MIND TECHNOLOGY, INC

Previous wording

Recently, we have experienced decreased visibility for future business activity, as partially indicated by decreased firm backlog as discussed below. We believe this is due in large part to uncertainties in the marine exploration and survey markets. Global economic, political and security concerns have, in our opinion, contributed to this uncertainty. As an example, certain of our customers have experienced disruptions in operations due to the current conflict in the Middle East. However, we believe these disruptions are temporary and that the longer-term outlook in the marine exploration and survey market is quite positive. Certain of our customers have recently reported increasing backlogs and many industry commentators predict a strong resurgence in marine exploration and survey activity.

Current wording

Recently, we have experienced decreased visibility for future business activity, as partially indicated by decreased firm backlog as discussed below. We believe this is due in large part to uncertainties in the marine exploration and survey markets. Global economic, political and security concerns have, in our opinion, contributed to this uncertainty. The on-going war with Iran has created additional uncertainty and disruptions. Certain of our customers have experienced disruptions in operations due to the current conflict in Iran. Such disruptions have caused pauses in on-going operations, delays in payments and delays in the award and commencement of anticipated projects. Despite these near-term challenges, we believe the disruptions are temporary and that the longer-term outlook in the marine exploration and survey market is quite positive. Certain of our customers have recently reported increasing backlogs for projects outside of the Middle East and many industry commentators predict a strong resurgence in marine exploration and survey activity.

Previous wording

As of April 30, 2026, our backlog of firm orders was approximately $7.6 million, compared to approximately $13.9 million as of January 31, 2026. We believe a significant portion of our current backlog will be completed and shipped by the end of fiscal 2027. In addition to our backlog of firm orders, we have a significant pipeline of pending and potential orders, and we have recently identified new opportunities for later this fiscal year and subsequent periods. We believe our backlog of firm orders, pending and potential orders, and identified new opportunities provide a solid revenue outlook for the balance of fiscal 2027. The level of backlog at a particular point in time may not necessarily be indicative of results in subsequent periods as the size and delivery period of individual orders can vary significantly.

Current wording

As of July 31, 2026, our backlog of firm orders was approximately $4.8 million, compared to approximately $13.9 million as of January 31, 2026. We believe a significant portion of our current backlog will be completed and shipped by the end of fiscal 2027. In addition to our backlog of firm orders, we have a significant pipeline of pending and potential orders, and we have recently identified new opportunities for later this fiscal year and subsequent periods. However, the timing of many of these opportunities is uncertain and we believe the recent reduced level of activity will continue at least through the third quarter of fiscal 2027. The level of backlog at a particular point in time may not necessarily be indicative of results in subsequent periods as the size and delivery period of individual orders can vary significantly.

Previous wording

Based on this visibility and expected delivery schedules, we expect a decline in revenue in fiscal 2027 from the level of revenue recognized in fiscal 2026. While our long-term outlook for our existing product lines is optimistic, the outlook for fiscal 2027 is less clear. We believe this expected decline in fiscal 2027 revenue is due to recent delays in certain projects and temporary changes in capital allocations by ultimate end-users. We are currently pursuing a number of initiatives, including new products and significant project opportunities, which we believe could have a positive impact on our future financial results.

Current wording

Based on this visibility and expected delivery schedules, we expect a decline in revenue in fiscal 2027 from the level of revenue recognized in fiscal 2026. While our long-term outlook for our existing product lines is optimistic, the outlook for fiscal 2027 is less clear. We believe this expected decline in fiscal 2027 revenue is due to recent delays in certain projects and temporary changes in capital allocations by ultimate end-users. We are currently pursuing a number of initiatives, including the development of new products and significant project opportunities, some of which could have a positive impact on our future financial results, although there can be no assurance as to the magnitude or timing of any such contributions.

