Penguin Solutions, Inc.

Previous wording

Our fiscal year is the 52- or 53-week period ending on the last Friday in August. Fiscal years 2025 and 2024 contained 52 weeks and 53 weeks, respectively. All period references are to our fiscal periods unless otherwise indicated. All financial information for our subsidiaries in Brazil is included in our consolidated financial statements on a one-month lag because their fiscal years ended on July 31 of each year. In connection with the completion of the divestiture of an 81% interest in SMART Brazil, we ceased consolidating the operations of SMART Brazil in our financial statements as of the November 29, 2023 disposal date. As a result, financial information for the first quarter of 2024 includes the four-month period for the SMART Brazil operations from August 1, 2023 to November 29, 2023. All tabular amounts are in thousands.

Current wording

Our fiscal year is the 52- or 53-week period ending on the last Friday in August. Fiscal years 2025 and 2024 contain 52 weeks and 53 weeks, respectively. All period references are to our fiscal periods unless otherwise indicated. All financial information for our subsidiaries in Brazil is included in our consolidated financial statements on a one-month lag because their fiscal years ended on July 31 of each year. In connection with the completion of the divestiture of an 81% interest in SMART Brazil, we ceased consolidating the operations of SMART Brazil in our financial statements as of the November 29, 2023 disposal date. As a result, financial information for the first quarter of 2024 includes the four-month period for the SMART Brazil operations from August 1, 2023 to November 29, 2023. All tabular amounts are in thousands, except percentages.

Previous wording

On November 29, 2023, we completed the divestiture of an 81% interest in SMART Brazil to Lexar Europe B.V., an affiliate of Shenzhen Longsys Electronics Co. Ltd.

Current wording

On November 29, 2023, we completed the divestiture of an 81% interest in SMART Modular Technologies do Brasil – Indústria e Comercio de Componentes Ltda. (“SMART Brazil”) to Lexar Europe B.V., an affiliate of Shenzhen Longsys Electronics Co. Ltd.

Previous wording

Shifts in the Mix and Timing of Our Revenue. Shifts in the mix of revenue from our operating segments, and in the timing of revenue, which can vary significantly from period to period, can impact our business and operating results, including gross and operating margins. For example, our Advanced Computing segment has shown solid growth, but is subject to variability in its sales and margin profile from period to period for reasons such as: recognition of revenue is sometimes tied to customer decisions as to the completion of delivery and system go-

Current wording

Shifts in the Mix and Timing of Our Revenue: Shifts in the mix of revenue from our operating segments, and in the timing of revenue, which can vary significantly from period to period, can impact our business and operating results, including gross and operating margins. For example, our Advanced Computing segment has shown solid growth, but is subject to variability in its sales and margin profile from period to period for reasons such as the

Previous wording

live events, sales can be affected by the timing of customer deployments or customer budget considerations and margin is driven by the extent to which higher margin software and managed services comprise Advanced Computing sales. Our resource commitments and planning for each segment are relatively fixed in the short term, and as such, variability in expected revenue mix will have direct implications for our operating income and margins.

Current wording

following: recognition of revenue is sometimes tied to customer decisions as to the completion of delivery and system go-live events, sales can be affected by the timing of customer deployments or customer budget considerations and margin is driven by the extent to which higher margin software and managed services comprise Advanced Computing sales. Our resource commitments and planning for each segment are relatively fixed in the short term, and as such, variability in expected revenue mix will have direct implications for our operating income and margins.

