents[98](index=98&type=chunk) - Management believes the aggregate liability from these actions will not have a material adverse effect on financial position, results of operations, or cash flows[98](index=98&type=chunk) - No environmental matters required to be disclosed for this period, based on the SEC's **$1 million** threshold[99](index=99&type=chunk) [NOTE 10: SUPPLEMENTAL CASH FLOW INFORMATION](index=23&type=section&id=NOTE%2010%3A%20SUPPLEMENTAL%20CASH%20FLOW%20INFORMATION) This note provides supplemental cash flow details, specifically cash payments for interest expense and income taxes Supplemental Cash Flow Information (in millions) | Cash Payments for | Three Months Ended August 31, 2025 | Three Months Ended August 31, 2024 | | :-------------------------------- | :--------------------------------- | :--------------------------------- | | Interest (net of capitalized interest) | $195 | $158 | | Income taxes | $112 | $75 | | Income tax refunds received | ($27) | ($12) | | **Cash tax payments/(refunds), net** | **$85** | **$63** | [Report of Independent Registered Public Accounting Firm](index=24&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Ernst & Young LLP reviewed FedEx's interim financial statements, finding no material modifications necessary for U.S. GAAP conformity and confirming the fair statement of the May 31, 2025, balance sheet - The independent registered public accounting firm is not aware of any material modifications that should be made to the condensed consolidated interim financial statements for them to be in conformity with U.S. GAAP[102](index=102&type=chunk) - The information in the condensed consolidated balance sheet as of May 31, 2025, is fairly stated in all material respects[103](index=103&type=chunk) [ITEM 2. Management's Discussion and Analysis of Results of Operations and Financial Condition](index=25&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Results%20of%20Operations%20and%20Financial%20Condition) This section provides management's perspective on FedEx's financial performance, liquidity, capital resources, and critical accounting estimates, discussing key trends and segment-specific results [GENERAL](index=25&type=section&id=GENERAL) This section outlines FedEx's business, primary operating companies, and recent strategic decisions, including the planned FedEx Freight spin-off and fiscal year end change - FedEx provides a broad portfolio of transportation, e-commerce, and business services through its global network[107](index=107&type=chunk) - FedEx's Board decided to pursue a full separation of FedEx Freight through a tax-free spin-off to stockholders, expected to be completed by June 2026[109](index=109&type=chunk) - The Board approved a change in FedEx's fiscal year end from May 31 to December 31, effective June 1, 2026[110](index=110&type=chunk) [Trends Affecting Our Business](index=25&type=section&id=Trends%20Affecting%20Our%20Business) This section discusses significant macroeconomic, inflationary, fuel price, and geopolitical trends impacting FedEx's business and the transportation industry - Weakened business conditions in the transportation industry are attributed to a decline in U.S. imports of consumer goods and slowed global industrial production, negatively affecting FedEx Freight shipments[113](index=113&type=chunk) - Changes in the global trade environment, such as the removal of the de minimis exemption for U.S. imports from non-China countries, have contributed to lower international export package volumes[114](index=114&type=chunk) - Elevated global inflation and steady interest rates continue to negatively affect consumer and business spending, pressuring demand for FedEx's transportation services, particularly priority services[115](index=115&type=chunk) - Lower fuel prices in Q1 2026 negatively affected yields due to reduced fuel surcharges but also led to decreased fuel expense across transportation segments[116](index=116&type=chunk) [RESULTS OF OPERATIONS](index=27&type=section&id=RESULTS%20OF%20OPERATIONS) This section analyzes FedEx's operating results, covering consolidated performance, revenue and expense drivers, business optimization and separation costs, income taxes, and the company's outlook Consolidated Operating Results (Three Months Ended August 31, in millions, except per share amounts) | Metric | 2025 | 2024 | Percent Change | | :-------------------------------- | :----- | :----- | :------------- | | Revenue | $22,244 | $21,579 | 3% | | Consolidated operating income | $1,186 | $1,080 | 10% | | Consolidated net income | $824 | $794 | 4% | | Diluted earnings per share | $3.46 | $3.21 | 8% | | Consolidated operating margin | 5.3% | 5.0% | 30 bp | | Federal Express segment operating income | $1,138 | $953 | 19% | | FedEx Freight segment operating income | $360 | $439 | (18)% | | Corporate, other, and eliminations operating income | ($312) | ($312) | — | | Federal Express segment operating margin | 6.0% | 5.2% | 80 bp | | FedEx Freight segment operating margin | 16.0% | 18.8% | (280) bp | - Operating income was positively impacted by improved yields for U.S. domestic and international priority package services, structural cost reductions from business optimization initiatives, and higher U.S. domestic package demand at Federal Express[121](index=121&type=chunk) - Negative impacts included increased operating expenses, decreased yields for international economy package services, lower international package export volume due to global trade policies, the expiration of the USPS contract, and lower revenue at FedEx Freight[121](index=121&type=chunk) - Business optimization costs were **$67 million** in Q1 2026, down from **$128 million** in Q1 2025[122](index=122&type=chunk) - Costs related to the FedEx Freight spin-off were **$43 million** in Q1 2026[123](index=123&type=chunk) - FedEx repurchased **$500 million** of common stock in Q1 2026, benefiting diluted EPS by **$0.02**[124](index=124&type=chunk) [CONSOLIDATED RESULTS](index=28&type=section&id=CONSOLIDATED%20RESULTS) Consolidated operating income increased by **10%** in Q1 2026, driven by improved yields, structural cost reductions, and higher U.S. domestic package demand at Federal Express [Revenue](index=31&type=section&id=Revenue) Consolidated revenue increased by **3%** in Q1 2026, driven by Federal Express yield improvements and volume, partially offset by USPS contract expiration and FedEx Freight declines - Consolidated revenue increased **3%** in Q1 2026 to **$22,244 million**[130](index=130&type=chunk) - Federal Express segment revenue increased **4%** due to improved base yields, increased U.S. domestic and international economy package volumes, and favorable exchange rates[131](index=131&type=chunk) - FedEx Freight revenue decreased **3%** due to lower volume and lower base yields[131](index=131&type=chunk) [Operating Expenses](index=31&type=section&id=Operating%20Expenses) Total operating expenses increased by **3%** in Q1 2026, driven by higher salaries and purchased transportation, partially offset by a significant decrease in fuel expense Operating Expenses (Three Months Ended August 31, in millions) | Expense Category | 2025 | 2024 | Percent Change | | :-------------------------------- | :----- | :----- | :------------- | | Salaries and employee benefits | $8,062 | $7,785 | 4% | | Purchased transportation | $5,488 | $5,275 | 4% | | Fuel | $873 | $1,075 | (19)% | | Separation and other costs | $45 | — | NM | | Business optimization costs | $67 | $128 | (48)% | | Other | $3,396 | $3,168 | 7% | | **Total operating expenses** | **$21,058** | **$20,499** | **3%** | - Salaries and employee benefits increased **4%** due to higher wage rates, unfavorable exchange rates, and higher employee benefits, partially offset by lower variable incentive compensation[133](index=133&type=chunk) - Purchased transportation expense increased **4%** due to higher rates and volume[133](index=133&type=chunk) - Fuel expense decreased **19%** due to lower fuel prices and the expiration of the USPS contract[133](index=133&type=chunk) - Other operating expenses increased **7%** primarily due to higher professional fees, credit losses, and self-insurance accruals[133](index=133&type=chunk) [Business Optimization Costs](index=32&type=section&id=Business%20Optimization%20Costs) FedEx incurred **$67 million** in business optimization costs in Q1 2026, a **48%** decrease, related to Network 2.0 and the Europe workforce reduction plan - Business optimization costs were **$67 million** (**$52 million** net of tax, or **$0.22 per diluted share**) in Q1 2026, down from **$128 million** in Q1 2025[135](index=135&type=chunk) - These costs are primarily related to professional services and severance for Network 2.0 and the Europe workforce reduction plan[135](index=135&type=chunk) - Network 2.0, a multi-year effort to improve U.S. and Canada package efficiency, has been implemented in approximately **360 locations** as of August 31, 2025, with U.S. implementation expected by end of calendar 2027[136](index=136&type=chunk) - The Europe workforce reduction plan is expected to yield approximately **$150 million** in annualized savings starting calendar 2026, with pre-tax costs of about **$250 million** through fiscal 2026[137](index=137&type=chunk)[138](index=138&type=chunk) [Separation and Other Costs](index=32&type=section&id=Separation%20and%20Other%20Costs) FedEx incurred **$43 million** for the FedEx Freight spin-off and **$4 million** for the fiscal year change in Q1 2026, primarily for professional services - Costs for the planned FedEx Freight spin-off were **$43 million** (**$33 million** net of tax, or **$0.14 per diluted share**) in Q1 2026, mainly for professional services[139](index=139&type=chunk) - Costs for the fiscal year change were **$4 million** (**$3 million** net of tax, or **$0.01 per diluted share**) in Q1 2026, primarily for professional fees[140](index=140&type=chunk) [Income Taxes](index=32&type=section&id=Income%20Taxes) The effective tax rate for Q1 2026 was **27.3%**, unfavorably impacted by a non-recurring expense, with ongoing evaluation of new legislation and tax examinations - The effective tax rate was **27.3%** for Q1 2026, up from **24.8%** in Q1 2025, due to a non-recurring income tax expense of **$16 million** (**$0.07 per diluted share**)[141](index=141&type=chunk) - FedEx is evaluating the implications of the 'One Big Beautiful Bill Act' signed in July 2025[142](index=142&type=chunk) - The company is under IRS examination for tax years 2016-2021 and is litigating a challenge to a tax regulation related to the TCJA's transition tax, having recorded a cumulative benefit of **$249 million**[143](index=143&type=chunk)[144](index=144&type=chunk) [Outlook](index=33&type=section&id=Outlook) FedEx anticipates continued demand pressure for higher-yielding services, expects **$1.0 billion** in structural cost reduction benefits in fiscal 2026, and projects **$4.5 billion** in capital expenditures - The industrial economy is expected to continue pressuring demand for higher-yielding business-to-business services, with a shift towards deferred service offerings[145](index=145&type=chunk) - FedEx expects an incremental **$1.0 billion** in structural cost reduction benefits from DRIVE and Network 2.0 in fiscal 2026[146](index=146&type=chunk) - Capital expenditures for fiscal 2026 are expected to be approximately **$4.5 billion**, a **$0.4 billion** increase