American Superconductor (AMSC) - 2026 Q1 - Quarterly Report

PART I—FINANCIAL INFORMATION Item 1. Financial Statements This section presents American Superconductor Corporation's unaudited condensed consolidated financial statements and detailed notes for Q1 2025 and Q4 2024 Unaudited Condensed Consolidated Balance Sheets This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheets (in thousands): | Item | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Cash and cash equivalents | $207,890 | $79,494 | | Accounts receivable, net | $54,684 | $46,186 | | Inventory, net | $71,602 | $71,169 | | Total current assets | $348,857 | $206,517 | | Total assets | $452,846 | $310,521 | | Total current liabilities | $105,310 | $99,764 | | Total liabilities | $119,730 | $113,407 | | Total stockholders' equity | $333,116 | $197,114 | Unaudited Condensed Consolidated Statements of Operations This section outlines the company's revenues, costs, and profitability over a specific reporting period Condensed Consolidated Statements of Operations (in thousands, except per share data): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Revenues | $72,358 | $40,290 | | Cost of revenues | $47,869 | $28,065 | | Gross margin | $24,489 | $12,225 | | Operating income (loss) | $5,644 | $(3,291) | | Net income (loss) | $6,724 | $(2,524) | | Basic Net income (loss) per common share | $0.17 | $(0.07) | | Diluted Net income (loss) per common share | $0.17 | $(0.07) | Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) This section presents the company's total comprehensive income or loss, including net income and other comprehensive income items Condensed Consolidated Statements of Comprehensive Income (Loss) (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Net income (loss) | $6,724 | $(2,524) | | Foreign currency translation (loss) gain | $(187) | $15 | | Total other comprehensive (loss) gain, net of tax | $(187) | $15 | | Comprehensive income (loss) | $6,537 | $(2,509) | Unaudited Condensed Consolidated Statements of Stockholders' Equity This section details changes in the company's equity accounts, reflecting transactions with owners and comprehensive income Changes in Stockholders' Equity (in thousands): | Item | Balance at March 31, 2025 | Balance at June 30, 2025 | | :-------------------------------- | :------------------------ | :----------------------- | | Common Stock (Par Value) | $399 | $456 | | Additional Paid-in Capital | $1,259,540 | $1,388,948 | | Accumulated Other Comprehensive Income | $1,565 | $1,378 | | Accumulated Deficit | $(1,060,625) | $(1,053,901) | | Total Stockholders' Equity | $197,114 | $333,116 | - Issuance of common stock from equity offering, net of expenses, contributed $124,577 thousand to stockholders' equity for the three months ended June 30, 2025[17] Unaudited Condensed Consolidated Statements of Cash Flows This section reports the cash generated and used by the company across operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Net cash provided by operating activities | $4,125 | $3,409 | | Net cash used in investing activities | $(735) | $(20) | | Net cash provided by (used in) financing activities | $124,577 | $(142) | | Net increase in cash, cash equivalents and restricted cash | $128,038 | $3,243 | | Cash, cash equivalents and restricted cash at end of period | $213,419 | $95,523 | Notes to Unaudited Condensed Consolidated Financial Statements This section provides detailed explanations and additional information supporting the condensed consolidated financial statements Note 1. Nature of the Business and Operations AMSC provides megawatt-scale power resiliency solutions for grid and Navy applications, with financial statements prepared on a going concern basis - AMSC provides megawatt-scale power resiliency solutions for grid and Navy applications, utilizing proprietary 'smart materials' and 'smart software and controls'[24] - The unaudited condensed consolidated financial statements are prepared on a going concern basis in accordance with GAAP and SEC instructions to Form 10-Q[25] Note 2. Acquisition AMSC acquired NWL for approximately $61.4 million, adding $17.8 million in revenue and $2.5 million in net income to the Grid segment in Q1 2025 - AMSC acquired Megatran Industries, Inc. (NWL) on August 1, 2024, for approximately $61.4 million, comprising cash and common stock[27][29] NWL Acquisition Purchase Price Allocation (in millions): | Item | Amount | | :-------------------------------- | :----- | | Net tangible assets/(liabilities) | $54.7 | | Net identifiable intangible assets | $2.0 | | Goodwill | $4.7 | | Total purchase consideration | $61.4 | NWL Contribution to AMSC (Three Months Ended June 30, 2025): | Item | Amount | | :-------------------------------- | :----- | | Revenue | $17.8 million | | Net income | $2.5 million | Note 