Financial Performance and Position - As of December 31, 2025, SmartBank's net loan and lease portfolio totaled approximately $4.3 billion, representing about 74% of total assets[21]. - SmartBank's investment policy emphasizes high-quality, investment-grade securities, primarily backed by U.S. government guarantees[30]. - SmartBank's net interest income is highly sensitive to interest rate changes, with a potential increase of approximately $3.4 million if rates rise by 200 basis points[126]. - Conversely, a decrease of 200 basis points could lead to a reduction in net interest income by approximately $4.06 million over the next 12 months[126]. - The company reported total loans for construction and land development at 100% or more of its total risk-based capital, indicating significant exposure in this area[111]. - As of December 31, 2025, the Company's CLD and CRE ratios were 71.45% and 277.30%, respectively, both below regulatory guidelines[153]. - Approximately 80% of the Company's loans and leases had real estate as a primary or secondary component of collateral, including 10% secured by construction and development[165]. - The Company’s 10 largest borrowing relationships totaled approximately $303 million, representing about 7% of the total loan portfolio, indicating significant concentration risk[168]. - The company may recognize losses on securities held in its portfolio due to interest rate increases or deteriorating market conditions, which could adversely affect financial results[181]. Regulatory Environment - The company is extensively regulated under federal and state law, which may impact its operations and earnings[54]. - The company and its affiliates must undergo regular on-site examinations by regulatory agencies to ensure compliance with legal and regulatory responsibilities[55]. - The company is required to maintain certain minimum capital levels based on ratios of capital to total average assets and risk-weighted assets[72]. - The capital rules require a capital conservation buffer of 2.5% above each minimum capital ratio requirement to absorb losses during economic stress[76]. - The company is subject to oversight by various regulatory bodies, including the SEC and the Public Company Accounting Oversight Board[70]. - The Dodd-Frank Act mandates that public companies provide shareholders with advisory votes on executive compensation at least every three years[69]. - The company is subject to various regulatory policies regarding dividend payments, which are limited by capital adequacy and regulatory minimums[88]. - The Company is required to submit capital restoration plans for regulatory approval if it fails to meet capital requirements, with holding companies guaranteeing these plans[79]. - SmartBank is subject to comprehensive supervision and regulation by the Federal Reserve and the Tennessee Department of Financial Institutions (TDFI)[90]. - The company’s ability to declare and pay dividends is limited and subject to regulatory restrictions, with future dividends dependent on various factors[191][192]. Competition and Market Conditions - The company faces strong competition from both bank and non-bank competitors, including national banks, fintech companies, and other financial intermediaries[50]. - Competition from fintechs is increasing, with these companies often operating under fewer regulatory restrictions, allowing for greater flexibility and lower costs[51]. - The company encounters strong pricing competition and may not offer the same range of products as larger national and super-regional banks[52]. - Economic conditions in the company's concentrated market areas, including East and Middle Tennessee, Alabama, and the Florida Panhandle, significantly impact loan origination and borrower repayment ability[144]. - Increased competition from various financial institutions may pressure the company to raise deposit rates or lower loan rates, potentially reducing profitability[148]. Growth Strategy - The company is focused on organic growth in loans and deposits, alongside disciplined merger and acquisition activities[19]. - SmartBank's strategic plan includes evaluating business combination opportunities, which may involve significant assets and liabilities[19]. - Future acquisitions are expected to be a key growth strategy, but the Company may face challenges in identifying suitable targets and realizing anticipated benefits[161]. - The Company anticipates an increase in loans to small to medium-sized businesses during 2026, focusing on this segment as a substantial part of its strategy[169]. Risk Management - The company has a comprehensive credit risk management process to monitor and manage credit quality across its loan portfolio[27]. - The company maintains allowances for credit losses based on credit risk analysis, but incorrect assumptions could lead to insufficient allowances and negatively impact net income[140]. - The company faces risks related to interest rate adjustments by the Federal Reserve, which could adversely affect deposit levels and loan demand[122]. - An increase in interest rates may lead to higher payment requirements for borrowers, increasing the potential for defaults and nonperforming assets[124]. - The company faces risks related to mortgage banking activities, particularly in higher interest rate environments, which could negatively impact net income and profitability[182]. - The company is exposed to risks from employee misconduct, which could lead to significant legal liability and reputational harm[188]. - The company may face challenges in retaining senior management and attracting experienced financial services professionals, impacting growth and customer relationships[187]. Cybersecurity - The company's risk management program emphasizes cybersecurity as a critical component, with the Information Security Officer (ISO) responsible for its development and monitoring[207]. - The information security program is based on the NIST Cybersecurity Framework and FFIEC guidelines, leveraging third-party benchmarking and threat intelligence to enhance effectiveness[208]. - The company employs a layered defensive strategy focused on prevention, identification, response, and rapid remediation of cyber threats[208]. - An Incident Response Plan is in place, evaluated and tested at least annually, to coordinate responses to cybersecurity incidents[210]. - The ISO has 18 years of experience in the financial services industry, providing substantial expertise in overseeing the information security program[212]. - The information security department consists of professionals with diverse technical expertise, ensuring compliance with industry expectations for education and certification[214]. - The company actively monitors email gateways for phishing campaigns and remote connections due to a significant portion of the workforce working remotely[208]. - Cybersecurity incidents experienced in the past have not materially affected the company's business strategy or financial condition[211]. - The ISO collaborates with peer banks and industry groups to discuss cybersecurity trends and ensure program effectiveness[208]. - The company maintains a third-party risk management program to assess and manage risks associated with external service providers[208]. Employee and Workplace Culture - SmartBank's employee base includes 581 full-time and 8 part-time associates, with over 66% of associates being women and 10% being minorities[41]. - The company achieved certification as a Great Place to Work® in 2025 and was recognized as the 28th best Financial and Insurance Services Company to work for[45]. - The company has adopted an updated clawback policy in October 2023 to ensure that incentive compensation plans do not encourage inappropriate risks[68].

