Willdan Group, Inc.

Previous wording

Contract revenue. Consolidated contract revenue increased $32.5 million, or 23.0%, in the three months ended July 4, 2025, compared to the three months ended June 28, 2024, reflecting increased demand for our services in both our Energy segment and our Engineering and Consulting segment.

Current wording

Contract revenue. Consolidated contract revenue increased $23.8 million, or 15.0%, in the three months ended October 3, 2025, compared to the three months ended September 27, 2024, reflecting increased demand for our services in both our Energy segment and our Engineering and Consulting segment.

Previous wording

Contract revenue in our Energy segment increased $28.9 million, or 24.5%, in the three months ended July 4, 2025, compared to the three months ended June 28, 2024, primarily as a result of increased demand for energy efficiency and electrification services under utility programs, higher construction management revenues, higher planning and advisory consulting revenues, and the incremental revenues from our acquisitions of Enica Engineering, PLCC. (“Enica”) and Alternative Power Generation, Inc. (“APG”).

Current wording

Contract revenue in our Energy segment increased $20.7 million, or 15.5%, in the three months ended October 3, 2025, compared to the three months ended September 27, 2024, primarily as a result of increased demand for energy efficiency and electrification services under utility programs, higher construction management revenues, higher planning and advisory consulting revenues, and the incremental revenues from our acquisitions of Enica Engineering, PLCC. (“Enica”) and Alternative Power Generation, Inc. (“APG”).

Previous wording

Contract revenue in our Engineering and Consulting segment increased $3.6 million, or 15.5%, in the three months ended July 4, 2025, compared to the three months ended June 28, 2024, primarily due to increased demand for services provided to our clients, combined with the incremental revenues from our acquisition of Alpha Inspections, Inc. (“Alpha”).

Current wording

Contract revenue in our Engineering and Consulting segment increased $3.1 million, or 12.5%, in the three months ended October 3, 2025, compared to the three months ended September 27, 2024, primarily due to increased demand for services provided to our clients, combined with the incremental revenues from our acquisition of Alpha Inspections, Inc. (“Alpha”).

Previous wording

Direct costs of contract revenue. Direct costs of consolidated contract revenue increased $13.0 million, or 14.1%, for the three months ended July 4, 2025, compared to the three months ended June 28, 2024, primarily as a result of the increase and change of mix in contract revenues as described above. As a percentage of contract revenue, subcontractor services and other direct costs decreased to 45.3% in the three months ended July 4, 2025 from 48.6% in the three months ended June 28, 2024, while direct salaries and wages decreased to 15.4% in the three months ended July 4, 2025 from 16.8% in the three months ended June 28, 2024.

Current wording

Direct costs of contract revenue. Direct costs of consolidated contract revenue increased $8.3 million, or 7.8%, for the three months ended October 3, 2025, compared to the three months ended September 27, 2024, primarily as a result of the increase and change of mix in contract revenues as described above. As a percentage of contract revenue, subcontractor services and other direct costs decreased to 47.8% in the three months ended October 3, 2025 from 52.2% in the three months ended September 27, 2024. Direct salaries and wages increased $3.8 million, or 15.7%, to support the increased volume of projects in the three months ended October 3, 2025, compared to the three months ended September 27, 2024.

Previous wording

Direct costs of contract revenue in our Energy segment increased $11.6 million, or 14.2%, for the three months ended July 4, 2025, compared to the three months ended June 28, 2024. Direct costs of contract revenue for the Engineering and Consulting segment increased $1.4 million, or 13.3%, in the three months ended July 4, 2025, compared to the three months ended June 28, 2024.

Current wording

Direct costs of contract revenue in our Energy segment increased $6.7 million, or 7.0%, for the three months ended October 3, 2025, compared to the three months ended September 27, 2024. Direct costs of contract revenue for the Engineering and Consulting segment increased $1.6 million, or 14.9%, in the three months ended October 3, 2025, compared to the three months ended September 27, 2024.

