Ubiquiti Inc.

Previous wording

The following discussion of our financial condition and results of operations should be read together with the Consolidated Financial Statements (unaudited) and related notes that are included elsewhere in this Quarterly Report on Form 10-Q, as well as our audited consolidated financial statements and related notes for the fiscal year ended June 30, 2025 contained in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025 (the “2025 Annual Report”). In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Quarterly Report on Form 10-Q, particularly in Note 9, “Commitments and Contingencies” to our consolidated financial statements and Part II. Item 1. Legal Proceedings and Item 1A. Risk Factors, in this Quarterly Report on Form 10-Q. We assume no obligation to update any of these forward-looking statements.

Current wording

The following discussion of our financial condition and results of operations should be read together with the Consolidated Financial Statements (unaudited) and related notes that are included elsewhere in this Quarterly Report on Form 10-Q, as well as our audited consolidated financial statements and related notes for the fiscal year ended June 30, 2025 contained in our Annual Report. In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Quarterly Report on Form 10-Q, particularly in Note 9, “Commitments and Contingencies” to our Consolidated Financial Statements (unaudited) and Part II. Item 1. Legal Proceedings and Item 1A. Risk Factors, in this Quarterly Report on Form 10-Q. We assume no obligation to update any of these forward-looking statements.

Previous wording

Tariff and Trade Tensions– Recently, the U.S. government has issued several executive orders imposing significant tariffs on imports from China, and tariffs on most imports from other counties, including Vietnam. The U.S. government has made numerous changes to the tariff rates including temporary pauses with a reduction in rates and product exclusions. In addition, the U.S. government may in the future propose and implement additional changes to international trade agreements and tariffs. These actions have increased the cost of importing products containing certain raw materials and have affected our operating results and margins. The magnitude and scope of the recent changes have increased and we expect will significantly increase our product costs. For so long as such tariffs are in effect, we expect such tariffs and related trade policy uncertainty will continue to affect our operating results and margins. As a result, our historical and current gross profit margins may not be indicative of our gross profit margins for future periods. Refer to “Part II—Item 1A. Risk Factors—Risks Related to Our International Operations—Our business may be negatively affected by geopolitical events and foreign policy responses” for additional information.

Current wording

Tariff and Trade Tensions – Recently, the U.S. government has issued several executive orders imposing significant tariffs on imports from China, and tariffs on most imports from other counties, including Vietnam. The U.S. government has made numerous changes to the tariff rates including temporary pauses with a reduction in rates and product exclusions. In addition, the U.S. government may in the future propose and implement additional changes to international trade agreements and tariffs. These actions have increased the cost of importing products containing certain raw materials and have affected our operating results and margins. The magnitude and scope of the recent changes have increased our product costs. For so long as such tariffs are in effect, we expect such tariffs and related trade policy uncertainty will continue to affect our product costs, operating results and margins. As a result, our historical and current gross profit margins may not be indicative of our gross profit margins for future periods. Refer to “Part II—Item 1A. Risk Factors—Risks Related to Our International Operations—Our business may be negatively affected by geopolitical events and foreign policy responses” for additional information.

Previous wording

Russia-Ukraine Military Conflict – We are monitoring the ongoing military conflict between Russia and Ukraine, escalating tensions in surrounding countries, and associated economic sanctions. While the impact on our operations in Ukraine and its surrounding countries has not been material to our business or results of operations as of the date hereof, the full impact of the military conflict on our business and results of operations remains uncertain. The extent to which the conflict may impact our business or results of operations in future periods will depend on future developments, including the severity and duration of the conflict, its impact on regional and global economic conditions, as well as its impact on surrounding countries, including its impact on our operations in Ukraine and its surrounding countries, and its impact on global supply chains. Refer to “Part II – Item IA. Risk Factors” for a discussion of these factors and other risks.

Current wording

Russia-Ukraine Military Conflict – We are monitoring the ongoing military conflict between Russia and Ukraine, associated tensions in surrounding countries, and associated economic sanctions. While the impact on our operations in Ukraine and its surrounding countries has not been material to our business or results of operations as of the date hereof, the full impact of the military conflict on our business and results of operations remains uncertain. The extent to which the conflict may impact our business or results of operations in future periods will depend on future developments, including the severity and duration of the conflict, its impact on regional and global economic conditions, as well as its impact on surrounding countries, including its impact on our operations in Ukraine and its surrounding countries, and its impact on global supply chains. Refer to “Part II – Item 1A. Risk Factors” for a discussion of these factors and other risks.

