Sales Performance - Total sales for fiscal year 2025 increased by 6% compared to fiscal year 2024, driven by higher demand in Gaming, Keyboards & Combos, Pointing Devices, and Tablet Accessories [240]. - Net sales for fiscal year 2025 increased by 6% to $4,554.9 million compared to fiscal year 2024, with a constant currency sales growth rate of 7% [264]. - Sales in the EMEA, Asia Pacific, and Americas regions increased by 9%, 6%, and 4%, respectively, compared to fiscal year 2024 [240]. - The Gaming product category experienced a 9% sales increase to $1,338.5 million in fiscal year 2025, driven by higher sales of gaming mice and steering wheels [270]. - Tablet Accessories sales surged by 18% to $299.5 million in fiscal year 2025, supported by strong demand from the education sector [278]. - Other product category sales decreased by 15% to $124.2 million in fiscal year 2025, primarily due to a decline in mobile speaker sales [280]. Financial Performance - Gross margin for fiscal year 2025 improved by 170 basis points to 43.1%, up from 41.4% in fiscal year 2024, primarily due to lower product costs [241]. - Net income for fiscal year 2025 was $631.5 million, an increase from $612.1 million in fiscal year 2024, reflecting higher gross margin despite increased operating expenses [243]. - Gross profit for fiscal year 2025 was $1,962.6 million, representing a 10.4% increase from $1,778.0 million in fiscal year 2024, with a gross margin of 43.1% [281]. - Operating expenses for fiscal year 2025 were $1,307.7 million, or 28.7% of sales, compared to $1,190.7 million, or 27.7% of sales, in fiscal year 2024 [241]. - Marketing and selling expenses rose by $84.1 million in fiscal year 2025, driven by higher investments in marketing and advertising [286]. - Research and development expenses increased by $21.8 million in fiscal year 2025, reflecting greater investment in product innovation and higher personnel-related costs [288]. Tax and Income - The effective tax provision for fiscal year 2025 was $75.3 million, a significant increase from $9.5 million in fiscal year 2024, primarily due to discrete tax benefits recognized in the previous year [242]. - The provision for income taxes for fiscal year 2025 was $75,343,000, with an effective income tax rate of 10.7%, compared to $9,453,000 and 1.5% in fiscal year 2024, reflecting changes in tax positions and audit resolutions [299]. Cash Flow and Capital Management - Net cash provided by operating activities for fiscal year 2025 was $842,557,000, resulting from a net income of $631,500,000 and non-cash adjustments of $228,400,000 [317]. - Cash and cash equivalents as of March 31, 2025, were $1,503,200,000, a slight decrease from $1,520,800,000 as of March 31, 2024 [308]. - Working capital decreased to $1,491,600,000 as of March 31, 2025, from $1,545,500,000 as of March 31, 2024, primarily due to a decrease in accounts receivable and an increase in accrued liabilities [309]. - Net cash used in investing activities was $57,268,000, mainly for property, plant, and equipment purchases totaling $56,100,000 [318]. - Net cash used in financing activities was $797,360,000, primarily due to share repurchases of $588,800,000 and cash dividends of $207,900,000 [319]. Shareholder Returns and Repurchase Programs - The Board of Directors recommended a cash dividend of CHF 1.26 per share for fiscal year 2025, resulting in an aggregate gross dividend of approximately CHF 187.1 million [322]. - During the fiscal year ended March 31, 2025, the company repurchased 6.7 million shares for an aggregate cost of $588.0 million under the 2023 share repurchase program [323]. - The 2023 share repurchase program was increased by $600.0 million to a total of $1.6 billion, with plans to target $2 billion in share repurchases over the next three years [324]. - The company has a three-year share repurchase program that allows opportunistic repurchases during favorable market conditions, effective through July 27, 2026 [326]. Strategic Focus and Challenges - The company expects ongoing challenges from macroeconomic conditions, including inflation and foreign currency fluctuations, which may impact demand and pricing [237]. - The introduction of new products and business acquisitions is anticipated to significantly influence sales and operating expenses [239]. - The company is focusing on diversifying its manufacturing footprint and supplier ecosystem to mitigate risks associated with tariffs and geopolitical conditions [238]. - The ongoing growth in gaming and the adoption of new ways of working present opportunities for the company to expand its product offerings [242]. - The company has generated positive cash flows from operating activities for over ten years, but market volatility may increase costs of capital and affect business operations [328]. Investment and Commitments - As of March 31, 2025, the company had non-cancelable purchase commitments of $358.7 million for inventory purchases, with a liability of $19.6 million recorded for excess and obsolete inventory [329]. - The company has firm purchase commitments of $19.1 million for capital expenditures related to tooling and equipment for new and existing products [330]. - As of March 31, 2025, the company had $88.5 million in non-current income taxes payable related to uncertain tax positions [332]. Other Financial Metrics - Interest income for fiscal year 2025 was $54,997,000, an increase of 8.5% compared to $50,636,000 in fiscal year 2024, primarily due to a higher average cash equivalents balance [294]. - Other income (expense), net for fiscal year 2025 was a loss of $2,980,000, significantly improved from a loss of $16,376,000 in fiscal year 2024, driven by reduced losses on investments and currency exchange [295]. - As of March 31, 2025, accounts receivable, net, was $454,546,000, down from $541,715,000 in the previous year, indicating improved collection efficiency with a decrease in days sales outstanding (DSO) from 48 to 40 days [314][316].

