IRIDEX CORP

Previous wording

Our propriety MicroPulse® Technology and Endpoint Management™ Technology are used for the treatment of glaucoma and retina disorders. Both technologies are offered as optional treatment modes in select laser consoles in addition to the standard continuous-wave (“CW”) treatment mode. They allow low-energy, subvisible, tissue-sparing laser therapy by different means: MicroPulse technology uses short, microsecond-long laser pulses that allow tissue to cool between pulses giving physicians finer control of thermal elevation to minimize tissue damage. Endpoint Management technology uses a delivery algorithm to titrate the laser energy. CW laser photocoagulation can stabilize vision over the long term but can also result in varying degrees of vision loss. Both MicroPulse and Endpoint Management technologies have demonstrated clinical efficacy with a safer profile compared to standard high-energy CW laser for the treatment of both retinal diseases and glaucoma.

Current wording

Our proprietary MicroPulse® Technology and Endpoint Management™ Technology are used for the treatment of glaucoma and retina disorders. Both technologies are offered as optional treatment modes in select laser consoles in addition to the standard continuous-wave (“CW”) treatment mode. They allow low-energy, subvisible, tissue-sparing laser therapy by different means: MicroPulse technology uses short, microsecond-long laser pulses that allow tissue to cool between pulses giving physicians finer control of thermal elevation to minimize tissue damage. Endpoint Management technology uses a delivery algorithm to titrate the laser energy. CW laser photocoagulation can stabilize vision over the long term but can also result in varying degrees of vision loss. Both MicroPulse and Endpoint Management technologies have demonstrated clinical efficacy with a safer profile compared to standard high-energy CW laser for the treatment of retinal diseases and glaucoma.

Previous wording

Ophthalmologists typically use our laser systems in hospital operating rooms and ambulatory surgical centers, as well as their offices and clinics. In operating rooms and ambulatory surgical centers, ophthalmologists use our laser systems with either an indirect laser ophthalmoscope or a single-use consumable probe, including MicroPulse P3®, G-Probe® and G-Probe Illuminate® delivery devices, and EndoProbe handpieces. In the offices and clinics, ophthalmologists use our laser systems with either an indirect laser ophthalmoscope or a slit-lamp adapter.

Current wording

Ophthalmologists typically use our laser systems in hospital operating rooms and ambulatory surgical centers, as well as their offices and clinics. In operating rooms and ambulatory surgical centers, ophthalmologists use our laser systems with either an indirect laser ophthalmoscope or a single-use consumable probe, including MicroPulse P3®, G-Probe® and G-Probe Illuminate® delivery devices, and EndoProbe handpieces. In the offices and clinics, ophthalmologists use our laser systems with either an indirect laser ophthalmoscope or a slit-lamp adapter. Our proprietary MicroPulse® and Continuous Wave laser therapies for glaucoma have been adopted by physicians around the globe as effective tools for managing and slowing the progression of glaucoma.

Previous wording

Cost of revenues consists primarily of our direct manufacturing costs which include the cost of components and sub-systems, assembling, packaging, shipping and testing components at our facility, direct labor and associated overhead, warranty, royalty and amortization of intangible assets and depot service costs. For certain of the Company’s products, the Company is responsible for the cost of the fully assembled product that is manufactured by a third-party.

Current wording

Cost of revenues consists primarily of our direct manufacturing costs which include the cost of components and sub-systems, assembling, packaging, shipping and testing components at our facility, direct labor and associated overhead, warranty, royalty and amortization of intangible assets and depot service costs. For certain of our products, we are responsible for the cost of the fully assembled product that is manufactured by a third-party.

Previous wording

Current macroeconomic conditions exhibit challenges that can affect capital equipment purchasing demand and timing, including recessionary fears, inflation concerns, tariffs and retaliatory responses, trade wars, lapse in government funding, healthcare reform initiatives, heightened interest rates as a result of government actions to combat inflation, and uncertainty in the global banking and financial services market, as well as other geopolitical developments, have impacted and may continue to impact business spending and the economy as a whole. As a result, the Company has seen customers extend purchase decision cycles. If the U.S. dollar strengthens again, the Company could experience some demand softness due to pricing effects from the strength of the U.S. dollar.

