IDT CORP

Previous wording

The following information should be read in conjunction with the accompanying consolidated financial statements and the associated notes thereto of this Quarterly Report, and the audited consolidated financial statements and the notes thereto and our Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the fiscal year ended July 31, 2024 (or our 2024 Form 10-K) as filed with the U.S. Securities and Exchange Commission (or SEC).

Current wording

The following information should be read in conjunction with the accompanying condensed consolidated financial statements and the associated notes thereto of this Quarterly Report, and the audited consolidated financial statements and the notes thereto and our Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the fiscal year ended July 31, 2025 as filed with the U.S. Securities and Exchange Commission (or SEC).

Previous wording

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements that contain the words “believes,” “anticipates,” “expects,” “plans,” “intends,” and similar words and phrases. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the results projected in any forward-looking statement. In addition to the factors specifically noted in the forward-looking statements, other important factors, risks, and uncertainties that could result in those differences include, but are not limited to, those discussed under Item 1A to Part I “Risk Factors” in our 2024 Form 10-K and Item 1A to Part II “Risk Factors” of this Quarterly Report. The forward-looking statements are made as of the date of this report and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Investors should consult all of the information set forth in this report and the other information set forth from time to time in our reports filed with the SEC pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934, including our 2024 Form 10-K.

Current wording

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements that contain the words “believes,” “anticipates,” “expects,” “plans,” “intends,” and similar words and phrases. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the results projected in any forward-looking statement. In addition to the factors specifically noted in the forward-looking statements, other important factors, risks, and uncertainties that could result in those differences include, but are not limited to, those discussed under Item 1A to Part I “Risk Factors” in our 2025 Form 10-K. The forward-looking statements are made as of the date of this report and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Investors should consult all of the information set forth in this report and the other information set forth from time to time in our reports filed with the SEC pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934, including our 2025 Form 10-K.

Previous wording

As of April 30, 2025, we owned 94.0% of the outstanding shares of our subsidiary, net2phone 2.0, Inc., or net2phone 2.0, which owns and operates the net2phone segment, and 81.6% of the outstanding shares of National Retail Solutions, or NRS. On a fully diluted basis assuming all the vesting criteria related to various rights granted have been met, we would own 90.2% of the equity of net2phone 2.0 and 79.5% of the equity of NRS.

Current wording

As of October 31, 2025, we owned 94.0% of the outstanding shares of our subsidiary, net2phone 2.0, Inc., or net2phone 2.0, which owns and operates the net2phone segment, and 81.6% of the outstanding shares of National Retail Solutions, or NRS. On a fully diluted basis assuming all the vesting criteria related to various rights granted have been met, we would own 90.1% of the equity of net2phone 2.0 and 79.5% of the equity of NRS.

Previous wording

NRS uses two key metrics to measure the size of its customer base: active POS terminals and payment processing accounts. Active POS terminals are the number of POS terminals that have completed at least one transaction in the calendar month. It excludes POS terminals that have not been fully installed by the end of the month. Payment processing accounts are accounts that can generate revenue. It excludes accounts that have been approved but not activated. NRS’ recurring revenue is NRS’ revenue in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP, excluding its revenue from POS terminal sales.

Current wording

NRS uses four key metrics to measure the size of its customer base, including two that are non-GAAP measures: active POS terminals and payment processing accounts. Active POS terminals are the number of POS terminals that have completed at least one transaction in the calendar month. It excludes POS terminals that have not been fully installed by the end of the month. Payment processing accounts are accounts that can generate revenue. It excludes accounts that have been approved but not activated. In addition to the foregoing, NRS uses recurring revenue as a performance metric, which consist of NRS’ revenue in accordance with U.S. GAAP, excluding its revenue from POS terminal sales and monthly average recurring revenue per terminal.

Previous wording

net2phone’s cloud communications offerings are priced on a per-seat basis, with customers paying based on the number of users in their organization. net2phone’s subscription revenue is its revenue in accordance with U.S. GAAP excluding its equipment revenue and revenue generated by a legacy SIP trunking offering in Brazil.

Current wording

net2phone’s UNITE (UCaaS), uContact (CCaaS) and Coach offerings are priced on a per-seat basis, with customers paying based on the number of users in their organization. net2phone AI is priced according to interaction credits, a usage-based criterion. net2phone’s subscription revenue is its revenue in accordance with U.S. GAAP excluding its equipment revenue and revenue generated by a legacy SIP trunking offering in Brazil.