Previous wording

We sell our products and solutions globally to enterprises and service providers primarily through our extensive network of distributors and through direct sales through our webstores. Sales to distributors accounted for 57% of our revenues during the three months ended September 30, 2025. Direct sales accounted for 43% of our revenue during the three months ended September 30, 2025.

Current wording

We sell our products and solutions globally to enterprises and service providers primarily through our extensive network of distributors and through direct sales through our webstores. Sales to distributors accounted for 55% of our revenues during the six months ended December 31, 2025. Direct sales accounted for 45% of our revenue during the six months ended December 31, 2025.

Previous wording

Our cost of revenues is comprised primarily of the costs of procuring finished goods from our contract manufacturers and certain keycomponents that we consign to certain of our contract manufacturers. In addition, cost of revenues includes labor and other costs which include salary, benefits and share-based compensation, in addition to costs associated with tooling, testing and quality assurance, warranty costs, logistics costs, tariffs and excess and obsolete inventory write-downs.

Current wording

Our cost of revenues is comprised primarily of the costs of procuring finished goods from our contract manufacturers and certain key components that we consign to certain of our contract manufacturers. In addition, cost of revenues includes labor and other costs which include salary, benefits and share-based compensation, in addition to costs associated with tooling, testing and quality assurance, warranty costs, logistics costs, tariffs and excess and obsolete inventory write-downs.

Previous wording

We use the asset and liability method to account for income taxes. Significant management judgment is required in determining the provision for income taxes, deferred tax assets and liabilities and any valuation allowance recorded against net deferred tax assets. In preparing the consolidated financial statements, we are required to estimate income taxes in each of the jurisdictions in which we operate. We must assess potential exposures and, where necessary, provide a reserve to cover any expected loss. To the extent that we establish a reserve, the provision for income taxes would be increased. If we ultimately determine that payment of these amounts is unnecessary, we reverse the liability and recognize a tax benefit during the period in which we determine that the liability is no longer necessary. We record an additional charge in our provision for taxes in the period in which we determine that tax liability is greater than our original estimate. We recognize interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations and comprehensive income. Refer to “Part II—Item 1A. Risk Factors—Risks Related to Regulatory, Legal and Tax Matters—Changes in applicable tax regulations could negatively affect our financial results” for additional information.

Current wording

We use the asset and liability method to account for income taxes. Significant management judgment is required in determining the provision for income taxes, deferred tax assets and liabilities and any valuation allowance recorded against net deferred tax assets. In preparing the consolidated financial statements, we are required to estimate income taxes in each of the jurisdictions in which we operate. We must assess potential exposures and, where necessary, provide a reserve to cover any expected loss. To the extent that we establish a reserve, the provision for income taxes would be increased. If we ultimately determine that payment of these amounts is unnecessary, we reverse the liability and recognize a tax benefit during the period in which we determine that the liability is no longer necessary. We record an additional charge in our provision for taxes in the period in which we determine that tax liability is greater than our original estimate. We recognize interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. Refer to “Part II—Item 1A. Risk Factors—Risks Related to Regulatory, Legal and Tax Matters—Changes in applicable tax regulations could negatively affect our financial results” for additional information.

Previous wording

We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. In other cases, management’s judgment is required in selecting among available alternative accounting standards that provide for different accounting treatment for similar transactions. The preparation of consolidated financial statements also requires us to make estimates and assumptions that affect the amounts we report as assets, liabilities, revenues, costs and expenses and affect the related disclosures. We base our estimates on historical experience and other assumptions that we believe are reasonable under the circumstances. In many instances, we could reasonably use different accounting estimates, and in some instances changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, our actual results could differ significantly from the estimates made by our management. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected. Our critical accounting policies are discussed in our 2025 Annual Report, and there have been no material changes other than that have been disclosed in Note 2, "Summary of Significant Accounting Policies" to our consolidated financial statements herein. As events continue to evolve our estimates may change materially in future periods. We believe that the accounting policies discussed in our 2025 Annual Report, are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.