3. Revenue Recognition Revenue is primarily recognized at a point in time, disaggregated by product line and region, with key customers Fuji Bridex Pte Ltd (21% of total revenue) and Inox Wind Limited (16%) - For the three months ended June 30, 2025, 91% of revenue was recognized at the point in time when control transferred to the customer, compared to 88% for the same period in 2024[37] Disaggregated Revenue by Product Line (in thousands): | Product Line | Q1 2025 (Grid) | Q1 2025 (Wind) | Q1 2024 (Grid) | Q1 2024 (Wind) | | :-------------------------------- | :------------- | :------------- | :------------- | :------------- | | Equipment and systems | $55,521 | $11,881 | $29,726 | $7,424 | | Services and technology development | $4,566 | $390 | $2,610 | $530 | | Total | $60,087 | $12,271 | $32,336 | $7,954 | Customers Representing 10% or More of Total Revenues: | Customer | Segment | Q1 2025 | Q1 2024 | | :-------------------------------- | :------ | :------ | :------ | | Fuji Bridex Pte Ltd | Grid | 21% | <10% | | Inox Wind Limited | Wind | 16% | 18% | - As of June 30, 2025, the Company had outstanding performance obligations of approximately $215.2 million to be recognized in the next twelve months and $88.4 million over thirteen to sixty months[51] Note 4. Stock-Based Compensation Stock-based compensation expense significantly increased to $4.5 million in Q1 2025, with $31.4 million in unrecognized costs for unvested restricted stock Stock-Based Compensation Expense (in thousands): | Line Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Cost of revenues | $340 | $58 | | Research and development | $687 | $143 | | Selling, general and administrative | $3,499 | $1,028 | | Total | $4,526 | $1,229 | - The Company issued 880,000 shares of restricted stock and 39,445 shares of immediately vested common stock during the three months ended June 30, 2025[53] - Total unrecognized compensation cost for unvested outstanding restricted stock was $31.4 million as of June 30, 2025, to be recognized over approximately 2.1 years[54] Note 5. Computation of Net Income (Loss) per Common Share Basic and diluted EPS improved to $0.17 in Q1 2025 from $(0.07) in Q1 2024, with certain anti-dilutive shares excluded Net Income (Loss) per Common Share (in thousands, except per share data): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Net income (loss) | $6,724 | $(2,524) | | Shares used in per-share calculation ― basic | 38,875 | 35,676 | | Shares used in per-share calculation ― diluted | 39,742 | 35,676 | | Net income (loss) per share ― basic | $0.17 | $(0.07) | | Net income (loss) per share ― diluted | $0.17 | $(0.07) | - For the three months ended June 30, 2025, 475,329 shares (primarily performance-based restricted stock where contingency was not met) were excluded from diluted EPS calculation as anti-dilutive[56] Note 6. Goodwill and Other Intangibles Goodwill from the NWL Acquisition remained at $4.7 million, while other intangible assets had a net book value of $5.6 million with $0.3 million amortization - Goodwill increased by $4.7 million during the fiscal year ended March 31, 2025, related to the NWL Acquisition, and remained unchanged for the three months ended June 30, 2025. It is assigned to the Grid business segment[58] Intangible Assets (in thousands): | Item | June 30, 2025 Net Book Value | March 31, 2025 Net Book Value | | :-------------------------------- | :----------------------------- | :---------------------------- | | Backlog | $0 | $0 | | Trade name and trademarks | $1,800 | $1,800 | | Customer relationships | $2,764 | $2,980 | | Core technology and know-how | $1,015 | $1,136 | | Total Intangible assets | $5,579 | $5,916 | - Intangible amortization expense was $0.3 million for the three months ended June 30, 2025, down from $0.4 million in the prior year period[60] Note 7. Fair Value Measurements Financial assets are classified into a three-level fair value hierarchy, with $175.7 million in Level 1 cash equivalents and $1.4 million in Level 2 short-term instruments - The fair value hierarchy prioritizes inputs into Level 1 (quoted prices in active markets), Level 2 (observable inputs other than quoted prices), and Level 3 (unobservable inputs)[67] Assets Carried at Fair Value (in thousands): | Item | June 30, 2025 Total Carrying Value | Level 1 | Level 2 | | :-------------------------------- | :------------------------------- | :------ | :------ | | Cash equivalents | $175,654 | $175,654 | $0 | | Short-term cash instruments | $1,401 | $0 | $1,401 | Note 8. Accounts Receivable Accounts receivable, net, increased to $54.7 million as of June 30, 2025, due to higher billed and unbilled receivables Accounts Receivable (in thousands): | Item | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Accounts receivable (billed) | $44,601 | $39,810 | | Accounts