Previous wording

Subcontractor services and other direct costs increased by $10.0 million, or 14.5%, in the three months ended July 4, 2025, compared to the three months ended June 28, 2024, primarily due to the increase in utility program revenues and construction management revenues, which utilize a higher percentage of material cost and installation subcontracting. Salaries and wages increased by $3.0 million, or 12.7%, in the three months ended July 4, 2025, compared to the three months ended June 28, 2024, primarily as aresult of the increases in contract revenue as described above.

Current wording

Subcontractor services and other direct costs increased by $4.5 million, or 5.4%, in the three months ended October 3, 2025, compared to the three months ended September 27, 2024, primarily due to the increase in utility program revenues and construction management revenues, which utilize a higher percentage of material cost and installation subcontracting. Salaries and wages increased by $3.8 million, or 15.7%, in the three months ended October 3, 2025, compared to the three months ended September 27, 2024, primarily as aresult of the increases in contract revenue as described above.

Previous wording

Gross Profit. Gross profit increased 40.0% to $68.3 million, or 39.4% gross margin, for the three months ended July 4, 2025, compared to gross profit of $48.8 million, or 34.6% gross margin, for the three months ended June 28, 2024. The increase in our gross margin was primarily driven by changes in the mix of revenues as described above.

Current wording

Gross Profit. Gross profit increased 30.0% to $67.1 million, or 36.9% gross margin, for the three months ended October 3, 2025, compared to gross profit of $51.6 million, or 32.6% gross margin, for the three months ended September 27, 2024. The increase in our gross margin was primarily driven by changes in the mix of revenues as described above.

Previous wording

General and administrative expenses. General and administrative (“G&A”) expenses increased $14.2 million, or 33.4%, to $56.5 million in the three months ended July 4, 2025, compared to $42.4 million for the three months ended June 28, 2024. G&A expenses consisted of an increase of $9.6 million, or 30.7%, in the Energy segment combined with an increase of $0.5 million, or 5.4%, in the Engineering and Consulting segment, and an increase of $4.1 million, or 235.4%, in unallocated corporate expenses.

Current wording

General and administrative expenses. General and administrative (“G&A”) expenses increased $9.3 million, or 21.7%, to $52.2 million in the three months ended October 3, 2025, compared to $42.9 million for the three months ended September 27, 2024. G&A expenses consisted of an increase of $7.4 million, or 23.1%, in the Energy segment combined with an increase of $1.0 million, or 11.1%, in the Engineering and Consulting segment, and an increase of $0.9 million in unallocated corporate expenses.

Previous wording

The overall increase in G&A expenses consisted of an increase of $6.5 million in salaries and wages, payroll taxes and employee benefits, an increase of $4.6 million in other general and administrative expenses, an increase of $1.9 million in depreciation and amortization, and an increase of $1.2 million in stock-based compensation. The increase in salaries and wages, payroll taxes and employee benefits was primarily due to increased staffing from acquisitions, an increase in incentive compensation to support revenue growth, consistent with the improvement in operating profit, and higher fringe benefit costs consistent with the growth in direct and indirect labor costs. The increase in other general and administrative expenses was primarily due to increased professional service fees and computer-related expenses. The increase in depreciation and amortization was primarily related to higher amortization of intangible assets from recent acquisitions. The increase in stock-based compensation expenses was primarily related to new stock grants to current employees, executives, and Board of directors at a higher stock price.

Current wording

The overall increase in G&A expenses consisted of an increase of $5.8 million in salaries and wages, payroll taxes and employee benefits, an increase of $2.1 million in other general and administrative expenses, and an increase of $1.1 million in stock-based compensation. The increase in salaries and wages, payroll taxes and employee benefits was primarily due to increased staffing from acquisitions, an increase in incentive compensation to support revenue growth, consistent with the improvement in operating profit, and higher fringe benefit costs consistent with the growth in direct and indirect labor costs. The increase in other general and administrative expenses was primarily due to increased professional service fees and computer-related expenses. The increase in stock-based compensation expenses was primarily related to new stock grants to current employees, executives, and Board of directors at a higher stock price.

