HARVARD BIOSCIENCE INC
For the period ended Mar 31, 2025. Filed May 12, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 12, 2025
HBIO$8.36-1.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-08.
0001171843-24-006181
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-12.
0001171843-25-003093
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 74 previous paragraphs and 48 current paragraphs.
24 unchanged; 12 reworded; 12 added; 34 removed; 4 previous and 0 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (12)
Current report
Our business is affected by global and regional economic trends and uncertainties. Our revenue has been and may continue to be affected by our customers forgoing or delaying purchases of our products and services as a result of ongoing uncertainty with respect to the level and timing of funding from the U.S. National Institutes of Health (the “NIH”) or similar government sources. Our business has also been affected by the imposition of increased tariffs on shipments of products between the United States and other countries, and in particular between the United States and China. Our revenue has been and may continue to be affected by greater restrictions and economic disincentives on international trade, including these tariffs. Products and services that we obtain from overseas sources has been and may continue to be affected by these tariffs, resulting in increased costs to our business.
Current report
If these trends are prolonged or are more severe than anticipated, our business, results of operations, and cash flow may be materially impacted.
Current report
Sales and marketing expenses decreased $0.9 million, or 15.8%, to $5.0 million for the three months ended March 31, 2025, compared with $5.9 million for the three months ended March 31, 2024. This decrease was primarily due to reduced compensation, travel and entertainment, consulting and trade show expenses.
Current report
Research and development expenses decreased $0.6 million, or 19.5%, to $2.3 million for the three months ended March 31, 2025, compared with $2.9 million for the three months ended March 31, 2024. This decrease was primarily due to reduced compensation costs.
Current report
Goodwill impairment
Current report
During the three months ended March 31, 2025, we identified a triggering event, including the sustained decrease in our stock price, our recent operating results, liquidity risk and the current macroeconomic conditions impacting the life sciences industries, requiring an interim impairment test. We recorded a non-cash goodwill impairment charge of $48.0 million in connection with the interim impairment test.
Current report
During the three months ended March 31, 2024, we recorded a loss on equity securities of $1.3 million consisting of a realized loss of $0.3 million for shares sold and an unrealized loss of $1.0 million for shares held of common stock of Harvard Apparatus Regenerative Technology Inc. (“HRGN”). We did not hold any shares of HRGN stock during the three months ended March 31, 2025.
Current report
The Coronavirus Aid, Relief, and Economic Security Act of 2020 (the “CARES Act”) provided an employee retention tax credit (“ERTC”) that was a refundable tax credit against certain employer taxes. The Company has received ERTC refunds of $4.2 million as of March 31, 2025 with $1.1 million received during the three months ended March 31, 2025. The Company’s compliance with the program’s qualifications may be subject to audit until May 2028, which is when the statute of limitation expires.
Current report
We maintain a Credit Agreement that provides for a term loan of $40.0 million and a $25.0 million revolving credit facility with an original maturity of December 22, 2025. On March 10, 2025, we entered into an amendment to the Credit Agreement (the “March 2025 Amendment”). The March 2025 Amendment provides, among other things, that the lender’s commitment under our revolving credit facility is capped at the amount outstanding thereunder as of the date thereof and thus we are unable to make additional borrowings under our revolving credit facility. The March 2025 Amendment also establishes certain milestones with respect to the refinancing of the debt underlying the Credit Agreement (the “Refinancing”) and dates by which such milestones must be met. These milestones (the “Refinancing Milestones”) include: (1) continuing to retain an investment banker for the purpose of assisting with the consummation of the Refinancing; (2) by March 14, 2025, the engagement of a financial advisor acceptable to the administrative agent; (3) by April 30, 2025, the delivery to the administrative agent of an executed bona fide indication of interest from one or more potential lenders with respect to the Refinancing on terms and conditions acceptable to the administrative agent; (4) by May 23, 2025, the delivery to the administrative agent of a term sheet or commitment letter from one or more potential lenders that provides for the Refinancing on terms and conditions acceptable to the administrative agent; (5) by June 13, 2025, delivery to the administrative agent of: (i) a statement of sources and uses of transaction proceeds; and (ii) evidence that the potential lender’s conditions to closing (other than customary closing deliveries) of the Refinancing, such as business commitments, are satisfied; and (6) by June 30, 2025, the closing of the Refinancing. the lenders also agreed not to assert the financial covenants included in the Credit Agreement for the first quarter of fiscal year 2025 provided that we continue to comply with our payment obligations, achieve the Refinancing Milestones, maintain minimum liquidity (the “Minimum Liquidity Requirement”) (defined as the sum of (a) unrestricted cash and cash equivalents and (b) the amount by which the aggregate amount committed under the Company’s revolving credit facility exceeds the total amount drawn under the credit facility) of $3.5 million and provide the administrative agent with certain financial reports. In addition, pursuant to the terms of the March 2025 Amendment the applicable interest rate margin is increased such that interest rate is equal to a rate per annum based on the Secured Overnight Financing Rate (“SOFR”) plus 400 bps and amortization payments were revised so that a proportionate payment must be made on a monthly rather than a quarterly basis. As of May 12, 2025,we were in compliance with the Refinancing Milestones applicable as of such date and the Minimum Liquidity Requirement.