Trust Account Balances - The company had approximately $51.2 million remaining in the trust account after the first redemption of 17,987,408 public shares[180]. - Following the October 2023 Special Meeting, the company had approximately $24.3 million remaining in the trust account after 2,700,563 public shares were tendered for redemption[183]. - In connection with the July 2024 Special Meeting, the company had approximately $12.9 million remaining in the trust account after 1,099,905 shares were redeemed at approximately $10.63 per share[190]. Business Combination Agreements - The company entered into a Business Combination Agreement on March 11, 2024, to merge with NewCo, with the expectation to close in the first half of 2025[196]. - The Business Combination Agreement includes a merger with a pre-money equity value of XCF at $1,750,000,000, with NewCo Common Stock priced at $10.00 per share[198]. - The Business Combination is subject to customary closing conditions, including stockholder approvals and regulatory clearances[199]. - The Business Combination Agreement allows for termination under specific conditions, including failure to obtain necessary stockholder approvals by September 11, 2024[202]. - The Business Combination Termination Date has been extended to May 31, 2025, through amendments to the agreement[203][206]. Financial Liabilities and Capital Contributions - The company recognized a liability of $418,400 for shares to be issued upon consummation of the initial business combination[187]. - The company entered into a Subscription Agreement for capital contributions of up to $1,200,000, which will be repaid within five business days of closing an initial business combination[185]. - The Company issued a promissory note of up to $500,000 to the Sponsor, which may be converted into warrants at $1.50 per warrant[214]. - The company has borrowed $1,200,000 in connection with a Subscription Agreement and issued a promissory note for up to $500,000, with $110,000 borrowed under this note as of March 31, 2025[225]. Operating Performance - For the three months ended March 31, 2025, the company reported a net loss of $1,426,442, primarily due to $1,295,159 in operating costs and $216,953 from changes in fair value of Note Payable – Polar[219]. - The company incurred $2,646,244 in operating costs for the three months ended March 31, 2024, resulting in a net loss of $2,504,756 for that period[220]. - As of March 31, 2025, the company had a working capital deficit of $9,597,976 and only $22,604 available in its operating bank account for working capital needs[222]. Tax Positions - The company recognized a reserve for uncertain tax positions of $115,870 on its balance sheet as of March 31, 2025, related to its Florida state tax return[217]. - The company has taken the position that no income should be apportioned to Florida in its state tax return, maintaining an uncertain tax position related to this[217]. Stockholder Commitments and Restrictions - The Sponsor has agreed to vote in favor of the Business Combination and related transactions, while also waiving certain anti-dilution rights[206][210]. - Certain stockholders have committed to not transfer shares until 12 months post-Closing, with specific conditions for early release[212]. - The Company has agreed to waive lock-up restrictions, allowing unrestricted transfer of NewCo Common Stock upon completion of the Business Combination[213]. Regulatory and Market Conditions - The company received a delisting notice from Nasdaq due to failure to complete a business combination within 36 months of its IPO[215]. - The company has utilized two monthly extensions to extend the Combination Period to April 7, 2025[193]. - The company engaged capital market advisors in 2023 to assist with market conditions and potential business combinations, with fees payable upon consummation of the initial business combination[236]. Underwriting and Financing - The underwriters of the initial public offering received a cash underwriting discount of 2.0% of gross proceeds, totaling $4.6 million, and a deferred underwriting discount of 3.5%, amounting to $8,050,000[235]. - The company reported a net borrowing of $988,402 under a Convertible Promissory Note issued to the Former Sponsor, which was terminated upon closing of the Purchase Agreement on November 2, 2023[224].