Previous wording

Income (loss) from operations. Operating income increased 83.3% to $11.8 million for the three months ended July 4, 2025, compared to an operating income of $6.4 millionfor the three months ended June 28, 2024, as a result of the factors noted above.

Current wording

Income (loss) from operations. Operating income increased 71.3% to $14.9 million for the three months ended October 3, 2025, compared to an operating income of $8.7 millionfor the three months ended September 27, 2024, as a result of the factors noted above.

Previous wording

Total other expense, net. Total other expense, net, increased $0.5 million, or 44.2%, for the three months ended July 4, 2025, compared to the three months ended June 28, 2024, primarily due to a one-time charge for unamortized debt issuance costs related to our prior credit facilities, partially offset by the lower interest expense resulting from the reduced interest rate spread derived from lower debt leverage levels under our credit facilities.

Current wording

Total other expense, net. Total other expense, net, decreased $0.6 million, or 51.2%, for the three months ended October 3, 2025, compared to the three months ended September 27, 2024, primarily due to the lower interest expense resulting from the reduced interest rate spread derived from lower debt leverage levels under our credit facilities.

Previous wording

Income tax expense (benefit). We recorded an income tax benefit of $5.3 million for the three months ended July 4, 2025, an effective tax benefit rate of 51.6% on income before income tax expense, compared to an income tax expense of $0.7 million for the three months ended June 28, 2024, an effective tax expense rate of 13.5% on income before tax expense. The reduction in the effective tax rate resulted from increases in discrete items related to stock compensation deductions and additional energy-efficiency building deductions.

Current wording

Income tax expense (benefit). Income tax expense was $0.6 million for the three months ended October 3, 2025, an effective tax expense rate of 4.0% on income before income tax expense, compared to an income tax expense of $0.2 million for the three months ended September 27, 2024, an effective tax expense rate of 2.1% on income before tax expense. The increase in the effective tax rate resulted from the higher income before income tax combined with decreases in discrete items related lower energy-efficiency building deductions, partially offset by increases in discrete items related to stock compensation deductions.

Previous wording

Net income (loss). Our net income was $20.1 million for the six months ended July 4, 2025, as compared to a net income of $7.5 million for the six months ended June 28, 2024. The increase in net income was primarily attributable to the increase in income from operations combined with the tax benefit.

Current wording

Net income (loss). Our net income was $13.7 million for the three months ended October 3, 2025, as compared to a net income of $7.3 million for the three months ended September 27, 2024. The increase in net income was primarily attributable to the increase in income from operations combined with the decrease in total other expense, net, partially offset by the higher effective tax rate.

Previous wording

Contract revenue. Consolidated contract revenue increased $62.4 million, or 23.7%, in the six months ended July 4, 2025, compared to the six months ended June 28, 2024, reflecting increased demand for our services in both our Energy segment and our Engineering and Consulting segment.

Current wording

Contract revenue. Consolidated contract revenue increased $86.1 million, or 20.4%, in the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024, reflecting increased demand for our services in both our Energy segment and our Engineering and Consulting segment.

Previous wording

Contract revenue in our Energy segment increased $54.4 million, or 24.9%, in the six months ended July 4, 2025, compared to the six months ended June 28, 2024, primarily as a result of increased demand for energy efficiency and electrification services under utility programs, higher construction management revenues, higher planning and advisory consulting revenues, and the incremental revenues from our acquisitions of Enica and APG.

Current wording

Contract revenue in our Energy segment increased $75.1 million, or 21.3%, in the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024, primarily as a result of increased demand for energy efficiency and electrification services under utility programs, higher construction management revenues, higher planning and advisory consulting revenues, and the incremental revenues from our acquisitions of Enica and APG.