Advertising and Revenue - The company expects to achieve over $1.4 billion in advertising spend by 2025, positioning itself as one of the largest Open Internet advertising platforms[45]. - In 2025, 93% of the company's revenue was derived directly from advertisers, leveraging proprietary digital buying platforms[48]. - The company had approximately 50 Joint Business Partnerships (JBPs) in process as of December 31, 2025, representing an average annual spend of $4 million each[49]. - The company serves approximately 10,000 media owners across CTV, online, and in-app environments, reaching over 2 billion consumers per month[54]. - Revenue from the company's CTV offering experienced consistent year-over-year quarterly growth in 2025, indicating strong demand in this segment[51]. - The company expects revenue fluctuations based on seasonal factors, with the fourth quarter historically reflecting the highest level of advertising activity[80]. Financial Management and Strategy - The company plans to maintain financial discipline by focusing on growing free cash flow and lowering debt leverage while investing in long-term growth[66]. - The company processes over one billion new data events per minute to support its high-performance integrated demand and supply platforms[69]. - The company aims to deepen relationships with media owners to maintain and grow access to premium, exclusive inventory, which is a cornerstone of its business strategy[61]. - The company plans to continue innovating across new and existing ad formats and user engagement tools, particularly in high-growth media environments like CTV and online video[62]. Employee and Organizational Structure - The company has approximately 1,700 employees, with 17% located in Israel, 17% in France, 13% in the United States, and 53% in other global offices[79]. - The company is committed to fostering employee engagement and development, which is seen as critical to innovation and productivity[78]. Compliance and Security - The company is certified under the E.U.-U.S. Data Privacy Framework, which became effective in July 2023, allowing for the transfer of personal data from the E.U. to the U.S.[88]. - The company maintains a robust privacy and security compliance program, adhering to various self-regulatory principles and industry standards[90]. - The company has implemented advanced security measures, including encryption of personal data and integration of third-party technology to scan ads for potential security violations[94]. - The company anticipates increased compliance costs and potential liability due to evolving laws and regulations related to data privacy and AI technologies[84]. Financial Position and Risks - Cash and cash equivalents amount to $128.2 million, with investments in marketable securities totaling $10.5 million[480]. - A 100-basis point change in interest rates would result in a change in the fair value of the investment portfolio of less than $0.1 million[481]. - The company assumed an Overdraft Facility with outstanding borrowings of $17.6 million as of December 31, 2025, carrying a variable interest rate based on the three-month EURIBOR plus a margin of 1.8%[482]. - Long-term debt as of December 31, 2025, includes Notes with a carrying value of $605.1 million, bearing a fixed interest rate[483]. - The company is monitoring inflation risks that could negatively impact business operations and financial condition[484]. - Credit risk is managed by monitoring the financial condition of customers and requiring prepayment from those with higher potential credit risk[485]. - The company may enter into foreign currency forward exchange contracts to manage foreign currency risk and reduce adverse impacts from exchange rate movements[479]. - The acquisition of Legacy Teads will increase foreign currency exposure, particularly to the Euro and other currencies, starting February 3, 2025[475].