from 2025, driven by Network 2.0 and modernization efforts[148](index=148&type=chunk) - Aircraft spend is expected to decline to approximately **$1.0 billion** in fiscal 2026, **$0.3 billion** lower than 2025[148](index=148&type=chunk) - The full separation of FedEx Freight through capital markets is expected to be executed by June 2026[150](index=150&type=chunk) [RECENT ACCOUNTING GUIDANCE](index=33&type=section&id=RECENT%20ACCOUNTING%20GUIDANCE) This section refers to Note 1 for a discussion of recent accounting guidance, including new accounting standards and those not yet adopted - Refer to Note 1 for a discussion of recent accounting guidance, including ASU 2025-05 (Financial Instruments—Credit Losses), ASU 2023-09 (Income Taxes Disclosures), and ASU 2024-03 (Income Statement–Expense Disaggregation Disclosures)[153](index=153&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk)[66](index=66&type=chunk) [REPORTABLE SEGMENTS](index=34&type=section&id=REPORTABLE%20SEGMENTS) FedEx's reportable segments are Federal Express and FedEx Freight, with Federal Express operating combined sales, marketing, administrative, and IT functions - Federal Express and FedEx Freight are the major service lines and reportable segments[154](index=154&type=chunk) - The Federal Express segment operates combined sales, marketing, administrative, and IT functions, with net operating costs allocated to other segments based on metrics like relative revenue or estimated services provided[154](index=154&type=chunk)[155](index=155&type=chunk) [CORPORATE, OTHER, AND ELIMINATIONS](index=34&type=section&id=CORPORATE%2C%20OTHER%2C%20AND%20ELIMINATIONS) This category includes corporate headquarters, FedEx Dataworks, FedEx Office, and FedEx Logistics costs, with operating results flat in Q1 2026 due to offsetting factors - Corporate, other, and eliminations includes corporate headquarters, FedEx Dataworks, FedEx Office, and FedEx Logistics[156](index=156&type=chunk)[157](index=157&type=chunk) - Operating results were flat in Q1 2026, driven by decreased purchased transportation costs at FedEx Logistics offset by higher professional fees at corporate headquarters and FedEx Dataworks[158](index=158&type=chunk) [FEDERAL EXPRESS SEGMENT](index=35&type=section&id=FEDERAL%20EXPRESS%20SEGMENT) The Federal Express segment reported a **4%** revenue increase and **19%** operating income increase in Q1 2026, driven by improved yields and higher U.S. domestic and international economy package volumes Federal Express Segment Revenue (Three Months Ended August 31, in millions) | Revenue Category | 2025 | 2024 | Percent Change | | :-------------------------------- | :----- | :----- | :------------- | | Total U.S. domestic package revenue | $12,694 | $11,798 | 8% | | Total international export package revenue | $3,612 | $3,566 | 1% | | International domestic | $1,135 | $1,112 | 2% | | Total package revenue | $17,441 | $16,476 | 6% | | Total freight revenue | $1,426 | $1,558 | (8)% | | Other | $249 | $271 | (8)% | | **Total revenue** | **$19,116** | **$18,305** | **4%** | | **Operating income** | **$1,138** | **$953** | **19%** | | **Operating margin** | **6.0%** | **5.2%** | **80 bp** | Federal Express Segment Package Statistics (Three Months Ended August 31, in thousands, except yield) | Metric | 2025 | 2024 | Percent Change | | :-------------------------------- | :----- | :----- | :------------- | | Total U.S. domestic ADV | 13,920 | 13,295 | 5% | | International priority ADV | 562 | 622 | (10)% | | International economy ADV | 518 | 491 | 5% | | Total international export ADV | 1,080 | 1,113 | (3)% | | U.S. domestic composite package yield | $14.25 | $13.87 | 3% | | International priority package yield | $62.77 | $55.37 | 13% | | International economy package yield | $40.87 | $43.33 | (6)% | | Composite package yield | $16.22 | $15.86 | 2% | - U.S. average daily freight pounds decreased **59%** due to the expiration of the USPS contract[164](index=164&type=chunk) - Operating expenses increased primarily due to higher wage and purchased transportation rates and higher credit losses, partially offset by a **20%** decrease in fuel expense[166](index=166&type=chunk)[167](index=167&type=chunk) - The segment incurred **$21 million** in business optimization costs, **$4 million** for the fiscal year change, and **$1 million** for the FedEx Freight spin-off in Q1 2026[168](index=168&type=chunk) [FEDEX FREIGHT SEGMENT](index=39&type=section&id=FEDEX%20FREIGHT%20SEGMENT) The FedEx Freight segment experienced a **3%** revenue decrease and an **18%** operating income decrease in Q1 2026, primarily due to lower volume, base yields, and increased intercompany charges FedEx Freight Segment Operating Results (Three Months Ended August 31, in millions, except per shipment/hundredweight) | Metric | 2025 | 2024 | Percent Change | | :-------------------------------- | :----- | :----- | :------------- | | **Revenue** | **$2,257** | **$2,329** | **(3)%** | | **Operating income** | **$360** | **$439** | **(18)%** | | **Operating margin** | **16.0%** | **18.8%** | **(280) bp** | | Total average daily shipments (thousands) | 90.0 | 92.0 | (2)% | | Composite revenue per shipment | $374.62 | $378.09 | (1)% | | Composite revenue per hundredweight | $40.50 | $40.73 | (1)% | - Average daily shipments decreased **2%** due to reduced demand from macroeconomic conditions[172](index=172&type=chunk) - Intercompany charges increased **9%** due to increased sales staffing for the planned spin-off[174](index=174&type=chunk) - Fuel expense decreased **7%** due to fewer shipments and lower fuel prices[174](index=174&type=chunk) - The segment incurred **$9 million** in costs related to the planned spin-off of FedEx Freight in Q1 2026[175](index=175&type=chunk) [FINANCIAL CONDITION](index=41&type=section&id=FINANCIAL%20CONDITION) This section assesses FedEx's financial condition, covering liquidity, capital resources, guarantor financial information, and the liquidity outlook [LIQUIDITY](index=41&type=section&id=LIQUIDITY) FedEx's cash and cash equivalents increased to **$6.2 billion**, driven by significantly increased operating cash flows and decreased investing and financing activities Cash Flow Summary (Three Months Ended August 31, in millions) | Activity | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | Cash provided by operating activities | $1,716 | $1,187 | | Cash used in investing activities | ($619) | ($802) | | Cash used in financing activities | ($460) | ($969) | | Net increase (decrease) in cash and cash equivalents | $664 | ($558) | | Cash and cash equivalents at end of period | $6,166 | $5,943 | - Cash flows from operating activities increased by **$0.5 billion** in Q1 2026, primarily due to working capital changes[176](index=176&type=chunk) - Capital expenditures decreased in Q1 2026, leading to a decrease in cash used in investing activities[177](index=177&type=chunk) - Cash used in financing activities decreased by **$0.5 billion**, driven by lower common stock repurchases and new debt issuances[178](index=178&type=chunk) [CAPITAL RESOURCES](index=41&type=section&id=CAPITAL%20RESOURCES) FedEx's capital expenditures decreased by **19%** in Q1 2026, primarily due to reduced spending on aircraft, vehicles, and IT, partially offset by increased facilities spending Capital Expenditures by Asset Category (Three Months Ended August 31, in millions) | Asset Category | 2025 | 2024 | Percent Change | | :-------------------------------- | :----- | :----- | :------------- | | Aircraft and related equipment | $60 | $181 | (67)% | | Package handling and ground support equipment | $205 | $197 | 4% | | Information technology | $118 | $153 | (23)% | | Vehicles and trailers | $47 | $90 | (48)% | | Facilities and other | $193 | $146 | 32% | | **Total capital expenditures** | **$623** | **$767** | **(19)%** | Capital Expenditures by Segment (Three Months Ended August 31, in millions) | Segment | 2025 | 2024 | Percent Change | | :-------------------------------- | :----- | :----- | :------------- | | Federal Express segment | $568 | $703 | (19)% | | FedEx Freight segment | $32 | $35 | (9)% | | Other | $23 | $29 | (21)% | | **Total capital expenditures** | **$623** | **$767** | **(19)%** | - Decreased spending on aircraft and related equipment, vehicles and trailers, and information and technology investments at Federal Express and FedEx Freight[180](index=180&type=chunk) [GUARANTOR FINANCIAL INFORMATION](index=42&type=section&id=GUARANTOR%20FINANCIAL%20INFORMATION) This section provides summarized financial information for FedEx (Parent) and its Guarantor Subsidiaries, and for FedEx (Parent Guarantor) and Federal Express (Subsidiary Issuer) - FedEx's senior unsecured debt securities are guaranteed by certain direct and indirect subsidiaries, which are **100%** owned by FedEx, with guarantees being full, unconditional, and joint and several[182](index=182&type=chunk) - FedEx fully and unconditionally guarantees the payment obligations of Federal Express for its **$711 million** Pass-Through Certificates[183](index=183&type=chunk) Parent and Guarantor Subsidiaries Summarized Balance Sheet (in millions) | Category | August 31, 2025 | May 31, 2025 | | :-------------------------------- | :-------------- | :----------- | | Current Assets | $9,924 | $9,514 | | Intercompany Receivable | $5,145 | $4,278 | | Total Assets | $84,186 | $83,125 | | Current Liabilities | $11,439 | $11,202 | | Total Liabilities | $53,492 | $52,324 | Parent and Guarantor Subsidiaries Summarized Statement of Income (Three Months Ended August 31, 2025, in millions) | Metric | Amount | | :-------------------------------- | :----- | | Revenue | $16,643 | | Intercompany Charges, net | ($1,106) | | Operating Income | $1,265 | | Income Before Income Taxes | $1,043 | | Net Income | $691 | Parent Guarantor and Subsidiary Issuer Summarized Balance Sheet (in millions) | Category | August 31, 2025 | May 31, 2025 | | :-------------------------------- | :-------------- | :----------- | | Current Assets | $9,856 | $9,504 | | Intercompany Receivable | $1,187 | $581 | | Total Assets | $73,227 | $72,044 | | Current Liabilities | $10,598 | $10,310 | | Total Liabilities | $50,346 | $49,200 | Parent Guarantor and Subsidiary Issuer Summarized Statement of Income (Three Months Ended August 31, 2025, in millions) | Metric | Amount | | :-------------------------------- | :----- | | Revenue | $14,302 | | Intercompany Charges, net | ($1,261) | | Operating Income | $894 | | Income Before Income Taxes | $1,035 | | Net Income | $772 | [LIQUIDITY OUTLOOK](index=43&type=section&id=LIQUIDITY%20OUTLOOK) FedEx expects to meet liquidity needs through existing cash, operating cash flows, and available financing, while continuing stock repurchases, voluntary pension contributions, and quarterly dividends - FedEx held **$6.2 billion** in cash and cash equivalents and had **$3.5 billion** in available liquidity under its credit agreements at August 31, 2025[190](index=190&type=chunk) - Costs related to the FedEx Freight spin-off are expected to be significant but not adversely affect liquidity[190](index=190&type=chunk) - The company expects to continue repurchasing additional shares of common stock during the remainder of 2026[191](index=191&type=chunk) - Capital expenditures for 2026 are expected to be approximately **$4.5 billion**, with aircraft spend declining to **$1.0 billion**[193](index=193&type=chunk) - Voluntary contributions of **$200 