Previous wording

Contract revenue in our Engineering and Consulting segment increased $8.0 million, or 17.8%, in the six months ended July 4, 2025, compared to the six months ended June 28, 2024, primarily due to increased demand for services provided to our clients, combined with the incremental revenues from our acquisition of Alpha.

Current wording

Contract revenue in our Engineering and Consulting segment increased $11.0 million, or 15.9%, in the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024, primarily due to increased demand for services provided to our clients, combined with the incremental revenues from our acquisition of Alpha.

Previous wording

Direct costs of contract revenue. Direct costs of consolidated contract revenue increased $32.6 million, or 19.5%, for the six months ended July 4, 2025, compared to the six months ended June 28, 2024, primarily as a result of the increase and change of mix in contract revenues as described above. As a percentage of contract revenue, subcontractor services and other direct costs decreased to 44.7% in the six months ended July 4, 2025 from 46.3% in the six months ended June 28, 2024, while direct salaries and wages decreased to 16.7% in the six months ended July 4, 2025 from 17.1% in the six months ended June 28, 2024.

Current wording

Direct costs of contract revenue. Direct costs of consolidated contract revenue increased $40.9 million, or 14.9%, for the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024, primarily as a result of the increase and change of mix in contract revenues as described above. As a percentage of contract revenue, subcontractor services and other direct costs decreased to 45.8% in the nine months ended October 3, 2025 from 48.5% in the nine months ended September 27, 2024. Direct salaries and wages increased $13.0 million, or 18.7%, to support the increased volume of projects in the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024.

Previous wording

Direct costs of contract revenue in our Energy segment increased $29.2 million, or 19.9%, for the six months ended July 4, 2025, compared to the six months ended June 28, 2024. Direct costs of contract revenue for the Engineering and Consulting segment increased $3.4 million, or 16.5%, in the six months ended July 4, 2025, compared to the six months ended June 28, 2024.

Current wording

Direct costs of contract revenue in our Energy segment increased $35.9 million, or 14.8%, for the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024. Direct costs of contract revenue for the Engineering and Consulting segment increased $5.0 million, or 16.0%, in the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024.

Previous wording

Subcontractor services and other direct costs increased by $23.4 million, or 19.2%, in the six months ended July 4, 2025, compared to the six months ended June 28, 2024, primarily due to the increase in utility program revenues and construction management revenues, which utilize a higher percentage of material cost and installation subcontracting. Salaries and wages increased by $9.2 million, or 20.3%, in the six months ended July 4, 2025, compared to the six months ended June 28, 2024, primarily as aresult of the increases in contract revenue as described above.

Current wording

Subcontractor services and other direct costs increased by $27.9 million, or 13.6%, in the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024, primarily due to the increase in utility program revenues and construction management revenues, which utilize a higher percentage of material cost and installation subcontracting. Salaries and wages increased by $13.0 million, or 18.7%, in the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024, primarily as aresult of the increases in contract revenue as described above.

Previous wording

Gross Profit. Gross profit increased 30.9% to $126.0 million, or 38.7% gross margin, for the six months ended July 4, 2025, compared to gross profit of $96.2 million, or 36.5% gross margin, for the six months ended June 28, 2024. The increase in our gross margin was primarily driven by changes in the mix of revenues as described above.

Current wording

Gross Profit. Gross profit increased 30.6% to $193.1 million, or 38.0% gross margin, for the nine months ended October 3, 2025, compared to gross profit of $147.8 million, or 35.1% gross margin, for the nine months ended September 27, 2024. The increase in our gross margin was primarily driven by changes in the mix of revenues as described above.

Previous wording

General and administrative expenses. General and administrative (“G&A”) expenses increased $22.7 million, or 26.9%, to $107.1 million in the six months ended July 4, 2025, compared to $84.4 million for the six months ended June 28, 2024. G&A expenses consisted of an increase of $16.5 million, or 26.3%, in the Energy segment combined with an increase of $2.0 million, or 10.5%, in the Engineering and Consulting segment, and an increase of $4.2 million, or 146.9%, in unallocated corporate expenses.

