SkyWater(SKYT) - 2026 Q2 - Quarterly Report

Forward-Looking Statements Special Note Regarding Forward-Looking Statements This section details the nature of forward-looking statements, their inherent risks, and the Company's policy on public updates - Forward-looking statements are subject to various risks, uncertainties, and assumptions, including business development, financial condition, operational capacity, technological changes, customer relationships, and economic conditions[10][12] - The Company does not undertake to publicly update any forward-looking statements to conform to changes in expectations or actual results, except as legally required[11] PART I. FINANCIAL INFORMATION Item 1. Financial Statements This section presents SkyWater Technology's unaudited condensed consolidated financial statements and related notes Condensed Consolidated Balance Sheets Condensed Consolidated Balance Sheets (in thousands) | Metric (in thousands) | June 29, 2025 | December 29, 2024 | Change | % Change | | :-------------------- | :------------ | :---------------- | :----- | :------- | | Cash and cash equivalents | $49,373 | $18,844 | $30,529 | 162.0% | | Total current assets | $155,938 | $132,077 | $23,861 | 18.1% | | Total assets | $334,693 | $313,775 | $20,918 | 6.7% | | Total current liabilities | $147,596 | $154,327 | $(6,731) | -4.4% | | Total liabilities | $282,727 | $250,285 | $32,442 | 13.0% | | Total shareholders' equity | $51,966 | $63,490 | $(11,524) | -18.1% | Condensed Consolidated Statements of Operations Condensed Consolidated Statements of Operations (Three-Month Period, in thousands) | Metric (in thousands) | Three-Month Period Ended June 29, 2025 | Three-Month Period Ended June 30, 2024 | Change | % Change | | :-------------------- | :------------------------------------- | :------------------------------------- | :----- | :------- | | Revenue | $59,063 | $93,329 | $(34,266) | -36.7% | | Gross profit | $10,899 | $17,114 | $(6,215) | -36.3% | | Operating (loss) income | $(6,478) | $1,400 | $(7,878) | -562.7% | | Net loss | $(8,857) | $(955) | $(7,902) | 827.4% | | Net loss attributable to SkyWater Technology, Inc. | $(9,978) | $(1,897) | $(8,081) | 426.0% | | Net loss per share, basic and diluted | $(0.21) | $(0.04) | $(0.17) | 425.0% | Condensed Consolidated Statements of Operations (Six-Month Period, in thousands) | Metric (in thousands) | Six-Month Period Ended June 29, 2025 | Six-Month Period Ended June 30, 2024 | Change | % Change | | :-------------------- | :----------------------------------- | :----------------------------------- | :----- | :------- | | Revenue | $120,359 | $172,965 | $(52,606) | -30.4% | | Gross profit | $25,156 | $30,094 | $(4,938) | -16.4% | | Operating (loss) income | $(10,499) | $(802) | $(9,697) | -1209.1% | | Net loss | $(15,075) | $(5,587) | $(9,488) | 170.0% | | Net loss attributable to SkyWater Technology, Inc. | $(17,323) | $(7,626) | $(9,697) | 127.1% | | Net loss per share, basic and diluted | $(0.36) | $(0.16) | $(0.20) | 125.0% | Condensed Consolidated Statements of Shareholders' Equity Condensed Consolidated Statements of Shareholders' Equity (in thousands) | Metric (in thousands) | Balance at June 29, 2025 | Balance at June 30, 2024 | Change | % Change | | :-------------------- | :----------------------- | :----------------------- | :----- | :------- | | Common Stock Amount | $485 | $474 | $11 | 2.3% | | Additional Paid-in Capital | $194,070 | $183,817 | $10,253 | 5.6% | | Accumulated Deficit | $(149,319) | $(132,829) | $(16,490) | 12.4% | | Total Shareholders' Equity, SkyWater Technology, Inc. | $45,236 | $51,462 | $(6,226) | -12.1% | | Noncontrolling Interests | $6,730 | $5,358 | $1,372 | 25.6% | | Total Shareholders' Equity | $51,966 | $56,820 | $(4,854) | -8.5% | - Equity-based compensation expense for the six-month period ended June 29, 2025, was $4,220 thousand, contributing to the increase in additional paid-in capital[21] - Net loss attributable to SkyWater Technology, Inc. for the six-month period ended June 29, 2025, was $(17,323) thousand, significantly increasing the accumulated deficit[21] Condensed Consolidated Statements of Cash Flows Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity (in thousands) | Six-Month Period Ended June 29, 2025 | Six-Month Period Ended June 30, 2024 | Change | % Change | | :-------------------------------- | :----------------------------------- | :----------------------------------- | :----- | :------- | | Net cash provided by operating activities | $54,300 | $5,423 | $48,877 | 901.3% | | Net cash used in investing activities | $(18,773) | $(3,218) | $(15,555) | 483.4% | | Net cash used in financing activities | $(4,998) | $(2,225) | $(2,773) | 124.6% | | Net change in cash and cash equivalents | $30,529 | $(20) | $30,549 | -152745.0% | | Cash and cash equivalents, end of period | $49,373 | $18,362 | $31,011 | 169.1% | - Significant increase in cash provided by operating activities in 2025 was primarily due to a $45.1 million increase in contract liabilities, including a $52.0 million cash receipt from a customer for tool installation[24][160] - Increased cash used in investing activities in 2025 was driven by higher capital spending on property and equipment, with purchases totaling $17,407 thousand[24][161] Notes to Condensed Consolidated Financial Statements Note 1 Nature of Business SkyWater is a U.S.