Previous wording

Disruptions in Our Supply Chain May Adversely Affect Our Businesses. We depend on third-party suppliers for key components of our products, such as commodity DRAM components from offshore foundries that we use in our specialty memory products, third-party wafers that we use in our memory and LED businesses and AI and HPC components for our Advanced Computing business. In our memory and LED businesses, we have adopted a “Fab-Light” business model to reduce our capital expenditures and operating expenses, while affording greater flexibility in adapting to shifts in demand and other market trends. Our Fab-Light business model contributed to margin expansion in our overall business. However, our reliance on third-party manufacturers exposes us to risk of supply chain disruption and lost business. For example, the recent global semiconductor shortage has adversely affected our operating results. In addition, in our Advanced Computing business, where we source components from third parties, the high demand for and limited supply of AI components globally, as well as any delays in the production of such components, continues to affect our sourcing of these components and the timing of deployments. In particular, we continue to experience extended lead times for certain components that are incorporated into our overall solutions, which impacts how quickly we are able to ramp existing and new customer projects. If such disruptions worsen or are prolonged, or if there is meaningful disruption in our supply arrangement with any of our third-party suppliers, our operating results and financial condition may continue to be adversely affected.

Current wording

Disruptions in Our Supply Chain May Adversely Affect Our Businesses: We depend on third-party suppliers for key components of our products, such as commodity DRAM components from offshore foundries that we use in our specialty memory products, third-party wafers that we use in our memory and LED businesses and AI and HPC components for our Advanced Computing business. In our memory and LED businesses, we have adopted a “Fab-Light” business model to reduce our capital expenditures and operating expenses, while affording greater flexibility in adapting to shifts in demand and other market trends. Our Fab-Light business model contributes to margin expansion in our overall business. However, our reliance on third-party manufacturers exposes us to risk of supply chain disruption and lost business. For example, the recent global semiconductor shortage has adversely affected our operating results. In addition, in our Advanced Computing business, where we source components from third parties, the high demand for and limited supply of AI components globally, as well as any delays in the production of such components, continues to affect our sourcing of these components and the timing of deployments. In particular, we continue to experience extended lead times for certain components that are incorporated into our overall solutions, which impacts how quickly we are able to ramp existing and new customer projects. If such disruptions worsen or are prolonged, or if there is meaningful disruption in our supply arrangement with any of our third-party suppliers, our operating results and financial condition may continue to be adversely affected.

Previous wording

Net sales increased by $66.9 million, or 24.4%, in the first quarter of 2025 compared to the same period in the prior year due to higher sales from our Advanced Computing and Integrated Memory business segments. Advanced Computing net sales increased by $58.6 million, or 49.3%, primarily due to higher hardware sales driven by increased demand for AI solutions and high-performance computing. Integrated Memory net sales increased by $11.0 million, or 12.9%, primarily due to higher sales volumes of DRAM products stemming from improved market demand, partially offset by lower sales of Flash products. Optimized LED net sales decreased by $2.8 million, or 4.0%, primarily due to lower direct sales driven by continued macroeconomic headwinds in China.

Current wording

Net sales increased by $80.7 million, or 28.3%, and $147.6 million, or 26.4%, in the second quarter and first six months of 2025, respectively, compared to the same periods in the prior year. These increases are due to higher sales from our Advanced Computing and Integrated Memory business segments. Advanced Computing net sales increased by $58.8 million, or 41.5%, and $117.4 million, or 45.1%, in the second quarter and first six months of 2025, respectively, compared to the same periods in the prior year, primarily due to higher hardware sales driven by increased demand for AI solutions and high-performance computing. Integrated Memory net sales increased by $22.0 million, or 26.4%, and $33.0 million, or 19.5%, in the second quarter and first six months of 2025, respectively, compared to the same periods in the prior year, primarily due to higher sales volumes of DRAM products stemming from improved market demand, partially offset by lower supply chain services. Optimized LED net sales were flat in the second quarter and decreased by $2.8 million, or 2.2%, in the first six months of 2025, compared to the same periods in the prior year, primarily due to lower direct sales across China and Europe.

Previous wording

Cost of sales increased by $51.9 million, or 27.1%, in the first quarter of 2025, compared to the same period in the prior year, primarily driven by increased product sales from our Advanced Computing and Integrated Memory segments as noted above.

Current wording

Cost of sales increased by $58.0 million, or 28.6%, and $109.9 million, or 27.9%, in the second quarter and first six months of 2025, respectively, compared to the same periods in the prior year, primarily driven by increased product sales from our Advanced Computing and Integrated Memory segments as noted above.

