Revenue Performance - Revenues for the year ended December 31, 2025, were $150.5 million, an increase of $7.9 million (or 6%) compared to approximately $142.6 million in 2024[198] - Carrier services revenues increased by $5.1 million to $91.8 million from $86.8 million last year, primarily due to increased contracting activity with federal customers[199] - Managed service fees increased by $3.3 million to $39.1 million from $35.8 million last year, driven by a new commercial contract for a U.S. government end customer[199] - U.S. Federal Government revenues rose to $125.3 million in 2025, an increase of $6.4 million from $118.9 million in 2024[201] - Total revenue for the year ended December 31, 2025 was $150.5 million, a 6% increase from $142.6 million in 2024[206] Profitability - Gross profit for the year ended December 31, 2025 was $21.0 million, or 14% of revenues, compared to $19.0 million, or 13% in 2024[208] - Managed services gross profit margin increased to 36% in 2025 from 34% in 2024[206] - Net loss for the year ended December 31, 2025 was $2.7 million, or $0.28 loss per share, compared to a net loss of $1.9 million, or $0.21 loss per share in 2024[219] Expenses and Cash Flow - Cost of revenues for the year ended December 31, 2025 was $129.5 million, representing 86% of revenues, compared to $123.5 million or 87% in 2024[204] - General and administrative expenses for the year ended December 31, 2025 were $19.7 million, or 13% of revenues, compared to $17.6 million, or 12% in 2024[212] - Net cash provided by operating activities for the year ended December 31, 2025 was approximately $5.7 million, up from $1.6 million in 2024[223] - Cash used in investing activities for the year ended December 31, 2025 was approximately $0.3 million, primarily for property and equipment purchases[225] Strategic Initiatives - The company achieved FedRAMP Authorized status for its Intelligent Technology Management System (ITMS) on February 19, 2025, enhancing its competitive position in government business[172] - The company plans to grow recurring managed services revenues and expand its commercial customer base organically in fiscal 2026[172] - The company aims to leverage its FedRAMP Authorized status to differentiate itself from competitors in pursuing government contracts[172] - The company is exploring the integration of artificial intelligence into its solutions to improve information security and service delivery[172] Other Financial Metrics - The company recorded a valuation allowance against a portion of domestic deferred tax assets, indicating management's assessment that it is more likely than not that the company will not earn sufficient income to realize these assets[195] - The company had net working capital of approximately $2.3 million at December 31, 2025, compared to $2.4 million at December 31, 2024[220] - Reselling and other services decreased by $0.7 million to $14.2 million due to a partial termination of a customer contract in 2025[199] - Sales to federal government customers increased by approximately $5.2 million in 2025 due to new contracts[207]

Revenue Growth - Total Adobe Annualized Recurring Revenue (ARR) grew to $26.06 billion at the end of Q1 fiscal 2026, representing a 10.9% year-over-year growth from $23.50 billion [159]. - Total revenue for the three months ended February 27, 2026, was $6.40 billion, an increase of $684 million, or 12%, compared to the same period in the previous year [172]. - Subscription revenue for the same period was $6.20 billion, up by $715 million, or 13%, year-over-year [172]. - Creative & Marketing Professionals customer group subscription revenue reached $4.39 billion in Q1 fiscal 2026, reflecting a 12% increase from $3.92 billion in Q1 fiscal 2025 [154]. - Business Professionals & Consumers customer group subscription revenue was $1.78 billion in Q1 fiscal 2026, marking a 16% increase from $1.53 billion in Q1 fiscal 2025 [156]. - Total revenue for the three months ended February 27, 2026, was $6,398 million, a 12% increase from $5,714 million in the same period of 2025 [177]. - Revenue from the Americas increased by 10% to $3,755 million, while EMEA revenue rose by 16% to $1,739 million, and APAC revenue increased by 12% to $904 million [177]. Expenses - Cost of revenue for the three months ended February 27, 2026, was $664 million, an increase of $42 million, or 7%, compared to the previous year [172]. - Operating expenses for the same period were $3.32 billion, up by $387 million, or 13%, year-over-year [172]. - Cost of revenue totaled $664 million, up 7% from $622 million, with subscription costs increasing by 10% to $540 million [180]. - Research and development expenses rose by 8% to $1,110 million, representing 17% of total revenue [185]. - Sales and marketing expenses increased by 14% to $1,708 million, accounting for 27% of total revenue [185]. - General