receivable (unbilled) | $10,083 | $6,376 | | Accounts receivable | $54,684 | $46,186 | Note 9. Inventory Net inventory remained stable at $71.6 million, with $0.7 million in write-downs recorded for Q1 2025 Inventory, net of reserves (in thousands): | Item | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Raw materials | $37,184 | $35,892 | | Work-in-process | $22,459 | $19,633 | | Finished goods | $6,343 | $9,888 | | Deferred program costs | $5,616 | $5,756 | | Net inventory | $71,602 | $71,169 | - Inventory write-downs of $0.7 million were recorded for the three months ended June 30, 2025, compared to $0.5 million in the prior year period[70] Note 10. Property, Plant and Equipment Net property, plant and equipment slightly decreased to $38.5 million, with $0.9 million in depreciation expense for the quarter Property, Plant and Equipment, net (in thousands): | Item | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Property, plant and equipment, gross | $89,809 | $88,964 | | Less accumulated depreciation | $(51,288) | $(50,392) | | Property, plant and equipment, net | $38,521 | $38,572 | - Depreciation expense was $0.9 million for the three months ended June 30, 2025, compared to $0.6 million in the prior year period[73] Note 11. Equity-Method Investments The 50% equity-method investment in NWL Pacific Inc. Co., LTD increased to $1.4 million, with the joint venture reporting $0.7 million net income - AMSC has a 50% ownership in NWL Pacific Inc. Co., LTD, a joint venture in South Korea, accounted for under the equity method[74][75] NWL Pacific Summarized Financial Information (in thousands, Three Months Ended June 30, 2025): | Item | Amount | | :-------------------------------- | :----- | | Net Revenue | $2,599 | | Gross Profit | $1,160 | | Income from operation | $657 | | Net income | $745 | Note 12. Accounts Payable and Accrued Expenses Accounts payable and accrued expenses increased to $38.4 million, driven by higher accounts payable and advanced deposits, with $0.5 million in warranty provisions Accounts Payable and Accrued Expenses (in thousands): | Item | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Accounts payable | $11,861 | $6,733 | | Advanced deposits | $4,636 | $1,267 | | Accrued compensation | $9,307 | $13,418 | | Accrued product warranty | $3,240 | $3,033 | | Total | $38,401 | $32,282 | Product Warranty Activity (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Balance at beginning of period | $3,033 | $2,363 | | Provisions for warranties during the period | $549 | $476 | | Settlements during the period | $(342) | $(297) | | Balance at end of period | $3,240 | $2,542 | Note 13. Income Taxes Income tax expense remained $0.2 million, with the company evaluating the impact of new tax reform and assessing the potential release of a valuation allowance on deferred tax assets - Income tax expense was $0.2 million for both the three months ended June 30, 2025, and 2024[80] - The company is evaluating the impact of the 'One Big Beautiful Bill' (OBBB) tax reform, signed on July 4, 2025, which includes provisions for R&D deductions and bonus depreciation[81] - A valuation allowance is maintained on U.S. federal and state deferred tax assets, with an assessment underway in fiscal year 2025 for potential release due to positive earnings trends[83] Note 14. Contingent Consideration All NEPSI and NWL acquisition contingent consideration was settled by September 30, 2024, resulting in no activity recorded in Q1 2025 - All outstanding contingent consideration under the NEPSI Stock Purchase Agreement was settled by September 30, 2024, including the issuance of 300,000 shares of common stock[84][85] - The NWL acquisition's contingent consideration was settled by September 30, 2024, with a $3.3 million payment[87] - The company recorded no activity related to contingent consideration in the three months ended June 30, 2025, compared to a loss of $3.9 million in the prior year period due to an increase in fair value[89] Note 15. Leases Operating lease right-of-use assets totaled $4.0 million and lease liabilities $3.8 million as of June 30, 2025, with total lease costs of $0.5 million Supplemental Balance Sheet Information Related to Leases (in thousands): | Item | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Right-of-use assets – Operating | $4,041 | $3,829 | | Lease liabilities – ST Operating | $854 | $685 | | Lease liabilities – LT Operating | $2,906 | $2,684 | | Total lease liabilities | $3,760 | $3,369 | Total Lease Costs (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Operating lease costs – fixed | $416 | $309 | | Operating lease costs – variable | $45 | $45 | | Short-term lease costs | $41 | $38 | | Total lease costs | $502 | $392 | - The present value of total minimum future lease obligations is $3.76 million, with $0.9 