-based independent technology foundry, recently acquiring Infineon's 200 mm fab in Austin - SkyWater operates a technology-as-a-service model, co-developing process technology IP with customers through Advanced Technology Services (ATS) and supporting volume production via Wafer Services[29] - On June 30, 2025, the Company completed the acquisition of Infineon Technologies AG's 200 mm fab in Austin, Texas, financed through debt[31] Note 2 Basis of Presentation and Principles of Consolidation This note details financial statement presentation, liquidity assessment, and net loss per share computation - The Company incurred net losses attributable to SkyWater Technology, Inc. of $9,978 thousand for the three-month period and $17,323 thousand for the six-month period ended June 29, 2025[36] - Management believes the Company has sufficient liquidity to fund operations for the next twelve months, supported by cash on hand and available borrowings from the Revolver, which was amended to increase capacity to $350 million[41] Net Loss Per Common Share (in thousands, except per share data) | Metric (in thousands, except per share data) | Three-Month Period Ended June 29, 2025 | Three-Month Period Ended June 30, 2024 | Six-Month Period Ended June 29, 2025 | Six-Month Period Ended June 30, 2024 | | :------------------------------------------- | :------------------------------------- | :------------------------------------- | :----------------------------------- | :----------------------------------- | | Net loss attributable to SkyWater Technology, Inc. | $(9,978) | $(1,897) | $(17,323) | $(7,626) | | Weighted average common shares outstanding, basic and diluted | 48,091 | 47,395 | 47,943 | 47,247 | | Net loss per common share, basic and diluted | $(0.21) | $(0.04) | $(0.36) | $(0.16) | Note 3 Summary of Significant Accounting Policies This note outlines new accounting standards and confirms no significant changes to existing policies during the period - The Company will adopt ASU 2023-09 (Income Taxes) for its fiscal year ending January 3, 2027, and ASU 2024-03 (Expense Disaggregation Disclosures) for its fiscal year ending January 2, 2028, as an emerging growth company[47][48] - No significant changes were made to the Company's accounting policies and estimates during the three- and six-month periods ended June 29, 2025[49] Note 4 Revenue This note disaggregates revenue by type, highlighting decreased Tools revenue, and details contract assets and liabilities Revenue by Type (Three-Month Period, in thousands) | Revenue Type (in thousands) | Three-Month Period Ended June 29, 2025 | Three-Month Period Ended June 30, 2024 | Change | % Change | | :-------------------------- | :------------------------------------- | :------------------------------------- | :----- | :------- | | ATS development | $52,605 | $61,669 | $(9,064) | -14.7% | | Wafer Services | $5,411 | $5,780 | $(369) | -6.4% | | Tools | $1,047 | $25,880 | $(24,833) | -96.0% | | Total Revenue | $59,063 | $93,329 | $(34,266) | -36.7% | Revenue by Type (Six-Month Period, in thousands) | Revenue Type (in thousands) | Six-Month Period Ended June 29, 2025 | Six-Month Period Ended June 30, 2024 | Change | % Change | | :-------------------------- | :----------------------------------- | :----------------------------------- | :----- | :------- | | ATS development | $105,140 | $122,853 | $(17,713) | -14.4% | | Wafer Services | $12,938 | $15,773 | $(2,835) | -18.0% | | Tools | $2,281 | $34,339 | $(32,058) | -93.4% | | Total Revenue | $120,359 | $172,965 | $(52,606) | -30.4% | - Contract liabilities increased from $107,067 thousand at December 29, 2024, to $152,137 thousand at June 29, 2025, primarily due to increased payments received from customers[57][58] - Remaining performance obligations for contracts with original expected durations of one year or more totaled $133,821 thousand as of June 29, 2025, primarily related to ATS development and tools revenue[59] Note 5 Balance Sheet Information This note provides detailed breakdowns and changes for key balance sheet