Current wording

General and administrative expenses. G&A expenses increased $32.0 million, or 25.1%, to $159.4 million in the nine months ended October 3, 2025, compared to $127.3 million for the nine months ended September 27, 2024. G&A expenses consisted of an increase of $23.9 million, or 25.2%, in the Energy segment combined with an increase of $3.0 million, or 10.7%, in the Engineering and Consulting segment, and an increase of $5.1 million in unallocated corporate expenses.

Previous wording

The overall increase in G&A expenses consisted of an increase of $11.1 million in salaries and wages, payroll taxes and employee benefits, an increase of $6.5 million in other general and administrative expenses, an increase of $2.7 million in depreciation and amortization, and an increase of $2.3 million in stock-based compensation. The increase in salaries and wages, payroll taxes and employee benefits was primarily due to increased staffing from acquisitions, an increase in incentive compensation to support revenue growth, consistent with the improvement in operating profit, and higher fringe benefit costs consistent with the growth in direct and indirect labor costs. The increase in other general and administrative expenses was primarily due to increased professional service fees and computer-related expenses. The

Current wording

in salaries and wages, payroll taxes and employee benefits was primarily due to increased staffing from acquisitions, an increase in incentive compensation to support revenue growth, consistent with the improvement in operating profit, and higher fringe benefit costs consistent with the growth in direct and indirect labor costs. The increase in other general and administrative expenses was primarily due to increased professional service fees and computer-related expenses. The increase in stock-based compensation expenses was primarily related to new stock grants to current employees, executives and Board of directors at a higher stock price. The increase in depreciation and amortization was primarily related to higher amortization of intangible assets from recent acquisitions.

Previous wording

Income (loss) from operations. Operating income increased 59.6% to $18.9 million for the six months ended July 4, 2025, compared to an operating income of $11.8 millionfor the six months ended June 28, 2024, as a result of the factors noted above.

Current wording

Income (loss) from operations. Operating income increased 64.6% to $33.7 million for the nine months ended October 3, 2025, compared to an operating income of $20.5 millionfor the nine months ended September 27, 2024, as a result of the factors noted above.

Previous wording

Total other expense, net. Total other expense, net, increased $0.9 million, or 35.5%, for the six months ended July 4, 2025, compared to the six months ended June 28, 2024, primarily due to a one-time charge for unamortized debt issuance costs related to our prior credit facilities combined with a one-time charge related to a facility lease modification, partially offset by lower interest expense resulting from the reduced interest rate spread derived from lower debt leverage levels under our credit facilities.

Current wording

Total other expense, net. Total other expense, net, increased $0.3 million, or 8.3%, for the nine months ended October 3, 2025, compared to the nine months ended September 27, 2024, primarily due to a one-time charge for unamortized debt issuance costs related to our prior credit facilities combined with a one-time charge related to a facility lease modification, partially offset by lower interest expense resulting from the reduced interest rate spread derived from lower debt leverage levels under our credit facilities.

Previous wording

Income tax expense (benefit). We recorded an income tax benefit of $4.7 million for the six months ended July 4, 2025, an effective tax benefit rate of 30.9% on income before income tax expense, compared to an income tax expense of $1.7 million for the six months ended June 28, 2024, an effective tax rate of 18.5% on income before tax expense. The reduction in the effective tax rate resulted from increases in discrete items related to stock compensation deductions and additional energy-efficiency building deductions.

Current wording

Income tax expense (benefit). We recorded an income tax benefit of $4.2 million for the nine months ended October 3, 2025, an effective tax benefit rate of 14.1% on income before income tax expense, compared to an income tax expense of $1.9 million for the nine months ended September 27, 2024, an effective tax rate of 11.1% on income before tax expense. The reduction in the effective tax rate resulted from increases in discrete items related to stock compensation deductions and additional energy-efficiency building deductions.