Previous wording

Three and Nine Months Ended April 30, 2025 Compared to Three and Nine Months Ended April 30, 2024

Current wording

Three Months Ended October 31, 2025 Compared to Three Months Ended October 31, 2024

Previous wording

NRS, which represented 10.3% and 8.6% of our total revenues in the three months ended April 30, 2025 and 2024, respectively, and 10.3% and 8.4% of our total revenues in the nine months ended April 30, 2025 and 2024, respectively, is an operator of a nationwide POS network providing independent retailers with store management software, electronic payment processing, and other ancillary merchant services. NRS’ POS platform provides marketers with digital out-of-home advertising and transaction data.

Current wording

NRS, which represented 11.5% and 9.8% of our total revenues in the three months ended October 31, 2025 and 2024, respectively, is an operator of a POS network operating in the U.S. and Canada that provides independent retailers with POS equipment, store management software, electronic payment processing, and other ancillary merchant services. NRS’ POS platform also provides marketers with digital out-of-home advertising and transaction data.

Previous wording

Selling, General and Administrative. Selling, general and administrative expense increased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 primarily due to increases in sales commissions, bad debt expense, employee compensation, and stock-based compensation. The increase in bad debt expense was related to a large programmatic advertising partner. As a percentage of NRS’ revenue, NRS’ selling, general and administrative expense increased to 64.2% from 60.9% in the three months ended April 30, 2025 and 2024, respectively, and increased to 61.4% from 59.4% in the nine months ended April 30, 2025 and 2024, respectively.

Current wording

Selling, General and Administrative. Selling, general and administrative expense increased in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025. The increase was primarily driven by increases in personnel-related costs and other operating expenses supporting NRS’ continued growth. As a percentage of NRS’ revenue, NRS’ selling, general and administrative expense decreased to 59.0% from 62.6% in the three months ended October 31, 2025 and 2024, respectively.

Previous wording

Fintech, which represented 12.8% and 10.5% of our total revenues in the three months ended April 30, 2025 and 2024, respectively, and 12.3% and 9.6% of our total revenues in the nine months ended April 30, 2025 and 2024, respectively, is comprised of: (i) BOSS Money, a provider of international money remittance and related value/payment transfer services; and (ii) other, significantly smaller, financial services businesses, including a variable interest entity, or VIE, that processes disbursement payments, or the Disbursement Payments VIE, and IDT Financial Services Limited, or IDT Financial Services, a Gibraltar-based bank.

Current wording

Fintech, which represented 13.2% and 12.0% of our total revenues in the three months ended October 31, 2025 and 2024, respectively, is comprised of: (i) BOSS Money, a provider of international money remittance and related value/payment transfer services; and (ii) other, significantly smaller, financial services businesses, including a variable interest entity(“VIE”), that processes disbursement payments, which we refer to as the Disbursement Payments VIE, (iii)IDT Financial Services Limited, or IDT Financial Services, a Gibraltar-based bank and (iv) IDT Services Limited (“IDTS”), a Malta-based electronic money institution.

Previous wording

Direct Cost of Revenues. Direct cost of revenues increased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 primarily due to an increase in BOSS Money’s direct cost of revenues, which reflected the increase in BOSS Money’s revenue.

Current wording

Direct Cost of Revenues. Direct cost of revenues increased in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025 primarily due to an increase in BOSS Money’s direct cost of revenues. However, gross profit margin increased as BOSS Money’s recent growth enabled it to negotiate volume-based reductions in certain per transaction costs including fees paid to disbursement agents.

Previous wording

Technology and Development. Technology and development expense increased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 primarily due to increases in employee compensation and depreciation and amortization expense, partially offset by a decrease in consulting expense.

Current wording

Technology and Development. Technology and development expense increased slightly in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025. The increase primarily reflected higher depreciation and amortization expense, partially offset by lower employee compensation and other development-related costs.

Previous wording

The net2phone segment, which represented 7.3% and 6.9% of our total revenues in the three months ended April 30, 2025 and 2024, respectively, and 7.1% and 6.8% of our total revenues in the nine months ended April 30, 2025 and 2024, respectively, is comprised of net2phone’s integrated cloud communications and contact center services.

Current wording

The net2phone segment, which represented 7.3% and 7.0% of our total revenues in the three months ended October 31, 2025 and 2024, respectively, is comprised of net2phone’s communications and workflow solutions including its UCaaS net2phone AI and Coach solutions.