Current wording

We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. In other cases, management’s judgment is required in selecting among available alternative accounting standards that provide for different accounting treatment for similar transactions. The preparation of consolidated financial statements also requires us to make estimates and assumptions that affect the amounts we report as assets, liabilities, revenues, costs and expenses and affect the related disclosures. We base our estimates on historical experience and other assumptions that we believe are reasonable under the circumstances. In many instances, we could reasonably use different accounting estimates, and in some instances changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, our actual results could differ significantly from the estimates made by our management. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected. Our critical accounting policies are discussed in our Annual Report, and there have been no material changes other than that have been disclosed in Note 2, "Summary of Significant Accounting Policies" to our consolidated financial statements herein. As events continue to evolve our estimates may change materially in future periods. We believe that the accounting policies discussed in our Annual Report, are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.

Previous wording

Comparison of Three Months Ended September 30, 2025 and 2024

Current wording

Comparison of Three and Six Months Ended December 31, 2025 and 2024

Previous wording

The increase in revenues for the three months ended September 30, 2025, as compared to the same period in the prior year, was primarily driven by an increase in revenue from our Enterprise Technology platform, partially offset by a decrease in revenue from our Service Provider Technology platform.

Current wording

The increase in revenues for the three months and six months ended December 31, 2025, as compared to the same periods in the prior year, was driven by an increase in revenue from both our Enterprise Technology platform and our Service Provider Technology platform.

Previous wording

The increase in Enterprise Technology revenue during the three months ended September 30, 2025, as compared to the same period in the prior year, was due to an increase in revenue from our Enterprise Technology platform across all regions.

Current wording

The increase in Enterprise Technology revenue during the three months and six months ended December 31, 2025, as compared to the same periods in the prior year, was due to an increase in revenue from our Enterprise Technology platform across all regions.

Previous wording

The decrease in Service Provider Technology in the three months ended September 30, 2025, as compared to the same period in the prior year, was primarily due to a decline in revenues in the South America, Asia Pacific and North America regions.

Current wording

The increase in Service Provider Technology in the three months ended December 31, 2025, as compared to the same period in the prior year, was due to an increase in revenues across all regions except South America. The increase in Service Provider Technology in the six months ended December 31, 2025, as compared to the same period in the prior year, was due to an increase in revenues in the North America and EMEA regions.

Previous wording

We have determined the geographical distribution of our product revenues based on our customers’ ship-to destinations. A majority of our sales are to distributors who either sell to resellers or directly to end customers, who may be located in different countries than the initial ship-to destination. The following are our revenues by geography for the three months ended September 30, 2025 and 2024 (in thousands, except percentages):

Current wording

We have determined the geographical distribution of our product revenues based on our customers’ ship-to destinations. A majority of our sales are to distributors who either sell to resellers or directly to end customers, who may be located in different countries than the initial ship-to destination. The following are our revenues by geography for the three and six months ended December 31, 2025 and 2024 (in thousands, except percentages):

Previous wording

(1) Revenue for the United States was $351.3 million and $248.7 million for the three months ended September 30, 2025 and 2024, respectively.

Current wording

(1) Revenue for the United States was $388.3 million and $296.1 million for the three months ended December 31, 2025 and 2024, respectively. Revenue for the United States was $739.6 million and $544.8 million for the six months ended December 31, 2025 and 2024, respectively.

Previous wording

The increase in EMEA revenues during the three months ended September 30, 2025, as compared to the same period in the prior year, was due to increased revenue from both our Enterprise Technology products as well as our Service Provider Technology products.

Current wording

The increase in EMEA revenues during the three months and six months ended December 31, 2025, as compared to the same periods in the prior year, was due to increased revenue from both our Enterprise Technology products, and our Service Provider Technology products.

Previous wording

Revenues in the Asia Pacific region increased by $12.2 million, or 30%, from $40.9 million in the three months ended September 30, 2024 to $53.1 million in the three months ended September 30, 2025.

Current wording

Revenues in the Asia Pacific region increased by $11.4 million, or 26%, from $43.1 million in the three months ended December 31, 2024 to $54.5 million in the three months ended December 31, 2025 and increased by $23.6 million, or 28%, from $84.0 million in the six months ended December 31, 2024 to $107.6 million in the six months ended December 31, 2025.