million** were made to the U.S. Pension Plan in Q1 2026, with up to **$200 million** more anticipated for the remainder of 2026; no minimum contributions are required[198](index=198&type=chunk) - Standard & Poor's and Moody's Investors Service have assigned investment-grade credit ratings with a 'stable' outlook[200](index=200&type=chunk) [CRITICAL ACCOUNTING ESTIMATES](index=44&type=section&id=CRITICAL%20ACCOUNTING%20ESTIMATES) Management continuously reviews accounting policies and estimates, with no additional events indicating goodwill impairment testing is required or at risk as of August 31, 2025 - Management does not believe there has been any additional change of events or circumstances that would indicate that additional reevaluation of the goodwill of our reporting units is required as of August 31, 2025, nor do we believe the goodwill of our reporting units is at risk of failing impairment testing[202](index=202&type=chunk) [FORWARD-LOOKING STATEMENTS](index=44&type=section&id=FORWARD-LOOKING%20STATEMENTS) This section provides a cautionary statement regarding forward-looking statements, emphasizing that actual results may differ materially due to various risks and uncertainties - Forward-looking statements involve risks and uncertainties, and actual results may differ materially from those contemplated[205](index=205&type=chunk) - Key risks include economic conditions, changes in shipment volumes and prices, geopolitical developments, fuel price volatility, ability to implement business strategy and transformation initiatives (Network 2.0, FedEx Freight spin-off), data breaches, e-commerce growth, and regulatory changes[205](index=205&type=chunk)[215](index=215&type=chunk) - The company is under no obligation to update or alter any forward-looking statements[207](index=207&type=chunk) [ITEM 3. Quantitative and Qualitative Disclosures About Market Risk](index=48&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section reports no material changes in market risk sensitive instruments, identifying foreign currency exchange rates and fuel prices as principal market risks - No material changes in market risk sensitive instruments and positions since the Annual Report[208](index=208&type=chunk) - Principal foreign currency exchange rate risks relate to the euro, Chinese yuan, British pound, Canadian dollar, Australian dollar, Mexican peso, Hong Kong dollar, and Japanese yen[209](index=209&type=chunk) - The U.S. dollar's weaker performance relative to foreign currencies had a slightly negative effect on results in Q1 2026[209](index=209&type=chunk) - Market risk for changes in vehicle and jet fuel prices is largely mitigated by indexed fuel surcharges[210](index=210&type=chunk) [ITEM 4. Controls and Procedures](index=48&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of August 31, 2025, with no material changes in internal control over financial reporting during the quarter - Disclosure controls and procedures were effective as of August 31, 2025[211](index=211&type=chunk) - No material changes occurred in internal control over financial reporting during the quarter ended August 31, 2025[212](index=212&type=chunk) PART II. OTHER INFORMATION [ITEM 1. Legal Proceedings](index=48&type=section&id=ITEM%201.%20Legal%20Proceedings) This section refers to Note 9 of the condensed consolidated financial statements for a description of all material pending legal proceedings - For a description of all material pending legal proceedings, refer to Note 9 of the accompanying unaudited condensed consolidated financial statements[213](index=213&type=chunk) [ITEM 1A. Risk Factors](index=48&type=section&id=ITEM%201A.%20Risk%20Factors) This section states that there have been no material changes from the risk factors disclosed in the Annual Report on Form 10-K - There have been no material changes from the risk factors disclosed in the Annual Report on Form 10-K[214](index=214&type=chunk) [ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=49&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the issuance of unregistered common stock for an acquisition and FedEx's common stock repurchases during Q1 2026 - FedEx issued **359,052 unregistered shares** of common stock (valued at approximately **$90 million**) in February 2025 and an additional **296 shares** in August 2025 as partial consideration for the acquisition of RouteSmart Technologies, Inc[216](index=216&type=chunk) Issuer Purchases of Equity Securities (Q1 2026) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Program | Approximate Dollar Value of Shares That May Yet Be Purchased Under Program ($ in millions) | | :---------------- | :------------------------------- | :--------------------------- | :------------------------------------------------------------------- | :------------------------------------------------------------------------------------- | | Jun. 1-30, 2025 | 650,000 | $224.56 | 650,000 | $1,918 | | Jul. 1-31, 2025 | 1,502,645 | $235.58 | 1,502,645 | $1,564 | | Aug. 1-31, 2025 | — | — | — | $1,564 | | **Total** | **2,152,645** | | **2,152,645** | **$1,564** | - FedEx repurchased **2.2 million shares** for **$500 million** in Q1 2026 under its **$5.0 billion** stock repurchase program, with approximately **$1.6 billion** remaining available as of September 18, 2025[219](index=219&type=chunk)[220](index=220&type=chunk) [ITEM 5. Other Information](index=49&type=section&id=ITEM%205.%20Other%20Information) No director or officer adopted, modified, or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter ended August 31, 2025 - No director or officer adopted, modified, or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the quarter ended August 31, 2025[222](index=222&type=chunk) [ITEM 6. Exhibits](index=50&type=section&id=ITEM%206.%20Exhibits) This section lists all exhibits filed as part of the Form 10-Q, including organizational documents, indentures, certifications, and interactive data files - The exhibits include the Restated Certificate of Incorporation, Amended and Restated Bylaws, Indentures for debt securities, certifications of principal executive and financial officers, and Interactive Data Files (Inline XBRL)[223](index=223&type=chunk) Signature [Official Signature](index=51&type=section&id=Official%20Signature) This section contains the official signature block, confirming the report was signed on behalf of FedEx Corporation by its Corporate Vice President and Chief Accounting Officer - The report is signed by Guy M. Erwin II, Corporate Vice President and Chief Accounting Officer of FedEx Corporation, on September 18, 2025[226](index=226&type=chunk)

**Executive Summary & First Quarter Performance**](index=1&type=section&id=Executive%20Summary%20%26%20First%20Quarter%20Performance) FedEx reported year-over-year earnings growth in Q1 FY2026, driven by strategic initiatives and cost reductions, with adjusted diluted EPS increasing to $3.83 [**Consolidated Financial Results (GAAP & Adjusted)**](index=1&type=section&id=Consolidated%20Financial%20Results%20(GAAP%20%26%20Adjusted)) FedEx reported year-over-year earnings growth in Q1 FY2026, with adjusted diluted EPS increasing to $3.83 from $3.60. Revenue grew to $22.2 billion from $21.6 billion, and adjusted operating income improved to $1.30 billion from $1.21 billion, reflecting successful strategic initiatives and cost reductions Consolidated Results (GAAP & Adjusted) | | Fiscal 2026 | | Fiscal 2025 | | | --- | --- | --- | --- | --- | | | As Reported (GAAP) | Adjusted (non-GAAP) | As Reported (GAAP) | Adjusted (non-GAAP) | | Revenue | $22.2 billion | $22.2 billion | $21.6 billion | $21.6 billion | | Operating income | $1.19 billion | $1.30 billion | $1.08 billion | $1.21 billion | | Operating margin | 5.3% | 5.8% | 5.0% | 5.6% | | Net income | $0.82 billion | $0.91 billion | $0.79 billion | $0.89 billion | | Diluted EPS | $3.46 | $3.83 | $3.21 | $3.60 | - Earnings growth is attributed to the success of strategic initiatives, including flexing the network, reducing cost-to-serve, and enhancing value proposition and customer experience[1](index=1&type=chunk) - Consolidated operating results improved, reflecting strength in U.S. domestic package revenue and continued structural cost reduction, despite an unfavorable non-recurring income tax expense of **$16 million ($0.07 per diluted share)**[1](index=1&type=chunk) [**Segment Performance Overview**](index=1&type=section&id=Segment%20Performance%20Overview) The Federal Express segment improved due to higher U.S. domestic and international priority package yields and increased U.S. domestic package volume, while the FedEx Freight segment saw decreased operating results from lower revenue and higher costs [**Federal Express Segment**](index=1&type=section&id=Federal%20Express%20Segment%20Performance) The Federal Express segment improved due to higher U.S. domestic and international priority package yields and increased U.S. domestic package volume, despite higher costs and global trade impacts - Federal Express segment operating results improved during the quarter, driven by higher U.S. domestic and international priority package yields, continued cost savings from transformation initiatives, and increased U.S. domestic package volume[2](index=2&type=chunk) - These positive factors were partially offset by higher wage and purchased transportation rates, the impact of the evolving global trade environment on international export package demand, and the expiration of the U.S. Postal Service contract[2](index=2&type=chunk)[3](index=3&type=chunk) [**FedEx Freight Segment**](index=2&type=section&id=FedEx%20Freight%20Segment%20Performance) The FedEx Freight segment experienced decreased operating results due to lower revenue, higher wage rates, and increased sales professional hiring - FedEx Freight segment operating results decreased during the quarter due to lower revenue, higher wage rates, and the hiring of additional dedicated LTL sales professionals[3](index=3&type=chunk) **Strategic Initiatives & Business Updates**](index=2&type=section&id=Strategic%20Initiatives%20%26%20Business%20Updates) FedEx advanced strategic initiatives including share repurchases, the planned spin-off of FedEx Freight, and announced upcoming rate increases [**Share Repurchase Program**](index=2&type=section&id=Share%20Repurchase%20Program) FedEx completed $0.5 billion in share repurchases during the quarter, buying back approximately 2.2 million shares, which positively impacted diluted EPS by $0.02. The company expects to continue repurchasing shares, with $1.6 billion remaining under the 2024 authorization - FedEx completed **$0.5 billion** in share repurchases via open market transactions during the quarter, repurchasing approximately **2.2 million shares**[4](index=4&type=chunk) - The decrease in outstanding shares benefited first quarter results by **$0.02 per diluted share**[4](index=4&type=chunk) - As of August 31, 2025, **$1.6 billion** remained available for repurchases under the company's 2024 stock repurchase authorization[5](index=5&type=chunk) [**FedEx Freight Separation On Track**](index=2&type=section&id=FedEx%20Freight%20Separation%20On%20Track) The planned spin-off of FedEx Freight into a new publicly traded company (FDXF) is on track for completion by June 2026, expected to be tax-efficient for stockholders. The company submitted its confidential Form 10 to the SEC and requested a private letter ruling from the IRS - The planned