Previous wording

Net income (loss). Our net income was $15.4 million for the three months ended July 4, 2025, as compared to a net income of $4.6 million for the three months ended June 28, 2024. The increase in net income was primarily attributable to the increase in income from operations combined with the tax benefit.

Current wording

Net income (loss). Our net income was $33.8 million for the nine months ended October 3, 2025, as compared to a net income of $14.9 million for the nine months ended September 27, 2024. The increase in net income was primarily attributable to the increase in income from operations combined with the tax benefit.

Previous wording

Our primary sources of liquidity for the next 12 months and beyond are cash generated from operations, cash and cash equivalents, andavailable borrowings under our Revolving Credit Facility and Delayed Draw Term Loan under the Credit Agreement (the “Revolving Credit Facility”). We believe these sources will be sufficient to finance our operating activities for at least the next 12 months.

Current wording

Our primary sources of liquidity for the next 12 months and beyond are cash generated from operations, cash and cash equivalents, andavailable borrowings under our Revolving Credit Facility and Delayed Draw Term Loan under the Credit Agreement (the “Credit Facilities”). We believe these sources will be sufficient to finance our operating activities for at least the next 12 months.

Previous wording

As of July 4, 2025, we had a fully drawn $50.0 million term loan with $50.0 million outstanding, a $100.0 million Revolving Credit Facility with $10.0 million outstanding and $1.6 million in letters of credit issued, and a $50.0 million Delayed Draw Term Loan with no borrowed amounts, each scheduled to mature on May 5, 2030. In addition, as of July 4, 2025, we had $32.3 million of unrestricted cash and cash equivalents. As of July 4, 2025, unhedged borrowings under our Credit Facilities, exclusive of the effects of upfront fees, undrawn fees and issuance cost amortization, bore interest at an annual rate of 6.2%. Subsequent to July 4, 2025, we repaid $10.0 million of borrowings under our Revolving Credit Facility, reducing the outstanding balance to zero, and thereby increasing available borrowing capacity under the Revolving Credit Facility to its full $100.0 million. See Part I, Item 1, Note 6, “Debt Obligations”, of the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for information regarding our indebtedness, including information about Amended and Restated Credit Agreement

Current wording

As of October 3, 2025, we had a fully drawn $50.0 million term loan with $49.4 million outstanding, a $100.0 million Revolving Credit Facility with no borrowed amounts outstanding and $1.6 million in letters of credit issued, and a $50.0 million Delayed Draw Term Loan which has not been drawn on. The Delayed Draw Term Loan must be drawn before May 2027. The Credit Facilities are each scheduled to mature on May 5, 2030. In addition to the Credit Facilities, we had $33.1 million of unrestricted cash and cash equivalents as of October 3, 2025. Unhedged borrowings under our Credit Facilities, exclusive of the effects of upfront fees, undrawn fees and issuance cost amortization, bore

Previous wording

Cash flows provided by operating activities were $28.7 million for the six months ended July 4, 2025, as compared to cash flows provided by operating activities of $27.8 million for the six months ended June 28, 2024. Cash flows from operating activities primarily consists of net income, adjusted for non-cash charges, such as depreciation and amortization and stock-based compensation, plus or minus changes in current operating assets and liabilities. Cash flows provided by operating activities for the six months ended July 4, 2025, resulted primarily from the increase in earnings combined with lower working capital requirements. Cash flows provided by operating activities for the six months ended June 28, 2024, resulted primarily from the increase in earnings and lower working capital requirements.

Current wording

Cash flows provided by operating activities were $40.9 million for the nine months ended October 3, 2025, as compared to cash flows provided by operating activities of $38.6 million for the nine months ended September 27, 2024. Cash flows from operating activities primarily consists of net income, adjusted for non-cash charges, such as depreciation and amortization and stock-based compensation, plus or minus changes in current operating assets and liabilities. Cash flows provided by operating activities for the nine months ended October 3, 2025, resulted primarily from the increase in earnings partially offset by higher working capital requirements to support the expansion of revenue. Cash flows provided by operating activities for the nine months ended September 27, 2024, resulted primarily from the increase in earnings and reduced working capital requirements resulting from faster billing and improved collections.