Current wording

Current macroeconomic conditions exhibit challenges that can affect capital equipment purchasing demand and timing, including recessionary fears, tariffs and retaliatory responses, trade wars, conflicts in the Middle East, lapse in government funding, healthcare reform initiatives, unexpected changes in taxes or policies, inflation concerns, changing interest rates, as well as other geopolitical developments and uncertainty, have impacted and may continue to impact business spending and the economy as a whole. As a result, we have seen customers extend purchase decision cycles.

Previous wording

While we believe that the market for our products remains strong, the overall capital expenditure landscape within hospitals, surgical centers and physician offices may continue to be negatively impacted by persistent macroeconomic concerns, including those from ongoing geopolitical uncertainty, tariffs and trade wars.

Current wording

While we believe that the market for our products remains strong, the overall capital expenditure landscape within hospitals, surgical centers and physician offices may continue to be negatively impacted by persistent macroeconomic concerns, including those from ongoing geopolitical uncertainties, including the conflicts in the Middle East, tariffs and trade wars, and other factors.

Previous wording

Gross margins may fluctuate due to changes in the relative proportion of domestic and international sales, the product mix of sales, introduction of new products, manufacturing variances, total unit volume changes, responses to the evolving macroeconomic and geopolitical uncertainty, including tariffs and trade wars, and other factors.

Current wording

Gross margins may fluctuate due to changes in the relative proportion of domestic and international sales, the product mix of sales, introduction of new products, manufacturing variances, total unit volume changes, responses to the evolving macroeconomic and geopolitical uncertainty, conflicts in the Middle East, including tariffs and trade wars, and other factors.

Previous wording

Other expense, net, was $1.7 million for the nine months ended September 27, 2025, driven primarily by the costs associated with the settlement of the Lind Note. Other expense, net, was $0.2 million for the nine months ended September 28, 2024, consisting of interest and amortization of loan expenses related to the Lind Note transaction and foreign currency loss.

Current wording

Other expense, net, was $0.1 million for the three months ended April 4, 2026, primarily consisting of interest and amortization of loan expenses. Other expense, net, was $1.5 million for the three months ended March 29, 2025, driven primarily by the costs associated with the Lind Note payable settlement.

Previous wording

The Company recorded an income tax provision of $4 thousand and $17 thousand for the three months ended September 27, 2025 and September 28, 2024, respectively.

Current wording

We recorded an income tax provision of $58 thousand and $12 thousand for the three months ended April 4, 2026 and March 29, 2025, respectively.

Previous wording

As of September 27, 2025, the Company had cash and cash equivalents of $5.6 million and working capital of $11.7 million compared to cash and cash equivalents of $2.4 million and working capital of $7.0 million as of December 28, 2024.

Current wording

As of April 4, 2026, we had cash and cash equivalents of $4.6 million and working capital of $11.8 million compared to cash and cash equivalents of $6.0 million and working capital of $12.0 million as of January 3, 2026.

Previous wording

Net cash used in operating activities was $2.7 million in the nine months ended September 27, 2025 compared to net cash used in operating activities of $6.0 million in the nine months ended September 28, 2024. The decrease in net cash used in operating activities was primarily due to reduction in net loss and reduction in inventory, offset by decreases in collections of accounts receivable and a paydown of liabilities.

Current wording

Net cash used in operating activities was $1.3 million in the three months ended April 4, 2026 compared to net cash used in operating activities of $1.1 million in the three months ended March 29, 2025. The increase in net cash used in operating activities was primarily due to increase in loss from operations.

Previous wording

For the nine months ended September 27, 2025 and September 28, 2024, net cash used in investing activities was $37 thousand and $4 thousand, respectively, which consisted of capital expenditures.

Current wording

For the three months ended April 4, 2026, net cash used in investing activities was $0.1 million, which consisted of capital expenditures. For the three months ended March 29, 2025, net cash used in investing activities was $11 thousand, which consisted of capital expenditures.