and administrative expenses surged by 26% to $463 million, making up 7% of total revenue [185]. - Provision for income taxes increased by 44% to $533 million, with an effective tax rate of 22% compared to 17% in the previous year [199]. Profitability - Net income for Q1 fiscal 2026 was $1.89 billion, an increase of $78 million, or 4%, compared to the same period last year [172]. - Cash flows from operations increased to $2.96 billion during the three months ended February 27, 2026, up by $476 million, or 19%, year-over-year [172]. - Net cash provided by operating activities was $2.96 billion for the three months ended February 27, 2026, an increase from $2.48 billion in the same period last year [219]. Cash and Investments - Cash and cash equivalents as of February 27, 2026, were $6,332 million, up from $5,431 million on November 28, 2025 [216]. - Working capital decreased to $(1,004) million from $(37) million, indicating a decline in short-term financial health [216]. - Net cash provided by investing activities was $474 million, primarily due to proceeds from the maturities of short-term investments [220]. - Net cash used for financing activities was $2.54 billion, mainly for common stock repurchases and taxes related to equity awards [221]. - The company has a $1.5 billion senior unsecured revolving credit agreement, with no outstanding borrowings as of February 27, 2026 [227]. - The company expects to continue investing in short-term and long-term investments, as well as infrastructure and strategic acquisitions [225]. - Cash reserves may be used for stock repurchases and strategic acquisitions that complement the business [225]. - The company believes existing cash and anticipated cash flows will be sufficient to meet working capital and capital expenditure requirements for the next twelve months [223]. Acquisitions and Agreements - The company entered into a definitive agreement to acquire Semrush Holdings, Inc. for approximately $1.9 billion, expected to close in the second quarter of fiscal 2026 [226]. - The stock repurchase program has $3.89 billion remaining under the authority granted in March 2024, with $2.48 billion spent on repurchases during the last quarter [234][235]. - The company incurred a net increase in revenue of approximately $123 million due to foreign currency fluctuations, partially offset by net hedging losses of $49 million [178]. Obligations - Remaining performance obligations as of February 27, 2026, were $22.22 billion, reflecting a 13% increase from $19.69 billion as of February 28, 2025 [172]. - As of February 27, 2026, the carrying value of senior notes was $6.23 billion, with a maximum commitment for interest payments of $933 million [231].

Revenue Dependency and Product Performance - OviTex products accounted for 67% of total revenue in 2023, indicating high dependency on this product line [252]. - The company expects OviTex products to continue to dominate revenue, while also diversifying with OviTex PRS and LIQUIFIX products [252]. - Sales of OviTex products are crucial for future revenue growth, particularly in hernia and abdominal wall reconstruction procedures [257]. - Approximately 15% of the company's revenue for the years ended December 31, 2025, 2024, and 2023 came from sales in markets outside of the U.S. [276]. Regulatory and Compliance Risks - The company must navigate regulatory compliance and potential off-label promotion risks, which could lead to significant penalties [261]. - The FDA's clearance process can be delayed due to requests for additional clinical data and changes in regulatory requirements, which could adversely affect business operations [344]. - Aroa has obtained 510(k) clearances from the FDA for its OviTex products, including the OviTex PRS Long-Term Resorbable product [333]. - Compliance with the EU MDR is necessary for marketing products in the EEA, with the regulation effective since May 26, 2021 [340]. - Regulatory non-compliance could lead to significant enforcement actions, including fines, product recalls, and delays in market introduction [348]. Intellectual Property Challenges - The company owns twenty-six issued U.S. patents and has ten pending U.S. patent applications, with rights to a total of twenty-eight issued or allowed U.S. patents as of December 31, 2025 [296]. - The company may face significant litigation regarding patent rights, which could divert management's attention and resources from its core business [304]. - The company may be required to indemnify customers against infringement claims, which could lead to costly litigation and potential settlement payments [313]. - The company may struggle to enforce its intellectual property rights globally due to high costs and varying laws in different jurisdictions [317]. Market and Competitive Landscape - The medical device industry is highly competitive, with larger competitors