Previous wording

*Revenues.*net2phone’s revenues increased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 driven primarily by the growth in subscription revenue, most significantly in the U.S., and from its contact center services, which reflected the increase in seats served at April 30, 2025 compared to April 30, 2024.

Current wording

Revenues. net2phone’s revenues increased in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025 primarily due to sales in its UCaaS and CCaas services revenue, reflecting an increase in seats served during the period.

Previous wording

Direct Cost of Revenues. Direct cost of revenues increased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 primarily due to the increase in revenues, with the largest increase in the U.S. market. net2phone’s revenue growth exceeded the increase in direct cost of revenues.

Current wording

Direct Cost of Revenues. Direct cost of revenues increased in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025 primarily due to higher revenues, net2phone’s continued focus on mid-sized businesses, multi-channel strategies, and localized offerings supported revenue growth that exceeded the increase in direct cost of revenues.

Previous wording

Selling, General and Administrative. Selling, general and administrative expense slightly decreased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 primarily due to decreases in marketing expense and bad debt expense, partially offset by increases in sales commissions. As a percentage of net2phone’s revenues, net2phone’s selling, general and administrative expense decreased to 59.1% from 63.1% in the three months ended April 30, 2025 and 2024, respectively, and to 60.1% from 64.7% in the nine months ended April 30, 2025 and 2024, respectively.

Current wording

Selling, General and Administrative. Selling, general and administrative expense increased in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025. This increase was primarily driven by higher sales commissions and depreciation and amortization, partially offset by decreases in marketing, consulting and bad debt expenses. As a percentage of net2phone’s revenues, net2phone’s selling, general and administrative expense decreased to 58.6% from 60.8% in the three months ended October 31, 2025 and 2024, respectively.

Previous wording

The Traditional Communications segment, which represented 69.6% and 74.0% of our total revenues in the three months ended April 30, 2025 and 2024, respectively, and 70.3% and 75.2% of our total revenues in the nine months ended April 30, 2025 and 2024, respectively, includes: (i) IDT Digital Payments, which enables customers to transfer airtime and bundles of airtime, messaging, and data to international and domestic mobile accounts; (ii) BOSS Revolution, an international long-distance calling service marketed primarily to immigrant communities in the United States and Canada; and (iii) IDT Global, a wholesale provider of international voice and SMS termination and outsourced traffic management solutions to telecoms worldwide. Traditional Communications also includes other small businesses and offerings including early-stage business initiatives and mature businesses in harvest mode.

Current wording

The Traditional Communications segment, which represented 68.0% and 71.2% of our total revenues in the three months ended October 31, 2025 and 2024, respectively, includes: (i) IDT Digital Payments, which enables customers to transfer airtime and bundles of airtime, messaging, and data to international and domestic mobile accounts; (ii) BOSS Revolution, an international long-distance calling service marketed primarily to immigrant communities in the United States and Canada; and (iii) IDT Global, a wholesale provider of international voice and SMS termination and outsourced traffic management solutions to telecoms worldwide. Traditional Communications also includes other small businesses and offerings including early-stage business initiatives and mature businesses in harvest mode.

Previous wording

Traditional Communications’ most significant revenue streams are from IDT Digital Payments, BOSS Revolution, and IDT Global. IDT Digital Payments and BOSS Revolution are sold directly to consumers and through distributors and retailers. We receive payments for BOSS Revolution, traditional calling cards, and IDT Digital Payments prior to providing the services. We recognize the revenue when services are provided to the customer. Traditional Communications’ revenues tend to be somewhat seasonal, with the second fiscal quarter (which contains Christmas and New Year’s Day) and the fourth fiscal quarter (which contains Mother’s Day and Father’s Day) typically showing higher minute volumes.

Current wording

Traditional Communications’ most significant revenue streams are from IDT Digital Payments, BOSS Revolution, and IDT Global. IDT Digital Payments and BOSS Revolution are sold directly to consumers and through the BOSS Money and BOSS Revolution apps as well as through distributors and retailers. We receive payments for BOSS Revolution and IDT Digital Payments prior to providing the services. We recognize the revenue when services are provided to the customer. Traditional Communications’ revenues tend to be somewhat seasonal, with the second fiscal quarter (which contains Christmas and New Year’s Day) and the fourth fiscal quarter (which contains Mother’s Day and Father’s Day) typically showing higher minute volumes.