accounts across reporting periods Balance Sheet Accounts (in thousands) | Account (in thousands) | June 29, 2025 | December 29, 2024 | Change | % Change | | :--------------------- | :------------ | :---------------- | :----- | :------- | | Total inventory | $18,286 | $19,282 | $(996) | -5.2% | | Total prepaid assets and other current assets | $41,914 | $23,476 | $18,438 | 78.5% | | Total property and equipment, net | $161,582 | $165,431 | $(3,849) | -2.3% | | Total intangible assets, net | $8,441 | $7,779 | $662 | 8.5% | | Total accrued expenses | $40,627 | $36,829 | $3,798 | 10.3% | - Prepaid expenses and other current assets significantly increased by $18,438 thousand, primarily due to an increase in tools purchased for customers, rising from $16,923 thousand to $34,423 thousand[67] - Depreciation expense for property and equipment was $8,002 thousand for the six-month period ended June 29, 2025, primarily classified as cost of revenue[69] Note 6 Debt This note details the Company's debt structure, including Revolver, VIE, and Tool Financing, and maturity schedule Debt Components (in thousands) | Debt Component (in thousands) | June 29, 2025 | December 29, 2024 | Change | % Change | | :---------------------------- | :------------ | :---------------- | :----- | :------- | | Revolver outstanding balance | $25,803 | $30,171 | $(4,368) | -14.5% | | Total short-term financing, net | $23,614 | $27,669 | $(4,055) | -14.7% | | VIE Financing | $34,106 | $34,671 | $(565) | -1.6% | | Tool financing loans | $9,935 | $7,253 | $2,682 | 37.0% | | Total long-term debt, excluding current portion | $35,316 | $34,704 | $612 | 1.8% | - As of June 29, 2025, the Revolver had an outstanding balance of $25,803 thousand at an 8.7% interest rate, with $104,196 thousand remaining availability[80][198] - The VIE Financing, fixed at 3.44% interest, had a balance of $34,106 thousand and is repayable in monthly installments until October 2030[79][81] Future Principal Payments of Long-Term Debt (in thousands) | Future Principal Payments of Long-Term Debt (in thousands) | | :------------------------------------------------------- | | Remainder of 2025 | $3,370 | | 2026 | $5,975 | | 2027 | $2,808 | | 2028 | $2,008 | | 2029 | $1,307 | | Thereafter | $28,573 | | Total | $44,041 | Note 7 Income Taxes This note explains effective tax rates, influenced by state taxes and valuation allowances, and upcoming tax law changes Effective Tax Rate | Effective Tax Rate | Three-Month Period Ended June 29, 2025 | Three-Month Period Ended June 30, 2024 | Six-Month Period Ended June 29, 2025 | Six-Month Period Ended June 30, 2024 | | :----------------- | :------------------------------------- | :------------------------------------- | :----------------------------------- | :----------------------------------- | | Effective Tax Rate | (8.04)% | 11.7% | (7.0)% | 1.5% | - The One Big Beautiful Bill Act, signed July 4, 2025, increases the Section 48D credit for semiconductor manufacturing facilities from 25% to 35% for property placed in service after 2025. The Company will record the effect of these tax law changes in the third quarter of 2025, anticipating no material impact to overall tax expense[119] Note 8 Equity-Based Compensation This note details equity-based compensation expense recognized across various categories for the reporting periods Equity-Based Compensation Expense (in thousands) | Expense Category (in thousands) | Three-Month Period Ended June 29, 2025 | Three-Month Period Ended June 30, 2024 | Six-Month Period Ended June 29, 2025 | Six-Month Period Ended June 30, 2024 | | :------------------------------ | :------------------------------------- | :------------------------------------- | :----------------------------------- | :----------------------------------- | | Cost of revenue | $626 | $504 | $1,193 | $959 | | Research and development expense | $113 | $90 | $196 | $197 | | Selling, general and administrative expense | $1,543 | $1,422 | $2,831 | $2,932 | | Total equity-based compensation expense | $2,282 | $2,016 | $4,220 | $4,088 | Note 9 Commitments and Contingencies This note outlines the Company's commitments and contingencies, including capital expenditures, leases, and grants - The Company has $5,470 thousand in contractual capital expenditure commitments outstanding as of June 29, 2025, expected to be paid in the next twelve months[92] - Under the CfN Lease, SkyWater is obligated to bring the facility to full production capacity within five years and operate it for an additional 15 years, with potential termination payment of up to $15,000 thousand[93] - SkyWater committed to a 20% matching share contribution of approximately $9,100 thousand for the Build Back Better Grant, with $1,000 