spin-off of FedEx Freight into a new publicly traded company (FDXF) continues to advance and is expected to be achieved in a tax-efficient manner for FedEx stockholders and executed by June 2026[6](index=6&type=chunk) - In August, the company submitted its confidential Form 10 to the SEC, and in September, submitted a request for a private letter ruling on the tax treatment of the transaction to the IRS[7](index=7&type=chunk) [**2026 Rate Increases**](index=2&type=section&id=2026%20Rate%20Increases) Effective January 5, 2026, FedEx parcel and FedEx Freight LTL shipping rates will increase by an average of 5.9% - Effective January 5, 2026, FedEx parcel and FedEx Freight LTL shipping rates will increase by an **average of 5.9%**[8](index=8&type=chunk) **Fiscal 2026 Outlook**](index=2&type=section&id=Outlook) FedEx initiated its fiscal 2026 outlook, forecasting revenue growth and adjusted diluted EPS, based on current economic and fuel price assumptions [**Financial Forecasts**](index=3&type=section&id=Financial%20Forecasts) FedEx initiated its full-year fiscal 2026 earnings outlook, forecasting 4% to 6% revenue growth. Adjusted diluted EPS is projected to be $17.20 to $19.00 (excluding MTM retirement adjustments, business optimization, spin-off, and fiscal year change costs). The company also expects $1 billion in permanent cost reductions and $4.5 billion in capital spending Fiscal 2026 Forecasts (Non-GAAP) | Metric | Forecast | | :--- | :--- | | Revenue growth rate year over year | 4% to 6% | | Diluted EPS (before MTM retirement plans accounting adjustments) | $14.20 to $16.00 | | Diluted EPS (after excluding business optimization, FedEx Freight spin-off, and fiscal year change costs) | $17.20 to $19.00 | | ETR (prior to MTM retirement plans accounting adjustments) | Approximately 25% | | Pension contributions | Up to $400 million (vs. prior $600 million) | | Permanent cost reductions (transformation-related savings) | $1 billion | | Capital spending | $4.5 billion | - Reaffirmed fiscal 2026 forecast includes **$1 billion in permanent cost reductions** from structural cost reductions and the advancement of Network 2.0[12](index=12&type=chunk) - Capital spending of **$4.5 billion**, with a priority on investments in network optimization and efficiency improvement, including fleet and facility modernization and automation[12](index=12&type=chunk) [**Key Assumptions**](index=3&type=section&id=Key%20Assumptions) The forecasts assume current economic conditions and fuel price expectations, with no additional adverse economic, geopolitical, or international trade-related developments. The company is unable to provide a GAAP EPS or ETR outlook due to the unpredictability of mark-to-market retirement plan accounting adjustments - Forecasts assume the company's current economic forecast and fuel price expectations, and no additional adverse economic, geopolitical, or international trade-related developments[10](index=10&type=chunk) - FedEx is unable to forecast the fiscal 2026 mark-to-market ("MTM") retirement plans accounting adjustments, and thus cannot provide a GAAP EPS or effective tax rate ("ETR") outlook[9](index=9&type=chunk)[10](index=10&type=chunk) **Corporate Information & Disclosures**](index=3&type=section&id=Corporate%20Information%20%26%20Disclosures) This section provides an overview of FedEx, details investor resources, outlines forward-looking statements and associated risks, and lists contact information [**Corporate Overview**](index=3&type=section&id=Corporate%20Overview) FedEx Corp. (NYSE: FDX) is a global transportation, e-commerce, and business services provider with $89 billion in annual revenue and over 500,000 employees. The company offers integrated business solutions and aims for carbon-neutral operations by 2040 - FedEx Corp. provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services, with annual revenue of **$89 billion** and over **500,000 employees**[11](index=11&type=chunk) - FedEx is committed to connecting people and possibilities around the world responsibly and resourcefully, with a goal to achieve carbon-neutral operations by **2040**[13](index=13&type=chunk) [**Additional Information & Investor Resources**](index=4&type=section&id=Additional%20Information%20%26%20Investor%20Resources) Additional operating data and SEC filings (10-K, 10-Q, 8-K) are available on the company's investor relations website, investors.fedex.com, which also hosts webcasts of earnings calls and other material information - Additional information and operating data are contained in the company's annual report, Form 10-K, Form 10-Qs, Form 8-Ks and Statistical Books, available on investors.fedex.com[14](index=14&type=chunk) - The Investor Relations page of the website, investors.fedex.com, contains a significant amount of information about FedEx, including SEC filings and financial and other information for investors[15](index=15&type=chunk) [**Forward-Looking Statements & Risk Factors**](index=4&type=section&id=Forward-Looking%20Statements%20%26%20Risk%20Factors) The press release contains forward-looking statements subject to various risks and uncertainties, including economic conditions, global trade volatility, ability to implement strategies, cost reduction achievement, data breaches, labor costs, international conflicts, regulatory changes, fuel prices, competition, and successful spin-off of FedEx Freight - Certain statements in this press release may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act, subject to risks, uncertainties and other factors which could cause actual results to differ materially[16](index=16&type=chunk) - Potential risks and uncertainties include economic conditions in global markets, uncertainty and volatility in the global trade environment, ability to successfully implement business strategies and achieve cost reduction initiatives, and the successful implementation of the FedEx Freight Spin-Off[16](index=16&type=chunk)[17](index=17&type=chunk) - Other risks include a significant data breach, ability to meet labor and purchased transportation needs, international conflicts, evolving laws and government regulations, changes in fuel prices or currency exchange rates, and intense competition[17](index=17&type=chunk) [**Contacts**](index=5&type=section&id=Contacts) Contact information for Media Relations and Investor Relations is provided for inquiries - Media Contact: Caitlin Maier (901-434-8100, mediarelations@fedex.com)[18](index=18&type=chunk) - Investor Relations Contact: Jeni Hollander (901-818-7200, ir@fedex.com)[18](index=18&type=chunk) **Reconciliations of Non-GAAP Financial Measures to GAAP Financial Measures**](index=6&type=section&id=RECONCILIATIONS%20OF%20NON-GAAP%20FINANCIAL%20MEASURES%20TO%20GAAP%20FINANCIAL%20MEASURES) This section reconciles non-GAAP financial measures to GAAP, explaining adjustments for business optimization, spin-off, and fiscal year change costs for Q1 FY2026 and FY2025, and the FY2026 EPS forecast [**Explanation of Non-GAAP Adjustments**](index=6&type=section&id=Explanation%20of%20Non-GAAP%20Adjustments) FedEx uses non-GAAP financial measures, excluding business optimization costs, FedEx Freight spin-off costs, and fiscal year change costs, to provide a clearer view of core operating performance and assist investors in assessing underlying business trends. These adjustments are consistent with management's view and decision-making processes - Non-GAAP financial measures exclude business optimization costs, FedEx Freight spin-off costs, and fiscal year change costs[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk)[23](index=23&type=chunk) - These adjustments are made to facilitate analysis and comparisons of ongoing business operations by excluding items that may not be indicative of, or are unrelated to, the company's and business segments' core operating performance[26](index=26&type=chunk) - Management uses these non-GAAP financial measures in making financial, operating and planning decisions and evaluating the company's and each business segments' ongoing performance[26](index=26&type=chunk) [**First Quarter Fiscal 2026 Reconciliations**](index=8&type=section&id=First%20Quarter%20Fiscal%202026%20Reconciliations) Detailed reconciliation tables are provided for FedEx Corporation, Federal Express Segment, and FedEx Freight Segment, showing the impact of business optimization, FedEx Freight spin-off, and fiscal year change costs on operating income, net income, and diluted EPS for Q1 FY2026 [**First Quarter Fiscal 2026 FedEx Corporation**](index=8&type=section&id=First%20Quarter%20Fiscal%202026%20FedEx%20Corporation) First Quarter Fiscal 2026 FedEx Corporation Reconciliation | Dollars in millions, except EPS | | Operating Income | Margin | | Income Taxes | Net Income | Diluted Earnings Per Share | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | GAAP measure | $ | 1,186 | 5.3 % | $ | 310 | $ 824 | $ 3.46 | | Business optimization costs | | 67 | 0.3 % | | 15 | 52 | 0.22 | | FedEx Freight spin-off costs | | 41 | 0.2 % | | 10 | 33 | 0.14 | | Fiscal year change costs | | 4 | — % | | 1 | 3 | 0.01 | | Non-GAAP measure | $ | 1,298 | 5.8 % | $ | 336 | $ 912 | $ 3.83 | [**Federal Express Segment**](index=8&type=section&id=First%20Quarter%20Fiscal%202026%20Federal%20Express%20Segment) First Quarter Fiscal 2026 Federal Express Segment Reconciliation | Dollars in millions | Operating Income | Margin | | :--- | :--- | :--- | | GAAP measure | $ 1,138 | 6.0 % | | Business optimization costs | 21 | 0.1 % | | FedEx Freight spin-off costs | 1 | — % | | Fiscal year change costs | 4 | — % | | Non-GAAP measure | $ 1,164 | 6.1 % | [**FedEx Freight Segment**](index=8&type=section&id=First%20Quarter%20Fiscal%202026%20FedEx%20Freight%20Segment) First Quarter Fiscal 2026 FedEx Freight Segment Reconciliation | Dollars in millions | Operating Income | Margin | | :--- | :--- | :--- | | GAAP measure | $ 360 | 16.0 % | | FedEx Freight spin-off costs | 9 | 0.4 % | | Non-GAAP measure | $ 369 | 16.3 % | [**First Quarter Fiscal 2025 Reconciliations**](index=9&type=section&id=First%20Quarter%20Fiscal%202025%20Reconciliations) Detailed reconciliation tables are provided for FedEx Corporation and Federal Express Segment, showing the impact of business optimization costs on operating income, net income, and diluted EPS for Q1 FY2025 [**FedEx Corporation**](index=9&type=section&id=First%20Quarter%20Fiscal%202025%20FedEx%20Corporation) First Quarter Fiscal 2025 FedEx Corporation Reconciliation | Dollars in millions, except EPS | Operating Income | Margin | | Income Taxes | Net Income | Diluted Earnings Per Share | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | GAAP measure | $ 1,080 | 5.0 % | $ | 262 | $ 794 | $ 3.21 | | Business optimization costs | 128 | 0.6 % | | 30 | 98 | 0.39 | | Non-GAAP measure | $ 1,208 | 5.6 % | $ | 292 | $ 892 | $ 3.60 | [**Federal Express Segment**](index=9&type=section&id=First%20Quarter%20Fiscal%202025%20Federal%20Express%20Segment) First Quarter Fiscal 2025 Federal Express Segment Reconciliation | Dollars in millions | Operating Income | Margin | | :--- | :--- | :--- | | GAAP measure | $ 953 | 5.2 % | | Business optimization costs | 43 | 0.2 % | | Non-GAAP measure | $ 996 | 5.4 % | [**Fiscal 2026 Diluted Earnings Per Share Forecast**](index=11&type=section&id=Fiscal%202026%20Diluted%20Earnings%20Per%20Share%20Forecast) The fiscal 2026 diluted EPS forecast is a non-GAAP measure, excluding MTM retirement plans accounting adjustments and estimated costs for business optimization, FedEx Freight spin-off, and fiscal year change. A table outlines the effects of these exclusions, except for MTM adjustments which are impracticable to predict - The fiscal 2026 EPS forecast is a non-GAAP financial measure because it excludes fiscal 2026 MTM retirement plans accounting adjustments and estimated costs related to business optimization initiatives, the planned spin-off of FedEx Freight, and the planned fiscal year change[28](index=28&type=chunk) Fiscal 2026 Diluted Earnings Per Share Forecast Adjustments | Dollars in millions, except EPS | Adjustments | Diluted Earnings Per Share | | :--- | :--- | :--- | | Diluted earnings per share before MTM retirement plans accounting adjustments (non-GAAP) | | $14.20 to $16.00 | | FedEx Freight spin-off costs | $600 | | | Business optimization | 310 | | | Fiscal year change costs | 30 | | | Total adjustments | $940 | | | Income tax effect | (215) | | | Net of tax effect | $725 | 3.00 | | Diluted earnings per share with adjustments (non-GAAP) | | $17.20 to $19.00 | **Detailed Financial Statements**](index=12&type=section&id=Detailed%20Financial%20Statements) This section presents detailed unaudited consolidated financial statements, including income statements, balance sheets, cash flows, and segment-specific financial and operating highlights [**FedEx Corp. Financial Highlights (Consolidated Income Statement)**](index=12&type=section&id=FEDEX%20CORP.