Current report
If we are not able to comply with the terms and conditions of the March 2025 Amendment, or if we are otherwise unable to regain and maintain compliance with the covenants under the Credit Agreement, as amended, or are unsuccessful in obtaining waivers or amendments for any covenant in the future, in addition to other actions our lenders may require, the amounts outstanding under the Credit Agreement may become immediately due and payable.
Current report
We are exploring alternative sources of capital that would allow us to refinance the outstanding indebtedness by June 30, 2025, in order to avoid default under the Credit Agreement, but our ability to access such other sources of capital is uncertain. There is no assurance that such capital will be available, be obtainable on commercially acceptable terms, or provide sufficient funds to meet our objectives. Based on our anticipated cash flows from operations, unless we are able to access other sources of capital or extend the date for repayment under the Credit Agreement, we will be unable to pay our debt obligations and fund our operations for at least twelve months from the date of issuance of the unaudited consolidated financial statements contained in this Quarterly Report on Form 10-Q. As a result, there is substantial doubt about our ability to continue as a going concern.
Current report
Cash provided by operations was $3.0 million and $1.4 million for the three months ended March 31, 2025 and 2024, respectively. Cash flow from operations for the three months ended March 31, 2025 was positively impacted by cash inflows from accounts receivable of $0.7 million and inventories of $1.3 million compared with the three months ended March 31, 2024.
Removed paragraphs (34)
Previous report
Our business, results of operations, and cash flows have been impacted by macroeconomic trends affecting the life sciences industry and the global economy. These trends include inflationary and interest rate pressures, fluctuations in exchange rates, economic conditions in China, and the events in Ukraine and the Middle East. Our business has also been affected by the softening of certain international markets, especially in China and the Asia-Pacific region, as well as by delays in government funding for certain customers. Our business has also been affected by reduced demand from our biotechnology and pharmaceutical company customers, principally due to the increased cost of capital and a reduction in spending following the COVID-19 pandemic. We expect that any continuation of these trends, or any further delay in market recovery, would continue to impact our business, results of operations, and cash flows.
Previous report
Gross profit decreased $1.9 million, or 13.3%, to $12.8 million for the three months ended September 30, 2024, compared with $14.7 million for the three months ended September 30, 2023, primarily due to the decrease in revenues. Gross margin was 58.1% for both the three months ended September 30, 2024, and September 30, 2023. Gross margin was unfavorably impacted by the under-absorption of fixed manufacturing overhead costs due to the decrease in revenues which was offset by a better mix of high margin products and lower labor costs.
Previous report
Sales and marketing expenses decreased $0.2 million, or 3.7%, to $5.5 million for the three months ended September 30, 2024, compared with $5.7 million for the three months ended September 30, 2023.
Previous report
Research and development expenses remained relatively unchanged and decreased $0.2 million, or 7.0%, to $2.6 million for the three months ended September 30, 2024, compared with $2.8 million for the three months ended September 30, 2023.
Previous report
Loss on pension settlement
Previous report
During the three months ended September 30, 2024, we settled our obligations under one of our defined benefit plans by using plan assets to purchase non-participating annuity contracts. The settlement resulted in the recognition of a non-cash charge of $1.2 million, which has been presented as a component of other income (expense), net. This amount includes the immediate recognition of the portion of the accumulated other comprehensive income (“AOCI”) balance related to this plan.
Previous report
Gain on equity securities
Previous report
During the three months ended September 30, 2023 we recorded an unrealized gain of $1.2 million related to shares of common stock of Harvard Apparatus Regenerative Technology Inc. (“HRGN”). These shares were received in connection with settlement of indemnification obligations related to litigation and were all sold during the six months ended June 30, 2024.