million due in the remaining fiscal year 2026[93] Note 16. Commitments and Contingencies The company records liabilities for probable legal losses and has $5.5 million in performance bond commitments secured by restricted cash - The company records a liability for legal matters when a loss is known or considered probable and the amount can be reasonably estimated[94] Restricted Cash (in thousands): | Item | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Restricted cash (current) | $1,349 | $1,613 | | Restricted cash (long-term) | $4,180 | $4,274 | | Total restricted cash | $5,529 | $5,887 | Note 17. Business Segments AMSC operates in Grid and Wind segments, both showing improved operating income in Q1 2025, driven by power resiliency and wind power solutions - The Grid segment enables electric utilities, industrial facilities, and renewable energy project developers to connect, transmit, and distribute power, and sells ship protection products to the U.S. Navy[99][123] - The Wind segment supplies advanced power electronics and control systems, licenses wind turbine designs, and provides support services to wind turbine manufacturers[100][123] Segment Operating Income (in thousands): | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Grid | $4,155 | $(237) | | Wind | $1,489 | $866 | | Unallocated corporate expenses | $0 | $(3,920) | | Total Operating Income (Loss) | $5,644 | $(3,291) | Total Assets by Segment (in thousands): | Segment | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Grid | $221,959 | $211,520 | | Wind | $17,437 | $13,697 | | Corporate assets | $213,450 | $85,304 | | Total | $452,846 | $310,521 | Note 18. Recent Accounting Pronouncements The company is evaluating new FASB ASUs on income tax disclosures, codification improvements, and expense disaggregation, effective in future reporting periods - The company is evaluating ASU 2023-09 (Income Taxes), effective for periods beginning after December 15, 2024, which aims to improve income tax disclosures[108] - The company is evaluating ASU 2024-02 (Codification Improvements), effective for periods beginning after December 15, 2024, which removes references to Concepts Statements[109] - The company is evaluating ASU 2024-03 (Expense Disaggregation Disclosures), effective for periods beginning after December 15, 2026, which requires more disaggregated expense information[110] Note 19. Subsequent Events No subsequent events were identified or reported through the filing date of the Quarterly Report on Form 10-Q - No subsequent events were identified to report through the filing date of the Form 10-Q[111] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's financial performance, condition, and operational results for Q1 2025, covering an executive overview, accounting policies, segment results, liquidity, and recent pronouncements Executive Overview This section provides a high-level summary of the company's business, strategic drivers, and key recent developments - AMSC is a leading system provider of megawatt-scale power resiliency solutions for grid and Navy applications, enhancing performance, protecting fleets, and lowering wind power costs[118] - Demand for solutions is driven by modernized smart grids, U.S. Navy fleet electrification, and increased renewable energy adoption[119] - The company's core technologies include PowerModule™ programmable power electronic converters and Amperium® high temperature superconductor (HTS) wires[120] - On August 1, 2024, AMSC acquired NWL for $61.4 million, integrating it into the Grid business segment[125] - In June 2025, the company completed an equity offering, raising approximately $124.6 million in net proceeds[126] Critical Accounting Policies and Estimates This section highlights the significant accounting policies and estimates that require management's judgment and can materially impact financial reporting - The preparation of financial statements requires management to make estimates and judgments that affect reported amounts of assets, liabilities, revenues, and expenses[127] Results of Operations This section analyzes the company's financial performance, detailing revenues, costs, and profitability across various operational aspects Revenues This section details the company's revenue performance, disaggregated by segment, and highlights key drivers of change Total Revenues (in thousands): | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------- | | Grid | $60,087 | $32,336 | +86% | | Wind | $12,271 | $7,954 | +54% | | Total | $72,358 | $40,290 | +80% | - The increase in Grid segment revenues was primarily driven by the acquisition of NWL and increased shipments of new energy power systems[128] - The increase in Wind segment revenues was driven by additional shipments of electrical control systems (ECS)[129] Cost of Revenues and Gross