ACCURAY INC

Previous wording

The following discussion and analysis of our financial condition as of December 31, 2025, and results of operations for the three and six months ended December 31, 2025 and 2024 should be read together with our unaudited condensed consolidated financial statements and related notes included in this report. Statements made in this Form 10-Q report that are not statements of historical fact are forward-looking statements that are subject to the“safe harbor”* provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this report relate, but are not limited, to: our future results of operations and financial position, including the sufficiency of cash resources and expected cash flows to fund future operations, including the next 12 months; our expectations regarding backlog, age-ins and age-outs, cancellations of contracts and foreign currency impacts; the anticipated drivers of our future capital requirements; expectations regarding our strategy in China and our China joint venture as well as its expected impact on our business; expectations regarding the market in China for radiation oncology systems; expectations regarding the effects of the global macroeconomic conditions on our financial results and business as well as the business of our customers and suppliers; expectations regarding the impact of changes in government administration policy positions; expectations regarding delays in deliveries and installations and its impact on our business; expectations regarding inflation, supply chain challenges and heightened logistics costs and its impact on our business, including gross margins and net income (loss); expectations regarding revenue from the Americas region; expectations regarding the timing of deliveries and revenue conversion; our expectations regarding the adequacy of our manufacturing facilities; the anticipated risks associated with our foreign operations and fluctuations in the U.S. Dollar and foreign currencies as well as our ability to mitigate such risks; tariffs and trade policies; expectations related to the effect of the GILTI tax and the One Big Beautiful Bill Act on the company; expectations related to our convertible notes and credit facilities; expectations related to our leases; the amount of unrecognized tax amounts; the sufficiency of our cash, cash equivalents and investments to meet our anticipated cash needs for working capital and capital expenditures and our business strategy, plans and objectives. Forward-looking statements generally can be identified by words such as*“anticipates,”* “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” “may,” “will be,” “will continue,” “will likely result,” and similar expressions. These forward-looking statements involve risks and uncertainties. If any of these risks or uncertainties materialize, or if any of our assumptions prove incorrect, actual results could differ materially from the results expressed or im…

Excerpt shortened here; the source contains the full paragraph.

Current wording

The following discussion and analysis of our financial condition as of March 31, 2026, and results of operations for the three and nine months ended March 31, 2026 and 2025 should be read together with our unaudited condensed consolidated financial statements and related notes included in this report. Statements made in this Form 10-Q report that are not statements of historical fact are forward-looking statements that are subject to the“safe harbor”* provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this report relate, but are not limited, to: our future results of operations and financial position, including the sufficiency of cash resources and expected cash flows to fund future operations, including the next 12 months; our expectations regarding backlog, age-ins and age-outs, cancellations of contracts and foreign currency impacts; the anticipated drivers of our future capital requirements; expectations regarding our strategy in China and our China joint venture as well as its expected impact on our business; expectations regarding the market in China for radiation oncology systems; expectations regarding the effects of the global macroeconomic conditions on our financial results and business as well as the business of our customers and suppliers; expectations regarding the impact of changes in government administration policy positions; expectations regarding delays in deliveries and installations and its impact on our business; expectations regarding inflation, supply chain challenges and heightened logistics costs and its impact on our business, including gross margins and net income (loss); expectations regarding revenue from the Americas region; expectations regarding the timing of deliveries and revenue conversion; our expectations regarding the adequacy of our manufacturing facilities; the anticipated risks associated with our foreign operations and fluctuations in the U.S. Dollar and foreign currencies as well as our ability to mitigate such risks; potential changes in tariffs export controls, trade sanctions, and other trade policies; expectations related to the effect of the GILTI tax and the One Big Beautiful Bill Act on the company; expectations related to our convertible notes and credit facilities; expectations related to our leases; the amount of unrecognized tax amounts; the sufficiency of our cash, cash equivalents and investments to meet our anticipated cash needs for working capital and capital expenditures and our business strategy, plans and objectives. Forward-looking statements generally can be identified by words such as*“anticipates,”* “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” “may,” “will be,” “will continue,” “will likely result,” and similar expressions. These forward-looking statements involve risks and uncertainties. If any of these risks or uncertainties materialize, or if any of our assumptions prove incorrect, actual results …

Excerpt shortened here; the source contains the full paragraph.