having significantly greater market share and financial resources, impacting the company's ability to compete effectively [410][411]. - The competitive landscape includes established companies with bundled product offerings, which may provide better pricing options for potential customers [412]. - The company faces challenges in renewing contracts with Group Purchasing Organizations (GPOs) and Integrated Delivery Networks (IDNs), which are crucial for sales growth [414][416]. Financial and Operational Risks - Rising inflation rates may negatively impact revenues and profitability, with potential material adverse effects if costs cannot be passed to consumers [247]. - Increased operating costs and liquidity constraints in the financial services industry could impair access to funding and impact business operations [248][249]. - The company has federal net operating loss carryforwards (NOLs) of approximately $304.1 million and state NOLs of $244.5 million as of December 31, 2025 [444]. - The trading price of the company's common stock has been highly volatile, and an active trading market may not be sustained, potentially impairing the value of shares [445]. Supply Chain and Manufacturing Risks - The company relies on Aroa as the exclusive manufacturer and supplier of its OviTex and OviTex PRS products, which poses risks if Aroa fails to meet production demands [278]. - Supply chain disruptions due to geopolitical tensions and other factors may lead to increased costs and delays in raw materials, adversely affecting margins and production [418]. - The company does not have redundant facilities and relies on a single location in Malvern, Pennsylvania for all research and development, which poses risks of operational disruption [437]. Cybersecurity and Data Protection - The company is exposed to risks related to cybersecurity incidents that could adversely affect business operations and reputation [439]. - The integration of AI technologies may pose cybersecurity risks and challenges, potentially impacting the company's reputation and operational integrity [382]. - Non-compliance with GDPR and UK GDPR could result in fines up to €20 million or 4% of total worldwide revenue, whichever is greater [389]. Product Development and Market Introduction - The company may face challenges in introducing new product indications and developing new products, which could impair revenue growth [273]. - The total addressable market for the company's products may be smaller than estimated, which could impair sales growth and negatively impact business performance [428]. - Future modifications to products may require new 510(k) clearances or could be subject to the more costly PMA process, potentially delaying product introductions [333].

Financial Performance - Revenues for the year ended December 31, 2025, were $2,661,669, representing a 63% increase compared to $1,636,440 in 2024[236] - Gross profit for 2025 was $567,451, a 164% increase from $215,190 in 2024[236] - Total cost of goods sold increased to $2,094,218 in 2025 from $1,421,250 in 2024, primarily due to higher volumes and increased custom duties and tariffs[247] - Gross profit rose to $567,451 in 2025, with a gross profit margin of 21%, up from 13% in the prior year, reflecting an 8 percentage point improvement[251] - Operating expenses totaled $9,062,415 in 2025, representing a 340% increase compared to $8,138,892 in 2024[236] - Operating expenses increased by approximately 11% to $9,062,415 in 2025, driven by higher general and administrative expenses, including a 17% rise in compensation and benefits costs[255] - Sales and marketing expenses grew by approximately 10% to $2,971,193 in 2025, influenced by increased spending on events and trade shows to expand the business network[259] - Research and development costs decreased by approximately 11% to $725,388 in 2025, primarily related to the development of new smartglass variants and improvements to the Lucyd app[262] - Net cash flows from operating activities were $(7,275,301) in 2025, compared to $(6,739,630) in 2024, reflecting ongoing net losses[267] - Net working capital as of December 31, 2025, was $8,389,807, a decline of approximately 1% from $8,500,498 in 2024[268] Product Performance - The Lucyd Armor product line sold over 12,000 units in 2025, accounting for approximately 50% of total smartglass units sold[238] - The company launched four alternate variants of the Lucyd Armor product line to cater to a wider range of safety glass users[238] - Customer ratings for the latest products have improved, indicating positive feedback on design and functionality[232] - Lucyd Armor smartglasses and Reebok® Powered by Lucyd smartglasses are expected to drive significant revenue growth in 2026, with a focus on international expansion in the UK, EU, Canada, and Latin America starting in late 2025[246] Sales Channels - Approximately 