Previous report
Nine months ended September 30, 2024, compared to nine months ended September 30, 2023
Previous report
Revenues
Previous report
Revenues decreased $14.5 million, or 17.3%, to $69.6 million for the nine months ended September 30, 2024, compared to $84.1 million for the nine months ended September 30, 2023. The decrease in revenues was primarily due to continued softening of worldwide demand primarily from distributors, CRO’s and academic medical research institutions.
Previous report
Gross profit
Previous report
Sales and marketing expenses
Previous report
Sales and marketing expenses decreased $1.1 million, or 6.0%, to $16.8 million for the nine months ended September 30, 2024, compared with $17.9 million for the nine months ended September 30, 2023. The decrease was primarily due to lower compensation and travel costs.
Previous report
General and administrative expenses
Previous report
General and administrative expenses decreased $0.8 million, or 4.6%, to $16.7 million for the nine months ended September 30, 2024, compared with $17.5 million for the nine months ended September 30, 2023. The decrease was primarily due to lower compensation costs and increased capitalization of costs for internal-use software.
Previous report
Research and development expenses
Previous report
Research and development expenses decreased $0.5 million, or 6.2%, to $8.1 million for the nine months ended September 30, 2024, compared with $8.6 million for the nine months ended September 30, 2023. The decrease was primarily due to lower compensation costs and higher capitalized software development costs.
Previous report
Amortization of intangible assets
Previous report
Amortization of intangible assets included in operating expenses remained relatively unchanged and was $4.0 million for the nine months ended September 30, 2024, compared with $4.1 million for the nine months ended September 30, 2023.
Previous report
Other operating expenses
Previous report
Interest expense
Previous report
Interest expense decreased $0.4 million, or 15.8%, to $2.4 million for the nine months ended September 30, 2024, compared with $2.8 million for the nine months ended September 30, 2023. The decrease was primarily due to lower average borrowings during the period.
Previous report
Loss on pension settlement
Previous report
During the nine months ended September 30, 2024, we settled our obligations under one of our defined benefit plans by using plan assets to purchase non-participating annuity contracts. The settlement resulted in the recognition of a non-cash charge of $1.2 million which has been presented as a component of other income (expense), net. This amount included the immediate recognition of the portion of the AOCI balances related to this plan.
Previous report
As of December 31, 2023, we held shares of common stock of HRGN with an estimated fair value of $3.5 million. These shares were received in connection with settlement of indemnification obligations related to litigation which was resolved during the year ended December 31, 2022. During the nine months ended September 30, 2024, we sold all of our HRGN shares for $1.9 million and recorded a loss on sale of $1.6 million. During the nine months ended September 30, 2023, we recorded unrealized losses $0.4 million related to these shares.
Previous report
Income tax benefit
Previous report
We maintain a Credit Agreement that provides for a term loan of $40.0 million and a $25.0 million revolving credit facility both maturing on December 22, 2025. On March 28, 2024, we entered into an amendment to the Credit Agreement pursuant to which the Lenders and administrative agent modified the definition of Consolidated EBITDA used in the calculation of certain financial covenants to adjust for charges related to an abandoned property audit and commission fees in connection with our employee retention tax credit filings.
Previous report
On August 6, 2024, we entered into an amendment to the Credit Agreement that, among other things, modified the financial covenants relating to the consolidated net leverage ratio and consolidated fixed charge coverage ratio through the period ended December 31, 2024. The amendment also added a net leverage ratio requirement with respect to additional borrowing under our revolving credit facility and restrictions on certain additional indebtedness and investments, which remains in effect until we deliver to the Lenders our financial statements for the fiscal year ending December 31, 2024. In addition, until delivery of such financial statements, the applicable interest rate margin is increased by 50bps during such time as the consolidated net leverage ratio is greater than 3.0. We paid fees of $0.2 million to the Lenders in connection with the amendment. As of September 30, 2024, we were in compliance with the financial covenants of the Credit Agreement (see Note 8 to the Consolidated Condensed Financial Statements included in Part I, Item 1. of this report).
Previous report
As of September 30, 2024, the weighted average interest rate on our borrowings, net of the effect of the interest rate swap, was 8.6%. Total revolver borrowing capacity is limited by our consolidated net leverage ratio as defined under the Credit Agreement. As of September 30, 2024, there was no available and unused borrowing capacity under our revolving line of credit, as amended on August 6, 2024 (see Note 8 to the Consolidated Condensed Financial Statements included in Part I, Item 1. of this report).