Previous wording

We are subject to risks and uncertainties caused, directly or indirectly, by events with significant geopolitical and macroeconomic impacts, including, but not limited to, inflation; actions taken to counter inflation, including high interest rates; foreign currency exchange rate fluctuations; uncertainty and volatility in the banking and financial services sector; tightening credit markets; geopolitical concerns, such as the Russia-Ukraine and Middle East conflicts and tension between China and the U.S., including with respect to Taiwan; uncertainty caused by the China anti-corruption campaign and timing of the China stimulus program; changes in government administration policy positions; new tariffs on global imports and uncertainties regarding impact, retaliations and further escalation, including against other countries; and other factors that may emerge. We are also continuing to navigate supply chain and inflation challenges, both of which continues to be a significant headwind that affects the Company’s results of operations.

Current wording

We are subject to risks and uncertainties caused, directly or indirectly, by events with significant geopolitical and macroeconomic impacts, including, but not limited to, inflation; actions taken to counter inflation, including high interest rates; foreign currency exchange rate fluctuations; uncertainty and volatility in the banking and financial services sector; tightening credit markets; the recent escalation of conflict in Iran, the Middle East and Southwest Asia, including the impact on global supply chains and oil prices, as well as other geopolitical concerns, such as the Russia-Ukraine conflict, and tension between China and the U.S., including with respect to Taiwan; uncertainty caused by the China anti-corruption campaign and timing of the China stimulus program; changes in government administration policy positions; new tariffs on global imports and uncertainties regarding impact, retaliations and further escalation, including against other countries; and other factors that may emerge. We are also continuing to navigate supply chain and inflation challenges, both of which continue to be a significant headwind that affects the Company’s results of operations.

Previous wording

We expect that the business of our customers and our own business will continue to be adversely impacted, directly or indirectly, by these macroeconomic and geopolitical issues. In addition, ongoing supply chain challenges and logistics costs, including difficulties in obtaining a sufficient supply of component materials and increased component costs, have adversely affected our gross margins and net income (loss), and we currently expects that gross margins and net income (loss) will continue to be adversely affected by increased material costs and freight and logistics expenses through at least fiscal year 2026, and potentially longer. In addition, we expect inflation and the ongoing supply chain challenges and logistics costs to impact our cash from operations through at least fiscal year 2026. In addition, reduced budgets and lower capital deployment priority for radiotherapy equipment, along with longer customer installation timelines, in the United States have negatively impacted our net revenue since fiscal year 2024, and we expect this will continue to have an impact through fiscal year 2026. The extent of the ongoing impact of these macroeconomic events on our business, our markets and on global economic activity however, is uncertain and the related financial impact cannot be reasonably estimated with any certainty at this time.

Current wording

We expect that the business of our customers and our own business will continue to be adversely impacted, directly or indirectly, by these macroeconomic and geopolitical issues. For example, we had product shipments planned in the third quarter of fiscal year 2026 to certain customers in the Middle East, North Africa and Pakistan that have been delayed indefinitely due to geopolitical disruption in the Middle East and continued pressure in China, which is also impacting our service revenue in those regions. In addition, ongoing supply chain challenges and logistics costs, including difficulties in obtaining a sufficient supply of component materials and increased component costs, have adversely affected our gross margins and net income (loss), and we currently expects that gross margins and net income (loss) will continue to be adversely affected by increased material costs and freight and logistics expenses through at least fiscal year 2026, and potentially longer. In addition, we expect inflation and the ongoing supply chain challenges and logistics costs to impact our cash from operations through at least fiscal year 2026. In addition, reduced budgets and lower capital deployment priority for radiotherapy equipment, along with longer customer installation timelines, in the United States have negatively impacted our net revenue since fiscal year 2024, and we expect this will continue to have an impact through fiscal year 2026. The extent of the ongoing impact of these macroeconomic events on our business, our markets and on global economic activity however, is uncertain and the related financial impact cannot be reasonably estimated with any certainty at this time.