Financial Performance - The company reported a net income of $102,958,139 for the three months ended March 31, 2025, compared to a net loss of $2,429,417 for the same period in 2024[22]. - For the three months ended March 31, 2025, Nukkleus Inc. reported a net income from continuing operations of $103,140,894, compared to a net loss of $(2,095,201) for the same period in 2024[28]. - The basic net income per common share for continuing operations was $20.80 in Q1 2025, compared to a loss of $(1.19) in Q1 2024[22]. - Other income (expense), net, increased approximately $104,658,000, or 1,043,970.3%, for the three months ended March 31, 2025, primarily due to gains from changes in fair value of stock purchase warrant liabilities[177]. - The accumulated deficit improved from $(201,075,743) on December 31, 2024, to $(98,117,604) on March 31, 2025, indicating a reduction of approximately 51.2%[21]. Revenue and Expenses - For the three months ended March 31, 2025, total revenues were $187,469, a decrease of 27.8% from $259,757 in the same period of 2024[101]. - Total operating expenses decreased to $317,352 in Q1 2025 from $531,235 in Q1 2024, a reduction of 40.2%[101]. - Operating expenses decreased from $2,085,176 in Q1 2024 to $1,507,107 in Q1 2025, a reduction of approximately 27.7%[22]. - The net loss from discontinued operations for the three months ended March 31, 2025, was $182,755 compared to a loss of $334,216 in the same period of 2024, indicating an improvement of 45.2%[101]. - Total other general and administrative expenses increased by approximately $266,000, or 119.1%, for the three months ended March 31, 2025, compared to the same period in 2024[176]. Assets and Liabilities - Total assets decreased from $9,109,284 on December 31, 2024, to $8,601,827 on March 31, 2025, representing a decline of approximately 5.6%[19]. - Current liabilities significantly decreased from $171,450,366 to $64,709,245, a reduction of about 62.2%[19]. - As of March 31, 2025, total current assets were $2,127,120, an increase of 95.5% from $1,089,052 as of December 31, 2024[100]. - Total liabilities increased to $4,453,142 as of March 31, 2025, compared to $3,179,877 as of December 31, 2024, reflecting a rise of 40.0%[100]. - The company had a working capital deficit of $56,246,392 as of March 31, 2025, including $4,462,916 of cash[179]. Cash Flow - The company incurred cash flow used in operating activities from continuing operations of approximately $1,621,478 for the three months ended March 31, 2025, compared to $(174,899) in the prior year[43]. - The company experienced a net cash used in operating activities of $(1,341,514) for the three months ended March 31, 2025, compared to $(1,122,709) in the prior year[28]. - Net cash flow used in investing activities was approximately $810,221 for the three months ended March 31, 2025, primarily due to an advance payment to Star of $800,000[186]. - There were no cash flows provided by financing activities for the three months ended March 31, 2025[188]. Stock and Equity - The number of common shares outstanding increased from 4,930,531 to 5,013,863, reflecting an increase of about 1.7%[20]. - The Company has authorized 15,000,000 shares of preferred stock, with no shares issued and outstanding as of March 31, 2025[124]. - The Company issued 100,000 stock options to a consultant on November 13, 2024, with a total share-based compensation expense of $177,905 for the three months ended March 31, 2025[140]. - The Company completed a private placement on December 20, 2024, raising approximately $9.99 million by selling 1,666,666 units at $6.00 per unit[127]. - The Company established the 2025 Equity Incentive Plan with 1,950,000 shares of common stock reserved for issuance, subject to shareholder approval[159]. Business Strategy and Operations - The company plans to focus its business on the defense sector following the acquisition of a controlling 51% interest in Star 26 Capital Inc., which supplies defense products[33]. - The Company entered into a Securities Purchase Agreement with Star 26 Capital Inc. to acquire a controlling 51% interest in Star for an aggregate investment of $21,000,000[153]. - The Company shifted its business focus to the defense sector following the Settlement Agreement related to the acquisition of Star[166]. - The company plans to cease operations of its General Support Services operating segment, which meets the discontinued operations criteria as of December 15, 2024[98]. Internal Controls and Compliance - As of March 31, 2025, the company concluded that its disclosure controls and procedures were effective[210]. - Material weaknesses in internal control over financial reporting were identified as of December 31, 2024, related to the evaluation of intangible assets and cost-method investments[212]. - Remediation actions for the identified material weaknesses began in Q4 of fiscal year 2024, including the use of external consultants for technical accounting issues[213]. - The material weaknesses will not be considered fully remediated until additional controls have operated effectively for a sufficient period[214]. - As of March 31, 2025, the company has not remediated the material weakness related to resources for evaluating intangible assets[215].