thousand obligated in the subsequent quarter[95] Note 10 Related Party Transactions This note describes related party transactions, including funding support, consulting, and a facility sale-leaseback - Oxbow Industries provides a support letter for up to $12,500 thousand in funding, if necessary, extended through March 18, 2026[97] - Consulting expenses with Oxbow Industries totaled $212 thousand for the three-month period and $416 thousand for the six-month period ended June 29, 2025[98] - The Company leases its Minnesota facility from Oxbow Realty with monthly payments of $426 thousand, subject to annual 2% increases[99] Note 11 Variable Interest Entity This note explains Oxbow Realty's consolidation as a VIE, detailing its assets, liabilities, revenue, and net income - Oxbow Realty is consolidated as a VIE because it lacks sufficient equity to finance its activities, and SkyWater is the primary beneficiary[102] Oxbow Realty Assets (in thousands) | Oxbow Realty Assets (in thousands) | June 29, 2025 | December 29, 2024 | | :--------------------------------- | :------------ | :---------------- | | Total assets | $43,150 | $42,885 | | Total liabilities | $36,420 | $37,009 | Oxbow Realty Financials (in thousands) | Oxbow Realty Financials (in thousands) | Three-Month Period Ended June 29, 2025 | Three-Month Period Ended June 30, 2024 | Six-Month Period Ended June 29, 2025 | Six-Month Period Ended June 30, 2024 | | :------------------------------------- | :------------------------------------- | :------------------------------------- | :----------------------------------- | :----------------------------------- | | Revenue | $1,438 | $1,423 | $2,872 | $2,842 | | Net income | $1,121 | $942 | $2,248 | $2,039 | Note 12 Leases This note details SkyWater's lease arrangements, including its lessor role and a recent failed sale-leaseback - SkyWater acts as a lessor for a portion of its Minnesota facility, recognizing $21,000 thousand in operating lease revenue over 4.5 years, prepaid by the customer[106][107] - In June 2025, the Company entered into a failed sale-leaseback transaction for a furnace, receiving $4,599 thousand cash and recording a financial obligation with monthly lease payments of $142 thousand over 36 months[108] Note 13 Reportable Segment and Geographic Information This note confirms SkyWater's single segment operation and details revenue by country and customer concentration - SkyWater operates and manages its business as one reportable segment[46] Revenue by Country (in thousands) | Revenue by Country (in thousands) | Three-Month Period Ended June 29, 2025 | Three-Month Period Ended June 30, 2024 | Six-Month Period Ended June 29, 2025 | Six-Month Period Ended June 30, 2024 | | :-------------------------------- | :------------------------------------- | :------------------------------------- | :----------------------------------- | :----------------------------------- | | United States | $53,780 | $90,598 | $111,026 | $166,822 | | Canada | $3,030 | $1,647 | $560 | $637 | | Hong Kong | $293 | $32 | $5,342 | $3,880 | | United Kingdom | $560 | $352 | $767 | $79 | | All others | $1,400 | $700 | $2,663 | $1,547 | | Total | $59,063 | $93,329 | $120,359 | $172,965 | - One customer accounted for 43% of revenue for the three-month period and 41% for the six-month period ended June 29, 2025[111] Note 14 Subsequent Events This note details significant post-period events, including the Fab 25 acquisition, loan amendment, and tax act - On June 30, 2025, SkyWater completed the acquisition of Spansion Fab 25, LLC for approximately $93 million in cash, expected to enhance foundational semiconductor manufacturing and strengthen its strategic position[112][113] - In connection with the acquisition, the Loan and Security Agreement was amended to increase the revolving line of credit to $350 million (from $130 million) and extend the maturity date to June 30, 2030[116][118] - The One Big Beautiful Bill Act, signed July 4, 2025, increases the Section 48D credit for semiconductor manufacturing facilities from 25% to 35% for property placed in service after 2025, with effects to be recorded in Q3 2025[119] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses SkyWater's financial condition, operational results, key trends, and performance metrics for Q2 and H1 2025 Overview SkyWater is a U.S.-based independent technology foundry, offering ATS and Wafer Services for high-growth markets - SkyWater is a U.S.