Previous wording

In fiscal year 2026, the Company implemented a comprehensive strategic, operational, and organizational, transformation plan (“FY26 Restructuring Plan”). The FY26 Restructuring Plan includes the elimination of approximately 3% of the global workforce during the three months ended September 30, 2025, and the elimination of approximately 15% of the global workforce during three months ended December 31, 2025. Certain employees notified during the three months ended December 31, 2025, have various termination dates during the quarterly periods ended March 31, 2026, and June 30, 2026. Restructuring charges also include implementation and other costs that were directly tied to the execution of the FY26 Restructuring Plan, as well as asset impairments for certain capitalized assets as a result of the FY26 Restructuring Plan. Total restructuring charges during the three and six months ended December 31, 2025, were $6.1 million and $8.9 million respectively. Restructuring charges for the FY26 Restructuring Plan are expected to be approximately $13 millionin fiscal year 2026. The FY26 Restructuring Plan is expected to be substantially completed by June 30, 2026.

Current wording

The actions also included a restructuring of the Company’s workforce (the “FY26 Restructuring Plan”) that resulted in the elimination of approximately 3% of the global workforce during the three months ended September 30, 2025, and the elimination of approximately 15% of the global workforce during three months ended December 31, 2025. Certain employees notified during the three months ended December 31, 2025, have various termination dates during the quarterly periods ended March 31, 2026, and June 30, 2026. Restructuring charges also include third-party implementation and other costs that were directly tied to the execution of the FY26 Restructuring Plan, as well as asset impairments for certain capitalized assets as a result of the FY26 Restructuring Plan. Total restructuring charges during the three and nine months ended March 31, 2026, were $6.5 million and $15.4 million respectively. Restructuring charges for the FY26 Restructuring Plan are expected to be approximately $17 million in fiscal year 2026. The FY26 Restructuring Plan is expected to be substantially completed by June 30, 2026.

Previous wording

Gross orders decreased by $10.7 million and $26.5 million during the three and six months ended December 31, 2025, respectively, as compared to thesame periods in the prior fiscal year, primarily due to the timing of system gross orders from the EIMEA and China regions.

Current wording

Gross orders decreased by $22.6 million and $49.1 million during the three and nine months ended March 31, 2026, respectively, as compared to thesame periods in the prior fiscal year, primarily due to a decrease in orders for our TomoTherapy Systems.

Previous wording

Our book-to-bill ratio is defined as gross orders for the period divided by product revenue for the period. Our book-to-bill ratio was 1.5 and 1.3 for the three and six months ended December 31, 2025, respectively, as compared to 1.3 and 1.2 for the three and six months ended December 31, 2024, respectively. A book-to-bill ratio greater than 1.2 generally indicates strong demand for our products. This metric allows management to monitor our business development efforts to ensure we grow our backlog and our business over time. Given that book-to-bill ratio is an operational measure and that our methodology for calculating book-to-bill ratio does not meet the definition of a non-GAAP measure, as that term is defined by the Securities and Exchange Commission, a quantitative reconciliation for book-to-bill ratio is not required nor provided.

Current wording

Our book-to-bill ratio is defined as gross orders for the period divided by product revenue for the period. Our book-to-bill ratio was 1.0 and 1.2 for the three and nine months ended March 31, 2026, respectively, as compared to 1.2 and 1.2 for the three and nine months ended March 31, 2025, respectively. A book-to-bill ratio greater than 1.2 generally indicates strong demand for our products. This metric allows management to monitor our business development efforts to ensure we grow our backlog and our business over time. Given that book-to-bill ratio is an operational measure and that our methodology for calculating book-to-bill ratio does not meet the definition of a non-GAAP measure, as that term is defined by the Securities and Exchange Commission, a quantitative reconciliation for book-to-bill ratio is not required nor provided.

Previous wording

Net orders are defined as gross orders less cancellations, age-outs net of age-ins, foreign currency impacts and other adjustments during the period. Net orders decreased by $23.0 million and $46.8 million during the three and six months ended December 31, 2025, respectively, as compared to the same periods in the prior fiscal year, primarily due to a decrease in gross orders, an increase in age-outs and no age-ins in fiscal year 2026.

Current wording

Net orders are defined as gross orders less cancellations, age-outs net of age-ins, foreign currency impacts and other adjustments during the period. Net orders decreased by$24.1 million and$70.8 million during thethree and nine months ended March 31, 2026, respectively, as compared to the same periods in the prior fiscal year, primarily due to a decrease in gross orders, and a decrease in age-ins.

Previous wording

Results of Operations—** Three and Six Months Ended December 31, 2025 and 2024**

Current wording

Results of Operations—** Three and Nine Months Ended March 31, 2026 and 2025**

Previous wording

Products net revenue decreased by $16.2 million and $27.4 million during the three and six months ended December 31, 2025, respectively, as compared to the same periods in the prior fiscal year, was primarily due to a lower volume of shipments to China, partially offset by a higher volume of shipments to the EIMEA region and Asia Pacific regions.