Operating Expenses - For the three months ended January 31, 2026, total operating expenses were approximately $5,347,000, an increase of $256,000 compared to $5,090,000 for the same period in 2025[145] - For the nine months ended January 31, 2026, total operating expenses were approximately $13,540,000, an increase of $3,714,000 compared to $9,826,000 for the same period in 2025[146] Net Loss - The company reported a net loss of approximately $5,284,000 for the three months ended January 31, 2026, compared to a net loss of $6,362,000 for the same period in 2025[151] - The company incurred net losses of approximately $11,844,000 for the nine months ended January 31, 2026, compared to $12,790,000 for the same period in 2025[155] Working Capital - As of January 31, 2026, the company had working capital of $35,398,396, an increase of $27,382,951 from $8,015,445 as of April 30, 2025[153] Cash Flow - Net cash used in operating activities totaled approximately $12,132,000 for the nine months ended January 31, 2026, compared to $7,153,000 for the same period in 2025[156] - Net cash provided by financing activities totaled approximately $41,975,000 for the nine months ended January 31, 2026, primarily due to proceeds from the sale of common stock of approximately $31,695,000[158] Interest Income - The company reported interest income of approximately $191,000 for the nine months ended January 31, 2026, compared to $100,000 for the same period in 2025[149] Financing Activities - The company completed a financing in December 2025 for gross proceeds of $31.2 million through a private placement of shares and warrants[142] Project Development - The company is conducting engineering studies towards the completion of a feasibility study for the CK Gold Project[142]

Financial Performance - Full-year revenue for 2025 reached a record $427.5 million, representing a 12.6% increase from $379.8 million in 2024[4] - The company reported a net loss of $29.2 million for 2025, significantly improved from a net loss of $195.5 million in 2024; Non-GAAP adjusted net profit was $13.0 million compared to a loss of $84.6 million in 2024[4] - Revenues for the year ended December 31, 2025, increased to $427,516,000, up from $379,801,000 in 2024, representing a growth of approximately 12.5%[28] - The net loss for the year ended December 31, 2025, was $29,218,000, a substantial improvement compared to a net loss of $195,457,000 in 2024[28] - Adjusted net loss for the year ended December 31, 2025, was $12,975 thousand, compared to an adjusted net loss of $84,648 thousand in 2024[37] - EBITDA for 2025 was $2,534 thousand, a recovery from an EBITDA loss of $155,656 thousand in 2024[39] Gross Margin and Profit - Gross margin decreased to 28.6% in 2025 from 31.5% in 2024, primarily due to a $32.5 million inventory impairment charge[5] - Gross profit for the year ended December 31, 2025, was $122,110,000, compared to $119,552,000 in 2024, showing a slight increase of about 2.1%[28] - The gross profit for the three months ended December 31, 2025, was $959,000, a significant decrease from $41,520,000 in the prior year[29] - The company reported a gross margin of 1.0% for Q4 2025, down from 36.6% in Q4 2024[35] Operating Expenses - Operating expenses were reduced by 50.4% to $118.3 million in 2025, down from $238.3 million in 2024[5] - Operating expenses decreased significantly to $118,269,000 in 2025 from $238,300,000 in 2024, a reduction of approximately 50.4%[28] - Cash generated from operating activities was $75,908 thousand in 2025, a significant increase from $2,814 thousand in 2024[31] Cash and Assets - Cash and cash equivalents increased to $169.2 million as of December 31, 2025, compared to $109.6 million at the end of 2024[6] - Total current assets increased to $448,723,000 as of December 31, 2025, compared to $428,026,000 in 2024, marking an increase of approximately 4.0%[27] - The company’s cash and cash equivalents increased to $104,963,000 in 2025 from $73,007,000 in 2024, representing a growth of approximately 43.5%[27] - Total cash, cash equivalents, and restricted cash increased to $169,238 thousand at the end of 2025, up from $109,601 thousand in 2024[34] Capital Expenditures and Future Plans - Capital expenditures for 2025 totaled $38.7 million, primarily for manufacturing capacity expansion, down from $49.9 million in 2024[5] - The company anticipates achieving serial production at the Huzhou Phase 3.2 expansion in 2026, which is expected to increase capacity[11] - Microvast is focusing on expanding its customer base across EMEA, North America, and APAC, targeting high-barrier-to-entry segments[12] Quarterly Performance - For Q4 2025, revenue was $96.4 million, a decrease of 15.0% from $113.4 million in Q4 2024, attributed to regulatory shifts and customer platform delays[10] - For the three months ended December 31, 2025, revenues were $96,399,000, down from $113,387,000 in the same period of 2024, reflecting a decline of about 15%[29] - The company reported a net income of $16,539,000 for the three months ended December 31, 2025, compared to a net loss of $82,323,000 in the same period of 2024[29] Inventory Impairment - The company incurred an impairment loss of $32,507 thousand related to energy storage systems in 2025[35]