Previous wording

For the nine months ended September 27, 2025, net cash provided by financing activities was $6.0 million. The Company received $10 million in issuance of convertible preferred shares and convertible debt, offset by $4.0 million in early prepayment of convertible debt and taxes paid related to net share settlements of equity awards. For the nine months ended September 28, 2024, net cash $2.8 million was provided by financing activities of issuance of convertible notes, net.

Current wording

For the three months ended April 4, 2026, net cash used in financing activities was $1 thousand, primarily related to taxes paid to net share settlement of equity awards. For the three months ended March 29, 2025, net cash from financing activities was $6.0 million. In the first fiscal quarter of 2025, we received $10 million in issuance of convertible preferred shares and convertible debt, offset by $4.0 million in early prepayment of convertible debt.

Previous wording

The Company has historically funded our operations primarily through sales of our products to customers, sales of our common stock and borrowing arrangements. As of September 27, 2025, our principal sources of liquidity consisted of cash and cash equivalents of $5.6 million. The Company has incurred net losses over the last several years, and as of September 27, 2025, have an accumulated deficit of approximately $92.3 million.

Current wording

We have historically funded our operations primarily through sales of our products to customers, sales of our common stock and borrowing arrangements. As of April 4, 2026, our principal sources of liquidity consisted of cash and cash equivalents of $4.6 million.

Previous wording

On March 19, 2025, the Company entered into the Novel Securities Agreement and the Novel Note Purchase Agreement with Novel. Pursuant to the Novel Securities Agreement and the Novel Note Purchase Agreement, Novel has the right to purchase additional convertible promissory notes (the “Growth Notes”) in an aggregate principal amount of $10,000,000. The Growth Notes are issuable in three installments, with one third of the aggregate principal amount issuable upon each yearly anniversary after March 19, 2025.

Current wording

On March 19, 2025, the Company entered into the Novel Securities Agreement and the Novel Note Purchase Agreement with Novel. Pursuant to the Novel Securities Agreement and the Novel Note Purchase Agreement, Novel has the right to purchase additional convertible promissory notes (the “Growth Notes”) in an aggregate principal amount of $10,000,000. The Growth Notes are issuable in three installments, with one third of the aggregate principal amount issuable upon each yearly anniversary after March 19, 2025. We have not issued any Growth Notes, but may do so in the future.

Previous wording

The Company believes its existing cash and cash equivalents will be sufficient to meet its anticipated cash needs over the next 12 months. The Company’s future capital requirements will depend on many factors, including its growth rate, the timing and extent of its spending to support research and development activities, the timing and cost of establishing additional sales and marketing capabilities, the introduction of new and enhanced products and its costs to implement new manufacturing technologies. Any debt financing obtained by the Company in the future could also involve restrictive covenants relating to its capital-raising activities and other financial and operational matters, which may make it more difficult for the Company to obtain additional capital and to pursue business opportunities, including potential acquisitions. Additionally, if the Company raises additional funds through further issuances of equity, its existing stockholders could suffer significant dilution in their percentage ownership of the Company, and any new equity securities the Company issues could have rights, preferences and privileges senior to those of holders of our common stock.

Current wording

We believe our existing cash and cash equivalents will be sufficient to meet our anticipated cash needs over the next 12 months. Our future capital requirements will depend on many factors, including our growth rates, the timing and extent of our spending to support research and development activities, the timing and cost of establishing additional sales and marketing capabilities, the introduction of new and enhanced products and our costs to implement new manufacturing technologies. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all. Any debt financing obtained by us in the future could also involve restrictive covenants relating to our capital-raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. Additionally, if we raise additional funds through further issuances of equity, our existing stockholders could suffer significant dilution in their percentage ownership of our company, and any new equity securities we issue could have rights, preferences and privileges senior to those of holders of our common stock. If we are unable to obtain adequate financing or financing on terms satisfactory to us, when we require it, our ability to continue to grow or support our business and to respond to business challenges could be significantly limited.

Previous wording

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Current wording

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.