Previous wording

Gross margin decreased to 28.7% in the first quarter of 2025 compared to 30.2% in the same period in 2024, primarily due to unfavorable mix from higher product revenue in our Advanced Computing business.

Current wording

Gross margin decreased to 28.6% in the second quarter of 2025 compared to 28.8% in the same period in 2024, and to 28.7% in the first six months of 2025 compared to 29.5% in the same period of 2024, primarily due to unfavorable mix from higher product revenue in our Advanced Computing business.

Previous wording

Below is a table of our operating income, measured on a non-GAAP basis, which Penguin Solutions management uses to supplement Penguin Solutions’ financial results under GAAP to analyze its operations and make decisions as to future operational plans and believes that this supplemental non-GAAP information is useful to investors in analyzing and assessing the company’s past and future operating performance. These non-GAAP measures exclude certain items, such as share-based compensation expense; amortization of acquisition-related intangible assets (consisting of amortization of developed technology, customer relationships, trademarks/trade names and

Current wording

Below is a table of our operating income, measured on a non-GAAP basis, which Penguin Solutions management uses to supplement Penguin Solutions’ financial results under GAAP to analyze its operations and make decisions as to future operational plans and believes that this supplemental non-GAAP information is useful to investors in analyzing and assessing our past and future operating performance. These non-GAAP measures exclude certain items, such as share-based compensation expense; amortization of acquisition-related intangible assets (consisting of amortization of developed technology, customer relationships, trademarks/trade names and backlog acquired in connection with business combinations); acquisition-related inventory adjustments; diligence, acquisition and integration expense; restructuring charges; impairment of goodwill; changes in the fair value of contingent consideration; redomiciliation costs; and other infrequent or unusual items. While amortization of acquisition-related intangible assets is excluded, the revenues from acquired companies is reflected in our non-GAAP measures and these intangible assets contribute to revenue generation. See “Item 1. Financial Statements – Notes to Consolidated Financial Statements – Segment and Other Information.”

Previous wording

Advanced Computing operating income increased by $12.2 million, or 68.2%, in the first quarter of 2025 compared to same period in the prior year, primarily due to increased net revenue, as well as lower operating expenses, mainly driven by lower subcontract services.

Current wording

Advanced Computing operating income increased by $14.6 million, or 65.7%, and $26.9 million, or 66.8%, in the second quarter and first six months of 2025, respectively, as compared to the same periods in the prior year, primarily due to increased net revenue, as well as lower operating expenses, mainly driven by lower subcontract services, partially offset by increased operating expenses, mainly driven by increased personnel costs stemming from bonus achievement.

Previous wording

Optimized LED operating income increased by $2.1 million, or 132.8%, in the first quarter of 2025 compared to the same period in the prior year, primarily due to higher gross profit, stemming from better factory leverage and more favorable product mix.

Current wording

Optimized LED operating income increased by $3.0 million, or 166.2%, and $5.1 million, or 2,420.0%, in the second quarter and first six months of 2025, respectively, as compared to the same periods in the prior year, primarily due to higher gross profit, stemming from more favorable product mix.

Previous wording

Research and development expense decreased by $1.6 million, or 7.4%, in the first quarter of 2025 compared to the same period in the prior year, primarily due to lower personnel-related expenses mainly driven by headcount reductions, as well as lower subcontract services mainly driven by Penguin Computing.

Current wording

Research and development expense decreased by $0.6 million, or 3.0%, and $2.2 million, or 5.2%, in the second quarter and first six months of 2025, respectively, as compared to the same periods in the prior year, primarily due to lower personnel-related expenses mainly driven by headcount reductions, as well as lower subcontract services mainly driven by Penguin Computing.