Previous wording

The increase in Asia Pacific revenues during the three months ended September 30, 2025, as compared to the same period in the prior year, was due to increased revenue from our Enterprise Technology products, partially offset by decreased revenue from our Service Provider Technology products.

Current wording

The increase in Asia Pacific revenues during the three months ended December 31, 2025, as compared to the same period in the prior year, was due to increased revenue from both our Enterprise Technology products, and Service Provider Technology products. The increase in Asia Pacific revenues during the six months ended December 31, 2025, as compared to the same period in the prior year, was due to increased revenue from our Enterprise Technology products, offset in part by decreased revenue from our Service Provider Technology products.

Previous wording

The increase in North America revenues during the three months ended September 30, 2025, as compared to the same period in the prior year, was due to increased revenue from our Enterprise Technology products, offset in part by decreased revenue from our Service Provider Technology products.

Current wording

The increase in South America revenues during the three months and six months ended December 31, 2025, as compared to the same periods in the prior year, was due to an increase in revenue from our Enterprise Technology products, offset in part by decreased revenue from our Service Provider Technology products.

Previous wording

Gross profit margin increased to 46.0% in the three months ended September 30, 2025, compared to 42.1% in the three months ended September 30, 2024. The increase in gross profit margin for the three months ended September 30, 2025, as compared to the comparable prior year period, was primarily driven by favorable product mix and, as a percentage of revenue, lower shipping costs, indirect operating expenses, and excess and obsolete inventory charges, offset in part by higher tariff costs.

Current wording

Gross profit margin increased to 46% in the three months ended December 31, 2025, compared to 41% in the three months ended December 31, 2024 and increased to 46% in the six months ended December 31, 2025, compared to 42% in the six months ended December 31, 2024. The increase in gross profit margin for the three months ended December 31, 2025, as compared to the comparable prior year period, was primarily driven by favorable product mix, lower shipping costs, lower excess and obsolete inventory charges, offset in part by higher tariff costs. The increase in gross profit margin for the six months ended December 31, 2025, as compared to the comparable prior year period, was primarily driven by favorable product mix, lower shipping costs, excess and obsolete inventory charges, and warehouse-related expenses, offset in part by higher tariff costs.

Previous wording

Research and development (“R&D”) expenses increased by $10.5 million, or 28%, from $38.0 million in the three months ended September 30, 2024 to $48.5 million in the three months ended September 30, 2025. As a percentage of revenues, R&D expenses remained consistent at 7% for the three months ended September 30, 2025 compared to the three months ended September 30, 2024.

Current wording

Research and development (“R&D”) expenses increased by $10.9 million, or 27%, from $40.0 million in the three months ended December 31, 2024 to $50.8 million in the three months ended December 31, 2025. As a percentage of revenues, R&D expenses decreased from 7% for the three months ended December 31, 2024 to 6% for the three months ended December 31, 2025.

Previous wording

The increase in R&D expenses during the three months ended September 30, 2025, as compared to the comparable prior year period, was primarily driven by higher employee-related expenses, higher prototype-related expenses and software costs.

Current wording

The increase in R&D expenses during the three and six months ended December 31, 2025, as compared to the comparable prior year periods, was primarily driven by higher employee-related expenses and prototype-related expenses.

Previous wording

Sales, general and administrative (“SG&A”) expenses increased by $2.7 million, or 11%, from $24.4 million in the three months ended September 30, 2024 to $27.1 million in the three months ended September 30, 2025. As a percentage of revenues, SG&A expenses remained consistent at 4% for the three months ended September 30, 2025, compared to the three months ended September 30, 2024.

Current wording

Sales, general and administrative (“SG&A”) expenses increased by $1.8 million, or 6%, from $28.5 million in the three months ended December 31, 2024 to $30.3 million in the three months ended December 31, 2025. As a percentage of revenues, SG&A expenses decreased from 5% for the three months ended December 31, 2024 to 4%, for the three months ended December 31, 2025.

Previous wording

The increase in SG&A for the three months ended September 30, 2025, as compared to the comparable prior year period, was primarily due to higher fees associated with webstore credit card processing, higher employee-related expenses, professional fees, and software expenses, partially offset by lower marketing expenses.