Previous report
Primarily due to a decline in revenues, we experienced a net cash outflow from operations during the nine months ended September 30, 2024. We have substantial debt and other financial obligations. Any failure to meet these obligations or maintain compliance with the debt covenants contained in our Credit Agreement could have a material adverse effect on our business, financial condition and results of operations. As of the date of this report, we are unable to make additional borrowings under our revolving credit facility and will be unable to make any such borrowings until we deliver to the lenders our financial statements for the year ending December 31, 2024, due to net leverage ratio requirements set forth in the August 2024 Amendment.
Previous report
We continue to take actions intended to improve liquidity, including actions related to cost containment and inventory reduction. Based on our current operating plans, we expect that our available cash and cash generated from operations will be sufficient to finance operations and capital expenditures and service our debt for at least the next 12 months. Our ongoing cash flows and ability to meet our debt covenants are dependent on our revenues and operating performance. If we are unable to successfully carry out our operating plans or increase our revenues, our ability to maintain compliance with our debt covenants could be adversely affected.
Previous report
Cash (used in) provided by operating activities was $(0.3) million and $9.7 million for the nine months ended September 30, 2024 and 2023, respectively. Cash flow from operations for the nine months ended September 30, 2024 was negatively impacted as a result of the decline in net income for the period adjusted for non-cash items and was positively impacted by the receipt of $3.2 million of employee retention tax credits.
Previous report
During the three and nine months ended September 30, 2024, changes in foreign currency exchange rates had an insignificant effect on our revenues and expenses.
Reworded paragraphs (12)
Previous wording
Harvard Bioscience, Inc., a Delaware corporation, is a leading developer, manufacturer and seller of technologies, products and services that enable fundamental advances in life science applications, including research, pharmaceutical and therapy discovery, bioproduction and preclinical testing for pharmaceutical and therapy development. Our products and services are sold globally to customers ranging from renowned academic institutions and government laboratories to the world’s leading pharmaceutical, biotechnology and contract research organizations (“CROs”). With operations in the United States, Europe and China, we sell through a combination of direct and distribution channels to customers around the world.
Current wording
Harvard Bioscience, Inc., a Delaware corporation, is a leading developer, manufacturer and seller of technologies, products and services that enable fundamental advances in life science applications, including research, drug and therapy discovery, bioproduction and preclinical testing for pharmaceutical and therapy development. Our products and services are sold globally to customers ranging from renowned academic institutions and government laboratories to the world’s leading pharmaceutical, biotechnology and contract research organizations (“CROs”). With operations in the United States, Europe and China, we sell through a combination of direct and distribution channels to customers around the world.
Previous wording
Revenues decreased $3.4 million, or 13.4%, to $22.0 million for the three months ended September 30, 2024, compared to $25.4 million for the three months ended September 30, 2023. The decrease in revenues was primarily due to continued softening of worldwide demand primarily from CRO’s and academic medical research institutions.
Current wording
Revenues decreased $2.7 million, or 11.2%, to $21.8 million for the three months ended March 31, 2025, compared to $24.5 million for the three months ended March 31, 2024. The decrease in revenues was primarily due to continued softening of worldwide demand primarily from academic research institutions and CROs.
Previous wording
Gross profit decreased $8.9 million, or 18.1%, to $40.8 million for the nine months ended September 30, 2024 compared with $49.7 million for the nine months ended September 30, 2023, primarily due to the decrease in revenues. Gross margin decreased to 58.6% for the nine months ended September 30, 2024, compared with 59.2% for the nine months ended September 30, 2023. Gross margin was unfavorably impacted by a lower mix of high margin products and the under-absorption of fixed manufacturing overhead costs due to the decrease in revenues, which was partially offset by lower labor costs.
Current wording
Gross profit decreased $2.6 million, or 17.5%, to $12.2 million for the three months ended March 31, 2025, compared with $14.8 million for the three months ended March 31, 2024, primarily due to the decrease in revenues as well as the associated lower absorption of fixed manufacturing costs. Gross margin was 56.0% for the three months ended March 31, 2025, compared to 60.3% for the three months ending March 31, 2024. The decrease in gross margin was primarily the result of under-absorption of fixed manufacturing overhead costs due to the decrease in revenues, increases in purchase price variance as well as a higher mix of lower margin products.
Previous wording
General and administrative expenses decreased $0.8 million, or 13.2%, to $5.0 million for the three months ended September 30, 2024, compared with $5.8 million for the three months ended September 30, 2023. The decrease was primarily due to lower compensation costs and increased capitalization of costs for internal-use software.