%20FINANCIAL%20HIGHLIGHTS) Presents the unaudited consolidated income statement for the three months ended August 31, 2025, and 2024, detailing revenue by segment, operating expenses, operating income, other income/expense, income before taxes, provision for income taxes, net income, and diluted EPS FedEx Corp. Financial Highlights (Consolidated Income Statement) | | | Three Months Ended | | | | :--- | :--- | :--- | :--- | :--- | :--- | | | | August 31, 2025 | | August 31, 2024 | Percent Change | | Revenue: | | | | | | | Federal Express segment | $ | 19,116 | $ | 18,305 | 4 | | FedEx Freight segment | | 2,257 | | 2,329 | (3) | | (1) Other and eliminations | | 871 | | 945 | (8) | | Total Revenue | | 22,244 | | 21,579 | 3 | | Operating Expenses: | | | | | | | Salaries and employee benefits | | 8,062 | | 7,785 | 4 | | Purchased transportation | | 5,488 | | 5,275 | 4 | | Rentals and landing fees | | 1,192 | | 1,161 | 3 | | Depreciation and amortization | | 1,092 | | 1,078 | 1 | | Fuel | | 873 | | 1,075 | (19) | | Maintenance and repairs | | 843 | | 829 | 2 | | Separation and other costs | | 45 | | — | NM | | Business optimization costs | | 67 | | 128 | (48) | | Other | | 3,396 | | 3,168 | 7 | | Total Operating Expenses | | 21,058 | | 20,499 | 3 | | Operating income (loss): | | | | | | | Federal Express segment | | 1,138 | | 953 | 19 | | FedEx Freight segment | | 360 | | 439 | (18) | | (1) Corporate, other, and eliminations | | (312) | | (312) | — | | Total Operating Income | | 1,186 | | 1,080 | 10 | | Other (Expense) Income: | | | | | | | Interest, net | | (119) | | (84) | 42 | | Other retirement plans, net | | 60 | | 49 | 22 | | Other, net | | 7 | | 11 | (36) | | Total Other (Expense) Income | | (52) | | (24) | 117 | | Income Before Income Taxes | | 1,134 | | 1,056 | 7 | | Provision for Income Taxes | | 310 | | 262 | 18 | | Net Income | $ | 824 | $ | 794 | 4 | | Diluted Earnings Per Share | $ | 3.46 | $ | 3.21 | 8 | | Weighted Average Common and Common Equivalent Shares | | 238 | | 247 | (4) | | Capital Expenditures | $ | 623 | $ | 767 | (19) | [**FedEx Corp. Condensed Consolidated Balance Sheets**](index=13&type=section&id=FEDEX%20CORP.%20CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) Provides the unaudited condensed consolidated balance sheets as of August 31, 2025, and May 31, 2025, detailing current and long-term assets, liabilities, and common stockholders' investment FedEx Corp. Condensed Consolidated Balance Sheets | | August 31, 2025 | | | | | :--- | :--- | :--- | :--- | :--- | | | (Unaudited) | | | May 31, 2025 | | ASSETS | | | | | | Current Assets | | | | | | Cash and cash equivalents | $ | 6,166 | $ | 5,502 | | Receivables, less allowances | | 11,516 | | 11,368 | | Spare parts, supplies, and fuel, less allowances | | 604 | | 602 | | Prepaid expenses and other | | 1,058 | | 914 | | Total current assets | | 19,344 | | 18,386 | | Property and Equipment, at Cost | | 88,126 | | 87,622 | | Less accumulated depreciation and amortization | | 46,742 | | 45,980 | | Net property and equipment | | 41,384 | | 41,642 | | Other Long-Term Assets | | | | | | Operating lease right-of-use assets, net | | 16,368 | | 16,453 | | Goodwill | | 6,672 | | 6,603 | | Other assets | | 4,648 | | 4,543 | | Total other long-term assets | | 27,688 | | 27,599 | | | $ | 88,416 | $ | 87,627 | | LIABILITIES AND COMMON STOCKHOLDERS' INVESTMENT | | | | | | Current Liabilities | | | | | | Current portion of long-term debt | $ | 883 | $ | 1,428 | | Accrued salaries and employee benefits | | 2,333 | | 2,731 | | Accounts payable | | 4,223 | | 3,692 | | Operating lease liabilities | | 2,591 | | 2,565 | | Accrued expenses | | 5,494 | | 4,995 | | Total current liabilities | | 15,524 | | 15,411 | | Long-Term Debt, Less Current Portion | | 20,291 | | 19,151 | | Other Long-Term Liabilities | | | | | | Deferred income taxes | | 4,050 | | 4,205 | | Pension, postretirement healthcare, and other benefit obligations | | 1,690 | | 1,698 | | Self-insurance accruals | | 4,132 | | 4,033 | | Operating lease liabilities | | 14,141 | | 14,272 | | Other liabilities | | 817 | | 783 | | Total other long-term liabilities | | 24,830 | | 24,991 | | Commitments and Contingencies | | | | | | Common Stockholders' Investment | | | | | | Common stock, $0.10 par value, 800 million shares authorized | | 32 | | 32 | | Additional paid-in capital | | 4,327 | | 4,290 | | Retained earnings | | 41,538 | | 41,402 | | Accumulated other comprehensive loss | | (1,371) | | (1,362) | | Treasury stock, at cost | | (16,755) | | (16,288) | | Total common stockholders' investment | | 27,771 | | 28,074 | | | $ | 88,416 | $ | 87,627 | [**FedEx Corp. Condensed Consolidated Statements of Cash Flows**](index=14&type=section&id=FEDEX%20CORP.%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Presents the unaudited condensed consolidated statements of cash flows for the three months ended August 31, 2025, and 2024, outlining cash flows from operating, investing, and financing activities FedEx Corp. Condensed Consolidated Statements of Cash Flows | | | Three Months Ended | | | :--- | :--- | :--- | :--- | :--- | | | August 31, 2025 | | | August 31, 2024 | | Operating Activities: | | | | | | Net income | $ | 824 | $ | 794 | | Adjustments to reconcile net income to cash provided by operating activities: | | | | | | Depreciation and amortization | | 1,092 | | 1,078 | | Other, net | | 910 | | 925 | | Changes in operating assets and liabilities, net | | (1,110) | | (1,610) | | Cash provided by operating activities | | 1,716 | | 1,187 | | Investing Activities: | | | | | | Capital expenditures | | (623) | | (767) | | Purchase of investments | | (34) | | (61) | | Proceeds from sale of investments | | 30 | | 13 | | Proceeds from asset dispositions and other investing activities, net | | 8 | | 13 | | Cash used in investing activities | | (619) | | (802) | | Financing Activities: | | | | | | Proceeds from debt issuances | | 997 | | — | | Principal payments on debt | | (625) | | (34) | | Proceeds from stock issuances | | 18 | | 404 | | Dividends paid | | (345) | | (339) | | Purchases of common stock | | (500) | | (1,000) | | Other | | (5) | | — | | Cash used in financing activities | | (460) | | (969) | | Effect of exchange rate changes on cash | | 27 | | 26 | | Net increase (decrease) in cash and cash equivalents | | 664 | | (558) | | Cash and cash equivalents at beginning of period | | 5,502 | | 6,501 | | Cash and cash equivalents at end of period | $ | 6,166 | $ | 5,943 | [**Federal Express Segment Financial & Operating Highlights**](index=15&type=section&id=FEDERAL%20EXPRESS%20SEGMENT%20FINANCIAL%20HIGHLIGHTS) Details the financial and operating performance of the Federal Express segment for the three months ended August 31, 2025, and 2024, including revenue breakdown by package type and freight, operating expenses, operating income, operating margin, and key package and freight statistics (volume, yield) Federal Express Segment Financial Highlights | | | Three Months Ended | | | | :--- | :--- | :--- | :--- | :--- | :--- | | | | August 31, 2025 | | August 31, 2024 | Percent Change | | Revenue: | | | | | | | Package: | | | | | | | U.S. priority | $ | 2,767 | $ | 2,591 | 7 | | U.S. deferred | | 1,273 | | 1,151 | 11 | | U.S. ground | | 8,654 | | 8,056 | 7 | | Total U.S. domestic package revenue | | 12,694 | | 11,798 | 8 | | International priority | | 2,258 | | 2,206 | 2 | | International economy | | 1,354 | | 1,360 | — | | Total international export package revenue | | 3,612 | | 3,566 | 1 | | (1) International domestic | | 1,135 | | 1,112 | 2 | | Total package revenue | | 17,441 | | 16,476 | 6 | | Freight: | | | | | | | U.S. | | 303 | | 569 | (47) | | International priority | | 595 | | 526 | 13 | | International economy | | 528 | | 463 | 14 | | Total freight revenue | | 1,426 | | 1,558 | (8) | | Other | | 249 | | 271 | (8) | | Total revenue | | 19,116 | | 18,305 | 4 | | Operating expenses: | | | | | | | Salaries and employee benefits | | 6,516 | | 6,201 | 5 | | Purchased transportation | | 5,073 | | 4,801 | 6 | | Rentals and landing fees | | 1,013 | | 986 | 3 | | Depreciation and amortization | | 954 | | 935 | 2 | | Fuel | | 760 | | 954 | (20) | | Maintenance and repairs | | 737 | | 719 | 3 | | Separation and other costs | | 5 | | — | NM | | Business optimization costs | | 21 | | 43 | (51) | | Intercompany allocations | | (233) | | (187) | 25 | | Other | | 3,132 | | 2,900 | 8 | | Total operating expenses | | 17,978 | | 17,352 | 4 | | Operating income | $ | 1,138 | $ | 953 | 19 | | Operating margin | | 6.0 % | | 5.2 % | 80 bp | Federal Express Segment Operating Highlights (Package Statistics) | PACKAGE STATISTICS | | | Three Months Ended | | | | :--- | :--- | :--- | :--- | :--- | :--- | | (1) Avg. daily package volume (ADV) (000s) : | | | | | | | U.S. priority | | 1,654 | | 1,600 | 3 | | U.S. deferred | | 1,061 | | 968 | 10 | | U.S. ground commercial | | 4,290 | | 4,289 | — | | U.S. ground home delivery/economy | | 6,915 | | 6,438 | 7 | | Total U.S. domestic ADV | | 13,920 | | 13,295 | 5 | | International priority | | 562 | | 622 | (10) | | International economy | | 518 | | 491 | 5 | | Total international export ADV | | 1,080 | | 1,113 | (3) | | (2) International domestic | | 1,806 | | 1,823 | (1) | | Total ADV | | 16,806 | | 16,231 | 4 | | Revenue per package (yield): | | | | | | | U.S. priority | $ | 26.13 | $ | 25.30 | 3 | | U.S. deferred | | 18.76 | | 18.59 | 1 | | U.S. ground | | 12.07 | | 11.73 | 3 | | U.S. domestic composite | | 14.25 | | 13.87 | 3 | | International priority | | 62.77 | | 55.37 | 13 | | International economy | | 40.87 | | 43.33 | (6) | | International export composite | | 52.27 | | 50.06 | 4 | | (2) International domestic | | 9.81 | | 9.53 | 3 | | Composite package yield | $ | 16.22 | $ | 15.86 | 2 | Federal Express Segment Operating Highlights (Freight Statistics) | FREIGHT STATISTICS | | | Three Months Ended | | | | :--- | :--- | :--- | :--- | :--- | :--- | | Average daily freight pounds (000s): | | | | | | | U.S. | | 2,165 | | 5,319 | (59) | | International priority | | 4,647 | | 4,465 | 4 | | International economy | | 11,222 | | 10,706 | 5 | | Total average daily freight pounds | | 18,034 | | 20,490 | (12) | | Revenue per pound (yield): | | | | | | | U.S. | $ | 2.18 | $ | 1.67 | 31 | | International priority | | 2.00 | | 1.84 | 9 | | International economy | | 0.74 | | 0.68 | 9 | | Composite freight yield | $ | 1.24 | $ | 1.19 | 4 | | Operating weekdays | | 64 | | 64 | — | [**FedEx Freight Segment Financial & Operating Highlights**](index=17&type=section&id=FEDEX%20FREIGHT%20SEGMENT%20FINANCIAL%20AND%20OPERATING%20HIGHLIGHTS) Details the financial and operating performance of the FedEx Freight segment for the three months ended August 31, 2025, and 2024, including revenue, operating expenses, operating income, operating margin, and key operating statistics (average daily shipments, weight per shipment, revenue per shipment, revenue per hundredweight) FedEx Freight Segment Financial Highlights | FINANCIAL HIGHLIGHTS | | | Three Months Ended | | | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | $ | 2,257 | $ | 2,329 | (3) | | Operating expenses: | | | | | | | Salaries and employee benefits | | 975 | | 984 | (1) | | Purchased transportation | | 201 | | 203 | (1) | | Rentals | | 74 | | 71 | 4 | | Depreciation and amortization | | 110 | | 110 | — | | Fuel | | 113 | | 121 | (7) | | Maintenance and repairs | | 81 | | 82 | (1) | | Separation and other costs | | 9 | | — | NM | | Intercompany charges | | 162 | | 148 | 9 | | Other | | 172 | | 171 | 1 | | Total operating expenses | | 1,897 | | 1,890 | — | | Operating income | $ | 360 | $ | 439 | (18) | | Operating margin | | 16.0 % | | 18.8 % | (280) bp | FedEx Freight Segment Operating Statistics | OPERATING STATISTICS | | | Three Months Ended | | | | :--- | :--- | :--- | :--- | :--- | :--- | | Operating weekdays | | 64 | | 64 | — | | Average daily shipments (000s): | | | | | | | Priority | | 62.0 | | 62.9 | (1) | | Economy | | 28.0 | | 29.1 | (4) | | Total average daily shipments | | 90.0 | | 92.0 | (2) | | Weight per shipment (lbs): | | | | | | | Priority | | 933 | | 956 | (2) | | Economy | | 907 | | 868 | 4 | | Composite weight per shipment | | 925 | | 928 | — | | Revenue per shipment: | | | | | | | Priority | $ | 359.54 | $ | 363.97 | (1) | | Economy | | 408.05 | | 408.60 | — | | Composite revenue per shipment | $ | 374.62 | $ | 378.09 | (1) | | Revenue per hundredweight: | | | | | | | Priority | $ | 38.54 | $ | 38.06 | 1 | | Economy | | 44.98 | | 47.09 | (4) | | Composite revenue per hundredweight | $ | 40.50 | $ | 40.73 | (1) |

Fiscal 2026 Q1 Review [Executive Summary & CEO Commentary](index=1&type=section&id=Executive%20Summary%20%26%20CEO%20Commentary) Scholastic reported a seasonal Q1 operating loss, with CEO Peter Warwick highlighting steady progress in book fairs, Entertainment IP, and strategic Education efforts, alongside real estate monetization plans - The company typically generates an **operating loss** in the first quarter due to **seasonality** when schools are not in session[1](index=1&type=chunk)[2](index=2&type=chunk) - **Fall book fair bookings are encouraging and exceed prior year bookings**, showing **strong engagement with hosts**[3](index=3&type=chunk) - Scholastic Entertainment is **expanding IP reach and value**, creating new brands, and building **higher-margin digital and licensing revenue streams**, leveraging 9 Story Media Group capabilities[3](index=3&type=chunk) - The Education division faced pressure from a **difficult and volatile funding environment**, leading to **delayed or reduced school purchases**[4](index=4&type=chunk) - The company is **evaluating potential sale-leasebacks of key real estate assets** to **enhance shareholder value**, which have **drawn substantial interest**[5](index=5&type=chunk) [Consolidated Financial Highlights](index=1&type=section&id=Consolidated%20Financial%20Highlights) Q1 FY26 saw a **5% revenue decrease** to **$225.6 million**, a **4% operating loss increase** to **$92.2 million**, and a **28% diluted loss per share widening**, while **Adjusted EBITDA improved 8%** to a **$55.7 million loss** | In $ millions (except per share data) | Fiscal 2026 | Fiscal 2025 | Change ($) | Change (%) | | :----------------------------------- | :---------- | :---------- | :--------- | :--------- | | Revenues | $ 225.6 | $ 237.2 | $ (11.6) | (5)% | | Operating income (loss) | $ (92.2) | $ (88.5) | $ (3.7) | (4)% | | Earnings (loss) before taxes | $ (97.0) | $ (91.8) | $ (5.2) | (6)% | | Diluted earnings (loss) per share | $ (2.83) | $ (2.21) | $ (0.62) | (28)% | | Operating income (loss), ex. one-time items * | $ (81.9) | $ (85.6) | $ 3.7 | 4 % | | Diluted earnings (loss) per share, ex. one-time items * | $ (2.52) | $ (2.13) | $ (0.39) | (18)% | | Adjusted EBITDA * | $ (55.7) | $ (60.5) | $ 4.8 | 8 % | [Overall Financial Performance](index=1&type=section&id=Overall%20Financial%20Performance) Consolidated revenues **decreased 5%** to **$225.6 million** due to lower Education Solutions sales, resulting in a **$92.2 million operating loss**, though **Adjusted EBITDA improved 8%** to a **$55.7 million loss** - Revenues **decreased 5% to $225.6 million**, mainly due to **lower Education Solutions sales** amid a **volatile funding environment**[7](index=7&type=chunk) - Operating loss **increased 4% to $92.2 million** (including one-time charges), but **improved by $3.7 million excluding these charges**[8](index=8&type=chunk) - **Adjusted EBITDA improved 8% to a loss of $55.7 million**, reflecting **reduced discretionary overhead** and **higher Children's Book Publishing and Distribution revenues**[8](index=8&type=chunk)[9](index=9&type=chunk) Quarterly Results by Segment [Children's Book Publishing and Distribution](index=2&type=section&id=Children's%20Book%20Publishing%20and%20Distribution) This segment's revenues **increased 4%** to **$109.4 million**, driven by an **18% rise in Book Fairs**, despite a **33% drop in Book Clubs**, leading to an improved operating loss of **$35.1 million** | Metric | FY26 Q1 ($M) | FY25 Q1 ($M) | Change ($M) | Change (%) | | :---------------------- | :----------- | :----------- | :---------- | :--------- | | Total Revenues | 109.4 | 105.4 | 4.0 | 4 % | | Book Fairs Revenues | 34.1 | 28.8 | 5.3 | 18 % | | Book Clubs Revenues | 1.8 | 2.7 | (0.9) | (33)% | | Consolidated Trade | 73.5 | 73.9 | (0.4) | (1)% | | Operating income (loss) | (35.1) | (36.6) | 1.5 | 4 % | - **Higher redemptions of Scholastic Dollars** in Book Fairs are indicative of **positive engagement with Book Fair hosts**[11](index=11&type=chunk) [Education Solutions](index=2&type=section&id=Education%20Solutions) Education Solutions revenues significantly **decreased 28%** to **$40.1 million** due to school funding uncertainty, resulting in an **increased operating loss of $21.2 million** | Metric | FY26 Q1 ($M) | FY25 Q1 ($M) | Change ($M) | Change (%) | | :---------------------- | :----------- | :----------- | :---------- | :--------- | | Revenues | 40.1 | 55.7 | (15.6) | (28)% | | Operating income (loss) | (21.2) | (17.0) | (4.2) | (25)% | - The division continues to execute on **more focused product, marketing, and sales strategies** with the long-term goal of **regaining market share**[12](index=12&type=chunk) [Entertainment](index=2&type=section&id=Entertainment) Entertainment revenues **decreased 18%** to **$13.6 million** due to production delays, widening the operating loss to **$4.0 million**, partly from **$2.5 million in intangible amortization** related to the 9 Story transaction | Metric | FY26 Q1 ($M) | FY25 Q1 ($M) | Change ($M) | Change (%) | | :---------------------- | :----------- | :----------- | :---------- | :--------- | | Revenues | 13.6 | 16.6 | (3.0) | (18)% | | Operating income (loss) | (4.0) | (0.5) | (3.5) | NM | - The company incurred **$2.5 million in intangible amortization** related to the **9 Story transaction** during the quarter[13](index=13&type=chunk) [International](index=2&type=section&id=International) International revenues grew **4%** to **$59.4 million** (excluding currency impact), driven by Australia, UK, and Asia, leading to a **49% improved operating loss** of **$4.2 million** | Metric | FY26 Q1 ($M) | FY25 Q1 ($M) | Change ($M) | Change (%) | | :---------------------- | :----------- | :----------- | :---------- | :--------- | | Revenues | 59.4 | 56.8 | 2.6 | 5 % | | Operating income (loss) | (4.2) | (8.3) | 4.1 | 49 % | - **Excluding favorable foreign currency exchange of $0.2 million**, International revenues **increased 4%**[14](index=14&type=chunk) - **Adjusted operating loss improved by $4.2 million**, driven by **higher revenues and operational efficiencies**[14](index=14&type=chunk) [Overhead](index=2&type=section&id=Overhead) Overhead costs were **$27.7 million**, but adjusted costs **decreased $6.6 million** excluding **$9.4 million in one-time charges**, reflecting successful cost-saving initiatives | Metric | FY26 Q1 ($M) | FY25 Q1 ($M) | Change ($M) | Change (%) | | :---------------------- | :----------- | :----------- | :---------- | :--------- | | Operating income (loss) | (27.7) | (26.1) | (1.6) | (6)% | - **Excluding one-time charges**, adjusted overhead costs **decreased $6.6 million** due to **cost-saving initiatives**[15](index=15&type=chunk) Capital Position and Liquidity [Cash Flow and Debt](index=3&type=section&id=Cash%20Flow%20and%20Debt) Net cash used by operating activities **increased 95%** to **$81.8 million**, and net debt rose to **$242.8 million**, reflecting working capital needs, dividends, and share repurchases | In $ millions | Fiscal 2026 | Fiscal 2025 | Change ($) | Change (%) | | :------------------------------------------------ | :---------- | :---------- | :--------- | :--------- | | Net cash (used) provided by operating activities | $ (81.8) | $ (41.9) | $ (39.9) | (95)% | | Additions to property, plant and equipment and prepublication expenditures | (14.9) | (24.4) | 9.5 | 39 % | | Net of borrowings (repayments) film related obligations | (3.5) | (2.4) | (1.1) | (46)% | | Free cash flow (use)* | $ (100.2) | $ (68.7) | $ (31.5) | (46)% | | Net cash (debt)* | $ (242.8) | $ (152.1) | $ (90.7) | (60)% | - Net cash used by operating activities **increased by 95% to $81.8 million**, driven by **lower net income** and **seasonal working capital**[17](index=17&type=chunk) - Net debt **increased to $242.8 million from $152.1 million**, reflecting **working capital, dividends, and share repurchases**[18](index=18&type=chunk) - The Company **distributed $5.2 million in dividends** and has **$70.0 million remaining for share repurchases**[18](index=18&type=chunk) [Real Estate Monetization Initiatives](index=3&type=section&id=Real%20Estate%20Monetization%20Initiatives) Scholastic is evaluating potential sale-leaseback transactions for its NYC and Missouri real estate, expecting **significant additional liquidity** for **debt reduction and share repurchases** this fall - Scholastic has **retained Newmark Group** to identify investment partners for **potential sale-leaseback transactions** of its owned real estate assets[19](index=19&type=chunk) - These processes are expected to **conclude this fall** and could provide **significant additional liquidity** for **debt reduction and share repurchases**[19](index=19&type=chunk) Additional Information [Non-GAAP Financial Measures](index=3&type=section&id=Non-GAAP%20Financial%20Measures) The