Current wording

The increase in SG&A for the three months ended December 31, 2025, as compared to the comparable prior year period, was primarily due to higher marketing expenses and credit card processing fees arising from increased webstore sales, offset in part by lower bad debt expenses relating to a customer default. The increase in SG&A for the six months ended December 31, 2025, as compared to the comparable prior year period, was primarily due to higher fees associated with webstore credit card processing, driven by higher webstore sales, marketing expenses, professional fees, and payroll expenses, offset in part by lower bad debt expenses relating to a customer default.

Previous wording

Interest expense and other, net ("I&O") expenses decreased by $7.4 million, or 70%, from $10.6 million in the three months ended September 30, 2024 to $3.2 million in the three months ended September 30, 2025. As a percentage of revenue, I&O expenses decreased from 2% for the three months ended September 30, 2024 to 0.4% for the three months ended September 30, 2025.

Current wording

Interest expense and other, net ("I&O") expenses decreased $9.9 million, or 86% from $11.4 million in the three months ended December 31, 2024 to $1.6 million in the three months ended December 31, 2025. As a percentage of revenue, I&O decreased from 2% for the three months ended December 31, 2024 to 0% for the three months ended December 31, 2025.

Previous wording

The decrease in I&O expenses during the three months ended September 30, 2025, as compared to the comparable prior year period, was primarily due to lower interest expense driven by a decrease in borrowings and lower interest rates and foreign exchange losses in the first quarter of fiscal 2026 compared to foreign exchange gains in the comparable prior year period.

Current wording

The decrease in I&O expenses during both the three and six months ended December 31, 2025, as compared to the comparable prior year periods, was primarily due to lower interest expense, driven by a decrease in borrowings and lower interest rates, and lower foreign exchange losses.

Previous wording

Our provision for income taxes increased by $20.0 million, or 65%, from $30.6 million for the three months ended September 30, 2024 to $50.7 million for the three months ended September 30, 2025. Our effective tax rate increased to 19.6% for the three months ended September 30, 2025 as compared to 19.3% for the three months ended September 30, 2024.

Current wording

Our provision for income taxes increased $27.1 million, or 89%, from $30.6 million for the three months ended December 31, 2024 to $57.7 million for the three months ended December 31, 2025. Our effective tax rate increased to 19.8% for the three months ended December 31, 2025 as compared to 18.3% for the three months ended December 31, 2024.

Previous wording

The change in effective tax rates for the three months ended September 30, 2025, as compared to the same period in the prior year, was primarily driven by a change in the mix of income earned in various tax jurisdictions as well as in the mix of income eligible for the Foreign-Derived Intangible Income (“FDII”) rules and subject to the Global Intangible Low-Taxes Income ("GILTI") and Pillar Two rules.

Current wording

The change in effective tax rates for the three and six months ended December 31, 2025, as compared to the same periods in the prior year, was primarily driven by a change in the mix of income earned in various tax jurisdictions as well as in the mix of income eligible for the Foreign-Derived Intangible Income (“FDII”) rules and subject to the Global Intangible Low-Taxes Income ("GILTI") and Pillar Two rules.

Previous wording

Our principal source of liquidity are cash and cash equivalents, cash generated by operations, the availability of additional funds under the Facilities and short-term investments. We had cash and cash equivalents of $177.2 million and $149.7 million as of September 30, 2025 and June 30, 2025, respectively.

Current wording

Our principal source of liquidity are cash and cash equivalents, cash generated by operations and the availability of additional funds under the Facilities. We had cash and cash equivalents of $302.8 million and $149.7 million as of December 31, 2025 and June 30, 2025, respectively.

Previous wording

Net cash provided by operating activities during the three months ended September 30, 2025 consisted primarily of net income of $207.9 million, and non-cash adjustments of $12.3 million, partially offset by other changes in operating assets and liabilities that resulted in net cash outflows of $21.7 million. This net change in operating assets and liabilities consisted primarily of a $32.5 million decrease in net accounts payable and accrued liabilities, a $6.6 million increase in inventories, partially offset by a $8.3 million increase in taxes payable, a $8.1 million increase in deferred revenue, and a $1.8 million decrease in vendor deposits.