Previous wording

Direct Cost of Revenues. Direct cost of revenues decreased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 primarily due to the decreases in BOSS Revolution’s minutes of use and direct cost of revenues.

Current wording

Direct Cost of Revenues. Direct cost of revenues decreased slightly in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025, primarily due to decreased minutes of use and associated costs in BOSS Revolution.

Previous wording

Selling, General and Administrative. Selling, general and administrative expense decreased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 primarily due to decreases in stock-based compensation, sales commissions, and debit and credit card processing charges, partially offset by an increase in legal fees. As a percentage of Traditional Communications’ revenue, Traditional Communications’ selling, general and administrative expense decreased to 9.8% from 10.2% in the three months ended April 30, 2025 and 2024, respectively, and decreased to 9.3% from 9.6% in the nine months ended April 30, 2025 and 2024, respectively.

Current wording

Selling, General and Administrative. Selling, general and administrative expense decreased in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025. The decrease was primarily due to lower sales commissions and debit and credit processing charges, partially offset by higher bad debt expense. As a percentage of Traditional Communications’ revenue, Traditional Communications’ selling, general and administrative expense decreased to 8.7% from 9.1% in the three months ended October 31, 2025 and 2024, respectively.

Previous wording

Technology and Development. Technology and development expense decreased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 primarily due to decreases in employee compensation, cloud services expense, and depreciation and amortization expense.

Current wording

Technology and Development. Technology and development expense remained flat in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025. Modest increases in certain operating costs were offset by decreases in employee compensation, cloud services, and depreciation and amortization expense, resulting in overall flat expenses for the period.

Previous wording

General and Administrative. Corporate general and administrative expense increased in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 primarily because of an increase in employee compensation. As a percentage of our consolidated revenues, Corporate general and administrative expense was 0.9% and 0.8% in the three months ended April 30, 2025 and 2024, respectively, and 0.9% and 0.9% in the nine months ended April 30, 2025 and 2024, respectively.

Current wording

General and Administrative. Corporate general and administrative expense decreased in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025. This decrease primarily reflects lower employee-related costs and reduced overhead expenses during the quarter. As a percentage of our consolidated revenues, Corporate general and administrative expense was 0.8% and 0.9% in the three months ended October 31, 2025 and 2024. respectively.

Previous wording

Stock-Based Compensation Expense. Total stock-based compensation expense included in consolidated selling, general and administrative expense and technology and development expense was $0.9 million and $2.1 million in the three months ended April 30, 2025 and 2024, respectively, and $2.7 million and $5.4 million in the nine months ended April 30, 2025 and 2024, respectively. The decrease in stock-based compensation expense was primarily due to a decrease in expense related to certain equity grants made in fiscal 2024 to Bill Pereira, our President and Chief Operating Officer, and a decrease in stock-based compensation expense from the grant of deferred stock units, or DSUs, that entitle the grantees to receive shares of our Class B common stock. As of April 30, 2025, there was $0.5 million of total unrecognized compensation cost related to non-vested DSUs, which is being recognized on a graded vesting basis over the requisite service periods that end in October 2027.

Current wording

Stock-Based Compensation Expense. Total stock-based compensation expense included in consolidated selling, general and administrative expense and technology and development expense was $2.0 million and $0.9 million in the three months ended October 31, 2025 and 2024, respectively. The increase primarily reflects the expense recognized during the period related to DSU’s granted to executive officers and employees under the Company’s long-term incentive programs. As of October 31, 2025, there was $11.9 million of total unrecognized compensation cost related to non-vested DSUs, which is being recognized on a graded vesting basis over the requisite service periods that end in February 2028.

Previous wording

Effective as of June 30, 2022, restricted shares of NRS’ Class B common stock were granted to certain NRS employees. The restrictions on the shares lapse in three installments, the first was on June 1, 2024, and the others are June 1, 2026 and June 1, 2027. As of April 30, 2025, unrecognized compensation cost related to NRS’ non-vested Class B common stock was an aggregate of $1.4 million. The unrecognized compensation cost is expected to be recognized over the remaining vesting period that ends in fiscal 2027.