51% of sales in 2025 were processed through the online store (Lucyd.co), 40% on Amazon.com, and 8% through reseller partners[242] - The company increased the number of retail store locations from over 350 at the beginning of 2025 to over 400 by the end of 2025[231] Financial Strategy - A minor price increase of $15 was instituted for most custom lens orders to help offset new tariff expenses[235] - The company opened three new fulfillment centers in Europe, Canada, and China to improve international business fluidity[235] - The company sold 606,377 shares of common stock from August 15, 2025, to December 12, 2025, generating approximately $1.2 million in gross proceeds for working capital and corporate purposes[273] - The Company entered into inducement letter agreements to exercise existing warrants for cash, resulting in gross proceeds of approximately $1.8 million on April 14, 2025, and $2.2 million on June 24, 2025, with net proceeds of approximately $1.5 million and $1.8 million respectively, intended for working capital and general corporate purposes[274][275] - During May and June 2025, the Company received gross cash proceeds of approximately $2.6 million from the exercise of Series G and Series H Warrants, also designated for working capital and general corporate purposes[276] - The Company has a financing agreement with Lucyd Ltd. allowing for up to $1,250,000 in services or cash, with a convertible note bearing 10% interest and maturing on September 1, 2027[277] - The Company anticipates continued operating losses as it invests in business expansion, but believes existing cash and cash equivalents will fund operations for at least the next twelve months[279] - Future capital requirements will depend on factors such as growth in retail store customers and e-commerce needs, with potential for additional equity or debt financing if current liquidity sources are insufficient[280] Inventory and Returns - As of December 31, 2025, the Company recorded provisions for excess inventory of $59,000, up from $0 in 2024, indicating a need for inventory management[285] - Revenue is primarily generated from sales of optical glasses and subscriptions to the "Pro" version of the Lucyd app, with a deferred revenue balance of $4,506 as of December 31, 2025[287][294] - The Company recorded an allowance for sales returns of $14,669 as of December 31, 2025, slightly down from $15,746 in 2024, reflecting historical return trends[296] Stock Compensation - Stock-based compensation expenses are recognized based on the grant date fair value, with the Black-Scholes-Merton model used for estimating fair value of stock options[297][298]

Financial Performance - Total revenues for FY2025 were $61.9 million, a 10% increase from $56.1 million in FY2024, driven by the launch of Emrosi[4] - The net loss for FY2025 was $11.4 million, or $(0.47) per share, compared to a net loss of $14.7 million, or $(0.72) per share in FY2024[6] - Total revenue for 2025 reached $61,858 million, a 10% increase from $56,134 million in 2024[17] - The net loss for 2025 was $11,431 million, an improvement from a net loss of $14,672 million in 2024, representing a 22% reduction in losses[17] - Basic and diluted net loss per common share improved to $(0.47) in 2025 from $(0.72) in 2024[17] Revenue Sources - Emrosi generated net revenues of $14.7 million in FY2025, with approximately 53,000 total prescriptions filled[1] - Product revenue, net for 2025 was $61,239 million, up from $55,134 million in 2024, reflecting a growth of approximately 11%[17] Expenses - Selling, general and administrative expenses increased by 10% to $44.4 million in FY2025, primarily due to activities related to Emrosi's launch[4] - Operating expenses totaled $70,030 million in 2025, slightly higher than $69,811 million in 2024, indicating a 0.3% increase[17] - Research and development expenses for 2025 were $480 million, a significant decrease from $9,857 million in 2024, indicating a strategic shift in focus[17] - The company reported total other expenses of $3,199 million in 2025, compared to $934 million in 2024, highlighting increased financial costs[17] Profitability Metrics - Adjusted EBITDA for FY2025 was $2.9 million, or $0.12 per share basic, compared to $0.8 million, or $0.04 per share basic in FY2024[6] - Non-GAAP Adjusted EBITDA for 2025 was $2,854 million, significantly higher than $788 million in 2024, marking a 263% increase[23] - Non-GAAP Adjusted EBITDA per share basic was $0.12 in 2025, compared to $0.04 in 2024, reflecting a 200% increase[23] Cash Position - Cash and cash equivalents increased to approximately $24.1 million at December 31, 2025, up from $20.3 million at December 31, 2024[6] Product Development and Market Access - Payer access for Emrosi expanded to over 100 million U.S. commercial lives by July 2025, up from 54 million in May 2025[5] - Emrosi was approved by the FDA in November 2024 and launched commercially on April 7, 2025[5] - The company is focused on advancing innovative therapies for dermatologic conditions while optimizing financial performance[3]