Current wording

Net cash provided by operating activities during the six months ended December 31, 2025 consisted primarily of net income of $441.5 million, the benefit of decreasing vendor deposits of $7.2 million and non-cash adjustments of $23.9 million, partially offset by other changes in operating assets and liabilities that resulted in net cash outflows of $10.2 million. This net change in operating assets and liabilities consisted primarily of a $39.7 million decrease in taxes payable, a $11.3 million increase in prepaid expenses and other assets, $3.7 million increase in inventory and $2.2 million decrease in net accounts payable and accrued liabilities, partially offset by a $30.3 million decrease in accounts receivable and $16.5 million increase in deferred revenue.

Previous wording

Net cash provided by operating activities during the three months ended September 30, 2024 consisted primarily of net income of $128.0 million, and the benefit of decreasing vendor deposits of $21.7 million, decreasing inventories of $8.5 million and non-cash adjustments of $15.9 million, further augmented by other changes in operating assets and liabilities that resulted in net cash inflows of $59.7 million. This net change in operating assets and liabilities consisted primarily of a $58.7 million increase in net accounts payable and accrued liabilities, a $6.2 million increase in taxes payable and $5.4 million decrease in accounts receivable.

Current wording

Net cash provided by operating activities during the six months ended December 31, 2024 consisted primarily of net income of $264.8 million, the benefit of decreasing vendor deposits of $42.9 million and non-cash adjustments of $30.1 million, further augmented by

Previous wording

We used $5.2 million of cash in investing activities during the three months ended September 30, 2025. Our investing activities consisted primarily of $5.2 million of capital expenditures.

Current wording

We used $8.8 million of cash in investing activities during the six months ended December 31, 2025. Our investing activities consisted primarily of $8.8 million of capital expenditures.

Previous wording

We used $2.6 million of cash in investing activities during the three months ended September 30, 2024. Our investing activities consisted primarily of $2.6 million of capital expenditures.

Current wording

We used $4.6 million of cash in investing activities during the six months ended December 31, 2024. Our investing activities consisted primarily of $4.6 million of capital expenditures.

Previous wording

We used $165.8 million of cash in financing activities during the three months ended September 30, 2025. During the three months ended September 30, 2025, we repaid $116.3 million under the Company's Facilities and used $48.4 million related to dividends paid on our common stock.

Current wording

We used $300.5 million of cash in financing activities during the six months ended December 31, 2025. During the six months ended December 31, 2025, we repaid $202.5 million under the Company's credit Facilities and used $96.8 million related to dividends paid on our common stock.

Previous wording

We used $192.2 million of cash in financing activities during the three months ended September 30, 2024. During the three months ended September 30, 2024, we repaid $155.6 million under the Company’s Facilities and used $36.3 million related to dividends paid on our common stock.

Current wording

We used $374.8 million of cash in financing activities during the six months ended December 31, 2024. During the six months ended December 31, 2024, we repaid $301.9 million under the Company’s credit Facilities and used $72.6 million related to dividends paid on our common stock.

Previous wording

We believe our existing cash and cash equivalents, in addition to the ability to draw cash under the existing Revolving Facility, and our intention to enter into a new credit facility before the existing one matures in March 2026,if needed, will be sufficient to meet our near-term working capital requirements, pay quarterly dividends, make repurchases of our common stock and capital expenditure needs for the next twelve months. We believe that we have sufficient track record of managing working capital that we will be able to establish a new credit facility prior to the maturity of our existing credit facility satisfying our long-term liquidity requirements in the event that the cash from operations is not adequate to meet our cash needs. However, this estimate is based on a number of assumptions that may prove to be wrong and we could exhaust our available cash and cash equivalents earlier than presently anticipated or need to rely more heavily on the credit facilities or other sources of liquidity to continue to meet our needs. Our future capital requirements may vary materially from those currently planned and will depend on many factors, including our rate of revenue growth, the timing and extent of spending to support development efforts, the timing of new product introductions, market acceptance of our products, management of inventory and vendor deposits, the availability of additional funds under the credit facilities and overall economic conditions. Inflation and the current geopolitical environment have caused and may continue to cause significant volatility in financial markets and the domestic and global economy. This volatility may contribute to potential payment delays or defaults in our accounts receivable, affect asset valuations resulting in impairment charges, and affect the availability of financing credit as well as other segments of the credit markets. For a further discussion of the uncertainties and business risks, refer to "Part II-Item 1A. Risk Factors – Risks Related to Our Business and Industry – Our contract manufacturers, logistics centers and certain administrative and research and development operations, as well as our customers and suppliers, are located in areas likely to be subject to natural disasters, public health problems, military conflicts and geopolitical tensions, which could adversely affect our business, results of operations and financial condition" and "Part II-Item 1A. Risk Factors – Risks Related to Our Business and Industry – General global economic downturns and macroeconomic trends, including inflation or slowed economic growth, may negatively affect our customers and their ability to purchase our products. A downturn or such other trends may decrease our revenues and increase our costs and may increase credit risk with our customers and impact our ability to collect account receivable and recognize revenue," for additional information. We expect to continue to maintain financing flexibility in t…