Financial Performance - The company reported a net income of $102,958,139 for the three months ended March 31, 2025, compared to a net loss of $2,429,417 for the same period in 2024[22]. - Basic net income per common share for continuing operations was $20.80 for Q1 2025, compared to a loss of $(1.19) for Q1 2024[22]. - For the three months ended March 31, 2025, the net income from continuing operations was approximately $103.14 million, compared to a net loss of approximately $2.10 million for the same period in 2024[28]. - Other income (expense), net, increased approximately $104,658,000, or 1,043,970.3%, for the three months ended March 31, 2025, primarily due to gains from changes in fair value of stock purchase warrant liabilities[177]. - Pre-tax net income from continuing operations was $103,140,894 for the three months ended March 31, 2025, compared to a pre-tax net loss of $2,095,201 for the same period in 2024[179]. Assets and Liabilities - Total assets decreased from $9,109,284 on December 31, 2024, to $8,601,827 on March 31, 2025, a decline of approximately 5.6%[19]. - Current liabilities significantly decreased from $171,450,366 to $64,709,245, representing a reduction of about 62.2%[19]. - The accumulated deficit improved from $(201,075,743) on December 31, 2024, to $(98,117,604) on March 31, 2025, indicating a reduction of approximately 51.2%[21]. - The total stockholders' deficit decreased from $(163,350,109) on December 31, 2024, to $(57,217,016) on March 31, 2025, a reduction of approximately 65%[21]. - As of March 31, 2025, total current assets were $2,127,120, an increase of 95.5% from $1,089,052 as of December 31, 2024[100]. - Total liabilities increased to $4,453,142 as of March 31, 2025, compared to $3,179,877 as of December 31, 2024, representing a rise of 40.0%[100]. Cash Flow and Operating Activities - The company incurred a cash flow used in operating activities from continuing operations of approximately $1.62 million for the three months ended March 31, 2025, compared to $174,899 for the same period in 2024[43]. - The company experienced a net cash used in operating activities of approximately $1.34 million for the three months ended March 31, 2025, compared to $1.12 million for the same period in 2024[28]. - Net cash used in operating activities was approximately $1,341,514 for the three months ended March 31, 2025, compared to $1,122,709 for the same period in 2024[183]. - Net cash flow used in investing activities was approximately $810,221 for the three months ended March 31, 2025, primarily due to an advance payment to Star of $800,000[186]. Business Strategy and Operations - The company plans to focus its business on the defense sector following the acquisition of a controlling 51% interest in Star 26 Capital Inc., which supplies defense products[33]. - The company plans to cease operations of its General Support Services operating segment, which meets the discontinued operations criteria[98]. - The Company entered into a Securities Purchase Agreement with Star 26 Capital Inc. to acquire a controlling 51% interest in Star for an aggregate investment of $21,000,000[153]. - The cash advances to be made by the Company to Star were increased from $1,800,000 to $3,000,000 as per Amendment No. 2 to the Star Agreement[160]. Stock and Equity - The company issued 83,332 shares of common stock from the exercise of pre-funded warrants, contributing $3,055,814 to additional paid-in capital[24]. - The weighted average common shares outstanding increased from 1,754,449 in Q1 2024 to 4,959,516 in Q1 2025[23]. - The Company established the 2025 Equity Incentive Plan with 1,950,000 shares of common stock reserved for issuance, subject to shareholder approval[159]. - The company issued 100,000 stock options to a consultant on November 13, 2024, with a total stock options activity resulting in 104,823 options outstanding as of March 31, 2025[140]. Expenses and Cost Management - Operating expenses decreased from $2,085,176 in Q1 2024 to $1,507,107 in Q1 2025, a reduction of approximately 27.7%[22]. - Total operating expenses for the three months ended March 31, 2025, were $1,507,107, a decrease of 27.7% from $2,085,176 in the same period of 2024[173]. - Professional fees decreased by approximately $878,000, or 47.9%, for the three months ended March 31, 2025, primarily due to a reduction in advisory and legal fees[174]. - Total other general and administrative expenses increased by approximately $266,000, or 119.1%, for the three months ended March 31, 2025, compared to the same period in 2024[176]. Internal Controls and Compliance - The company has substantial doubt about its ability to continue as a going concern for at least one year from the issuance of the financial statements due to its liquidity condition[45]. - Material weaknesses in internal control over financial reporting were identified as of December 31, 2024, related to the evaluation of intangible assets and cost-method investments[212]. - Remediation actions for the identified material weaknesses began in Q4 of fiscal year 2024, including the use of external consultants for technical accounting issues[213]. - As of March 31, 2025, the company has not remediated the material weakness related to resources for evaluating intangible assets[215]. - Management acknowledges that no controls can provide absolute assurance that all control issues and instances of fraud have been detected[217].