Financial Performance - Nkarta reported a cash balance of $295.1 million as of December 31, 2025, expected to fund operations into 2029[5] - Research and development (R&D) expenses for the full year 2025 were $90.4 million, with $25.3 million incurred in the fourth quarter[12] - General and administrative (G&A) expenses totaled $31.6 million for the full year 2025, with $5.7 million in the fourth quarter[12] - The net loss for the full year 2025 was $104.1 million, or $1.41 per share, while the fourth quarter net loss was $27.4 million, or $0.37 per share[12] - Total operating expenses for the full year 2025 were $121.997 million, compared to $128.194 million in 2024[20] Clinical Development - Nkarta advanced the dose escalation for NKX019 to 4 billion cells per dose, totaling 12 billion cells per cycle[5] - Initial clinical data from the Ntrust-1 and Ntrust-2 trials is targeted for presentation at a medical conference in 2026[5] - Enrollment is ongoing in the Ntrust-1 and Ntrust-2 clinical trials, which evaluate NKX019 in multiple autoimmune diseases[6] - The company aims to maximize B-cell depletion and clinical response through its CAR-NK cell therapy platform[3] - Nkarta is focused on disciplined clinical execution as it continues enrollment in its clinical programs[3]

Financial Performance and Projections - The company has incurred operating losses and negative cash flows since inception, with an accumulated deficit of approximately $63.5 million as of December 31, 2025[170]. - The company does not anticipate generating product sales for the next several years, if ever, and may never achieve profitability[171]. - The company expects to continue incurring operating losses and negative cash flows, requiring substantial additional funds to support ongoing research and development activities[170]. Clinical Development and Regulatory Challenges - The company has not yet successfully completed all clinical trial phases for any of its product candidates, which are still in early-stage development[165]. - The time required to obtain regulatory approval from the FDA and comparable foreign authorities is unpredictable and typically takes many years[175]. - The company faces significant risks related to the successful commercialization of its product candidates, including the need for extensive clinical trials and regulatory approvals[174]. - The company may experience delays in clinical trials due to various factors, including recruitment challenges and regulatory requirements[178]. - The company may face challenges in demonstrating that product candidates are safe, pure, and potent, which could hinder regulatory approval[179]. - Clinical trials may be suspended or terminated due to various factors, including failure to comply with regulatory requirements, which could delay product revenue generation[181]. - Preliminary results from clinical trials are subject to change, and material adverse changes could significantly harm business prospects[182]. - The FDA requires two adequate, well-controlled clinical trials to demonstrate safety and effectiveness for drug approval, which involves significant costs and time[184]. - The company may seek expedited designations from the FDA, but there is no guarantee that such designations will lead to faster approval[193]. - Failure to obtain regulatory approval for product candidates would significantly harm the company's business and operational results[187]. Manufacturing and Supply Chain Risks - The company relies on contract manufacturing organizations (CMOs) for production, which may lead to reduced control over manufacturing processes and potential supply issues[217][219]. - Shortages in raw materials necessary for production could adversely affect the company's ability to manufacture sufficient quantities of product candidates[220]. - Problems in preparing for commercial scale manufacturing may delay marketing approval or impair the ability to produce products at acceptable costs[221][222]. - The company relies on third-party manufacturers for compliance with cGMP regulations, which are essential for regulatory approval and commercialization of product candidates[223]. - Any deviations from manufacturing requirements could lead to costly remedial measures, including potential suspension of clinical trials or commercial sales[225]. - The company is responsible for ensuring compliance with regulatory requirements, but has limited control over third-party manufacturers, which could impact product development and approval[226]. - Regulatory enforcement actions against manufacturers could result in significant interruptions to product supplies, adversely affecting the company's