Previous wording

During the second quarter of 2023, we initiated a plan pursuant to which we intend to wind down manufacturing and discontinue the sale of certain legacy products offered through our Penguin Edge business by approximately

Current wording

During the second quarter of 2023, we initiated a plan pursuant to which we intend to wind down manufacturing and discontinue the sale of certain legacy products offered through our Penguin Edge business by approximately the end of 2025. In connection therewith and with the preparation of the financial statements included in this Quarterly Report, we assessed goodwill associated with our Penguin Edge business within our Advanced Computing segment and concluded it was partially impaired. As a result, we recorded a charge of $6.1 million in the second quarter of 2025 to impair the carrying value of Advanced Computing goodwill. We currently anticipate that the goodwill of the Penguin Edge reporting unit of $10.0 million as of February 28, 2025 will become further impaired in future periods.

Previous wording

Other operating expense in the first quarter of 2025 and 2024 included restructuring charges of $0.1 million and $2.9 million, respectively, primarily for employee severance costs and other benefits resulting from workforce reductions, the elimination of certain projects across our businesses and other costs associated with the wind down of our Penguin Edge business. We anticipate that these activities will continue into future quarters and anticipate recording additional restructuring charges.

Current wording

Other operating expense in the first six months of 2025 and 2024 included restructuring charges of $1.0 million and $6.3 million, respectively, primarily for employee severance costs and other benefits resulting from workforce reductions, the elimination of certain projects across our businesses and other costs associated with the wind down of our Penguin Edge business. We anticipate that these activities will continue into future quarters and anticipate recording additional restructuring charges.

Previous wording

Net interest expense decreased by $5.2 million in the first quarter of 2025 compared to the same period in the prior year, primarily due to principal payments made on the Amended 2027 TLA (as defined below) during the last half of fiscal 2024.

Current wording

Net interest expense decreased by $5.1 million in the first six months of 2025 compared to the same period in the prior year, primarily due to principal payments made on the Amended 2027 TLA (as defined below) during the last half of fiscal 2024.

Previous wording

Other non-operating (income) expense in the first quarter of 2025 and 2024 primarily reflected foreign currency gains (losses). See “Item 1. Financial Statements – Notes to Consolidated Financial Statements – Other Non-operating (Income) Expense.”

Current wording

Other non-operating (income) expense in the first six months of 2025 and 2024 primarily reflected foreign currency gains (losses). See “Item 1. Financial Statements – Notes to Consolidated Financial Statements – Other Non-operating (Income) Expense.”

Previous wording

Income tax provision in the first quarter of 2025 increased by $2.8 million as compared to the same period in the prior year, primarily due to an increase in profit before tax in jurisdictions subject to income tax.

Current wording

Income tax provision in the second quarter and first six months of 2025 increased by $5.4 million and by $8.3 million, respectively, as compared to the same periods in the prior year, primarily due to an increase in profit before tax in jurisdictions subject to income tax, partially offset by a reduction in withholding tax and increase in research and development tax credit.

Previous wording

Our effective tax rate was 51.6% in the first quarter of 2025 and differed from the U.S. statutory rate primarily due to losses generated in a jurisdiction where no tax benefit can be recognized and to withholding taxes and state income taxes. Our effective tax rate was (46.0)% in the first quarter of 2024 and differed from the U.S. statutory rate primarily due to losses generated in a jurisdiction where no tax benefit can be recognized, withholding taxes and state income taxes.

Current wording

Our effective tax rate was 46.3% and 48.6% in the second quarter and first six months of 2025, respectively, and differed from the U.S. statutory rate primarily due to losses generated in a jurisdiction where no tax benefit can be recognized and to withholding taxes, state income taxes, and nondeductible compensation paid to officers,

Previous wording

The global minimum tax under the Pillar Two framework became effective for us in the first quarter of fiscal year 2025. While the impact on our unaudited consolidated financial statements is currently not material, our analysis is ongoing as the Organisation for Economic Co-operation and Development continues to release additional guidance and countries enact related legislation.

Current wording

The global minimum tax under the Pillar Two framework became effective for us in the first quarter of 2025. While the impact on our unaudited consolidated financial statements is currently not material, our analysis is ongoing as the Organisation for Economic Co-operation and Development continues to release additional guidance and countries enact related legislation.