Stock Repurchase and Financial Performance - The company spent $37.6 million to repurchase 377,154 shares of its common stock during fiscal 2025, with a total of approximately $832 million spent on repurchases since the program's inception in 1997[20] - The company has repurchased a total of 114,476,691 shares of its common stock since the start of its repurchase program, with 2,523,309 shares remaining authorized for repurchase as of March 31, 2025[20] - The company has authorized a stock repurchase program for up to 117,000,000 shares, with 114,476,691 shares repurchased to date[135] - As of March 31, 2025, the average price paid for repurchased shares was $111.50, with a total of 80,661 shares repurchased in the first quarter of 2025[156] - The company's common stock has shown significant growth, increasing from 100.00 in 2020 to 616.24 in 2025, outperforming both the Nasdaq Composite and the Nasdaq Healthcare Services Index[161] - The company has never paid cash dividends and intends to retain future earnings for business use and stock repurchases[154] Employee and Workplace Dynamics - As of March 31, 2025, CorVel had 5,075 employees, with 91% working from home or in a hybrid arrangement due to the COVID-19 pandemic[71][72] - The company has been recognized as a "Great Place to Work Company" for five consecutive years, reflecting its commitment to employee satisfaction and organizational culture[73] - Over one-third of CorVel's employees identified as racially or ethnically diverse, and over 79% of employees identify as women[76] - The company has assessed its lease obligations and expects a reduction in office space needs due to more employees working from home[149] Technology and Innovation - The company’s proprietary bill review technology includes over 100 million individual rules, significantly improving the efficiency of the claims management process[25] - CorVel's CareMC® platform enhances claims management by providing real-time access to claims information and streamlining healthcare transaction processing through artificial intelligence[58][61] - The company continues to modernize its claims system capabilities, aiming to provide real-time information and rapid feedback through the CareMC® online portal[62] - The introduction of new technologies and software products is essential for competitiveness, but development may take longer and cost more than anticipated[102] Claims and Case Management Services - The company’s virtual care platform allows injured workers to access 24/7 nurse triage and telehealth services, facilitating timely medical intervention[49] - The company’s case management services include telephonic and field case management, focusing on early intervention and rehabilitation to reduce disability duration[45] - CorVel's vocational rehabilitation program assists injured workers with services such as ergonomic assessments and job placement, tailored to individual case needs[51] - Patient management services include claims management, case management, and 24/7 nurse triage, designed to expedite return to work for injured employees[209] Financial Risks and Competition - The healthcare cost containment industry is competitive, with CorVel facing significant competition from larger firms and potential in-house capabilities developed by customers[64] - Increased competition from national managed care providers and insurance companies could adversely affect growth and profitability[89] - A decline in referrals for patient management services has previously led to decreased revenue, influenced by factors such as workplace injury rates and regional competition[90] - Declines in workers' compensation claims could materially harm the company's financial results, as fewer work-related injuries are reported[91] - The company faces inflation risks that could increase operational costs, impacting overall profitability[98] Regulatory and Compliance Issues - The company is subject to increased scrutiny regarding privacy and data security laws, which may lead to higher liabilities and operational challenges[131] - Regulatory changes in healthcare and workers' compensation could increase operational costs and reduce demand for services, impacting overall business performance[127] - There is a risk of litigation related to the company's recommendations on medical treatment plans, which could result in significant liabilities if claims are successful[124] Internal Controls and Governance - The management assessed the effectiveness of internal control over financial reporting and concluded it was effective as of March 31, 2025, providing reasonable assurance regarding the reliability of financial reporting[173] - The independent registered public accounting firm, Haskell & White LLP, audited the consolidated financial statements and issued an attestation report on the effectiveness of internal control over financial reporting as of March 31, 2025[174] - The company has established an insider trading policy applicable to all directors, officers, and employees to ensure compliance with securities laws[181] - The Board of Directors adopted a code of ethics and business conduct applicable to all employees, officers, and directors, promoting ethical behavior within the company[182] Operational Challenges - The company may face significant operational disruptions due to natural disasters, severe weather, or pandemics, which could materially impact its financial position and results[110] - Cybersecurity risks are increasing, with a notable rise in the frequency and sophistication of attacks, potentially leading to reputational harm and financial losses[113] - The company has invested significantly in information technology and data security measures to protect sensitive information, but these expenditures may adversely affect financial condition and operational focus[113] - The company relies on its information systems for efficient data processing, and any interruptions could lead to customer cancellations and competitive disadvantages[118] Market Position and Strategy - The company operates as an independent nationwide provider of medical cost containment and managed care services, focusing on workers' compensation, automobile insurance claims, and group health insurance benefits[207] - The company serves a diverse customer base, including insurers and government agencies, with no single customer accounting for 10% or more of revenue in fiscal years 2025, 2024, or 2023[63] - The company aims for internal growth and strategic acquisitions in the workers' compensation managed care industry, but faces risks related to personnel retention and resource acquisition[85] - Future growth is contingent on the ability to manage and process claims data effectively, with no assurance that current systems will meet future demands[119]