business[227]. Competition and Market Dynamics - The company faces significant competition in a rapidly changing technological environment, which may harm its financial condition and ability to market product candidates[246]. - Competitors may have greater financial resources and expertise in research, development, and marketing, potentially diminishing the company's market opportunities[248]. - The inability to negotiate adequate reimbursement arrangements could adversely affect product sales and financial performance[249]. - The company may face challenges in scaling up manufacturing to meet clinical or commercial requirements, impacting its ability to commercialize product candidates[251]. Intellectual Property and Legal Risks - Intellectual property protection for the company's technologies may be limited, reducing its commercial opportunities if competitors develop similar technologies[252]. - The company may face litigation to enforce or defend its intellectual property rights, which could increase operating losses and reduce resources for development activities[263]. - The biotechnology and pharmaceutical industries are characterized by extensive litigation regarding patents, which could interfere with the company's product discovery and development efforts[269]. - The company may be required to pay substantial damages or ongoing royalty payments if found infringing on third-party patents, which could materially harm its business[272]. - The company relies on compliance with various procedural and fee payment requirements to maintain patent protection, and non-compliance could lead to a loss of patent rights[275]. - The risk of patent infringement claims increases as the biotechnology and pharmaceutical industries expand and more patents are issued, potentially affecting the company's competitive position[270]. Regulatory Compliance and Market Access - The FDA approval process for product candidates is lengthy and unpredictable, with no prior NDA submissions made by the company[296]. - Even with FDA approval, ongoing regulatory obligations may lead to significant additional expenses and compliance requirements[297]. - Regulatory approvals may come with limitations on indicated uses and conditions, potentially requiring costly post-marketing studies[299]. - The company faces additional regulatory burdens in foreign markets that may limit growth and require strategic partnerships for product commercialization[302]. - Obtaining regulatory approval in one jurisdiction does not guarantee approval in others, potentially delaying market entry[303]. Economic and Political Factors - Legislative changes, such as the Inflation Reduction Act of 2022, may impact drug pricing and reimbursement levels, affecting revenue[314]. - The Drug Supply Chain Security Act imposes obligations on manufacturers related to product tracking and tracing, which could increase operational costs[311]. - The company anticipates that health technology assessments in the EEA will influence pricing and reimbursement decisions for its products[316]. - Future healthcare initiatives may limit third-party payor reimbursements, significantly reducing projected project values and profitability[321]. - Increased political uncertainty from global conflicts, including military tensions involving the U.S., Israel, and Iran, could materially affect the company's financial condition and operational results[346]. Workforce and Operational Challenges - The company anticipates needing to hire additional qualified personnel to support growth, but competition for talent is intense, which may hinder recruitment efforts[331][332][333]. - As of December 31, 2025, the company had 16 full-time employees and plans to expand its workforce to support product development and regulatory affairs[334]. - The company is pursuing new product candidates across various therapeutic areas, which requires significant resources and may strain its infrastructure[335]. Cybersecurity and Internal Control Risks - Cybersecurity risks are increasing, and any breaches could disrupt operations and lead to significant costs associated with data recovery and regulatory compliance[337][338][339][340]. - Material weaknesses in internal controls could impair the company's ability to produce accurate financial statements and meet reporting obligations[341]. Financial and Tax Considerations - U.S. federal income tax reform may adversely affect the company, particularly due to changes in the treatment of net operating losses (NOLs) under the Tax Cuts and Jobs Act (TCJA) and the CARES Act, which could lead to federal income tax obligations despite net losses[344]. - The TCJA requires research and development expenses to be capitalized and amortized over five years for U.S. activities and 15 years for foreign activities, which may impact the company's effective tax rate and operational results[345].