Previous wording

As discussed above, we have presented the results of SMART Brazil as discontinued operations in our consolidated statements of operations. As of August 25, 2023, SMART Brazil was classified as held for sale. Accordingly, in 2023 we evaluated the carrying value of the net assets of SMART Brazil (including $206.3 million recognized within shareholders’ equity related to the cumulative translation adjustment from SMART Brazil), estimated costs to sell and expected proceeds and concluded the net assets were impaired. As a result, we recognized an impairment charge of $153.0 million in 2023 to write down the carrying value of the net assets of SMART Brazil. In addition, we concluded that the outside basis of SMART Brazil inclusive of any withholding taxes should be recognized upon the classification as held for sale as of August 25, 2023. Accordingly, we recognized withholding taxes on the expected capital gain and deferred tax liabilities of $28.6 million in 2023. In the first quarter of 2024, we completed the divestiture, and in connection therewith, recognized an additional loss of $8.9 million.

Current wording

As discussed above, we have presented the results of SMART Brazil as discontinued operations in our consolidated statements of operations. In the first quarter of 2024, we completed the divestiture, and in connection therewith, recognized a loss of $8.9 million.

Previous wording

resources have been acquisitions, debt service requirements, capital expenditures, research and development expenditures and working capital requirements. We expect that future capital expenditures will focus on expanding our research and development activities, manufacturing equipment upgrades, acquisitions and IT infrastructure and software upgrades. Cash and cash equivalents generally consist of funds held in demand deposit accounts, money market funds and time deposits. We do not acquire investments for trading or speculative purposes.

Current wording

As of February 28, 2025, we had cash, cash equivalents and short-term investments of $647.0 million, of which $489.2 million was held by subsidiaries outside of the United States. Our principal uses of cash and capital resources have been acquisitions, debt service requirements, capital expenditures, research and development expenditures and working capital requirements. We expect that future capital expenditures will focus on expanding our research and development activities, manufacturing equipment upgrades, acquisitions and IT infrastructure and software upgrades. Cash and cash equivalents generally consist of funds held in demand deposit accounts, money market funds and time deposits. We do not acquire investments for trading or speculative purposes.

Previous wording

On February 7, 2022, Penguin Solutions and SMART Modular Technologies, Inc. (collectively, the “Borrowers”) entered into a credit agreement (the “Original Credit Agreement”) with a syndicate of banks and Citizens Bank, N.A., as administrative agent that provided for (i) a term loan credit facility in an aggregate principal amount of $275.0 million (the “2027 TLA”) and (ii) a revolving credit facility in an aggregate principal amount of $250.0 million (the “2027 Revolver”), in each case, maturing on February 7, 2027. The Original Credit Agreement provides that up to $35.0 million of the 2027 Revolver is available for issuances of letters of credit. The Original Credit Agreement has subsequently been amended to, among other things, provide for incremental term loans in an aggregate amount of $300.0 million (together with the 2027 TLA, the “Amended 2027 TLA”), amend the First Lien Leverage Ratio (as defined in the Amended Credit Agreement) and increase the aggregate amount of unrestricted cash and permitted investments netted from the definitions of Consolidated First Lien Debt and Consolidated Net Debt. As of November 29, 2024, there was $300.0 million of aggregate principal amount outstanding under the Amended 2027 TLA and there were no amounts outstanding under the 2027 Revolver.

Current wording

On February 7, 2022, Penguin Solutions and SMART Modular Technologies, Inc. entered into a credit agreement (the “Original Credit Agreement”) with a syndicate of banks and Citizens Bank, N.A., as administrative agent that provided for (i) a term loan credit facility in an aggregate principal amount of $275.0 million (the “2027 TLA”) and (ii) a revolving credit facility in an aggregate principal amount of $250.0 million (the “2027 Revolver”), in each case, maturing on February 7, 2027. The Original Credit Agreement provided that up to $35.0 million of the 2027 Revolver is available for issuances of letters of credit. On August 29, 2022, the Original Credit Agreement was amended (the “Amended Credit Agreement”) to, among other things, provide for incremental term loans in an aggregate amount of $300.0 million (together with the 2027 TLA, the “Amended 2027 TLA”), amend the First Lien Leverage Ratio (as defined in the Amended Credit Agreement) and increase the aggregate amount of unrestricted cash and permitted investments netted from the definitions of Consolidated First Lien Debt and Consolidated Net Debt. As of February 28, 2025, there was $300.0 million of aggregate principal amount outstanding under the Amended 2027 TLA and there were no amounts outstanding under the 2027 Revolver.