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Current wording

We believe our existing cash and cash equivalents, in addition to the ability to draw cash under the existing Revolving Facility, and our intention to enter into a new credit facility before the existing one matures in March 2026, if needed, will be sufficient to meet our near-term working capital requirements, pay quarterly dividends, make repurchases of our common stock and meet capital expenditure needs for the next twelve months. We believe that we have sufficient track record of managing working capital that we will be able to establish a new credit facility prior to the maturity of our existing credit facility satisfying our long-term liquidity requirements in the event that the cash from operations is not adequate to meet our cash needs. However, this estimate is based on a number of assumptions that may prove to be wrong and we could exhaust our available cash and cash equivalents earlier than presently anticipated or need to rely more heavily on the credit facilities or other sources of liquidity to continue to meet our needs. Our future capital requirements may vary materially from those currently planned and will depend on many factors, including our rate of revenue growth, the timing and extent of spending to support development efforts, the timing of new product introductions, market acceptance of our products, management of inventory and vendor deposits, the availability of additional funds under the credit facilities and overall economic conditions. Inflation and the current geopolitical environment have caused and may continue to cause significant volatility in financial markets and the domestic and global economy. This volatility may contribute to potential payment delays or defaults in our accounts receivable, affect asset valuations resulting in impairment charges, and affect the availability of financing credit as well as other segments of the credit markets. For a further discussion of the uncertainties and business risks, refer to "Part II-Item 1A. Risk Factors – Risks Related to Our Business and Industry – Our contract manufacturers, logistics centers and certain administrative and research and development operations, as well as our customers and suppliers, are located in areas likely to be subject to natural disasters, public health problems, military conflicts and geopolitical tensions, which could adversely affect our business, results of operations and financial condition" and "Part II-Item 1A. Risk Factors – Risks Related to Our Business and Industry – General global economic downturns and macroeconomic trends, including inflation or slowed economic growth, may negatively affect our customers and their ability to purchase our products. A downturn or such other trends may decrease our revenues and increase our costs and may increase credit risk with our customers and impact our ability to collect account receivable and recognize revenue," for additional information. We expect to continue to maintain financing flexibilit…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

We subcontract with third parties to manufacture our products and supply key components. As of September 30, 2025, we had $1,249.8 million of purchase commitments with these third parties. If we cancel all or part of the orders, we may still be liable to the contract manufacturers for the cost of the components purchased by the subcontractors to manufacture our products. There have been no significant liabilities for current or anticipated cancellations recorded as of September 30, 2025. Our consolidated financial position and results of operations could be negatively impacted if we were required to compensate these third parties. In addition, we may be subject to additional purchase obligations to our contract manufacturers for supply agreements and components ordered by them based on manufacturing forecasts we provide them each month.

Current wording

We subcontract with third parties to manufacture our products and supply key components. As of December 31, 2025, we had $1,263.8 million of purchase commitments with these third parties. If we cancel all or part of the orders, we may still be liable to the contract manufacturers for the cost of the components purchased by the subcontractors to manufacture our products. There have been no significant liabilities for current or anticipated cancellations recorded as of December 31, 2025. Our consolidated financial position and results of operations could be negatively impacted if we were required to compensate these third parties. In addition, we may be subject to additional purchase obligations to our contract manufacturers for supply agreements and components ordered by them based on manufacturing forecasts we provide them each month.

Previous wording

As of September 30, 2025, we had $34.7 million of unrecognized tax benefits and an additional $6.0 million for accrued interest classified as non-current liabilities. At this time, we are unable to make a reasonably reliable estimate of timing of payments in individual years in connection with these tax liabilities.