Revenue and Financial Performance - Rafael Holdings reported a product revenue of $0.1 million for the three months ended January 31, 2026, and $0.3 million for the six months ended January 31, 2026, compared to $0 for the same periods in 2025, attributed to Cyclo's product revenue post-merger and sales from Rafael Medical Devices [289]. - The Healthcare segment incurred a loss from operations of $6.7 million for the three months ended January 31, 2026, which is an increase of 105% compared to a loss of $3.3 million for the same period in 2025 [288]. - Infusion Technology segment reported a revenue decrease of 100% to $0 for the three months ended January 31, 2026, compared to $51,000 in the same period of 2025 [293]. - Consolidated net loss attributable to Rafael Holdings, Inc. was $6.4 million for the three months ended January 31, 2026, a 38% increase from a net loss of $4.6 million in the same period of 2025 [298]. - Cash used in operating activities was $14.3 million for the six months ended January 31, 2026, significantly impacted by a net loss of $16.1 million [309]. - Total assets decreased by 13% to $99.3 million as of January 31, 2026, compared to $114.1 million as of July 31, 2025 [307]. - Interest income decreased by 30% to $0.7 million for the six months ended January 31, 2026, compared to $1.1 million in the same period of 2025 [299]. Expenses and Costs - Research and development expenses for the Healthcare segment increased to $4.0 million for the three months ended January 31, 2026, primarily due to Cyclo's expenses, compared to a significantly lower amount in the previous year [292]. - General and administrative expenses for the three months ended January 31, 2026, decreased by 7% to $2.2 million, mainly due to reductions in payroll and professional fees, despite the inclusion of Cyclo's expenses [291]. - General and administrative expenses in the Infusion Technology segment decreased by 89% to $29,000 for the six months ended January 31, 2026, compared to $255,000 in the same period of 2025 [293]. Investments and Strategic Initiatives - The company is focusing on completing the development of Trappsol® Cyclo™ and expanding its investment portfolio in therapeutics addressing high unmet medical needs [277]. - LipoMedix, with a 95% ownership interest, is exploring strategic options for its lead candidate, including potential licensing and collaborations [280]. - Rafael Medical Devices raised approximately $925,000 by selling a 31.6% equity interest to third parties in August 2023 [284]. Regulatory and Milestones - The FDA granted substantial equivalence determination for the VECTR System, which is intended for minimally invasive surgeries, marking a significant milestone for Rafael Medical Devices [284]. - The merger with Cyclo was completed on March 25, 2025, making Cyclo a wholly-owned subsidiary of Rafael Holdings [279]. Cash Flow and Financial Position - Cash and cash equivalents decreased by 28% to $37.8 million as of January 31, 2026, down from $52.8 million as of July 31, 2025 [307]. - Cash used in investing activities for the six months ended January 31, 2026 was primarily due to the purchase of investments in Nina Medical for $0.8 million [311]. - Revenue from tenants located in Israel represented 38% of consolidated revenues for the six months ended January 31, 2026, compared to 75% for the same period in 2025 [319]. Accounting and Financial Reporting - The company applies significant accounting policies consistently to report operating results and financial condition in conformity with U.S. GAAP [315]. - The company evaluates critical accounting estimates and assumptions on an ongoing basis, which may involve significant management judgments [316]. - The company does not anticipate paying dividends on common stock until achieving sustainable profitability and retaining certain minimum cash reserves [314]. - The company has no off-balance sheet arrangements that are likely to affect its financial condition or results of operations [317]. - The net amount of exposure to foreign currency exchange rate changes at the end of each reporting period is generally not material [319].