Previous wording

On December 13, 2024, we closed the Investment (as defined above) by SKT. Pursuant to the SKT Purchase Agreement, we sold to Astra AI Infra LLC, an affiliate of SKT, 200,000 convertible preferred shares, par value $0.03 per share, of Penguin Solutions (defined above as the “CPS”), at a price of $1,000 per share or an aggregate price of $200 million. The CPS are convertible into ordinary shares at a conversion price of $32.81 per preferred share, subject to adjustment upon the occurrence of certain events, will have an initial liquidation preference of 1x and will only be redeemable at our option, subject to certain conditions. The holder of the CPS may convert such holder’s CPS into ordinary shares at any time, provided that the CPS may, at our option, automatically be converted into ordinary shares on any date following the second anniversary of the closing upon certain conditions. The CPS entitles the holder to receive dividends of six percent per annum, cumulative, and payable quarterly in-kind or in cash at our option.

Current wording

On December 13, 2024, we closed the SKT Investment (as defined below) by SK Telecom Co., Ltd. (“SKT”). Pursuant to the SKT Purchase Agreement, we sold to Astra AI Infra LLC, an affiliate of SKT, 200,000 convertible preferred shares, par value $0.03 per share, of Penguin Solutions (defined above as the “CPS”), at a price of $1,000 per share or an aggregate price of $200.0 million (the “SKT Investment”). The CPS are convertible into ordinary shares at an initial conversion price of $32.81, subject to adjustment upon the occurrence of certain events, will have an initial liquidation preference of 1x and will only be redeemable at our option, subject to certain conditions. The holder of the CPS may convert such holder’s CPS into ordinary shares at any time, provided that the CPS may, at our option, automatically be converted into ordinary shares on any date following the second anniversary of the closing upon certain conditions. The CPS entitles the holder to receive dividends of six percent per annum, cumulative, and payable quarterly in-kind or in cash at our option.

Previous wording

Net cash provided by operating activities from continuing operations in the first quarter of 2025 resulted primarily from a net income of $6.0 million, adjusted for non-cash items of $26.9 million. Operating cash flows were adversely affected by a $19.1 million net change in our operating assets and liabilities, primarily from the effects of an increase of $93.4 million in inventories, primarily to support our Advanced Computing business, and an increase of $23.9 million in accounts receivable due to increased sales, partially offset by the effects of an increase of $97.5 million in accounts payable and accrued expenses and other liabilities primarily due to higher customer deposits resulting from refundable amounts received from customers in advance of satisfying performance obligations.

Current wording

Net cash provided by operating activities from continuing operations in the first six months of 2025 resulted primarily from net income of $14.8 million, adjusted for non-cash items of $58.8 million. Operating cash flows were positively affected by a $13.0 million net change in our operating assets and liabilities, primarily from the effects of an increase of $122.1 million in accounts payable and accrued expenses and other liabilities primarily due to increase in deferred revenue from customer services and higher accounts payable related to the timing of trade purchases, and a decrease of $15.7 million in other assets, partially offset by an increase of $46.2 million in inventories, primarily to support future demand across both Advanced Computing and Integrated Memory, and an increase of $78.6 million in accounts receivable primarily due to increased sales.