Current wording

Products net revenue decreased by$7.6 million and$35.0 million during thethree and nine months ended March 31, 2026, respectively, as compared to the same periods in the prior fiscal year, due to a lower volume of shipments.

Previous wording

Services net revenue increased by $2.2 million and $5.8 million during the three and six months ended December 31, 2025, respectively, as compared to the same periods in the prior fiscal year, primarily due to higher contract revenues as a result of an increase in our installed base and revenues from training and installations.

Current wording

Services net revenue decreased by$0.8 million during the three months ended March 31, 2026, as compared to the same period in the prior fiscal year, primarily due to a $1.2 million negative impact to service revenue as a result of the Middle East conflict, partially offset by an increase in contract revenues as a result of an increase in our install base. Services net revenue increased by$5.1 million during thenine months ended March 31, 2026 as compared to the same period in the prior fiscal year, primarily due to higher contract revenues resulting from an increase in our installed base, partially offset by a decrease in demand from customers for the purchase of spare parts.

Previous wording

Net revenue decreased $14.0 million and$21.5 million during thethree and six months ended December 31, 2025, as compared to the same periods in the prior fiscal year, primarily due to a lower volume of shipments to China, partially offset by a higher volume of shipments to the EIMEA and Asia Pacific regions.

Current wording

Net revenue decreased $8.4 million and$29.9 million during thethree and nine months ended March 31, 2026, as compared to the same periods in the prior fiscal year, primarily due to a lower volume of shipments to China and Asia Pacific regions, partially offset by a higher volume of shipments to the Americas region.

Previous wording

Gross profit decreased by $17.8 million and $25.3 million during the three and six months ended December 31, 2025, respectively, as compared to the same periods in the prior fiscal year, primarily due to a decrease in product unit sales and product mix. The decrease in gross profit as a percentage of revenue during thethree and six months ended December 31, 2025, as compared to the same periods in the prior fiscal year, was due to both geographic and product sales mix, and less shipments from our JV to its end customers.

Current wording

Gross profit decreased by $6.3 million and $31.6 million during the three and nine months ended March 31, 2026, respectively, as compared to the same periods in the prior fiscal year, primarily due to a decrease in product unit sales and product mix. The decrease in gross profit as a percentage of revenue during thethree and nine months ended March 31, 2026, as compared to the same periods in the prior fiscal year, was primarily due tohigher net parts consumption of $3.2 million, as well as higher than average logistics and duties costs.

Previous wording

Research and development expenses decreased by$2.9 million and$3.9 million during thethree and six months ended December 31, 2025, respectively, as compared to the same periods in the prior fiscal year, primarily due to $1.5 million and $3.1 million in capitalized labor costs for software development projects during thethree and six months ended December 31, 2025, respectively, and lower spending for research and development projects in fiscal year 2026.

Current wording

Research and development expenses decreased by$2.5 million and$6.4 million during thethree and nine months ended March 31, 2026, respectively, as compared to the same periods in the prior fiscal year primarily due to a $1.9 million and $5.8 million decrease in compensation and benefit costs as part of the FY26 Restructuring Plan for thethree and nine months ended March 31, 2026, respectively, and lower spending for research and development projects in fiscal year 2026. In addition, the decrease in compensation and benefit costs expense during the nine months ended March 31, 2026, includes $2.9 million in labor costs that were capitalized for software development projects as compared to the prior year period.

Previous wording

Selling and marketing expenses decreased by$2.3 million during both thethree and six months ended December 31, 2025, respectively, as compared to the same periods in the prior fiscal year, primarily due to lower compensation and benefit costs as part of the FY26 Restructuring Plan, and reduced travel and trade show spending related to cost-saving initiatives.

Current wording

Selling and marketing expenses decreased by$0.7 million and $2.9 million duringthe three and nine months ended March 31, 2026, respectively, as compared to the same periods in the prior fiscal year, primarily due to lower compensation and benefit costs as part of the FY26 Restructuring Plan, and reduced spending on travel and trade shows in connection with ongoing cost-saving initiatives.