Financial Performance - For the three months ended June 30, 2025, the Company generated total revenues of $768,065, an increase of $267,663 compared to $500,402 for the same period in 2024[165]. - Rental income for the three months ended June 30, 2025, was $750,604, reflecting an increase of $250,202 compared to the prior-year period[165]. - General and administrative expenses decreased to $946,927 for the three months ended June 30, 2025, down from $1,839,724 in the same period of 2024, representing a decrease of $892,797[167]. - The Company reported a loss from operations of $444,234 for the three months ended June 30, 2025, a decrease in loss of $1,049,846 compared to the loss of $1,494,080 in the prior-year period[167]. - Net income for the three months ended June 30, 2025, was $4,702,108, compared to $4,545,277 for the same period in 2024, representing a decrease of $156,831[170]. - For the six months ended June 30, 2025, net cash provided by operating activities was $1,502,272, compared to a net cash used of approximately $83,280 in the same period of 2024[174]. Cash and Liquidity - The Company had cash and cash equivalents of $115,947,978 as of June 30, 2025, compared to $117,521,935 as of December 31, 2024[176]. - On May 1, 2024, the Company completed its Asset Acquisition, resulting in cash proceeds of approximately $200 million[177]. - The Company entered into a Seller Lease Agreement, which results in annual rental revenue of approximately $3 million[178]. - Management has determined that the Company's sources of liquidity will be sufficient to meet its obligations for at least one year from the issuance date of the June 30, 2025 financial statements[179]. Accounting and Valuation - The Company accounts for Preferred Stock as a liability due to the non-substantive conversion feature, with an issue price of $11.50 per share deemed to approximate its fair value at issuance[181][182]. - Business combinations are accounted for under ASC 805, with purchase consideration allocated to identifiable assets and liabilities based on estimated fair values, any excess recorded as goodwill[183]. - Fair value determinations for business combinations involve significant judgment and estimates, particularly for identifiable intangible assets, relying on assumptions regarding forecasted cash flows and growth rates[184]. - Changes in market conditions or revisions to key inputs could materially affect the allocation of purchase consideration and the amount of goodwill recognized[185]. Regulatory and Reporting - As of June 30, 2025, the Company had no off-balance sheet arrangements as defined in Regulation S-K[187]. - The Company is classified as a smaller reporting company and is not required to provide certain market risk disclosures[188].

Financial Performance - Net income for the year ended December 31, 2025, was $57.2 million, an increase of $26.2 million, or 84.6%, compared to the prior year, driven by the acquisition of IFH and strong organic growth [213]. - Net income for the year ended December 31, 2025 was $57.2 million, an 84.6% increase from $31.0 million in 2024, partly due to the IFH acquisition [226]. - Core net income for 2025 was $56,290,000, compared to $40,069,000 in 2024, reflecting a 40.5% increase [342]. - Total revenue for 2025 reached $245,179,000, up from $186,156,000 in 2024, marking a 31.6% increase [342]. - The efficiency ratio improved to 63.25% in 2025 from 67.80% in 2024, indicating better cost management [342]. - The return on average equity increased to 15.13% in 2025 from 10.78% in 2024, showcasing enhanced profitability [342]. Interest Income and Assets - Net interest income rose to $196.0 million, an increase of $41.2 million from the prior year, primarily due to organic growth and the IFH acquisition [213]. - Average interest-earning assets increased by $727.9 million, or 29.3%, to $3.2 billion compared to the same period in 2024 [213]. - Total interest income for the year ended December 31, 2025, was $52.0 million, a decrease of $4.5 million from $47.6 million in 2024, primarily due to decreased interest rates despite growth in loan portfolios [238]. - The commercial bank net interest margin increased to 4.38% in 2025 from 3.93% in 2024, highlighting improved interest income generation [342]. Noninterest Income and Expenses - Noninterest income for the year ended December 31, 2025, was $49.2 million, an increase of $17.8 million, or 56.6%, from the same period in 2024, largely due to the full-year impact of the IFH acquisition [214]. - Noninterest income rose to $49.2 million, a 56.6% increase from $31.4 million, largely due to contributions from the IFH acquisition [227]. - Noninterest expense increased by $28.9 million, or 22.9%, to $155.1 million, mainly due to the IFH acquisition and higher salaries and employee benefits [229]. Credit Losses and Asset Quality - The provision for credit losses was $15.0 million for the year ended December 31, 2025, a decrease of $2.8 million from the prior year [213]. - Provision for credit losses decreased by $2.8 million, or 15.5%, to $15.0 million, primarily due to lower provisions in the commercial loan portfolio [226]. - Nonperforming loans to total portfolio loans rose to 1.84% in 2025 from 1.15% in 2024, indicating a deterioration in asset quality [347]. - The allowance for credit losses to total portfolio loans remained stable at 1.85% for both 2025 and 2024, suggesting consistent risk management practices [344]. Deposits and Liabilities - Deposits increased to $3.1 billion at December 31, 2025, up $331.3 million, or 12.0%, from the previous year [218]. - Total liabilities increased by $352.7 million to $X million as of December 31, 2025, primarily due to a $331.0 million growth in the deposit portfolio [303]. - Total interest-bearing deposits rose to $2.24 billion as of December 31, 2025, compared to $1.95 billion in 2024 [305]. - Uninsured deposits were approximately $1.3 billion, representing 