Current wording
General and administrative expenses decreased $0.8 million, or 13.0%, to $5.2 million for the three months ended March 31, 2025, compared with $6.0 million for the three months ended March 31, 2024. The decrease was primarily due to reduced compensation, partially offset by higher professional fees.
Previous wording
Amortization of intangible assets included in operating expenses was $1.3 million for the three months ended September 30, 2024, compared with $1.4 million for the three months ended September 30, 2023.
Current wording
Amortization of intangible assets included in operating expenses was $1.2 million for the three months ended March 31, 2025, compared with $1.3 million for the three months ended March 31, 2024.
Previous wording
Other operating expenses for the nine months ended September 30, 2024, were $1.4 million and included restructuring costs of $0.6 million in connection with headcount reductions, a fee of $0.5 million in connection with the receipt of employee retention tax credits, and $0.3 million related to settlement of an unclaimed property audit.
Current wording
Other operating expenses for the three months ended March 31, 2025 were $0.3 million, compared with $1.0 million for the three months ended March 31, 2024. During the three months ended March 31, 2025, other operating expenses included a fee of $0.2 million in connection with the receipt of employee retention credits and $0.1 million of restructuring costs in connection with headcount reductions in North America and Europe. During the three months ended March 31, 2024 other operating expenses included a fee of $0.5 million in connection with the receipt of employee retention credits and an estimated loss of $0.5 million related to an unclaimed property audit.
Previous wording
Interest expense was $0.9 million for both the three months ended September 30, 2024 and September 30, 2023. During the three months ended September 30, 2024, lower average borrowings were offset by increased interest rates under our Credit Facility.
Current wording
Interest expense was $0.8 million for both the three months ended March 31, 2025 and March 31, 2024.
Previous wording
The income tax expense was $0.3 million and $0.7 million for the three months ended September 30, 2024 and 2023, respectively. The effective tax rates for the three months ended September 30, 2024 and 2023 were (6.9)% and (120.5)%, respectively. The higher effective tax rate during the three months ended September 30, 2024 compared to the three months ended September 30, 2023 was related to a change in the mix of forecasted income and losses in the U.S. and foreign tax jurisdictions. The Company’s effective tax rate for the three months ended September 30, 2024, was different than the U.S. statutory rate primarily due to the inclusion of non-deductible executive compensation and changes in valuation allowances associated with the Company’s assessment of the likelihood of the recoverability of deferred tax assets. The Company’s effective tax rate for the three months ended September 30, 2023, was different than the U.S. statutory rate primarily due to the mix of forecasted income or losses in the U.S. and foreign tax jurisdictions and a Global Intangible Low-Taxed Income (“GILTI”) inclusion to taxable income. The effective tax rate for the three months ended September 30, 2023, was also impacted by changes in valuation allowances associated with the Company’s assessment of the likelihood of the recoverability of deferred tax assets.
Current wording
The income tax (benefit) expense was $(0.5) million and $0.2 million for the three months ended March 31, 2025 and 2024, respectively. The effective tax rates for the three months ended March 31, 2025 and 2024 were 0.9% and (4.7)%, respectively. The higher effective tax rate during the three months ended March 31, 2025, compared to the three months ended March 31, 2024, was primarily due to the tax effect of goodwill impairment and the release of reserves related to uncertain tax positions. The Company’s effective tax rate for the three months ended March 31, 2025, was different than the U.S. statutory rate primarily due to the tax effect of goodwill impairment and changes in valuation allowances associated with the Company’s assessment of the likelihood of the recoverability of deferred tax assets.
Previous wording
Our primary sources of liquidity are cash and cash equivalents, internally generated cash flow from operations and our revolving credit facility. Our expected cash outlays relate primarily to cash payments due under our Credit Agreement described below as well as salaries, inventory, and capital expenditures.
Current wording
Our primary sources of liquidity are cash and cash equivalents, internally generated cash flow from operations and our shelf registration statement that provides for the issuance of common stock, preferred stock, warrants and units up to an amount equal to $100 million. Our expected cash outlays relate primarily to cash payments due under our Credit Agreement described below as well as salaries, inventory, and capital expenditures. We held cash and cash equivalents of $5.5 million and $4.1 million as of March 31, 2025 and December 31, 2024, respectively. Borrowings outstanding were $36.4 million and $37.4 million as of March 31, 2025 and December 31, 2024, respectively.