Previous wording

Cash flows used in investing activities were $39.6 million for the six months ended July 4, 2025, as compared to cash flows used in investing activities of $4.1 million for the six months ended June 28, 2024. Cash flows used in investing activities for the six months ended July 4, 2025 were primarily due to cash paid for acquisitions, combined with cash paid for the development of proprietary software and the purchase of computers and equipment. Cash flows used in investing activities for the six months ended June 28, 2024 were primarily due to cash paid for the development of proprietary software and the purchase of computers and equipment.

Current wording

Cash flows used in investing activities were $40.3 million for the nine months ended October 3, 2025, as compared to cash flows used in investing activities of $6.0 million for the nine months ended September 27, 2024. Cash flows used in investing activities for the nine months ended October 3, 2025 and September 27, 2024, were primarily due to cash paid for acquisitions, combined with cash paid for the development of proprietary software and the purchase of computers and equipment.

Previous wording

Cash flows used in financing activities were $30.9 million for the six months ended July 4, 2025, as compared to cash flows used in financing activities of $2.9 million for the six months ended June 28, 2024.

Current wording

Cash flows used in financing activities were $41.6 million for the nine months ended October 3, 2025, as compared to cash flows used in financing activities of $2.9 million for the nine months ended September 27, 2024.

Previous wording

For the six months ended July 4, 2025, cash flows used in financing activities were primarily attributable to the $28.4 million cash used to pay down our Revolving Credit Facility, $3.1 million cash used to pay withholding taxes on stock grants, combined with repayments and borrowings of $90.0 million and $88.4 million, respectively, related to our Amended and Restated Credit Agreement. Cash flows used in financing activities were partially offset by $1.9 million in proceeds from stock option exercise, and $1.5 million of proceeds from sales of common stock under the employee stock purchase plan. Cash flows used in financing activities for the six months ended June 28, 2024 were primarily attributable to the repayments of $3.8 million under our prior Term Loan, $0.8 million cash used to pay withholding taxes on stock grants, and $0.7 million principal payments on finance leases, partially offset by $1.4 million of proceeds from sales of common stock under employee stock purchase plan, and $1.1 million in proceeds from stock option exercises.

Current wording

For the nine months ended October 3, 2025, cash flows used in financing activities were primarily attributable to the $39.0 million cash used to pay down our Revolving Credit Facility, $5.1 million cash used to pay withholding taxes on stock grants, $1.1 million principal payments on finance leases combined with repayments and borrowings of $90.0 million and $88.4 million, respectively, related to our Amended and Restated Credit Agreement. Cash flows used in financing activities were partially offset by $3.2 million of proceeds from sales of common stock under the employee stock purchase plan, and $2.5 million in proceeds from stock option exercise. Cash flows used in financing activities for the nine months ended September 27, 2024 were primarily attributable to the repayments of $5.6 million under our Term Loan, $1.2 million cash used to pay withholding taxes on stock grants, and $1.0 million principal payments on finance leases, partially offset by $2.8 million of proceeds from sales of common stock under employee stock purchase plan and $2.4 million in proceeds from stock option exercises.

Previous wording

We do not have any off-balance sheet financing arrangements or liabilities. In addition, our policy is not to enter into futures or forward contracts. Finally, we do not have any majority-owned subsidiaries or any interests in, or relationships with, any special-purpose entities that are not included in the consolidated financial statements. We have, however, an administrative services agreement with Genesys in which we provide Genesys with ongoing administrative, operational and other non-professional support services. We manage Genesys and have the power to direct the activities that most significantly impact Genesys’ performance, in addition to being obligated to absorb expected losses from Genesys. Accordingly, we are the primary beneficiary of Genesys and consolidate Genesys as a variable interest entity.