-based, independent, pure-play technology foundry with Defense Microelectronics Activity Category 1A Trusted Accreditation, offering enhanced IP security and secure U.S. domestic supply chain access[124] - The Company focuses on high-growth end markets including advanced compute, aerospace and defense, automotive, bio-health, and industrial, specializing in advanced solutions like infrared imaging and quantum computing ICs[125] Factors and Trends Affecting our Business and Results of Operations Key factors include the Fab 25 acquisition, macroeconomic conditions, CHIPS Act funding, and increased indebtedness - The acquisition of Spansion Fab 25, LLC on June 30, 2025, is expected to enhance SkyWater's capabilities in foundational semiconductor manufacturing[127] - The CHIPS Act provides significant incentives and funding for onshore semiconductor development and manufacturing; SkyWater received a preliminary memorandum of terms for up to $16 million in federal funding and $19 million in state incentives[129] - Customer-funded capital investment is a significant driver, enabling the development of technology platforms for future growth[129] Financial Performance Metrics Management reviews key financial metrics like revenue, gross profit, net loss, and Adjusted EBITDA for operational decisions - Key financial performance metrics reviewed by management include revenue, gross profit, net loss, and adjusted EBITDA[130][131] Results of Operations This section compares Q2 and H1 2025 operating results to 2024, showing decreased revenue and increased net loss Second Quarter of 2025 Compared to the Second Quarter of 2024 Q2 2025 revenue decreased by 37% to $59.1 million, driven by declines in customer-funded tools and ATS Second Quarter Financial Performance (in thousands) | Metric (in thousands) | Q2 2025 | Q2 2024 | Change | % Change | | :-------------------- | :------ | :------ | :----- | :------- | | Revenue | $59,063 | $93,329 | $(34,266) | -36.7% | | Cost of revenue | $48,164 | $76,215 | $(28,051) | -36.8% | | Gross profit | $10,899 | $17,114 | $(6,215) | -36.3% | | Operating (loss) income | $(6,478) | $1,400 | $(7,878) | -562.7% | | Net loss attributable to SkyWater Technology, Inc. | $(9,978) | $(1,897) | $(8,081) | 426.0% | - ATS development revenue decreased by $9.1 million, primarily driven by a $9.3 million decrease in aerospace and defense industry revenue due to shifts in U.S. government policy and delayed contract awards[134] - Selling, general and administrative expense increased by $1.7 million, primarily due to $2.2 million in expenses related to the acquisition of Fab 25[137] First Six Months of 2025 Compared to the First Six Months of 2024 H1 2025 revenue decreased by 30.4% to $120.4 million, with net loss increasing by 127% to $17.3 million First Six Months Financial Performance (in thousands) | Metric (in thousands) | H1 2025 | H1 2024 | Change | % Change | | :-------------------- | :------ | :------ | :----- | :------- | | Revenue | $120,359 | $172,965 | $(52,606) | -30.4% | | Cost of revenue | $95,203 | $142,871 | $(47,668) | -33.4% | | Gross profit | $25,156 | $30,094 | $(4,938) | -16.4% | | Operating loss | $(10,499) | $(802) | $(9,697) | -1209.1% | | Net loss attributable to SkyWater Technology, Inc. | $(17,323) | $(7,626) | $(9,697) | 127.1% | - Tools revenue decreased by $31.9 million, and ATS revenue decreased by $17.7 million, primarily due to an $18.1 million decrease in aerospace and defense industry revenue[141][142] - Cost of revenue decreased by $47.7 million, driven by a $31.2 million decrease from completion of tool procurement and the absence of an $8.0 million charge for estimated future losses on a customer program recorded in the prior year[144] - Selling, general and administrative expense increased by $5.5 million, mainly due to $2.2 million in acquisition-related consulting fees for the Fab 25 transaction[146] Liquidity and Capital Resources Liquidity is supported by cash and an expanded Revolver, despite increased indebtedness from the Fab 25 acquisition - As of June 29, 2025, SkyWater had $49.4 million in cash and cash equivalents and $104.2 million available under its Revolver. Post-Fab 25 acquisition, Revolver availability increased to $213.0 million[153][158] - Net cash provided by operating activities significantly increased to $54.3 million for the first six months of 2025, up from $5.4 million in 2024, primarily due to increased contract liabilities and improved cash collection[158][160] - Capital expenditures for the first six months of 2025 were $18.8 million, up from $5.2 million in 2024, reflecting increased investment in development and manufacturing capabilities[155][158][161] - Total debt on a consolidated basis was $179.1 million as of June 29, 2025 (pro forma for the Fab 25 acquisition), including $137.1 million under the Loan Agreement[209][215] Non-GAAP Financial Measure This section defines and reconciles Adjusted EBITDA, a non-GAAP measure for evaluating