Previous wording

Net cash provided by operating activities from continuing operations in the first quarter of 2024 resulted primarily from a net loss of $11.2 million, adjusted for non-cash items of $30.0 million. Operating cash flows were favorably affected by a $40.9 million net change in our operating assets and liabilities, primarily from the effects of a decrease of $48.7 million in accounts receivable and an increase of $23.6 million in accounts payable and accrued expenses and other liabilities, partially offset by the effect of an increase of $33.5 million in inventories. The decrease in accounts receivable was primarily due to lower gross sales in our Advanced Computing and Integrated Memory segments. Inventories and accounts payable and accrued expenses and other liabilities increased primarily to support our Advanced Computing business.

Current wording

Net cash provided by operating activities from continuing operations in the first six months of 2024 resulted primarily from a net loss of $24.2 million, adjusted for non-cash items of $59.4 million. Operating cash flows were favorably affected by a $2.6 million net change in our operating assets and liabilities, primarily from the effects of a decrease of $49.5 million in accounts receivable partially offset by the payment of $29.0 million of contingent consideration related to our 2023 acquisition of Stratus Technologies and an increase of $21.1 million in other current assets. The decrease in accounts receivable was primarily due to lower gross sales in our Advanced Computing and Integrated Memory segments.

Previous wording

Investing Activities: Net cash used for investing activities from continuing operations in the first quarter of 2025 consisted primarily of $16.9 million net purchase of marketable investment securities and $1.8 million for capital expenditures and deposits on equipment.

Current wording

Investing Activities: Net cash used for investing activities from continuing operations in the first six months of 2025 consisted primarily of $18.6 million net purchase of marketable investment securities and $4.2 million for capital expenditures and deposits on equipment.

Previous wording

Net cash used for investing activities from continuing operations in the first quarter of 2024 consisted of $4.6 million for capital expenditures and deposits on equipment, offset by net maturities of marketable investment securities of $1.2 million.

Current wording

Net cash used for investing activities from continuing operations in the first six months of 2024 consisted of $9.9 million for capital expenditures and deposits on equipment, offset by net maturities of marketable investment securities of $2.5 million.

Previous wording

Financing Activities: Net cash used for financing activities from continuing operations in the first quarter of 2025 consisted primarily of $11.1 million of payments to acquire our ordinary shares (including $7.8 million under our share repurchase program), partially offset by $3.4 million in proceeds from the issuance of ordinary shares from our equity plans.

Current wording

Financing Activities: Net cash provided by financing activities from continuing operations in the first six months of 2025 consisted primarily of $191.2 million of proceeds from the issuance of preferred shares, net of issuance costs of $8.8 million, and $3.7 million in proceeds from the issuance of ordinary shares from our equity plans, partially offset by $17.6 million of payments to acquire our ordinary shares (including $11.1 million under our share repurchase program).

Previous wording

Net cash used for financing activities from continuing operations in the first quarter of 2024 consisted primarily of $14.4 million in principal repayment of debt and $13.1 million of payments to acquire our ordinary shares, partially offset by $3.5 million in proceeds from the issuance of ordinary shares from our equity plans.

Current wording

Net cash used for financing activities from continuing operations in the first six months of 2024 consisted primarily of $51.6 million in principal repayment of debt, $21.0 million for payment of contingent consideration related to our 2023 acquisition of Stratus Technologies and $15.9 million of payments to acquire our ordinary shares (including $13.9 million under our share repurchase program), partially offset by $4.2 million in proceeds from the issuance of ordinary shares from our equity plans.

Previous wording

The preparation of these financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures. We evaluate our estimates and judgments on an ongoing basis. Estimates and judgments are based on historical experience, forecasted events and various other assumptions that we believe to be reasonable under the circumstances; however, actual results could differ from those estimates. Our

Current wording

The preparation of these financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures. We evaluate our estimates and judgments on an ongoing basis. Estimates and judgments are based on historical experience, forecasted events and various other assumptions that we believe to be reasonable under the circumstances; however, actual results could differ from those estimates. Our management believes our critical accounting estimates require management’s most difficult, subjective or complex judgments and are critical in the portrayal of our financial condition and results of operations. Our discussion of critical accounting estimates is intended to supplement our summary of significant accounting policies so that readers will have greater insight into the uncertainties involved in applying our critical accounting policies and estimates.