Margin This section analyzes the cost of goods sold and the resulting gross margin, explaining factors influencing profitability Cost of Revenues and Gross Margin (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------- | | Cost of revenues | $47,869 | $28,065 | +71% | | Gross margin | 34% | 30% | +4 ppts | - The increase in gross margin was due to higher revenues, a favorable product mix, and pricing increases across product lines[130] Operating Expenses This section details the company's operating expenses, including R&D, SG&A, and other non-revenue related costs Operating Expenses (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------- | | Research and development | $4,304 | $2,286 | +88% | | Selling, general and administrative | $14,204 | $8,898 | +60% | | Amortization of acquisition-related intangibles | $337 | $412 | -18% | | Change in fair value of contingent consideration | $0 | $3,920 | -100% | | Total Operating Expenses | $18,845 | $15,516 | +21% | - Increases in R&D and SG&A expenses were primarily driven by the addition of NWL expenses, higher overall compensation, and additional stock-based compensation[131][132] - The decrease in amortization expense is a result of using the economic consumption method for acquired customer relationship intangible assets[133] - No contingent consideration activity in Q1 2025 as the liability was settled in the prior fiscal year, compared to a $3.9 million loss in Q1 2024[134] Operating Income (Loss) This section presents the company's operating income or loss, broken down by business segment, reflecting core operational profitability Operating Income (Loss) by Segment (in thousands): | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Grid | $4,155 | $(237) | | Wind | $1,489 | $866 | | Unallocated corporate expenses | $0 | $(3,920) | | Total Operating Income (Loss) | $5,644 | $(3,291) | - Grid segment operating income improved significantly due to higher revenues and gross margins[136] - Wind segment operating income increased due to higher revenues and gross margins from increased ECS unit sales[137] Interest Income, Net This section reports the net interest income or expense, reflecting the company's financial income from investments and costs of debt Interest Income, Net (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------- | | Interest income, net | $932 | $1,120 | -17% | - The decrease in net interest income was due to lower interest rates[138] Other Income (Expense), Net This section details other non-operating income and expenses, including gains or losses from foreign currency and joint ventures Other Income (Expense), Net (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Other income (expense), net | $347 | $(160) | - The improvement was driven by favorable foreign currency fluctuations and a gain from the NWL Pacific joint venture[139] Income Taxes This section outlines the company's income tax expense for the period Income Tax Expense (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Income tax expense | $199 | $193 | Net Income (Loss) This section presents the company's overall net income or loss, reflecting total profitability after all expenses and taxes Net Income (Loss) (in thousands): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Net income (loss) | $6,724 | $(2,524) | - The improvement in net income was primarily driven by increased revenues and gross margins[141] Non-GAAP Financial Measure - Non-GAAP Net Income This section provides a non-GAAP measure of net income, adjusted for specific non-cash or unusual items to offer an alternative view of performance - Non-GAAP net income is defined as net income (loss) before stock-based compensation, amortization of acquisition-related intangibles, change in fair value of contingent consideration, and other non-cash or unusual charges[143] Non-GAAP Net Income (in thousands, except per share data): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Non-GAAP net income | $11,587 | $3,037 | | Non-GAAP net income per share - basic | $0.30 | $0.09 | | Non-GAAP net income per share - diluted | $0.29 | $0.08 | - The improvement in non-GAAP net income was due to higher revenues and gross margins[143] Liquidity and Capital Resources This section discusses the company's ability to meet its short-term and long-term financial obligations and its sources of funding - Primary liquidity sources are internally generated cash, cash and cash equivalents on hand, and access to capital markets[144] Cash, Cash Equivalents, and Restricted Cash (in thousands): | Item | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Cash and cash equivalents | $207,890 | $79,494 | | Restricted cash | $5,529 | $5,887 | | Total | $213,419 | $85,381 | - In June 2025, the company completed an equity offering, raising approximately $124.6 million in net