Previous wording

During fiscal 2026, our facility in Huntsville, Texas underwent an expansion to handle an expected increase in activity. As a result, repair and production activities were suspended for several months until the expansion activities were completed and repair and production operations resumed in the third quarter of fiscal 2026. We expect incremental activity and increased revenue from this facility in fiscal 2027.

Current wording

During fiscal 2026, our facility in Huntsville, Texas underwent an expansion to handle an expected increase in activity. As a result, repair and production activities were suspended for several months until the expansion activities were completed and repair and production operations resumed in the third quarter of fiscal 2026. We expect incremental activity and increased revenue from this facility in fiscal 2027 and beyond.

Previous wording

We also believe there are other initiatives that can expand our business and enhance stockholder value. These include development of new technology and products, the acquisition of technology, products or businesses or the combination with other companies. We continue to identify and evaluate these opportunities. We believe the Company is well positioned to take advantage of any such opportunities should they arise.

Current wording

We also believe there are other initiatives that can expand our business and enhance stockholder value. These include development of new technology and products, the acquisition of technology, products or businesses or the combination with other companies. We continue to actively identify and evaluate these opportunities. We believe the Company is well positioned to take advantage of any such opportunities should they arise.

Previous wording

General inflation levels have increased in recently due in part to supply chain issues, increased energy costs and geopolitical uncertainty. In addition, shortages of certain components, such as electronic components, have caused prices for available components to increase in some cases. Although these factors have had a negative impact on our costs, our revenues and results of operations have not been materially impacted by inflation or changing prices in the past several years.

Current wording

General inflation levels have increased recently due in part to supply chain issues, increased energy costs and geopolitical uncertainty. In addition, shortages of certain components, such as electronic components, have caused prices for available components to increase in some cases. Although these factors have had a negative impact on our costs, our revenues and results of operations have not been materially impacted by inflation or changing prices in the past several years.

Previous wording

Revenues for the three months ended April 30, 2026 were approximately $9.7 million, compared to approximately $7.9 million for the three months ended April 30, 2025,. For the three months ended April 30, 2026, we generated operating income of approximately $14,000, compared to an operating loss of approximately $658,000 for the three months ended April 30, 2025. A more detailed explanation of these variations follows.

Current wording

Revenues for the three and six months ended July 31, 2026 were approximately $5.6 million and $15.3 million, respectively, compared to approximately $13.6 million and $21.5 million for the three and six months ended July 31, 2025, respectively. For the three and six months ended July 31, 2026, we generated an operating loss of approximately $1.8 million and $1.8 million, respectively, compared to operating income of approximately $2.7 million and $2.0 million for the three and six months ended July 31, 2025, respectively. A more detailed explanation of these variations follows.

Previous wording

A significant portion of Seamap’s sales consist of large discrete orders, the timing of which is dictated by our customers. This timing generally relates to the availability of the vessel in port so that our products can be delivered and installed. Accordingly, sales can significantly vary from one period to another. The remaining sales relate to “after-market” activity such as the sale of spare parts, repairs and services. The gross profit margin in the three-month period ended April 30, 2026 remained consistent with the prior year comparable period.

Current wording

A significant portion of Seamap’s sales consist of large discrete orders, the timing of which is dictated by our customers. This timing generally relates to the availability of the vessel in port so that our products can be delivered and installed. Accordingly, sales can significantly vary from one period to another. The remaining sales relate to “after-market” activity such as the sale of spare parts, repairs and services. The gross profit margin in the six-month period ended July 31, 2026 decreased to 40% from 47% in the six-month period ended July 31, 2025 primarily attributable to the impact of unabsorbed overhead. The decline in gross margin was despite a higher percentage of after-market activity in the fiscal 2027 periods. After-market orders generally generate a higher gross margin than system sales.

Previous wording

Research and development costs were approximately $310,000 for the three- month period ended April 30, 2026, compared to approximately $380,000 for the three-month period ended April 30, 2025. Costs in each of the periods are related primarily to development of our next generation towed streamer system and other new products.