Financial Condition and Funding - The company has incurred operating losses and negative cash flows since inception, with an accumulated deficit of approximately $63.5 million as of December 31, 2025[170]. - The company expects to continue incurring operating losses for the foreseeable future and does not anticipate generating product sales for the next several years, if ever[171]. - The company requires substantial additional funds to support ongoing research and development activities, including anticipated costs of nonclinical studies and clinical trials[170]. - The company is dependent on obtaining necessary funding from outside sources to continue operations and meet financial obligations[162]. - The company anticipates needing substantial additional funds for research and development, which may not be available on favorable terms, potentially diluting stockholder interests[349]. Regulatory and Approval Challenges - The company has not yet successfully completed all clinical trial phases for any of its product candidates, which may delay or prevent commercialization[165]. - The time required to obtain regulatory approval is unpredictable and typically takes many years, with a high failure rate for drugs in development[175]. - The company may face challenges in demonstrating that product candidates are safe, pure, and potent, which could hinder regulatory approval[179]. - The FDA requires two adequate, well-controlled clinical trials to demonstrate safety and effectiveness for drug approval, which can be costly and time-consuming[184]. - Failure to obtain regulatory approval for product candidates would significantly harm the company's business and operational results[187]. - The FDA approval process for product candidates is lengthy and unpredictable, potentially leading to significant delays in market entry[296]. - Regulatory approvals may come with limitations on indicated uses and conditions that could necessitate costly post-marketing studies[299]. - Regulatory compliance failures may lead to significant consequences, including product recalls and marketing restrictions[305]. - Obtaining regulatory approval in one jurisdiction does not guarantee approval in others, potentially delaying market entry[303]. Clinical Trials and Development Risks - The company faces significant risks related to the successful commercialization of its products, including regulatory approval and market acceptance[177]. - Clinical trials may be suspended or terminated due to various factors, including failure to comply with regulatory requirements, which could delay product revenue generation[181]. - The company has limited experience in designing clinical trials and may face challenges in executing them successfully[174]. - The company faces challenges in patient enrollment for clinical trials, which could lead to delays or abandonment of trials, impacting development costs and revenue generation[205][207]. - Adverse events associated with product candidates could delay or prevent regulatory approval, limit commercial potential, and affect patient recruitment[208][212]. Manufacturing and Supply Chain Issues - The company relies on contract manufacturing organizations (CMOs) for production, which may lead to reduced control over manufacturing processes and potential supply issues[217][219]. - Shortages of raw materials necessary for production could adversely affect the company's ability to manufacture sufficient quantities of product candidates[220]. - Problems in preparing for commercial scale manufacturing may delay marketing approval or commercialization of product candidates[221][222]. - The company relies on third-party manufacturers for compliance with cGMP regulations, which are critical for the approval and commercialization of product candidates[223]. - Any deviations from manufacturing requirements could lead to costly remedial measures, including potential suspension of clinical trials or commercial sales[225]. Competition and Market Acceptance - The company faces significant competition in a rapidly changing technological environment, which may harm its financial condition and ability to market product candidates[246]. - Competitors may have greater financial resources and expertise in research, development, and marketing, potentially diminishing the company's market opportunities[248]. - The inability to negotiate adequate reimbursement arrangements could adversely affect the company's sales and market access[249]. - The company may face challenges in achieving market acceptance for its products, which is essential for generating revenue[239]. Intellectual Property and Legal Risks - Intellectual property protection for the company's technologies may be limited, reducing its commercial opportunities if competitors develop similar technologies[252]. - The patent application process is fraught with uncertainties, and failure to secure adequate patent protection could adversely affect the company's competitive position[261]. - The company may face litigation to enforce or defend its intellectual property rights, which could increase operating losses and reduce resources for development activities[263]. - The company relies on compliance with various procedural and fee payment requirements to maintain patent protection, and non-compliance could lead to a loss of patent rights[275]. - The company may not be granted patent term extensions for its drug candidates, which could allow competitors to launch similar drugs earlier, negatively impacting revenue[277]. Regulatory Compliance and International Operations - The company is subject to numerous laws and regulations in international operations, which may increase compliance costs and limit growth potential[323]. - Compliance with the Foreign Corrupt Practices Act (FCPA) and the U.K. Bribery Act is expensive and challenging, particularly in countries with corruption issues[324][325]. - The company may face significant penalties for non-compliance with international business laws, including suspension from government contracting and trading on U.S. exchanges[326]. - The company faces additional regulatory burdens in foreign markets that may limit growth and require strategic partnerships for product commercialization[302]. Workforce and Operational Challenges - The company anticipates needing to hire additional qualified personnel to support growth, which may be challenging due to competition in the biopharmaceutical sector[331][333]. - As of December 31, 2025, the company had 16 full-time employees and plans to expand its workforce to manage anticipated growth in product development and regulatory affairs[334]. - The company must maintain effective internal controls over financial reporting to avoid material misstatements and ensure timely financial disclosures[341]. Economic and Political Factors - Unfavorable global economic conditions, including the impact of the COVID-19 pandemic, could adversely affect the company's financial condition and operations[343]. - Increased political uncertainty from global conflicts, including military tensions involving the U.S., Israel, and Iran, could materially affect the company's business and financial condition[346]. - Changes in U.S. and international trade policies, particularly regarding tariffs, may adversely impact the company's operations and financial results due to increased trade tensions[347][348]. - Legislative changes, such as the Inflation Reduction Act of 2022, may impact drug pricing and reimbursement levels, affecting revenue[314]. Cybersecurity and Data Risks - Cybersecurity risks are increasing, and breaches could disrupt operations and lead to significant costs associated with data recovery and regulatory compliance[337][339].