Current wording

Effective as of June 30, 2022, restricted shares of NRS’ Class B common stock were granted to certain NRS employees. The restrictions on the shares lapse in three installments, the first was on June 1, 2024, and the others are June 1, 2026 and June 1, 2027. As of October 31, 2025, unrecognized compensation cost related to NRS’ non-vested Class B common stock was an aggregate of $1.1 million. The unrecognized compensation cost is expected to be recognized over the remaining vesting period that ends in fiscal 2027.

Previous wording

As of April 30, 2025, there was an aggregate of $0.6 million in unrecognized compensation cost related to non-vested stock options and restricted stock, which is expected to be recognized over the remaining vesting periods that end in fiscal 2028.

Current wording

As of October 31, 2025, there was an aggregate of $12.5 million in unrecognized compensation cost related to non-vested stock options, DSUs, and restricted stock, which is expected to be recognized over the remaining vesting periods that end in fiscal 2028.

Previous wording

Other Income (Expense), net. Other income (expense), net consists of the following:

Current wording

Other Expense, net. Other expense, net consists of the following:

Previous wording

We have an investment in shares of convertible preferred stock of a communications company (the equity method investee, or EMI). As of both April 30, 2025 and 2024, our ownership was 33.4% of the EMI’s outstanding shares on an as converted basis. We account for this investment using the equity method since we can exercise significant influence over the operating and financial policies of the EMI but do not have a controlling interest. We determined that on the dates of the acquisitions of the EMI’s shares, there were differences between our investment in the EMI and our proportional interest in the equity of the EMI of an aggregate of $8.2 million, which represented the share of the EMI’s customer list on the dates of the acquisitions attributed to our interest in the EMI. These basis differences are being amortized over the 6-year estimated life of the customer list. “Equity in the net loss of investee” includes the amortization of equity method basis difference.

Current wording

We have an investment in shares of convertible preferred stock of a communications company (the equity method investee, or EMI). As of both October 31, 2025 and 2024, our ownership was 33.4% respectively of the EMI’s outstanding shares on an as converted basis. We account for this investment using the equity method since we can exercise significant influence over the operating and financial policies of the EMI but do not have a controlling interest. We determined that on the dates of the acquisitions of the EMI’s shares, there were differences between our investment in the EMI and our proportional interest in the equity of the EMI of an aggregate of $8.2 million, which represented the share of the EMI’s customer list on the dates of the acquisitions attributed to our interest in the EMI. These basis differences are being amortized over the 6-year estimated life of the customer list. “Equity in the net loss of investee” includes the amortization of equity method basis difference.

Previous wording

Provision for Income Taxes. The change in income tax expense in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 was primarily due to differences in the amount of taxable income earned in the various taxing jurisdictions.

Current wording

Provision for Income Taxes. The change in income tax expense in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025 was primarily due to differences in the amount of taxable income earned in the various taxing jurisdictions.

Previous wording

Net Income Attributable to Noncontrolling Interests. The change in the net income attributable to noncontrolling interests in the three and nine months ended April 30, 2025 compared to the similar periods in fiscal 2024 was primarily due to increases in net income attributable to the noncontrolling interests in net2phone 2.0, NRS, and Sochitel.

Current wording

Net Income Attributable to Noncontrolling Interests. The change in the net income attributable to noncontrolling interests in the three months ended October 31, 2025 compared to the comparable period in fiscal 2025 was primarily due to increases in net income attributable to the noncontrolling interests in NRS and the VIE.

Previous wording

At April 30, 2025, we had cash, cash equivalents, debt securities, and current equity investments of $223.8 million and working capital (current assets in excess of current liabilities) of $211.1 million.

Current wording

At October 31, 2025, we had cash, cash equivalents, debt securities, and current equity investments of $220.0 million and working capital (current assets in excess of current liabilities) of $245.1 million.

Previous wording

Our cash flow from operations varies significantly from quarter to quarter and from year to year, depending on our operating results and the timing of operating cash receipts and payments, generally trade accounts receivable and trade accounts payable. The increase in net cash provided by operating activities to $96.1 million in the nine months ended April 30, 2025 from $52.7 in the nine months ended April 30, 2024 predominantly reflects the timing of disbursement prefunding payments to cover anticipated BOSS Money weekly remittance activity.

Current wording

Our cash flow from operations varies significantly from quarter to quarter and from year to year, depending on our operating results and the timing of operating cash receipts and payments. During the three months ended October 31, 2025, net cash used in operating activities was $10.1 million, which includes the impact of settlement assets and disbursements prefunding and customer fund deposits.