company provides **non-GAAP measures** like **Adjusted EBITDA** and **Free Cash Flow** for supplemental understanding, not as substitutes for GAAP financial information - **Non-GAAP measures** like **"Adjusted EBITDA"** and **"Free Cash Flow"** are included to **supplement GAAP financial statements**[20](index=20&type=chunk) - This information is **supplemental and not a substitute for GAAP financial information**[20](index=20&type=chunk) [Conference Call Details](index=3&type=section&id=Conference%20Call%20Details) Scholastic discussed **Q1 results** on a September 18, 2025 conference call, with a webcast and slides available on its investor relations website - A conference call was held on **September 18, 2025, at 4:30 p.m. ET** to discuss results, moderated by **Peter Warwick and Haji Glover**[21](index=21&type=chunk) - **Access to the live webcast and dial-in details were provided**, with an **archived webcast and slides available at investor.scholastic.com**[22](index=22&type=chunk) [About Scholastic](index=3&type=section&id=About%20Scholastic) **Scholastic Corporation** is a **global children's publishing, education, and media company** with over 100 years of history, empowering literacy through diverse content and channels worldwide - **Scholastic Corporation (NASDAQ: SCHL)** is a **global children's publishing, education, and media company** with **over 100 years of history**[23](index=23&type=chunk) - The company's mission is to **empower children to become lifelong readers and learners** through **bestselling books, literacy resources, and entertaining media**[23](index=23&type=chunk) - Scholastic **operates globally, reaching over 135 countries** through **school-based book clubs, book fairs, libraries, retail, and online platforms**[23](index=23&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This news release contains **forward-looking statements** subject to market and product acceptance risks, where **actual results could differ materially** from current expectations - The news release contains **forward-looking statements** subject to **risks and uncertainties**, including **market conditions and product acceptance**[25](index=25&type=chunk) - **Actual results could differ materially** from those currently anticipated[25](index=25&type=chunk) Unaudited Financial Statements [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) This section details revenues, operating costs, and net income (loss) for the three months ended August 31, 2025, and August 31, 2024 | | Three months ended | | | | :-------------------------------------- | :--------- | :--------- | :--------- | | | 08/31/25 | 08/31/24 | | | Revenues | $ 225.6 | $ 237.2 | | | Operating costs and expenses: | | | | | Cost of goods sold | 123.5 | 128.3 | | | Selling, general and administrative expense | 177.2 | 182.1 | | | Depreciation and amortization | 16.3 | 15.3 | | | Asset impairments and write downs | 0.8 | — | | | Total operating costs and expenses | 317.8 | 325.7 | | | Operating income (loss) | (92.2) | (88.5) | | | Interest income (expense), net | (4.5) | (3.0) | | | Other components of net periodic benefit (cost) | (0.3) | (0.3) | | | Earnings (loss) before income taxes | (97.0) | (91.8) | | | Provision (benefit) for income taxes | (25.9) | (29.3) | | | Net income (loss) | (71.1) | (62.5) | | | Basic and diluted earnings (loss) per share of Class A and Common Stock | | | | | Basic | $ (2.83) | $ (2.21) | | | Diluted | $ (2.83) | $ (2.21) | | | Basic weighted average shares outstanding | 25,161 | 28,290 | | | Diluted weighted average shares outstanding | 25,410 | 28,908 | [Segment Results](index=6&type=section&id=Segment%20Results) This section presents revenues and operating income (loss) for each operating segment for the three months ended August 31, 2025, and August 31, 2024 | | | | Three months ended | | | Change | | | :----------------------------------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | | | 08/31/25 | | | 08/31/24 | | $ | % | | Children's Book Publishing and Distribution | | | | | | | | | Revenues | | | | | | | | | Books Clubs | $ 1.8 | | $ 2.7 | | $ (0.9) | (33)% | | Book Fairs | 34.1 | | 28.8 | | 5.3 | 18 % | | School Reading Events | 35.9 | | 31.5 | | 4.4 | 14 % | | Consolidated Trade | 73.5 | | 73.9 | | (0.4) | (1)% | | Total Revenues | 109.4 | | 105.4 | | 4.0 | 4 % | | Operating income (loss) | (35.1) | | (36.6) | | 1.5 | 4 % | | Operating margin | NM | | NM | | | | | Education Solutions | | | | | | | | | Revenues | 40.1 | | 55.7 | | (15.6) | (28)% | | Operating income (loss) | (21.2) | | (17.0) | | (4.2) | (25)% | | Operating margin | NM | | NM | | | | | Entertainment | | | | | | | | | Revenues | 13.6 | | 16.6 | | (3.0) | (18)% | | Operating income (loss) | (4.0) | | (0.5) | | (3.5) | NM | | Operating margin | NM | | NM | | | | | International | | | | | | | | | Revenues | 59.4 | | 56.8 | | 2.6 | 5 % | | Operating income (loss) | (4.2) | | (8.3) | | 4.1 | 49 % | | Operating margin | NM | | NM | | | | | Overhead | | | | | | | | | Revenues | 3.1 | | 2.7 | | 0.4 | 15 % | | Operating income (loss) | (27.7) | | (26.1) | | (1.6) | (6)% | | Operating income (loss) | $ (92.2) | $ | (88.5) | $ | (3.7) | (4)% | [Supplemental Balance Sheet and Cash Flow Items](index=7&type=section&id=Supplemental%20Balance%20Sheet%20and%20Cash%20Flow%20Items) This section provides selected balance sheet items and cash flow details, including net cash from operating activities and free cash flow (use) | Selected Balance Sheet Items | | | | | :--------------------------- | :--------- | :--------- | :--------- | | | 08/31/25 | | 08/31/24 | | Cash and cash equivalents | $ 94.3 | | $ 84.1 | | Accounts receivable, net | 187.0 | | 201.1 | | Inventories, net | 322.2 | | 310.3 | | Accounts payable | 175.8 | | 184.0 | | Deferred revenue | 181.0 | | 173.9 | | Accrued royalties | 86.6 | | 77.5 | | Film related obligations | 14.7 | | 34.1 | | Lines of credit and long-term debt | 331.2 | | 231.1 | | (1) Net cash (debt) | (242.8) | | (152.1) | | Total stockholders' equity | 878.0 | | 957.3 | | Selected Cash Flow Items | | | | | | | Three months ended | | | | 08/31/25 | | 08/31/24 | | Net cash provided by (used in) operating activities | $ (81.8) | | $ (41.9) | | Property, plant and equipment additions | (10.0) | | (20.0) | | Prepublication expenditures | (4.9) | | (4.4) | | Net borrowings (repayments) of film related obligations | (3.5) | | (2.4) | | (2) Free cash flow (use) | $ (100.2) | | $ (68.7) | - **Net cash (debt)** is defined as **cash and cash equivalents less production cash, net of lines of credit and short-term and long-term debt, excluding film related obligations**[32](index=32&type=chunk) - **Free cash flow (use)** is defined as **net cash from operating activities, adjusted for acquisitions, asset sales, capital expenditures, prepublication costs, and film related obligations**[33](index=33&type=chunk) [Supplemental Results - Excluding One-Time Items](index=8&type=section&id=Supplemental%20Results%20-%20Excluding%20One-Time%20Items) This table reconciles reported financial results to those excluding **one-time items** for diluted EPS, net income, earnings before taxes, and segment operating income | | | | | Three months ended | | | | | | | | | :----------------------------------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | | | | | 08/31/2025 | | | | | 08/31/2024 | | | | | | | Reported | One-time items | | Excluding One-time items | | | Reported | One-time items | | Excluding One-time items | | | Diluted earnings (loss) per (1) share | $ (2.83) | $ 0.31 | $ (2.52) | | $ (2.21) | $ 0.08 | $ (2.13) | | | (2) Net income (loss) | $ (71.1) | $ 7.8 | $ (63.3) | | $ (62.5) | $ 2.2 | $ (60.3) | | | Earnings (loss) before income taxes | $ (97.0) | $ 10.3 | $ (86.7) | | $ (91.8) | $ 2.9 | $ (88.9) | | | Children's Book Publishing (3) and Distribution | $ (35.1) | $ 0.8 | $ (34.3) | | $ (36.6) | $ — | $ (36.6) | | | Education Solutions | (21.2) | — | (21.2) | | (17.0) | — | (17.0) | | | (4) Entertainment | (4.0) | 0.0 | (4.0) | | (0.5) | 1.7 | 1.2 | | | (5) International | (4.2) | 0.1 | (4.1) | | (8.3) | — | (8.3) | | | (6) Overhead | (27.7) | 9.4 | (18.3) | | (26.1) | 1.2 | (24.9) | | | Operating income (loss) | $ (92.2) | $ 10.3 | $ (81.9) | | $ (88.5) | $ 2.9 | $ (85.6) | | - **One-time items for Q1 FY26** included **$0.8M asset impairment** in Children's Book Publishing, **less than $0.1M acquisition costs** in Entertainment, **$0.1M severance** in International, and **$8.7M severance plus $0.7M other expenses** in Overhead[36](index=36&type=chunk)[37](index=37&type=chunk) [Adjusted EBITDA (Consolidated & Segment)](index=9&type=section&id=Adjusted%20EBITDA%20(Consolidated%20%26%20Segment)) This section calculates consolidated and segment **Adjusted EBITDA**, reconciling it from earnings before income taxes, excluding **one-time items**, interest, depreciation, and amortization | | | Three months ended | | | | :------------------------------------------ | :------- | :------- | :------- | :------- | | | 08/31/25 | | 08/31/24 | | | Earnings (loss) before income taxes as reported | $ (97.0) | | $ (91.8) | | | One-time items before income taxes | 10.3 | | 2.9 | | | Earnings (loss) before income taxes excluding one-time items | (86.7) | | (88.9) | | | (1) Interest (income) expense | 4.5 | | 3.4 | | | Depreciation and amortization | 26.5 | | 25.0 | | | (2) Adjusted EBITDA | $ (55.7) | | $ (60.5) | | | | | | | | | | Three months ended | | | | | | | | :----------------------------------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | :------- | | | CBPD (1) | EDUC (1) | ENT (1) | INTL (1) | OVH (1) | | Total | | | Earnings (loss) before income taxes as reported | $ (35.1) | $ (21.2) | $ (4.5) | $ (4.7) | $ (31.5) | | $ (97.0) | | | One-time items before income taxes | 0.8 | — | 0.0 | 0.1 | 9.4 | | 10.3 | | | Earnings (loss) before income taxes excluding one-time items | (34.3) | (21.2) | (4.5) | (4.6) | (22.1) | | (86.7) | | | (2) Interest (income) expense | 0.0 | 0.0 | 0.5 | (0.0) | 4.0 | | 4.5 | | | (3) Depreciation and amortization | 7.6 | 6.1 | 4.8 | 1.9 | 6.1 | | 26.5 | | | Adjusted EBITDA | $ (26.7) | $ (15.1) | $ 0.8 | $ (2.7) | $ (12.0) | | $ (55.7) | | | | | | | | | | Three months ended | | | | | | | | | | | | | | | 08/31/24 | | | | | | | | | CBPD (1) | EDUC (1) | ENT (1) | INTL (1) | OVH (1) | | Total | | | Earnings (loss) before income taxes as reported | $ (36.6) | $ (17.0) | $ (1.1) | $ (8.7) | $ (28.4) | | $ (91.8) | | | One-time items before income taxes | — | — | 1.7 | — | 1.2 | | 2.9 | | | Earnings (loss) before income taxes excluding one-time items | (36.6) | (17.0) | 0.6 | (8.7) | (27.2) | | (88.9) | | | (2) Interest (income) expense | 0.0 | — | 1.1 | (0.0) | 2.3 | | 3.4 | | | (3) Depreciation and amortization | 7.5 | 6.2 | 3.5 | 1.9 | 5.9 | | 25.0 | | | Adjusted EBITDA | $ (29.1) | $ (10.8) | $ 5.2 | $ (6.8) | $ (19.0) | | $ (60.5) | | - **Adjusted EBITDA** is defined as **earnings (loss), excluding one-time items, before interest, taxes, depreciation, and amortization**, and is considered a **meaningful measure of operating profitability**[40](index=40&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K _________________________________________________________________________________ ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended August 3, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to __________________ Commission File Number: 1-3822 THE CAMPBELL'S COMPANY (Ex ...