operating performance - Adjusted EBITDA is defined as net (loss) income before interest expense, income tax (benefit) expense, depreciation and amortization, net income attributable to noncontrolling interests, equity-based compensation expense, and transaction costs[189] Adjusted EBITDA Reconciliation (in thousands) | Metric (in thousands) | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :-------------------- | :------ | :------ | :------ | :------ | | Net loss attributable to SkyWater Technology, Inc. | $(9,978) | $(1,897) | $(17,323) | $(7,626) | | EBITDA | $(3,298) | $4,522 | $(4,088) | $6,288 | | Adjusted EBITDA | $2,276 | $8,144 | $6,361 | $13,079 | - Adjusted EBITDA decreased by 72% to $2.3 million in Q2 2025 and by 51% to $6.4 million in H1 2025, primarily due to headwinds in the ATS business from U.S. government policy impacts on defense spending[149] Item 3. Quantitative and Qualitative Disclosures About Market Risk This section discusses SkyWater's market risks, focusing on credit risk and interest rate risk from its Revolver - The Company's market risks are limited to potential changes in the fair value of debt due to fluctuations in market interest rates[196] - Credit risk is managed by monitoring financial institutions for cash balances and performing ongoing credit evaluations for accounts receivable and contract assets[197] - A 100 basis point increase in the interest rate on the Revolver (outstanding balance of $25.8 million at June 29, 2025) would increase annual interest expense by $0.3 million[198] Item 4. Controls and Procedures Disclosure controls were ineffective due to a revenue accounting material weakness, though financial statements are fairly presented - Disclosure controls and procedures were deemed ineffective as of June 29, 2025, due to a material weakness in the revenue accounting process[200] - Despite the material weakness, management concluded that the condensed consolidated financial statements for the periods presented are fairly presented in conformity with GAAP[201] - Remediation plans involve designing and implementing system improvements to monitor and evaluate changes processed via privileged access to the manufacturing application and its databases[203] PART II. OTHER INFORMATION Item 1. Legal Proceedings SkyWater is not involved in any legal proceedings expected to materially adversely affect its business or financial condition - The Company is not a party to any litigation that is believed to have a material adverse effect on its business, operating results, cash flows, or financial condition[206] Item 1A. Risk Factors This section updates risk factors, emphasizing Fab 25 acquisition uncertainties, increased leverage, and capital needs - The Company may not realize the anticipated benefits of the Fab 25 acquisition, and integration delays or difficulties could adversely affect business and financial results[208] - Increased leverage, totaling $179.1 million pro forma for the Fab 25 acquisition, could harm financial condition by increasing interest payments, vulnerability to economic changes, and limiting flexibility for future financing and acquisitions[209][211][215][218] - The Company may need to raise additional capital through equity or debt financings, which could result in significant dilution, increased fixed payment obligations, or relinquishing valuable rights to technologies[212] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds No unregistered sales of equity securities or use of proceeds occurred during the reporting period - No unregistered sales of equity securities or use of proceeds occurred during the reporting period[219] Item 3. Defaults Upon Senior Securities No defaults upon senior securities occurred during the reporting period - No defaults upon senior securities occurred during the reporting period[220] Item 4. Mine Safety Disclosures Mine safety disclosures are not applicable to the Company - Mine safety disclosures are not applicable to the Company[221] Item 5. Other Information This item discloses a director's adoption of a Rule 10b5-1 trading arrangement for common stock sales - On June 13, 2025, director Loren A. Unterseher adopted a Rule 10b5-1 trading arrangement for the sale of up to 480,370 shares of common stock, expiring by September 10, 2026[222] Item 6. Exhibits This item lists all filed exhibits, including acquisition and loan agreements, and officer certifications - Key exhibits include the Membership Interest Purchase Agreement for the Fab 25 acquisition and the Amended and Restated Loan and Security Agreement[224] - Certifications from the Chief Executive Officer and Chief Financial Officer are furnished pursuant to Exchange Act Rules and 18 U.S.C. Section 1350[224]