Previous wording
Cash used in investing activities was $0.9 million for the nine months ended September 30, 2024, and consisted of $2.8 million of capital expenditures for manufacturing and information technology infrastructure and software development, offset by $1.9 million in proceeds from the sale of marketable equity securities. Cash used in investing activities was $0.7 million for the nine months ended September 30, 2023, and consisted of $1.2 million of capital expenditures in manufacturing, information technology infrastructure, and software development, partially offset by $0.5 million from proceeds of the sale of our Hoefer product line.
Current wording
Cash used in investing activities was $0.7 million and $0.2 million for the three months ended March 31, 2025 and 2024, respectively. Cash used in investing for the three months ended March 31, 2025 consisted of $0.7 million of capital expenditures for manufacturing and capitalized software development. Cash used in investing activities for the three months ended March 31, 2024 primarily consisted of capital expenditures in manufacturing and information technology infrastructure of $0.7 million, partially offset by $0.5 million from the proceeds from the sale of marketable equity securities.
Previous wording
Cash provided by (used in) financing activities was $1.2 million and $(8.0) million for the nine months ended September 30, 2024 and 2023, respectively. During the nine months ended September 30, 2024, debt outstanding under our credit facility increased by $1.2 million, due to net borrowings under our revolver of $6.2 million and payments of $5.0 million against the term loan. During the nine months ended September 30, 2023, debt outstanding under our credit facility decreased by $8.3 million, due to net payments against our revolver of $5.0 million and payments of $3.3 million against the term loan.
Current wording
Cash used in financing activities was $1.2 million and $1.1 million for the three months ended March 31, 2025 and 2024, respectively. During the three months ended March 31, 2025, we made $1.0 million in debt repayments on our term loan and paid $0.1 million in debt issuance costs as part of the March 2025 Amendment. During the three months ended March 31, 2024, debt outstanding under our credit facility decreased by $1.0 million, consisting of net borrowings under our revolver of $2.0 million, and payments of $3.0 million against the term loan.
Previous wording
The gain (loss) associated with the translation of our foreign equity into U.S. dollars included as a component of other comprehensive loss was $1.6 million and $(1.3) million for the three months ended September 30, 2024 and 2023, respectively, and $0.7 million and $(0.4) million for the nine months ended September 30, 2024 and 2023, respectively.
Current wording
During the three months ended March 31, 2025, changes in foreign currency exchange rates resulted in an unfavorable effect on revenues of $0.1 million and a favorable effect on expenses of $0.1 million. The loss associated with the translation of our foreign equity into U.S. dollars included as a component of other comprehensive loss was $1.3 million and $0.8 million for the three months ended March 31, 2025 and 2024, respectively. Currency exchange rate fluctuations included as a component of net loss resulted in losses of $0.2 million for the three months ended March 31, 2025. Currency exchange rate fluctuations included as a component of net loss during the three months ended March 31, 2024 were not significant.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
Other operating expenses for the three months ended September 30, 2024 were $0.2 million and included restructuring costs in connection with headcount reductions in North America and Europe.
Previous report — wording carried elsewhere
The income tax expense was $0.2 million and $0.1 million for the nine months ended September 30, 2024 and 2023, respectively. The effective tax rates for the nine months ended September 30, 2024 and 2023 were (1.4)% and (9.9)%, respectively. The higher effective tax rate during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023, was related to a change in the mix of forecasted income and losses in the U.S. and foreign tax jurisdictions and changes to uncertain tax positions. The Company’s effective tax rate for the nine months ended September 30, 2024, was different than the U.S. statutory rate primarily due to the inclusion of non-deductible executive compensation and changes in valuation allowances associated with the Company’s assessment of the likelihood of the recoverability of deferred tax assets. The Company’s effective tax rate for the nine months ended September 30, 2023, was different than the U.S. statutory rate primarily due to the mix of forecasted income or losses in the U.S. and foreign tax jurisdictions and a GILTI inclusion to taxable income. The effective tax rate for the nine months ended September 30, 2023, was also impacted by changes in valuation allowances associated with the Company’s assessment of the likelihood of the recoverability of deferred tax assets.
Previous report — wording carried elsewhere
We held cash and cash equivalents of $4.6 million and $4.3 million as of September 30, 2024 and December 31, 2023, respectively. Borrowings outstanding were $38.3 million and $37.1 million as of September 30, 2024 and December 31, 2023, respectively.
Previous report — wording carried elsewhere
Currency exchange rate fluctuations included as a component of net loss resulted in losses of $(0.4) million and gains of $0.2 million for the three months ended September 30, 2024 and 2023, respectively, and losses of $(0.5) million and gains of $0.1 million for the nine months ended September 30, 2024 and 2023, respectively.