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (State or other jurisdiction of incorporation or organization) FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the year ended December 31, 2025. OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to _______________. Commission file number: 001-41456 ECB BANCORP, INC. (Exact name ...

Financial Performance - Net revenues for the three months ended February 28, 2026, increased by 6.0% to $657.4 million compared to $620.2 million for the same period in 2025[89]. - Gross profit increased to $85.6 million, representing 13.0% of revenues, although it decreased as a percentage due to product mix[89][90]. - Operating income rose significantly by 50.7% to $11.8 million, with an operating income margin of 1.8%[89]. - Net revenues for the six months ended February 28, 2026, increased by $114.3 million, or 9.2%, to $1,360.1 million compared to $1,245.8 million for the same period in 2025[100]. - Operating income rose significantly by $18.7 million, or 269.3%, to $25.6 million, compared to $6.9 million in the prior year[100]. Segment Performance - The Towable RV segment saw a 9.0% decrease in net revenues to $288.2 million, primarily due to a shift in product mix and lower unit volume[93]. - The Motorhome RV segment experienced a 29.3% increase in net revenues to $304.7 million, driven by higher unit volume from new products[95]. - In the Towable RV segment, net revenues increased by $13.5 million, or 2.5%, to $555.8 million, with unit deliveries rising to 14,036, a 1.4% increase[104]. - The Motorhome RV segment saw net revenues increase by $105.8 million, or 20.9%, to $613.2 million, with operating income improving to $15.7 million from a loss of $(3.8) million[106]. - The Marine segment reported a slight decrease in net revenues to $171.7 million, down $0.4 million, or 0.3%, with operating income declining to $9.0 million[109]. Cash Flow and Liquidity - Cash provided by operating activities was $0.6 million, a significant improvement from cash used of $(27.2) million in the same period last year[112]. - Total cash and cash equivalents as of February 28, 2026, were $47.4 million, with an additional $350.0 million available under the ABL Credit Facility[116]. - The company expects cash flow from operations and existing lines of credit to be sufficient to meet current liquidity needs[119]. Debt and Capital Management - The company repurchased $100.0 million of Senior Secured Notes in both periods, reflecting ongoing debt management strategies[102]. - As of February 28, 2026, the company has no debt maturing in the next twelve months classified as current on its Consolidated Balance Sheets[118]. - The company has $180.0 million remaining on its Board approved share repurchase authorization as of February 28, 2026[122]. - A quarterly cash dividend of $0.35 per share was approved, payable on April 29, 2026, to common stockholders of record[123]. - The ABL Credit Facility, the company's only floating rate debt instrument, remains undrawn as of February 28, 2026[131]. Inventory and Deliveries - Total unit deliveries for Towable RVs decreased by 8.4% to 6,615 units, with a notable decline in fifth wheel deliveries[93]. - Dealer inventory for Towable RV units increased by 2,449 units, or 14.1%, to 19,855 units as of February 28, 2026[104]. Tax and Regulatory - The effective tax rate increased due to higher pre-tax income, resulting in an income tax provision of $3.5 million compared to a benefit of $(1.5) million in the previous year[103]. Future Outlook - The company anticipates stabilization in consumer demand, which may lead to more stable ordering patterns from dealers[87]. - The company continues to evaluate the financial stability of counterparties for its 2030 Convertible Notes and Senior Secured Notes[119]. - The company maintains a long-term capital allocation strategy focused on funding operations and investments in growth before returning excess cash to shareholders[121].