40.9% of the deposit portfolio as of December 31, 2025, compared to $979.3 million, or 35.5%, in 2024 [308]. Equity and Capital - Stockholders' equity increased by $46.6 million for the year ended December 31, 2025, largely due to net income of $57.2 million [320]. - The common equity to total assets ratio was 11.14% at December 31, 2025, compared to 11.07% at December 31, 2024 [322]. - The Company and the Bank were in compliance with all applicable regulatory capital requirements as of December 31, 2025 [327]. - The Tier 1 capital ratio to risk-weighted assets was 13.05% for the Company and 11.34% for the Bank as of December 31, 2025 [329]. Loan Portfolio and Underwriting - Net portfolio loans reached $2.96 billion, an increase of $329.3 million, or 12.5%, from $2.63 billion in 2024 [251]. - The company’s commercial real estate loans increased to $41.4 million in 2025 from $28.6 million in 2024, reflecting a growth of 45.5% [260]. - The company has established underwriting guidelines and routinely monitors delinquency levels to manage nonperforming assets [285]. - The Problem Loan Status Report is reviewed quarterly for borrowers with an overall loan exposure exceeding $250,000 [290]. Interest Rate Risk Management - The bank's asset-sensitive position indicates that rising interest rates are expected to positively impact net interest income, while falling rates would have the opposite effect [360]. - The bank employs quarterly EAR simulations to assess the impact of changing interest rates on earnings under various scenarios [363]. - The Asset/Liability Management Committee (ALCO) regularly reviews the sensitivity of assets and liabilities to interest rate changes [359]. - The bank does not engage in leveraged derivatives or financial options to mitigate interest rate risk, focusing instead on managing its balance sheet [358].

Financial Position and Debt - The company's current short-term funding capacity is $702.5 million, comprising three credit facilities[114]. - As of December 31, 2025, the company had approximately $3,483.4 million of debt outstanding, including $2,986.6 million of securitization trust debt[117]. - Increased interest expenses were experienced in 2023 due to multiple interest rate hikes by the Federal Reserve, impacting financial position and liquidity[134]. - The company’s ability to maintain financing sources is influenced by market conditions and compliance with covenants under financing agreements[116]. - The company may need to increase credit enhancement requirements if economic conditions worsen, impacting cash resources available for operations[127]. - An increase in interest rates could reduce cash flows from excess spread, adversely affecting earnings and cash flows[179]. Securitization and Financing - The company relies on securitization transactions for permanent financing of automobile contracts, having completed 36 securitizations from 2010 to 2019[120]. - The company is dependent on the performance of its portfolio of securitized and warehoused automobile contracts, with higher delinquency and loss ratios potentially reducing cash flows from residual interests[125]. - Receivables originated since January 2018 are recorded at fair value, and actual credit losses exceeding estimates may lead to fair value adjustments[139]. - The company cannot borrow against defaulted automobile contracts under its warehouse credit facilities, potentially reducing cash flows[141]. - Risk retention rules require the company to retain at least 5% of the credit risk of assets collateralizing asset-backed securities, potentially limiting liquidity[151]. Economic and Market Risks - Economic conditions, including unemployment and inflation, could adversely affect the company's ability to collect payments on receivables, impacting financial results[131]. - Defaults on automobile contracts could materially and adversely affect the company's financial condition, cash flows, and liquidity[138]. - Economic downturns could impair operations, particularly due to the focus on sub-prime customers, leading to increased delinquencies and losses[174]. - The company is geographically concentrated in states prone to natural disasters, which could adversely affect collections on automobile contracts[177]. - The company faces restrictions that may limit its ability to obtain additional capital, potentially impacting earnings generation[167]. Competition and Operational Risks - The company faces competition from various finance companies, which may have greater access to capital markets and resources[135]. - The company specializes in purchasing and servicing automobile contracts for sub-prime customers, which entails higher risks of non-performance and delinquencies[137]. - The company faces intense competition for key personnel, and loss of any key employee could adversely affect its operations[143]. - Non-compliance with regulations could result in penalties, litigation losses, and damage to the company's reputation, adversely affecting financial condition[147]. - The company is subject to various litigations that could result in significant financial liabilities and adversely affect its operations[153]. Technology and Accounting Risks - The use of artificial intelligence in operations may expose the company to operational, regulatory, and reputational risks that could impact financial results[165]. - The company has incurred risks related to fair value accounting for receivables acquired since January 1, 2018, which could affect interest income recognition[170]. - If actual results for receivables deviate from estimates, the company may need to reduce recorded values, impacting income and book value[172]. Stock and Dividend Policy - The company's common stock is thinly traded, leading to limited selling opportunities and potential price volatility[180]. - The company has never declared or paid cash dividends on its common stock and intends to retain future earnings[181].