Previous wording

As discussed in Note 16 to the Consolidated Financial Statements included in Item 1 to Part I of this Quarterly Report, we (as well as other defendants) were named in a class action on behalf of the stockholders of our former subsidiary, Straight Path. On October 3, 2023, the Court of Chancery of the State of Delaware dismissed all claims against us, and found that, contrary to the plaintiff’s allegations, the class suffered no damages. On January 14, 2025, the plaintiff filed a notice of appeal of the Final Order and Judgment to the Supreme Court of the State of Delaware to appeal the Final Order and Judgment. On April 22, 2025, we filed our answering brief to the appeal. The Supreme Court of the State of Delaware has scheduled oral argument for July 2025.

Current wording

As discussed in Note 16 to the Condensed Consolidated Financial Statements included in Item 1 to Part I of this Quarterly Report, we and other parties were named in a putative class action and derivative complaint related to Straight Path Communications Inc. filed in the Court of Chancery of the State of Delaware. The Court dismissed all claims against us, and found that, contrary to the plaintiffs’ allegations, the class suffered no damages. The plaintiffs filed an appeal to which we answered. Oral argument was held on October 22, 2025 and on December 3, 2025, the Delaware Supreme Court affirmed the favorable decision of the Court of Chancery that dismissed all claims against us and found that Plaintiff and the class suffered no damages.

Previous wording

Our capital expenditures were $15.5 million and $13.6 million in the nine months ended April 30, 2025 and 2024, respectively. We currently anticipate that total capital expenditures in the twelve-month period ending April 30, 2026 will be $18 million to $21 million. We expect to fund our capital expenditures with our net cash provided by operating activities and cash, cash equivalents, debt securities, and current equity investments on hand.

Current wording

During the three months ended October 31, 2025, we deployed $5.3 million for capital expenditures. We currently anticipate that total capital expenditures in the twelve-month period ending October 31, 2026 will be $20 million to $22 million. We expect to fund our capital expenditures with our net cash provided by operating activities and cash, cash equivalents, debt securities, and current equity investments on hand.

Previous wording

In the nine months ended April 30, 2025 and 2024, each of the EMI’s shareholders, including us, purchased additional shares of the EMI’s convertible preferred stock. We paid an aggregate of $0.9 million and $1.5 million in the nine months ended April 30, 2025 and 2024, respectively, to purchase additional shares. In addition, in February 2025, we entered into a loan agreement with the EMI for a revolving credit facility. The aggregate principal amount available under the facility is $2.0 million. The loans will incur interest at 12% per annum payable semiannually and are due and payable in February 2027. In February 2025, we loaned the EMI $0.5 million under the revolving credit facility. In May 2025, we loaned the EMI an additional $0.4 million under the revolving credit facility.

Current wording

In February 2025, we entered into a loan agreement with the EMI for a revolving credit facility. The aggregate principal amount available under the facility is $2.0 million. The loans will incur interest at 12% per annum payable semiannually and are due and payable in February 2027. In February 2025, the Company loaned the EMI $0.5 million under the revolving credit facility. In May 2025, the Company loaned the EMI an additional $0.4 million for an aggregate of $1.9 million under the revolving credit facility. In both the three months ended October 31, 2025 and 2024, each of the EMI’s shareholders, including us, purchased additional shares of the EMI’s convertible preferred stock.

Previous wording

Purchases of debt securities and equity investments were $29.1 million and $27.6 million in the nine months ended April 30, 2025 and 2024, respectively. Proceeds from maturities and sales of debt securities and redemptions of equity investments were $35.0 million and $41.5 million in the nine months ended April 30, 2025 and 2024, respectively.

Current wording

For the three months ended October 31, 2025, purchases of debt securities and equity investments were $16.1 million and proceeds from maturities and sales of debt securities and redemptions of equity investments were $12.7 million.

Previous wording

In March 2025, our Board of Directors increased our quarterly cash dividend on our Class A and Class B common stock to $0.06 per share from $0.05 per share. In the nine months ended April 30, 2025 and 2024, we paid aggregate cash dividends of $0.16 and $0.05 per share, respectively, on our Class A and Class B common stock. In the nine months ended April 30, 2025 and 2024, we paid aggregate cash dividends of $4.0 million and $1.3 million, respectively. In May 2025, our Board of Directors declared a cash dividend on our Class A and Class B common stock of $0.06 per share payable on or about June 18, 2025 to stockholders of record on June 9, 2025.