Financial Performance - Net revenue for fiscal year 2025 was $2,015,458 thousand, a 12.3% increase from $1,794,792 thousand in fiscal year 2024 [192]. - Total homes sold increased to 19,753 in fiscal year 2025, up 16.7% from 16,928 in fiscal year 2024 [192]. - Gross profit for factory-built housing increased to $441,796 thousand, a 10.7% rise from $398,919 thousand in the previous year [195]. - Income before income taxes for fiscal year 2025 was $211,070 thousand, reflecting a 6.0% increase from $199,180 thousand in fiscal year 2024 [200]. - The effective tax rate for fiscal year 2025 was 19.0%, down from 20.7% in fiscal year 2024, attributed to increased tax credits [201]. Order Backlog - The company's home order backlog as of March 29, 2025, was approximately $197 million, an increase of $6 million from $191 million a year earlier [185]. Expenses - Selling, general and administrative expenses rose to $275,315 thousand, an 11.0% increase from $247,920 thousand in fiscal year 2024 [196]. Cash Flow - Cash and cash equivalents at the beginning of fiscal year 2025 were $368.8 million, an increase from $283.5 million in fiscal year 2024, representing a change of $85.3 million [205]. - Net cash provided by operating activities decreased by $46.2 million to $178.5 million in fiscal year 2025, primarily due to increased working capital needs [205]. - Net cash used in financing activities increased by $40.2 million to $147.9 million in fiscal year 2025, primarily related to common stock repurchases [209]. Loan Originations - Consumer loan originations decreased by $24.7 million to $66.1 million in fiscal year 2025, down from $90.8 million in fiscal year 2024 [206]. - Commercial loan originations increased by $32.1 million to $143.4 million in fiscal year 2025, compared to $111.2 million in fiscal year 2024 [207]. Financial Services - The financial services segment's net revenue increased by 5.3% to $82,347 thousand, primarily due to higher insurance premiums [194]. Market Challenges - The company continues to face challenges in the secondary market for manufactured home-only loans, impacting industry growth [188]. Production and Workforce Management - The company is focused on balancing production levels and workforce size with demand to maximize efficiencies [185]. Debt and Credit Facilities - The company has a $75.0 million revolving credit facility, with no amounts outstanding as of March 29, 2025 [203]. - The company anticipates compliance with its debt covenants, projecting cash availability to exceed operational needs for the next year [203]. Interest Rate and Exchange Rate Sensitivity - A 1% unfavorable change in average interest rates would reduce the fair value of consumer loans receivable by approximately $1.2 million [221]. - A 10% change in exchange rates could have resulted in a revaluation loss of approximately $0.7 million as of March 29, 2025 [223].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 For the month of May, 2025 Commission File Number: 001-14475 TELEFÔNICA BRASIL S.A. (Exact name of registrant as specified in its charter) TELEFONICA BRAZIL S.A. (Translation of registrant's name into English) Av. Eng° Luís Carlos Berrini, 1376 - 28º andar São Paulo, S.P. Federative Republic of Brazil (Address of princip ...

Investment Performance - The company has a strong investment performance track record, outperforming the MSCI ACWI Index with a net IRR of 11.2% compared to the benchmark's 0.9%[49] - The company has over 225 investment programs with the potential to earn performance fees, totaling over $95 billion in committed capital[54] - Approximately 75% of the accrued carried interest allocations of $1,496 million are from StepStone Fund vintages of 2019 or prior[54] Financial Growth - Management and advisory fees increased from $235 million in fiscal 2020 to $767 million in fiscal 2025, reflecting a 27% compounded annual growth rate[51] - As of March 31, 2025, the company had $24.6 billion of committed but undeployed fee-earning capital, expected to generate management fees upon deployment[52] - NAV-based management fees represented approximately 14% of total net management and advisory fees as of March 31, 2025, compared to 9% in 2024[601] Client Relationships - The company has maintained a high client retention rate of approximately 95% since inception[99] - Approximately 34% of the company's clients engage for both asset management and advisory services[99] - The company aims to expand existing client mandates and deploy already raised committed capital to drive growth[57][58] Global Expansion and Strategy - The company is focused on adding new clients globally, leveraging its established local presence and global investment capabilities[60] - The company plans to pursue selective strategic acquisitions to complement its platform and enhance distribution[64] Responsible Investment and Sustainability - The company became a signatory to the United Nations Principles for Responsible Investment (UNPRI) in 2013 and adopted a Responsible Investment policy in 2014, which is reviewed annually[88] - The company has engaged a consultant annually since 2019 to conduct a comprehensive carbon footprint measurement and analysis of its operations[95] - The company has implemented a standalone climate policy and incorporated TCFD-aligned climate considerations within its investment process in 2022[88] - The company has observed a growing focus on impact investing, targeting commercial returns while investing in thematic opportunities such as climate change and the United Nations' Sustainable Development Goals[92] Employee Development and Culture - As of March 31, 2025, the company had approximately 1,130 employees globally, including over 375 investment professionals[137] - The company emphasizes a culture of belonging and continuous improvement, fostering an environment where data and analysis drive decision-making[141] - The company’s investment in employee