Financial Performance - Q4 2025 revenue was approximately $100,000, a 94% quarterly sequential increase, while full-year 2025 revenue totaled approximately $230,000, up 15% year over year[11] - Revenue for Q4 2025 was $97,000, compared to $46,000 in Q4 2024, representing a 110% increase year-over-year[18] - GAAP net loss for Q4 2025 was $(7.3) million, or $(0.17) per share, and for the full year, it was $(34.0) million, or $(1.47) per share[11] - Net loss for the year 2025 was $(33,958,000), compared to $(35,460,000) in 2024, reflecting an improvement of 4.2%[18] - Non-GAAP net loss for the year ended December 31, 2025, was $24,359,000, compared to $25,780,000 in 2024, indicating a 5.5% reduction in losses[20] - Adjusted EBITDA for 2025 was reported at $(26,229,000), slightly improved from $(27,143,000) in 2024[20] - AEYE, Inc. reported a basic and diluted GAAP net loss per share of $1.47 for 2025, compared to $4.89 in 2024, showing a significant improvement[20] Cash and Assets - AEye ended 2025 with $86.5 million in cash, cash equivalents, and marketable securities, providing operational runway into 2028[11] - Cash and cash equivalents at the end of the period increased to $43,356,000 in 2025 from $10,266,000 in 2024, marking a significant increase[19] - Total current assets as of December 31, 2025, were $89,633,325, compared to $71,171,000 in 2024[17] - Total liabilities as of December 31, 2025, were $95,551,199, compared to $27,120,000 in 2024[17] Customer and Market Growth - AEye's customer count increased by 33%, reaching 16 active customers with revenue-generating shipments[4] - The company has expanded its commercial pipeline by 40% and is actively pursuing opportunities in high-speed rail and smart infrastructure[3] - AEye's technology is positioned in a market estimated at $5 billion today, with potential to reach a trillion-dollar opportunity by 2035[5] Operating Expenses - Total operating expenses for the year 2025 were $31,410,000, down from $35,252,000 in 2024, a reduction of approximately 11%[18] - Research and development expenses for Q4 2025 were $3,716,000, compared to $4,252,000 in Q4 2024, indicating a decrease of 12.6%[18] - Stock-based compensation expenses totaled $5,522,000 for the year ended December 31, 2025, down from $9,047,000 in 2024, reflecting a 39% decrease[20] Financing Activities - The company raised $90,961,000 through the issuance of common stock under Common Stock Purchase Agreements in 2025, a substantial increase from $11,080,000 in 2024[19] - AEYE, Inc. reported a net cash provided by financing activities of $91,665,000 in 2025, a notable increase from $10,060,000 in 2024[19] Technology and Partnerships - AEye's STRATOS™ sensor features a 1.5-kilometer detection range and resolution greater than twice that of its Apollo™ sensor[4] - AEye has joined the NVIDIA Halos AI Systems Inspection Lab to enhance automotive product readiness[4] - The company is formalizing multiple intersection deployments across the U.S. and signed a letter of intent with a regional partner in APAC[4] Shareholder Information - Weighted average common shares outstanding increased to 44,454,223 in Q4 2025 from 9,144,094 in Q4 2024[18]

Revenue and Financial Performance - For the year ended December 31, 2025, total revenue was $727.975 million, a decrease from $729.075 million in 2024, representing a decline of 0.15%[232]. - International Telecom segment revenue increased by $4.4 million, or 1.2%, to $381.9 million from $377.5 million in 2024, driven by a $4.1 million increase in ancillary services revenue[235]. - US Telecom segment revenue decreased by $5.5 million, or 1.6%, to $346.1 million, primarily due to a $4.1 million reduction in Fixed revenues and a $2.7 million decrease in Mobility revenue[238]. - Total revenue decreased by $1.1 million, or 0.2%, to $727.975 million for the year ended December 31, 2025, compared to $729.075 million in 2024[242]. - Mobility revenue decreased by $2.4 million, or 2.2%, to $107.6 million for the year ended December 31, 2025, from $110.0 million in 2024[245]. - Fixed revenue decreased by $4.5 million, or 1.0%, to $453.9 million for the year ended December 31, 2025, from $458.4 million in 2024[248]. - Carrier Services revenue increased by $1.5 million, or 1.1%, to $134.8 million for the year ended December 31, 2025, from $133.3 million in 2024[253]. - Other Communications Services revenue increased by $3.8 million, or 62.3%, to $9.9 million for the year ended December 31, 2025, from $6.1 million in 2024[255]. - Construction revenue increased to $4.8 million for the year ended December 31, 2025, from $3.9 million in 2024, due to an increase in the number of sites completed[257]. Operating Expenses and Income - Total operating expenses for the year ended December 31, 2025 were $699.541 million, compared to $729.870 million in 2024, reflecting a decrease of 4.1%[232]. - Operating income for the International