Current wording

In the three months ended October 31, 2025, we paid a cash dividend of $0.06 per share on our Class A and Class B common stock. In the three months ended October 31, 2025, we paid aggregate cash dividends of $1.5 million.

Previous wording

Our subsidiary, IDT Telecom, Inc., or IDT Telecom, entered into a credit agreement, dated as of May 17, 2021, with TD Bank, N.A. for a revolving credit facility for up to a maximum principal amount of $25.0 million. As of July 15, 2024 and July 28, 2023, IDT Telecom and TD Bank, N.A. amended certain terms of the credit agreement. IDT Telecom may use the proceeds to finance working capital requirements and for certain closing costs of the facility. At April 30, 2025 and July 31, 2024, there were no amounts outstanding under this facility. In the nine months ended April 30, 2025 and 2024, IDT Telecom borrowed and repaid an aggregate of $24.6 million and $32.9 million, respectively, under the facility. The revolving credit facility is secured by primarily all of IDT Telecom’s assets. The principal outstanding bears interest per annum at the secured overnight financing rate published by the Federal Reserve Bank of New York plus 10 basis points, plus depending upon IDT Telecom’s leverage ratio as computed for the most recent fiscal quarter, 125 to 175 basis points. Interest is payable monthly, and all outstanding principal and any accrued and unpaid interest is due on May 16, 2026. IDT Telecom pays a quarterly unused commitment fee of 10 basis points on the average daily balance of the unused portion of the $25.0 million commitment. IDT Telecom is required to comply with various affirmative and negative covenants as well as maintain certain targets based on financial ratios during the term of the revolving credit facility. As of April 30, 2025, IDT Telecom was in compliance with all of the covenants.

Current wording

IDT Telecom, Inc. (“IDT Telecom”), a subsidiary of the Company, maintains a $25.0 million revolving credit facility with TD Bank, N.A. maturing on May 16, 2026. The revolving credit facility is secured by primarily all of IDT Telecom’s assets and bears interest at the secured overnight financing rate (“SOFR”) plus a margin of 125-175 basis points, depending on leverage. At October 31, 2025 and July 31, 2025, there were no amounts outstanding under this facility. During the three months ended October 31, 2025 and 2024, IDT Telecom borrowed and repaid $12.7 million and $14.2 million, respectively.

Previous wording

We have an existing stock repurchase program authorized by our Board of Directors for the repurchase of shares of our Class B common stock. In January 2016, the Board of Directors authorized the repurchase of up to 8.0 million shares in the aggregate. In the nine months ended April 30, 2025, we repurchased 221,823 shares of our Class B common stock for an aggregate purchase price of $10.1 million. In the nine months ended April 30, 2024, we repurchased 204,107 shares of our Class B common stock for an aggregate purchase price of $5.7 million. At April 30, 2025, 4.2 million shares remained available for repurchase under the stock repurchase program.

Current wording

We have an existing stock repurchase program authorized by our Board of Directors for the repurchase of shares of our Class B common stock. In January 2016, the Board of Directors authorized the repurchase of up to 8.0 million shares in the aggregate. In the three months ended October 31, 2025, we repurchased 158,424 shares of our Class B common stock for an aggregate purchase price of $7.6 million. In the three months ended October 31, 2024, we repurchased 37,714 shares of our Class B common stock for an aggregate purchase price of $1.3 million. At October 31, 2025, 4.0 million shares remained available for repurchase under the stock repurchase program.

Previous wording

In the nine months ended April 30, 2025 and 2024, we paid $7.7 million and $1.5 million, respectively, to repurchase 157,180 and 41,994 shares, respectively, of our Class B common stock that were tendered by employees of ours to satisfy the employees’ tax withholding obligations in connection with the vesting of DSUs, the lapsing of restrictions on restricted stock, and shares issued for bonus payments. Such shares were repurchased by us based on their fair market value as of the close of business on the trading day immediately prior to the vesting date.

Current wording

In the three months ended October 31, 2025 and 2024, the Company withheld nil and 24,290 shares, valued at nil and $1.1 million, respectively, of the Company’s Class B common stock from employees to satisfy the employees’ tax withholding obligations in connection with the vesting of deferred stock units (“DSUs”)and the lapsing of restrictions on restricted stock. The value of the shares is based on the fair market value as of the close of business on the trading day immediately prior to the vesting date. These shares are not repurchased under the Company’s share repurchase program.