proceeds[146] Net Cash Flows (in thousands): | Activity | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Operating activities | $4,125 | $3,409 | | Investing activities | $(735) | $(20) | | Financing activities | $124,577 | $(142) | - The company believes it has sufficient liquidity for the next twelve months but may seek additional capital, with no assurance of favorable terms[152] Legal Proceedings This section provides an overview of any significant legal and administrative proceedings involving the company - The company records a liability for legal and administrative proceedings when a loss is known or considered probable and the amount can be reasonably estimated[153] Recent Accounting Pronouncements This section outlines the company's evaluation of recently issued accounting pronouncements and their potential impact on financial reporting - The company is evaluating the impact of ASU 2023-09 (Income Taxes), ASU 2024-02 (Codification Improvements), and ASU 2024-03 (Expense Disaggregation Disclosures)[154][155][156] Item 3. Quantitative and Qualitative Disclosures About Market Risk The company's exposure to market risks, including interest rate and foreign currency exchange, is discussed, with a 10% Euro fluctuation deemed immaterial Cash and Cash Equivalents This section details the company's market risk exposure related to its cash and cash equivalents, primarily focusing on interest rate risk - Exposure to market risk from short-term cash instruments is limited to interest rate risk and is not material[160] - Investments in marketable securities prioritize principal preservation, liquidity, and income maximization[160] Foreign Currency Exchange Risk This section assesses the company's exposure to foreign currency exchange rate fluctuations and their potential impact on financial results - The functional currency of AMSC Austria is the Euro, while other foreign subsidiaries use the U.S. dollar[161] - A 10% fluctuation in the functional currency for AMSC Austria would have an immaterial effect on consolidated financial statements[162] Foreign Currency Gains (Losses) (in millions): | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | Foreign currency gains (losses) | $0.1 | $(0.2) | Item 4. Controls and Procedures Management evaluated disclosure controls and procedures, concluding they were effective as of June 30, 2025, with no material changes to internal control over financial reporting Evaluation of Disclosure Controls and Procedures This section reports on management's assessment of the effectiveness of the company's disclosure controls and procedures - Management, with CEO and CFO participation, concluded that disclosure controls and procedures were effective at the reasonable assurance level as of June 30, 2025[164] Changes in Internal Control over Financial Reporting This section details any changes in the company's internal control over financial reporting during the reporting period - There were no changes to internal control over financial reporting during the quarter ended June 30, 2025, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[165] PART II—OTHER INFORMATION Item 1. Legal Proceedings No legal proceedings were reported for the period - No legal proceedings to report[167] Item 1A. Risk Factors No material changes to risk factors were reported from the Annual Report on Form 10-K for the fiscal year ended March 31, 2025 - No material changes to the risk factors described in the Annual Report on Form 10-K for the fiscal year ended March 31, 2025[167] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds No stock repurchase activity occurred during the three months ended June 30, 2025 - No stock repurchase activity occurred during the three months ended June 30, 2025[168] Item 3. Defaults Upon Senior Securities No defaults upon senior securities were reported for the period - No defaults upon senior securities[169] Item 4. Mine Safety Disclosure This item is not applicable to the company's operations - Not Applicable[169] Item 5. Other Information No other information was reported, including no director or officer Rule 10b5-1 trading arrangement activity - No other information to report[169] - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[169] Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including incentive plans, stock plans, certifications, and XBRL documents - Exhibits include Fiscal 2025 Executive Incentive Plan, Amended and Restated 2007 Director Stock Plan, CEO and CFO certifications (Rule 13a-14(a) and 13a-14(b)), and Inline XBRL documents[170] Signature The report was signed by John W. Kosiba, Jr., Senior Vice President, Chief Financial Officer and Treasurer, on July 30, 2025 - The report was signed by John W. Kosiba, Jr., Senior Vice President, Chief Financial Officer and Treasurer, on July 30, 2025[175][176]