Previous wording

General and administrative expenses decreased by$2.3 million and$2.5 million during thethree and six months ended December 31, 2025, respectively, as compared to the same periods in the prior fiscal year primarily due to $3.0 million and $3.1 million in respective lower compensation and benefits costs as part of the FY26 Restructuring Plan, partially offset by higher consulting and legal costs for the debt refinancing.

Current wording

General and administrative expenses increased by$0.5 million and during the three months ended March 31, 2026 as compared to the same period in the prior fiscal year primarily due to higher consulting and legal costs, partially offset by lower compensation and benefit costs as part of the FY26 Restructuring Plan. General and administrative expenses decreased by$2.1 million during the nine months ended March 31, 2026 as compared to the same periods in the prior fiscal year primarily due to $3.1 million in lower compensation and benefits costs as part of the FY26 Restructuring Plan, partially offset by higher bad debt expense.

Previous wording

Income from equity method investment, which relates to our JV, decreased by$1.1 million and$0.6 million during thethree and six months ended December 31, 2025, respectively, as compared to the same periods in the prior fiscal year, primarily due to decrease in revenue due toless shipments from our JV to its end customers.

Current wording

Income from equity method investment, which relates to our JV, decreased by$1.9 million and$2.5 million during thethree and nine months ended March 31, 2026, respectively, as compared to the same periods in the prior fiscal year, primarily due to decrease in revenue due toless shipments from our JV to its end customers.

Previous wording

Interest expense increased$4.8 million and$10.0 million during thethree and six months ended December 31, 2025, respectively, as compared to the same periods in the prior fiscal year, primarily due toour electing of non-cash interest-paid-in-kind during the current fiscal year and higher debt issuance costs as a result of debt financing costs and additional amortization costs related to issuance of warrants.

Current wording

Interest expense increased$5.5 million and$15.5 million during thethree and nine months ended March 31, 2026, respectively, as compared to the same periods in the prior fiscal year, primarily due toour electing of non-cash interest-paid-in-kind during the current fiscal year and higher debt issuance costs as a result of debt financing costs and additional amortization costs related to issuance of warrants.

Previous wording

Our Penny Warrants are accounted for as a liability with the changes in the fair value of the warrants recognized in the statement of operations and comprehensive loss. During thethree and six months ended December 31, 2025, we recorded a gain of$5.7 million and$3.8 million, respectively, due to a decrease in the share price of our common stock during the periods.

Current wording

Our Penny Warrants are accounted for as a liability with the changes in the fair value of the warrants recognized in the statement of operations and comprehensive loss. During thethree and nine months ended March 31, 2026, we recorded a gain of$3.4 million and$7.2 million, respectively, due to a decrease in the share price of our common stock during the periods.

Previous wording

Other (expense) income decreased during thethree and six months ended December 31, 2025, as compared to the same periods in the prior fiscal year. The $2.1 million decrease during the six months ended December 31, 2025, as compared to the prior year was primarily due to a decrease in gains from foreign currency transactions and $0.4 million in asset write-offs, partially offset by a decrease in costs for hedging activities.

Current wording

Other income (expense), net increased during thethree and nine months ended March 31, 2026, as compared to the same periods in the prior fiscal year, primarily due to favorable foreign currency transactions resulting from our cash flow hedging activities and a decrease in costs for hedging activities.

Previous wording

At December 31, 2025, we had $41.3 million incash and cash equivalents, excluding restricted cash. Cash from operations could be affected by various risks and uncertainties, including declines in our revenue, particularly without a corresponding decrease in our expenses, the timing of payments from our customers and our expenditures, as well as but not limited to, macroeconomic conditions, inflation, actions taken to counter inflation, foreign currency exchange rate fluctuations, and the risks included in Part I, Item 1A titled “Risk Factors.” In particular, we expect inflation and the ongoing supply chain challenges and logistics costs to impact our cash from operations through at least fiscal year 2026. In addition, reduced budgets and lower capital deployment priority for radiotherapy equipment, along with longer customer installation timelines, in the United States have negatively impacted our net revenue since fiscal year 2024, and we expect this will continue to have an impact through fiscal year 2026. Based on our cashand cash equivalents balance, available debt facilities, current business plan and revenue prospects, we believe we will have sufficient cash resources and anticipated cash flows to fund our operations for at least the next 12 months. However, we continue to critically review our liquidity and anticipated capital requirements in light of the significant uncertainty created by macroeconomic conditions.