Current wording

Research and development costs were approximately $407,000 and $717,000 for the three and six-month periods ended July 31, 2026, respectively, compared to approximately $311,000 and $691,000 for the three and six-month periods ended July 31, 2025, respectively. Costs in each of the periods are related primarily to development of our next generation towed streamer system and other new products.

Previous wording

Depreciation and amortization expense, which includes depreciation of equipment, furniture and fixtures and the amortization of intangible assets, decreased primarily attributable to assets becoming fully depreciated and amortized over the year. These costs were approximately $228,000 and $225,000 in the three-month periods ended April 30, 2026, and April 30, 2025, respectively.

Current wording

Depreciation and amortization expense, which includes depreciation of equipment, furniture and fixtures and the amortization of intangible assets, was approximately $224,000 and $452,000 in the three and six-month periods ended July 31, 2026, respectively, and approximately $217,000 and $442,000 for the three and six-month periods ended July 31, 2025, respectively.

Previous wording

Other income recognized for the three months ended April 30, 2026, related primarily to interest income on cash balances. Other losses recognized for the three months ended April 30, 2025 related primarily to foreign exchange losses.

Current wording

Other income recognized for the three and six months ended July 31, 2026, related primarily to interest income on cash balances. Other losses recognized for the three and six months ended July 31, 2025 related primarily to foreign exchange losses.

Previous wording

For the three months ended April 30, 2026, our income tax expense was approximately $476,000 on pre-tax income of approximately $65,000. For the three months ended April 30, 2025, our income tax expense was approximately $294,000 on a pre-tax loss of approximately $676,000. These amounts differed from the result expected when applying the U.S. statutory rate of 21% to our income before income taxes for the respective periods due primarily to the impact of income taxes accrued in certain foreign jurisdictions, primarily Singapore, which do not have net operating losses available to offset taxable income, and because we do not benefit from tax losses in the U.S. and certain foreign jurisdictions where we have valuation allowances recorded against our deferred tax assets. Valuation allowances have been provided against all deferred tax assets in the United States and certain foreign jurisdictions, including the United Kingdom.

Current wording

For the three and six months ended July 31, 2026, our income tax expense was approximately $18,000 and $494,000, respectively, on pre-tax losses of approximately $1.7 million and $1.7 million, respectively. For the three and six months ended July 31, 2025, our income tax expense was approximately $670,000 and $964,000, respectively on pre-tax income of approximately $2.6 million and $1.9 million, respectively. These amounts differed from the result expected when applying the U.S. statutory rate of 21% to our income before income taxes for the respective periods due primarily to the impact of income taxes accrued in certain foreign jurisdictions, primarily Singapore, which do not have net operating losses available to offset taxable income, and because we do not benefit from tax losses in the U.S. and certain foreign jurisdictions where we have valuation allowances recorded against our deferred tax assets. Valuation allowances have been provided against all deferred tax assets in the United States and certain foreign jurisdictions, including the United Kingdom.

Previous wording

The Company has generated income from operations and positive Adjusted EBITDA for each of the past three fiscal years. The Company also generated net income from operations and cash provided by operating activities for each of fiscal 2025 and fiscal 2026.

Current wording

The Company has generated income from operations and positive Adjusted EBITDA for each of the past three fiscal years. The Company also generated income from operations and cash provided by operating activities for each of fiscal 2025 and fiscal 2026.

Previous wording

As of April 30, 2026, the Company had working capital of approximately $37.8 million, including cash and cash equivalents of approximately $17.7 million, compared to working capital of approximately $37.4 million, including cash and cash equivalents of approximately $19.1 million, as of January 31, 2026. On March 17, 2026, the Company entered into a trade finance facility with The Hong Kong Bank Corporation Limited, Singapore Branch (“HSBC Singapore”) for the issuance, from time to time, of letters of credit or bank guarantees. The Company has entered into this facility to provide flexibility for potential future projects and to allow the Company to respond efficiently and economically as these potential projects may arise. As of June 10, 2026, there has been no activity associated with this trade facility.