Telecom segment decreased by $8.8 million, or 11.6%, to $67.0 million from $75.8 million in 2024[237]. - US Telecom segment operating loss improved to $1.7 million in 2025 from a loss of $44.4 million in 2024, indicating a significant reduction in losses[240]. - Operating expenses in the US Telecom segment decreased by $48.3 million, or 12.2%, to $347.8 million, largely due to cost-saving initiatives and a reduction in direct service costs[239]. - Selling, general and administrative expenses decreased by $9.4 million, or 4.1%, to $219.5 million for the year ended December 31, 2025, from $228.9 million in 2024[268]. - Depreciation and amortization expenses decreased by $5.3 million, or 3.8%, to $133.0 million in 2025[278]. - Amortization of intangibles from acquisitions decreased by $3.0 million to $4.9 million in 2025[280]. - Transaction-related charges for the year ended December 31, 2025, were $3.6 million, down from $4.8 million in 2024[273]. - Restructuring and reorganization expenses totaled $3.8 million in 2025, compared to $6.2 million in 2024[274][275]. Grants and Funding - The company generated $82 million in construction revenue from the FirstNet Agreement with AT&T, with an expectation of an additional $4 million as sites are completed[215]. - The company is set to receive $25.6 million annually from the Alaska Connect Fund starting January 1, 2025, continuing until December 31, 2028[221]. - The company has been awarded $98.8 million in construction grants pending completion, with $22.4 million disbursed in capital expenditures during the year ended December 31, 2025[223]. - The company has received $239 million in grants under various government programs to deploy broadband connectivity in underserved areas as of December 31, 2025[225]. - The company expects to receive approximately $144.9 million over the next thirteen years through the Enhanced Alternative Connect America Model funding, with annual amounts starting at $9 million[226]. Debt and Liquidity - Total liquidity as of December 31, 2025, was approximately $117.2 million, with $614.4 million of debt outstanding[305]. - As of December 31, 2025, the company had $121.1 million outstanding under the 2023 CoBank Term Loan and $57.6 million under the 2023 CoBank Revolving Loan, with $112.4 million available under the Revolving Loan[326]. - The 2024 Alaska Credit Facility includes a $300 million secured term loan and a $90 million revolving facility, with $300 million outstanding under the term facility as of December 31, 2025[330][331]. - The company capitalized $4.5 million of fees associated with the 2023 CoBank Credit Facility, which are being amortized over the life of the debt[324]. - The 2023 CoBank Credit Agreement requires a maximum Total Net Leverage Ratio of less than or equal to 3.25 to 1.0, measured quarterly[323]. - As of December 31, 2025, there were no outstanding borrowings under the 2025 IDB Revolving Facility or the 2025 IDB Term Loan, and OneGY was in compliance with all financial covenants[359]. - The OneVI Debt Agreement has a total outstanding amount of $60.0 million, with $2.3 million classified as current and $57.7 million as long-term as of December 31, 2025[366]. - The OneVI Net Leverage Ratio was amended to 7.0 to 1.0 through the maturity date of July 1, 2026, and the company was in compliance as of December 31, 2025[367]. - The OneVI Debt Amendment extends the maturity date from July 1, 2026, to July 1, 2035, with interest-only payments required until June 30, 2026[368]. - Future minimum principal repayments for long-term debt are projected at $24.6 million in 2026, escalating to $397.2 million in 2029[384]. Operational Efficiency and Management - The company has completed the integration and alignment of management across its international markets, enhancing operational efficiencies[209]. - The company plans to continue focusing on cost-saving initiatives and operational efficiencies to improve financial performance in the upcoming periods[239]. - The company is in compliance with all financial covenants of the 2023 CoBank Credit Facility as of December 31, 2025[376]. Other Financial Metrics - The company reported a net loss attributable to non-controlling interests of $8.616 million for the year ended December 31, 2025[236]. - The company experienced a $15.5 million gain on the disposition of long-lived assets in 2024, which impacted the operating expenses comparison[236]. - Net loss attributable to stockholders decreased by $11.5 million, or 43.6%, to $(14.906) million for the year ended December 31, 2025, from $(26.429) million in 2024[242]. - Interest income was $0.7 million in 2025, down from $1.2 million in 2024[289]. - Interest expense decreased to $47.8 million in 2025 from $49.5 million in 2024[290]. - Losses on foreign currency transactions were recorded at $2.0 million for 2025 and $1.9 million for 2024, indicating exposure to currency fluctuations[379].