Current wording

relationships with, any special-purpose entities that are not included in the consolidated financial statements. We have, however, an administrative services agreement with Genesys in which we provide Genesys with ongoing administrative, operational and other non-professional support services. We manage Genesys and have the power to direct the activities that most significantly impact Genesys’ performance, in addition to being obligated to absorb expected losses from Genesys. Accordingly, we are the primary beneficiary of Genesys and consolidate Genesys as a variable interest entity.

Previous wording

We have contingent obligations to make earnout payments in connection with our acquisitions of Enica and APG, subject to their future financial performance. We are obligated to pay up to $6.0 million in cash if Enica exceeds certain financial targets during the two years after the Enica closing date of October 23, 2024, and are obligated to pay up to $18.0 million in cash if APG exceeds certain financial targets during the three years after the APG closing date of March 3, 2025. As of July 4, 2025, we had contingent consideration payable of $17.5 million related to the acquisitions of Enica and APG. For fiscal year 2024, our statement of operations includes $1.4 million of interest accretion (excluding fair value adjustments) related to the contingent consideration.

Current wording

We have contingent obligations to make earnout payments in connection with our acquisitions of Enica and APG, subject to their future financial performance. We are obligated to pay up to $6.0 million in cash if Enica exceeds certain financial targets during the two years after the Enica closing date of October 23, 2024, and are obligated to pay up to $18.0 million in cash if APG exceeds certain financial targets during the three years after the APG closing date of March 3, 2025. As of October 3, 2025, we had contingent consideration payable of $18.5 million related to the acquisitions of Enica and APG and, through the nine months ended October 3, 2025, our statement of operations includes $2.3 million of interest accretion (excluding fair value adjustments) related to the contingent consideration.

Previous wording

See Part I, Item 1, Note 6, “Debt Obligations”, of the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q, and Part II, Item 8, Note 5, “Debt Obligations”, of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 27, 2024, for information regarding our indebtedness, including information about new borrowings and repayments, principal repayment terms, interest rates, covenants, and other key terms of our outstanding indebtedness. Subsequent to July 4, 2025, the Company repaid $10.0 million of borrowings under its Revolving Credit Facility, which increased the future borrowing capacity under the Revolving Credit Facility to its full $100.0 million and thus reflecting no borrowed amounts under the Revolving Credit Facility.

Current wording

See Part I, Item 1, Note 6, “Debt Obligations”, of the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q, and Part II, Item 8, Note 5, “Debt Obligations”, of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 27, 2024, for information regarding our indebtedness, including information about new borrowings and repayments, principal repayment terms, interest rates, covenants, and other key terms of our outstanding indebtedness.

Previous wording

We generally provide our services under contracts, purchase orders or retainer letters. The agreements we enter into with our clients typically incorporate one of three principal types of pricing provisions: time-and-materials, unit-based, and fixed price. Revenue on our time-and-materials and unit-based contracts are recognized as the work is performed in accordance with specific terms of the contract. As of July 4, 2025, 19% of our contracts are time-and-materials contracts, 36% are unit-based contracts, and 45% are fixed price contracts, compared to 19% are time-and-materials contracts, 39% are unit-based contracts, and 42% are fixed price contracts, as of June 28, 2024.

Current wording

We generally provide our services under contracts, purchase orders or retainer letters. The agreements we enter into with our clients typically incorporate one of three principal types of pricing provisions: time-and-materials, unit-based, and fixed price. Revenue on our time-and-materials and unit-based contracts are recognized as the work is performed in accordance with specific terms of the contract. As of October 3, 2025, 18% of our contracts are time-and-materials contracts, 36% are unit-based contracts, and 46% are fixed price contracts, compared to 18% are time-and-materials contracts, 38% are unit-based contracts, and 44% are fixed price contracts, as of September 27, 2024.