Current wording

At March 31, 2026, we had $38.1 million incash and cash equivalents, excluding restricted cash. Cash from operations could be affected by various risks and uncertainties, including declines in our revenue, particularly without a corresponding decrease in our expenses, the timing of payments from our customers and our expenditures, as well as but not limited to, macroeconomic conditions, inflation, actions taken to counter inflation, foreign currency exchange rate fluctuations, and the risks included in Part II, Item 1A titled “Risk Factors.” In particular, we expect inflation and the ongoing supply chain challenges and logistics costs to impact our cash from operations through at least fiscal year 2026. In addition, reduced budgets and lower capital deployment priority for radiotherapy equipment, along with longer customer installation timelines, in the United States have negatively impacted our net revenue since fiscal year 2024, and we expect this will continue to have an impact through fiscal year 2026. Based on our cashand cash equivalents balance, available debt facilities, current business plan and revenue prospects, we believe we will have sufficient cash resources and anticipated cash flows to fund our operations for at least the next 12 months. However, we continue to critically review our liquidity and anticipated capital requirements in light of the significant uncertainty created by macroeconomic conditions.

Previous wording

On June 6, 2025, we entered into a senior secured credit agreement (the “Financing Agreement”) by and among the Company, as borrower (the “Borrower”), TCW Asset Management Company LLC, a leading global asset manager (“TCW”), as collateral agent for the lenders (in such capacity, together with its successors and assigns in such capacity, the “Collateral Agent”) and as administrative agent for the lenders (in such capacity, together with its successors and assigns in such capacity, the “Administrative Agent”, and together with the Collateral Agent, each an “Agent” and collectively, the “Agents”), and certain other parties signatory thereto. The Financing Agreement provides for (a) $150 million of new five-year term loan facility (the “Term Loan Facility”), (b) a new $20 million delayed draw term loan facility (the “Delayed Draw Facility”) and (c) a new $20 million revolving credit facility (the “Revolving Credit Facility” and, together with the Term Loan Facility and Delayed Draw Facility, the “Facilities”). The proceeds of the Delayed Draw Facility may be used to fund any future repurchases of outstanding 3.75% Convertible Senior Notes due 2026 (“2026 Notes”). In December 2025, we entered into amendments to the Financing Agreement. The first amendment to the Financing Agreement (the "First Amendment") provided for the inclusion of certain restricted cash balances in the liquidity covenant in the Financing Agreement. The second amendment to the Financing Agreement (the "Second Amendment") provided for (i) the removal of the leverage condition we must meet to draw down on the Delayed Draw Facility; (ii) the reduction of the capacity of the Delayed Draw Facility to $18.25 million; and (iii) the delay of the commencement of the requirement for us to meet the fixed charge coverage ratio and leverage ratio to December 31, 2026. In addition, we agreed to pay an additional $1.9 million in fees and amounts available to be drawn under the revolving credit facility were reduced to $15.0 million through December 31, 2026.

Current wording

On June 6, 2025, we entered into a senior secured credit agreement (the “Financing Agreement”) by and among the Company, as borrower (the “Borrower”), TCW Asset Management Company LLC, a leading global asset manager (“TCW”), as collateral agent for the lenders (in such capacity, together with its successors and assigns in such capacity, the “Collateral Agent”) and as administrative agent for the lenders (in such capacity, together with its successors and assigns in such capacity, the “Administrative Agent”, and together with the Collateral Agent, each an “Agent” and collectively, the “Agents”), and certain other parties signatory thereto. The Financing Agreement provides for (a) $150 million of new five-year term loan facility (the “Term Loan Facility”), (b) a new $20 million delayed draw term loan facility (the “Delayed Draw Facility”) and (c) a new $20 million revolving credit facility (the “Revolving Credit Facility” and, together with the Term Loan Facility and Delayed Draw Facility, the “Facilities”). The proceeds of the Delayed Draw Facility may be used to fund any future repurchases of outstanding 3.75% Convertible Senior Notes due 2026 (“2026 Notes”). In December 2025, we entered into amendments to the Financing Agreement. The first amendment to the Financing Agreement (the "First Amendment") provided for the inclusion of certain restricted cash balances in the liquidity covenant in the Financing Agreement. The second amendment to the Financing Agreement (the "Second Amendment") provided for (i) the removal of the leverage condition we must meet to draw down on the Delayed Draw Facility; (ii) the reduction of the capacity of the Delayed Draw Facility to $18.25 million; and (iii) the delay of the commencement of the requirement for us to meet the fixed charge coverage ratio and leverage ratio to December 31, 2026. In addition, we agreed to pay $2.4 million in additional fees and amounts available to be drawn under the revolving credit facility were reduced to $15.0 million through December 31, 2026.