development includes structured training programs and mentorship opportunities to support professional growth[140] Financial Risks and Compliance - The company is preparing for compliance with the new anti-money laundering and customer identification programs required by the SEC and FinCEN by the end of 2025[124] - The SEC adopted amendments to Regulation S-P in May 2024, mandating notification to clients in the event of privacy breaches[124] - The company is subject to the EU Alternative Investment Fund Managers Directive II (AIFMD II), which entered into force on April 15, 2024, with a two-year implementation period[130] Borrowings and Interest Rates - The company had $175.0 million in borrowings outstanding under its Notes and $100.0 million under its Revolver as of March 31, 2025[605] - Interest expense is estimated to increase by $2.8 million in 2025 and $1.5 million in 2024 due to a 100 basis point increase in interest rates[605] - Interest income is expected to increase by $2.5 million in 2025 and $1.4 million in 2024 with a 100 basis point increase in interest rates[605] Market Sensitivity - A 10% decline in market values of investments held in the company's funds would result in an approximate decrease to annual management fees of $11.2 million in 2025 and $5.8 million in 2024[601] - A 10% decline in fair value of investments in funds would result in a decrease in investment income of $18.4 million in 2025 and $13.5 million in 2024[602] - The company’s carried interest allocation revenue is influenced by market factors, with varying impacts across different funds[602]

Revenue Performance - Total revenues for the three months ended April 30, 2025, were $2.24 billion, a 13% increase from $1.99 billion in the prior year period [120]. - Subscription services revenues were $2.06 billion for the three months ended April 30, 2025, representing a 13% increase from $1.82 billion in the prior year [133]. - The total subscription revenue backlog as of April 30, 2025, was $24.62 billion, up 19% from $20.68 billion a year earlier [136]. Customer Retention and Satisfaction - The gross revenue retention rate was approximately 98% as of April 30, 2025, indicating strong customer satisfaction and retention [134]. Operating Performance - Operating cash flows for the three months ended April 30, 2025, were $457 million, a 23% increase from $372 million in the prior year [120]. - Non-GAAP operating income increased by 32% to $677 million for the three months ended April 30, 2025, compared to $515 million in the prior year [120]. - GAAP operating income decreased to $39 million, or 1.8% of revenues, for the three months ended April 30, 2025, down from $64 million or 3.2% in the prior year [152]. - Non-GAAP operating income increased to $677 million, or 30.2% of revenues, for the three months ended April 30, 2025, compared to $515 million or 25.9% in the previous year [153]. Costs and Expenses - Total costs and expenses for the three months ended April 30, 2025, were $2.20 billion, a 14% increase from $1.93 billion in the prior year, including $166 million in restructuring expenses [138]. - Costs of subscription services increased by 21% to $350 million for the three months ended April 30, 2025, compared to $290 million in the prior year [139]. - Sales and marketing expenses increased to $623 million for the three months ended April 30, 2025, up $50 million or 9% from the prior year [145]. - General and administrative expenses rose to $212 million for the three months ended April 30, 2025, an increase of $11 million or 6% compared to the previous year [147]. - Restructuring expenses amounted to $166 million for the three months ended April 30, 2025, primarily related to employee transition and severance payments [149]. - Share-based compensation expense increased by $74 million to $459 million for the three months ended April 30, 2025, representing 20.5% of total revenues [150]. Cash Flow and Liquidity - Cash provided by operating activities was $457 million for the three months ended April 30, 2025, an increase from $372 million in the prior year [165]. - Free cash flows improved to $421 million for the three months ended April 30, 2025, compared to $291 million for the same period in 2024 [172]. - As of April 30, 2025, the company had cash, cash equivalents, and marketable securities totaling $8.0 billion [161]. - The company expects capital expenditures to be approximately $250 million in fiscal 2026, primarily for office facilities [168]. Market and Investment Risks - A hypothetical increase or decrease of 100 basis points in interest rates would have resulted in an approximately $111 million market value reduction or increase in the investment portfolio as of April 30, 2025 [194]. - The company has significant foreign currency exchange risk, with major exposures to the euro, British pound, Canadian dollar, and Australian dollar as of April 30, 2025 [190]. - The company’s investment portfolio is subject to market risk due to changes in interest rates, which may affect future investment income [193]. - The company does not enter into investments for trading or speculative purposes, focusing instead on preserving capital and meeting liquidity needs [192]. - The Senior Notes have fixed annual interest rates, thus the company does not have economic interest rate exposure on these debt obligations [195]. - The company’s borrowings under the 2022 Credit Agreement are exposed to market risk from changes in underlying index rates, affecting borrowing costs [196]. Strategic Initiatives - The company announced a restructuring plan in February 2025, resulting in a reduction of approximately 7.5% of its workforce [117]. - The company expects to continue investing in strategic growth areas, including innovative AI solutions and international expansion, to drive long-term subscription revenue growth [115]. Accounting Policies - There were no significant changes to the company's critical accounting policies and estimates during the three months ended April 30, 2025 [187]. - The company excludes share-based compensation expenses from non-GAAP financial measures, which are influenced by stock price and other factors beyond its control [182]. - Acquisition-related costs, including direct transaction costs and integration-related expenses, are excluded from non-GAAP financial measures due to their inconsistent nature [182].