Current wording

As of July 31, 2026, the Company had working capital of approximately $36.7 million, including cash and cash equivalents of approximately $15.8 million, compared to working capital of approximately $37.4 million, including cash and cash equivalents of approximately $19.1 million, as of January 31, 2026. On March 17, 2026, the Company entered into a trade finance facility with The Hong Kong and Shanghai Bank Corporation Limited, Singapore Branch (“HSBC Singapore”) for the issuance, from time to time, of letters of credit or bank guarantees. The Company has entered into this facility to provide flexibility for the pursuit of potential future projects and to allow the Company to respond efficiently and economically as these potential projects may arise. As of September 9, 2026, there has been no activity associated with this trade facility.

Previous wording

As of April 30, 2026, we had working capital of approximately $37.8 million, including cash and cash equivalents of approximately $17.7 million, as compared to working capital of approximately $37.4 million, including cash and cash equivalents of approximately $19.1 million, at January 31, 2026.

Current wording

As of July 31, 2026, we had working capital of approximately $36.7 million, including cash and cash equivalents of approximately $15.8 million, as compared to working capital of approximately $37.4 million, including cash and cash equivalents of approximately $19.1 million, at January 31, 2026.

Previous wording

Cash Flows from Operating Activities. Net cash used in operating activities was approximately $1.3 million in the first three months of fiscal 2027 as compared to cash provided by operating activities of approximately $4.1 million in the first three months of fiscal 2026. The decrease in net cash provided by operating activities was due mainly to increases in accounts receivable.

Current wording

Cash Flows from Operating Activities. Net cash used in operating activities was approximately $3.1 million in the first six months of fiscal 2027 as compared to cash provided by operating activities of approximately $2.9 million in the first six months of fiscal 2026. The decrease in net cash provided by operating activities was due mainly to the net loss for the six-month period ended July 31, 2026 and increases in accounts receivable during that same period.

Previous wording

Cash Flows from Investing Activities. Net cash used in investing activities during the first three months of fiscal 2026 relates primarily to the purchase of assets and investment related to the expansion of our facility in Huntsville, Texas.

Current wording

Cash Flows from Investing Activities. Net cash used in investing activities during the first six months of fiscal 2027 relates primarily to the purchase of assets. These purchases primarily reflect capital expenditures to support our manufacturing and product development activities. We expect to fund future capital expenditures from cash on hand and cash generated from operations and do not have any capital expenditure requirements that would materially affect our liquidity or capital resources.

Previous wording

Cash Flows from Financing Activities. For the three months ended April 30, 2026 and April 30, 2025, there was no cash flow related to financing activities.

Current wording

Cash Flows from Financing Activities. For the six months ended July 31, 2026 and July 31, 2025, there was no cash flow related to financing activities.

Previous wording

As of April 30, 2026, we had deposits in foreign banks equal to approximately $6.1 million, all of which we believe could be distributed to the United States without adverse tax consequences. However, in certain cases, the transfer of these funds may result in withholding taxes payable to foreign taxing authorities. If withholding taxes should become payable, we believe the amount of tax withheld would be immaterial.

Current wording

As of July 31, 2026, we had deposits in foreign banks equal to approximately $4.4 million, all of which we believe could be distributed to the United States without adverse tax consequences. However, in certain cases, the transfer of these funds may result in withholding taxes payable to foreign taxing authorities. If withholding taxes should become payable, we believe the amount of tax withheld would be immaterial.

Previous wording

Information regarding our critical accounting estimates is included in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended January 31, 2026. There have been no material changes to our critical accounting estimates during the three-month period ended April 30, 2026.

Current wording

Information regarding our critical accounting estimates is included in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended January 31, 2026. There have been no material changes to our critical accounting estimates during the three- and six-month periods ended July 31, 2026.