Current wording

As of December 31, 2025, we had $34.7 million of unrecognized tax benefits and an additional $6.6 million for accrued interest classified as non-current liabilities. At this time, we are unable to make a reasonably reliable estimate of timing of payments in individual years in connection with these tax liabilities.

Previous wording

When used in this Report, the words “anticipates,” “believes,” “could,” “seeks,” “estimates,” “expects,” “intends,” “may,” “plans” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressions and negatives of those terms are intended to identify forward-looking statements. These are statements that relate to future periods and include statements about our future results, sources of revenue, our dividend, our continued growth, our gross margins, market trends, our product development, our introduction of new products, technological developments, the features, benefits and performance of our current and future products, the ability of our products to address a variety of markets, our growth strategies, future prices, our competitive status, our efforts to mitigate shortages of components used to manufacture our products, our dependence on our senior management and our ability to attract and retain key personnel, dependency on and concentration of our distributors, our employee relations, current and potential litigation, current or potential indemnification liabilities, the effects of government regulations, the impact of tariffs, the expected impact of taxes on our liquidity and results of operations, our compliance with laws and regulations, our expected future operating costs and expenses and expenditure levels for research and development, selling, general and administrative expenses, fluctuations in operating results, fluctuations in our stock price, our payment of dividends, our future liquidity and cash needs, and the adequacy of and our reliance on our sources of liquidity to meet such needs, our ability to access new sources of liquidity, the Facilities (as defined herein), future acquisitions of and investments in complimentary businesses, the expected impact of various accounting policies and rules adopted by the Financial Accounting Standards Board, the military conflict between Russia and Ukraine and the escalating tensions between China and Taiwan on our business and results of operations. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to, the impact of the global shortage of components and pricing inflation and supply chain constraints, associated therewith, the impact of U.S. tariffs on results of operations, our ability to procure products, our ability to manage our growth, our ability to sustain or increase profitability, demand for our products, our ability to compete, our ability to rapidly develop new technology and introduce new products, our ability to safeguard our intellectual property, trends in the markets that we compete and fluctuations in general economic conditions, the military conflict between Russia and Ukraine and the escalating tensions between China and Taiwan on our business, results and liquidity, and the risks set forth throughout thi…

Excerpt shortened here; the source contains the full paragraph.

Current wording

When used in this Report, the words “anticipates,” “believes,” “could,” “seeks,” “estimates,” “expects,” “intends,” “may,” “plans” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressions and negatives of those terms are intended to identify forward-looking statements. These are statements that relate to future periods and include statements about our future results, sources of revenue, our dividend, our continued growth, market trends, our product development, our introduction of new products, technological developments, the features, benefits and performance of our current and future products, the ability of our products to address a variety of markets, our growth strategies, future prices, our competitive status, our efforts to mitigate shortages of components used to manufacture our products, the effects of government regulations, the impact of tariffs, the expected impact of taxes on our liquidity and results of operations, our compliance with laws and regulations, our expected future operating costs and expenses and expenditure levels for research and development, selling, general and administrative expenses, fluctuations in operating results, fluctuations in our stock price, our payment of dividends, our future liquidity and cash needs, and the adequacy of and our reliance on our sources of liquidity to meet such needs, our ability to access new sources of liquidity, the Facilities (as defined herein), future acquisitions of and investments in complimentary businesses, the expected impact of various accounting policies and rules adopted by the Financial Accounting Standards Board, the military conflict between Russia and Ukraine and the escalating tensions between China and Taiwan on our business and results of operations. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to, our limited visibility into end customer demand and channel inventory levels, the impact of the global shortage of components and pricing inflation and supply chain constraints associated therewith, the impact of U.S. tariffs on results of operations, our ability to procure products, our ability to manage our growth, our ability to sustain or increase profitability, demand for our products, our ability to compete, our ability to rapidly develop new technology and introduce new products, our dependence on our senior management, our ability to safeguard our intellectual property, our dependence on and concentration of our distributors, our ability to compete in the markets we serve, our ability to comply with applicable law and regulations, our employee relations, current and potential litigation, current or potential indemnification liabilities, trends in the markets that we compete and fluctuations in general economic conditions, the military conflict between Russia and Ukraine and the escala…

Excerpt shortened here; the source contains the full paragraph.