[Executive Summary](index=1&type=section&id=Executive%20Summary) Darden Restaurants reported strong Q1 2026 results with increased sales and EPS, alongside an updated positive fiscal 2026 outlook [Q1 2026 Performance Overview](index=1&type=section&id=Q1%202026%20Performance%20Overview) Darden reported a strong Q1 2026, with total sales up 10.4% to $3.0 billion and blended same-restaurant sales increasing by 4.7% | Metric | Q1 2026 Performance | | :-------------------------- | :------------------ | | Total Sales Increase | 10.4% | | Total Sales Value | $3.0 billion | | Blended Same-Restaurant Sales Increase | 4.7% | | Same-Restaurant Sales | Growth Rate | | :-------------------- | :---------- | | Consolidated Darden | 4.7% | | Olive Garden | 5.9% | | LongHorn Steakhouse | 5.5% | | Fine Dining | (0.2)% | | Other Business | 3.3% | - The strength of results is attributed to the company's strategy, focusing on "**being brilliant with the basics**" and leveraging **competitive advantages** to position brands for long-term success, enabling sales and market share growth while investing in the business and returning capital to shareholders[3](index=3&type=chunk) [Segment Performance](index=1&type=section&id=Segment%20Performance) Segment profit reporting was adjusted to exclude pre-opening costs, with 'Other Business' showing significant sales and profit growth - Segment profit reporting changed to exclude pre-opening costs, with fiscal 2025 figures recast for comparability. Segment profit is defined as sales less costs for food and beverage, restaurant labor, restaurant expenses, and marketing expenses, excluding non-cash real estate related expenses[4](index=4&type=chunk) | ($ in millions) | Q1 2026 Sales | Q1 2025 Sales | Q1 2026 Segment Profit | Q1 2025 Segment Profit | | :---------------- | :------------ | :------------ | :--------------------- | :--------------------- | | Consolidated Darden | $3,044.7 | $2,757.0 | | | | Olive Garden | $1,301.1 | $1,209.1 | $267.6 | $250.1 | | LongHorn Steakhouse | $776.4 | $713.5 | $134.9 | $128.4 | | Fine Dining | $286.5 | $278.9 | $38.7 | $38.9 | | Other Business | $680.7 | $555.5 | $109.3 | $84.3 | [Earnings Per Share & Shareholder Returns](index=1&type=section&id=Earnings%20Per%20Share%20%26%20Shareholder%20Returns) Diluted net EPS reached $2.19, with adjusted EPS up 12.6% to $1.97, alongside a $1.50 quarterly dividend and $183 million in share repurchases | Metric | Value | | :------------------------------------------------ | :---- | | Reported diluted net earnings per share (continuing operations) | $2.19 | | Adjusted diluted net earnings per share (continuing operations) | $1.97 | | Adjusted EPS Increase (YoY) | 12.6% | - The Board of Directors declared a quarterly cash dividend of **$1.50 per share**, payable on November 3, 2025, to shareholders of record on October 10, 2025[8](index=8&type=chunk) - The Company repurchased approximately **0.9 million shares** of its common stock for a total of **$183 million** during the quarter. As of the end of the fiscal first quarter, **$865 million** remained under the current **$1 billion** repurchase authorization[6](index=6&type=chunk)[9](index=9&type=chunk) [Fiscal 2026 Financial Outlook](index=3&type=section&id=Fiscal%202026%20Financial%20Outlook) Darden updated its fiscal 2026 outlook, projecting total sales growth of 7.5-8.5% and adjusted diluted net EPS of $10.50-$10.70 [Updated Outlook Details](index=3&type=section&id=Updated%20Outlook%20Details) The fiscal 2026 outlook projects total sales growth of 7.5-8.5%, same-restaurant sales growth of 2.5-3.5%, and adjusted diluted net EPS of $10.50-$10.70 | Metric | Fiscal 2026 Outlook | | :------------------------------------------------ | :------------------ | | Total sales growth | 7.5% to 8.5% | | Same-restaurant sales growth | 2.5% to 3.5% | | New restaurant openings | Approximately 65 | | Total capital spending | $700 to $750 million | | Total inflation | 3.0% to 3.5% | | Effective tax rate | Approximately 13% | | Adjusted diluted net earnings per share (continuing operations) | $10.50 to $10.70 | | Weighted average diluted shares outstanding | Approximately 117 million | - The total sales growth outlook includes approximately **2% growth** related to the 53rd week. The adjusted diluted net earnings per share outlook includes approximately **$0.20** related to the addition of the 53rd week[14](index=14&type=chunk) [Reconciliation of Adjusted Earnings Outlook](index=7&type=section&id=Reconciliation%20of%20Adjusted%20Earnings%20Outlook) A reconciliation details fiscal 2026 adjusted diluted net EPS outlook, accounting for Chuy's transaction costs, closed restaurant costs, and Olive Garden Canada sale gain | Reconciliation Item | 2026 Outlook Range | | :------------------------------------------------ | :----------------- | | Reported diluted net earnings per share from continuing operations | $10.64 to $10.84 | | Chuy's transaction and integration related costs | $0.06 | | Closed restaurants costs | $0.06 | | Gain on Olive Garden Canada sale | $(0.26) | | Adjusted diluted net earnings per share from continuing operations | $10.50 to $10.70 | [Company Information](index=3&type=section&id=Company%20Information) Darden Restaurants operates a diverse portfolio of restaurant brands and provides important disclosures regarding forward-looking statements [About Darden Restaurants](index=3&type=section&id=About%20Darden%20Restaurants) Darden Restaurants is a restaurant company with a diverse portfolio of differentiated brands, including well-known names like Olive Garden, LongHorn Steakhouse, and Ruth's Chris Steak House, among others - Darden's portfolio of differentiated brands includes Olive Garden, LongHorn Steakhouse, Yard House, Ruth's Chris Steak House, Cheddar's Scratch Kitchen, The Capital Grille, Chuy's, Seasons 52, Eddie V's, and Bahama Breeze[12](index=12&type=chunk) [Information About Forward-Looking Statements](index=5&type=section&id=Information%20About%20Forward-Looking%20Statements) Forward-looking statements are subject to risks and uncertainties, detailed in SEC filings, cautioning investors against undue reliance due to potential material differences - Forward-looking statements are made under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 and speak only as of their initial date, with no obligation to update[13](index=13&type=chunk) - Risks and uncertainties include cost pressures, economic factors impacting the restaurant industry, labor challenges, increased costs, health concerns, cybersecurity risks, integration challenges (Chuy's), regulatory changes, intense competition, changing consumer preferences, climate change, supply chain disruptions, and litigation[13](index=13&type=chunk)[16](index=16&type=chunk) [Non-GAAP Financial Measures](index=5&type=section&id=Non-GAAP%20Financial%20Measures) Darden utilizes non-GAAP financial measures, such as adjusted diluted net EPS, to supplement GAAP results for performance analysis [Explanation of Non-GAAP Measures](index=5&type=section&id=Explanation%20of%20Non-GAAP%20Measures) Non-GAAP measures, like adjusted diluted net EPS, offer supplemental performance insights but are not GAAP substitutes and may not be comparable - Non-GAAP measures, like **adjusted diluted net earnings per share**, are used by management for performance analysis and provide useful supplemental information for understanding operating results[17](index=17&type=chunk) - These non-GAAP disclosures should not be viewed as a substitute for GAAP operating results and may not be comparable to non-GAAP measures presented by other companies[17](index=17&type=chunk) [Q1 Reported to Adjusted Earnings Reconciliation](index=5&type=section&id=Q1%20Reported%20to%20Adjusted%20Earnings%20Reconciliation) This reconciliation details Q1 2026 and Q1 2025 earnings adjustments, including acquisition costs, closed restaurant costs, and Olive Garden Canada sale gain | $ in millions, except per share amounts | Q1 2026 Reported | Q1 2026 Adjustments | Q1 2026 Adjusted | Q1 2025 Reported | Q1 2025 Adjustments | Q1 2025 Adjusted | | :-------------------------------------- | :--------------- | :------------------ | :--------------- | :--------------- | :------------------ | :--------------- | | Earnings Before Income Tax | $293.8 | $(35.3) | $258.5 | $232.1 | $1.5 | $233.6 | | Income Tax Expense | $35.9 | $(8.8) | $27.1 | $24.5 | $0.3 | $24.8 | | Net Earnings | $257.9 | $(26.5) | $231.4 | $207.6 | $1.2 | $208.8 | | Diluted Net Earnings Per Share | $2.19 | $(0.22) | $1.97 | $1.74 | $0.01 | $1.75 | | % Change vs Prior Year | 25.9% | | 12.6% | | | | | **Adjustments Detail:** | | | | | | | | Acquisition transaction and integration related costs | | $3.6 (EBIT) / $2.7 (Net) / $0.02 (EPS) | | | $1.5 (EBIT) / $1.2 (Net) / $0.01 (EPS) | | | Closed restaurants | | $3.1 (EBIT) / $2.3 (Net) / $0.02 (EPS) | | | — | | | Gain on Olive Garden Canada sale | | $(42.0) (EBIT) / $(31.5) (Net) / $(0.26) (EPS) | | | — | | [Restaurant Portfolio](index=7&type=section&id=Restaurant%20Portfolio) Darden's restaurant portfolio expanded, increasing total company-owned restaurants from 2,040 to 2,165 by August 2025 [Number of Company-Owned Restaurants](index=7&type=section&id=Number%20of%20Company-Owned%20Restaurants) Darden's restaurant portfolio shows an increase in total company-owned restaurants from 2,040 in August 2024 to 2,165 in August 2025, primarily driven by the addition of Chuy's restaurants and growth in Olive Garden and LongHorn Steakhouse | Brand | 8/24/2025 | 8/25/2024 | | :---------------------- | :-------- | :-------- | | Olive Garden | 933 | 923 | | LongHorn Steakhouse | 595 | 577 | | Cheddar's Scratch Kitchen | 182 | 181 | | Chuy's | 108 | — | | Yard House | 89 | 88 | | Ruth's Chris Steak House | 82 | 82 | | The Capital Grille | 73 | 68 | | Seasons 52 | 43 | 44 | | Eddie V's | 29 | 29 | | Bahama Breeze | 28 | 44 | | The Capital Burger | 3 | 4 | | **Darden Continuing Operations** | **2,165** | **2,040** | [Consolidated Financial Statements](index=8&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements reflect strong Q1 2026 performance with increased sales, operating income, and cash flow [Consolidated Statements of Earnings](index=8&type=section&id=Consolidated%20Statements%20of%20Earnings) The consolidated statements of earnings show a significant increase in sales and net earnings for the three months ended August 24, 2025, compared to the prior year. Operating income grew substantially, and diluted net earnings per share from continuing operations rose from $1.74 to $2.19 | (In millions, except per share data) | Three Months Ended 8/24/2025 | Three Months Ended 8/25/2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | | Sales | $3,044.7 | $2,757.0 | | Total operating costs and expenses | $2,705.5 | $2,487.8 | | Operating income | $339.2 | $269.2 | | Earnings before income taxes | $293.8 | $232.1 | | Income tax expense | $35.9 | $24.5 | | Earnings from continuing operations | $257.9 | $207.6 | | Net earnings | $257.8 | $207.2 | | Diluted net earnings per share (continuing operations) | $2.19 | $1.74 | [Consolidated Balance Sheets](index=9&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheet as of August 24, 2025, shows an increase in total assets to $12,759.6 million from $12,587.0 million at May 25, 2025. Total liabilities also increased, while total stockholders' equity saw a slight decrease | (In millions) | 8/24/2025 (Unaudited) | 5/25/2025 | | :-------------------------------- | :-------------------- | :-------- | | **ASSETS** | | | | Total current assets | $932.8 | $937.7 | | Land, buildings and equipment, net | $4,826.6 | $4,716.0 | | Operating lease right-of-use assets | $3,608.0 | $3,555.9 | | Goodwill | $1,658.2 | $1,659.4 | | Trademarks | $1,346.4 | $1,346.4 | | Other assets | $387.6 | $371.6 | | **Total assets** | **$12,759.6** | **$12,587.0** | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Total current liabilities | $2,346.8 | $2,247.5 | | Long-term debt | $2,135.1 | $2,128.9 | | Operating lease liabilities - non-current | $3,878.3 | $3,816.9 | | Other liabilities | $1,840.8 | $1,803.6 | | **Total liabilities** | **$10,534.0** | **$10,275.7** | | Total stockholders' equity | $2,225.6 | $2,311.3 | | **Total liabilities and stockholders' equity** | **$12,759.6** | **$12,587.0** | [Consolidated Statements of Cash Flows](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The consolidated statements of cash flows indicate that net cash provided by operating activities of continuing operations increased to $342.5 million for the three months ended August 24, 2025. However, net cash used in financing activities also increased significantly, leading to a decrease in cash and cash equivalents | (In millions) | Three Months Ended 8/24/2025 | Three Months Ended 8/25/2024 | | :------------------------------------------------ | :--------------------------- | :--------------------------- | | Net cash provided by operating activities of continuing operations | $342.5 | $273.2 | | Net cash used in investing activities of continuing operations | $(159.3) | $(149.7) | | Net cash used in financing activities of continuing operations | $(212.2) | $(126.7) | | Increase (decrease) in cash, cash equivalents, and restricted cash | $(29.0) | $(3.2) | | Cash, cash equivalents, and restricted cash - end of period | $225.5 | $216.9 |

Exhibit 99.1 AirNet Technology Inc. and Subsidiaries Consolidated Balance Sheets (Stated in U.S. dollars in thousands, except share and per share data) | | December 31, | | June 30, | | | --- | --- | --- | --- | --- | | | 2024 | | 2025 | | | ASSETS | | | (Unaudited) | | | CURRENT ASSETS | | | | | | Cash and cash equivalents | $ | 2 | $ | 134 | | USDT | | - | | 1,885 | | Other current assets | | 4,111 | | 14 | | Current assets of discontinued operations | | 21,842 | | 22,100 | | Total current assets | | 25,9 ...