Previous wording

As of December 31, 2025, $18.0 million aggregate principal amount of the 2026 Notes remain outstanding and will be due on June 1,2026. We intend to use operating cash and proceeds from the Delayed Draw Facility to pay the remaining balance of the 2026 Notes. The 2026 Notes are classified as short-term debt on the consolidated balance sheets.

Current wording

As of March 31, 2026, $18.0 million aggregate principal amount of the 2026 Notes remain outstanding and will be due on June 1,2026. We intend to predominately use proceeds from the Delayed Draw Facility to pay the remaining balance of the 2026 Notes. The 2026 Notes are classified as short-term debt on the consolidated balance sheets.

Previous wording

Additionally, the undistributed earnings of our foreign subsidiaries as of December 31, 2025, for all countries except Japan, France, Switzerland, Germany and the United Kingdom are considered to be indefinitely reinvested and unavailable for distribution in the form of dividends or otherwise. Future repatriation of our foreign earnings could be subject to income taxes. As of December 31, 2025, wehad $13.5 millionof cash and cash equivalents at our foreign subsidiaries. If such funds were repatriated, there will be additional foreign tax withholdings imposed depending on the country from which the funds were repatriated.

Current wording

Additionally, the undistributed earnings of our foreign subsidiaries as of March 31, 2026, for all countries except Japan, France, Switzerland, Germany and the United Kingdom are considered to be indefinitely reinvested and unavailable for distribution in the form of dividends or otherwise. Future repatriation of our foreign earnings could be subject to income taxes. As of March 31, 2026, we had $8.8 million of cash and cash equivalents at our foreign subsidiaries. If such funds were repatriated, there will be additional foreign tax withholdings imposed depending on the country from which the funds were repatriated.

Previous wording

Our cash flows for the six months ended December 31, 2025 and 2024 are summarized as follows (in thousands):

Current wording

Our cash flows for the nine months ended March 31, 2026 and 2025 are summarized as follows (in thousands):

Previous wording

Net cash used in operating activities during the six months ended December 31, 2025, was due to a net loss of $35.4 million, offset by $17.3 million from the net changes of assets and liabilities and $14.4 million from non-cash items.

Current wording

Net cash used in operating activities during the nine months ended March 31, 2026, was due to a net loss of $47.3 million, offset by $20.6 million from non-cash items and $17.2 million from the net changes of assets and liabilities.

Previous wording

Net cash used in investing activities was $9.4 million during the six months ended December 31, 2025, due to spending $4.9 million for the purchase of property and equipment and $4.5 million for capitalized investments for software to be sold.

Current wording

Net cash used in investing activities was $10.9 million during the nine months ended March 31, 2026, due to spending $5.4 million for the purchase of property and equipment and $5.5 million for capitalized investments for software to be sold.

Previous wording

We presented our contractual obligations in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025. Our contractual obligations consist of debt, operating leases, purchase commitments, and other contractual obligations. There have been no material changes to these obligations outside the ordinary course of business during the six months ended December 31, 2025 as compared to the contractual obligations disclosed in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of our Annual Report on Form 10-K for the year ended June 30, 2025.

Current wording

We presented our contractual obligations in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025. Our contractual obligations consist of debt, operating leases, purchase commitments, and other contractual obligations. There have been no material changes to these obligations outside the ordinary course of business during the nine months ended March 31, 2026 as compared to the contractual obligations disclosed in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of our Annual Report on Form 10-K for the year ended June 30, 2025.

Previous wording

During the six months ended December 31, 2025, there were no material changes to the critical accounting policies and estimates, previously disclosed in Part II, Item 7, of our Annual Report on Form 10-K filed with the SEC on August 28, 2025.

Current wording

During the nine months ended March 31, 2026, there were no material changes to the critical accounting policies and estimates, previously disclosed in Part II, Item 7, of our Annual Report on Form 10-K filed with the SEC on August 28, 2025, as amended by the Company’s Annual Report on Form 10-K/A filed with the SEC on February 17, 2026.