Customer Dependence - Cirrus Logic's major customers represented approximately 96% of net sales in fiscal years 2025, 2024, and 2023, with Apple, Inc. accounting for about 89%, 87%, and 83% of total net sales respectively[28] - For the twelve-month periods ending March 29, 2025, March 30, 2024, and March 25, 2023, the company's ten largest end customers represented approximately 96%, 95%, and 92% of net sales, respectively[59] - Apple Inc. accounted for approximately 89%, 87%, and 83% of the company's total net sales for the same periods[59] - The company faces risks related to dependence on a limited number of customers, with significant pricing pressure expected on certain products[61] Business Strategy - The company maintains a three-pronged strategy focusing on leadership in smartphone audio, increasing high-performance mixed-signal content in smartphones, and expanding into additional applications and markets[18] - Cirrus Logic's product lines are categorized into Audio and High-Performance Mixed-Signal (HPMS), with HPMS expected to drive significant growth opportunities in the coming years[21] - The company is exploring acquisitions to enhance market position and technological capabilities, which involves risks such as integration challenges and unexpected costs[122][126] Manufacturing and Supply Chain - The company utilizes a fabless manufacturing model, relying on third-party foundries for wafer fabrication and assembly, primarily using GLOBALFOUNDRIES and TSMC[29] - A long-term supply agreement with GlobalFoundries requires the company to purchase a certain number of wafers through 2026, which could lead to excess inventory if actual requirements differ[81][82] - The company relies on third-party manufacturing and supply chain relationships, which poses risks such as increased costs and delays in meeting customer demand[73] - The company has experienced industry-wide manufacturing capacity constraints, impacting its ability to meet demand and potentially leading to increased prices and lower revenues[75] - The company may need to invest in geographically diversified manufacturing to meet customer demands for supply chain resilience[71] Research and Development - Research and development efforts are concentrated on designing and developing new products, with a focus on timely market introduction and integration support for customers[36] - The company is investing in research and development for new markets, but faces risks related to technology adoption and market growth[140] Workforce and Talent - The company had a voluntary turnover rate of 8% in fiscal year 2025, which is below the technology industry benchmarks[48] - As of March 29, 2025, the company employed 1,660 individuals, with 71% engaged in research and product development activities[49] - The global workforce was composed of 81% male and 19% female as of March 29, 2025[50] - Competition for qualified personnel is intense, with increased recruiting and employee costs impacting operational results[100][102] - Changes in immigration laws may impair the ability to attract and retain qualified engineering personnel, particularly in the U.S.[101] Financial Performance and Risks - Global economic conditions, including inflation, could adversely impact the company's financial results and market price of shares[90][92] - The company faces risks of significant fluctuations in inventory and operating results due to shifts in industry-wide capacity and customer order cancellations[157] - The company may incur future inventory write-downs and charges to gross margin due to imbalances between product inventories and demand[158] - The company is exposed to foreign currency exchange rate fluctuations, particularly with the British Pound Sterling, which could adversely impact financial results[161] - The company has a $300 million senior secured revolving credit facility that matures on July 8, 2026, with no outstanding balance as of March 29, 2025[163] Regulatory and Compliance - The company is subject to export controls and trade sanctions, which may limit its ability to conduct business with certain customers[45] - The company is subject to fluctuations in consumer electronics and smartphone markets, which could affect demand and sales[80] - The company is subject to increased operational and reporting requirements related to environmental, social, and governance (ESG) matters, which may impose additional costs[181] - Changes in environmental regulations may increase manufacturing costs and impact future operating results[142][145] Cybersecurity - Cybersecurity threats pose risks to the company's operations and could result in significant costs and liabilities[87][88] - The company conducts regular risk assessments to identify cybersecurity threats and evaluate the effectiveness of its internal controls[187] - The Board of Directors oversees the company's cybersecurity risks, with the Audit Committee responsible for periodic reporting[190] - The company employs a dedicated Information Security team to manage its cybersecurity strategy and conducts regular training for personnel[186] Market Competition - The semiconductor market is highly competitive, with significant risks from competitors that may have greater resources and capabilities[94][96] - The company expects increasing competition in its markets, which will depend on recruiting engineering talent and executing new product developments[37] - Average selling prices in the semiconductor industry have historically declined, and the company may struggle to maintain or increase prices for existing products[113][114] Intellectual Property - The company held approximately 4,130 pending and issued patents worldwide as of March 29, 2025, including about 1,570 granted U.S. patents[31] - The company may face significant liability for damages due to potential intellectual property claims and litigation, which could divert management's attention[171] Environmental and Social Responsibility - The company has maintained compliance with applicable environmental and health regulations, despite the inherent risks associated with hazardous materials in its laboratories[44] - The company may need to modify its supply chain practices and incur capital investments to meet customer requests for carbon emission reductions and renewable energy commitments[179]