Ranpak Holdings Corp.

Previous wording

The following discussion and analysis is intended to help the reader understand our business, financial condition, results of operations, liquidity and capital resources. You should read this discussion in conjunction with the sections entitled “Risk Factors” and “Forward-Looking Statements,” and our financial statements and related notes included in this Quarterly Report as well as the section entitled, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of Ranpak included in our 2024 10-K, filed with the SEC on March 17, 2025. Capitalized terms used and not defined herein have the meanings disclosed elsewhere in the Quarterly Report.

Current wording

The following discussion and analysis is intended to help the reader understand our business, financial condition, results of operations, liquidity and capital resources. You should read this discussion in conjunction with the sections entitled “Risk Factors” and “Cautionary Notice Regarding Forward-Looking Statements”and our financial statements and related notes included in this Quarterly Report as well as the sections entitled “Risk Factors,”“Cautionary Notice Regarding Forward-Looking Statements,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of Ranpak Holdings Corp (“Ranpak”, the “Company,” “we,” or “us”) included in our 2025 10-K, filed with the SEC on March 5, 2026. Capitalized terms used and not defined herein have the meanings disclosed elsewhere in the Quarterly Report.

Previous wording

The following discussion contains forward-looking statements that reflect future plans, estimates, beliefs and expected performance. The forward-looking statements are dependent upon events, risks and uncertainties that may be outside of the Company's control. The Company’s actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in the sections titled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” included elsewhere in this Quarterly Report.

Current wording

The following discussion contains forward-looking statements that reflect future plans, estimates, beliefs and expected performance. The forward-looking statements are dependent upon events, risks and uncertainties that may be outside of the Company’s control. The Company’s actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in the sections titled “Risk Factors” and “Cautionary Notice Regarding Forward-Looking Statements” included elsewhere in this Quarterly Report.

Previous wording

Ranpak is a leading provider of environmentally sustainable, systems-based, product protection and end-of-line automation solutions for e-commerce and industrial supply chains. Since our inception in 1972, we have delivered high quality protective packaging solutions, while maintaining commitment to environmental sustainability. We provide our paper-based Protective Packaging Solutions (“ PPS”) systems and paper consumables to distributors and certain select end-users. We operate manufacturing facilities in the United States, Europe and Asia. For our Automation product lines, we currently have dedicated facilities in Shelton, Connecticut and the Netherlands. R Squared Robotics, a division of Ranpak, uses three-dimensional computer vision and artificial intelligence technologies to improve end-of-line packaging and logistics functions. We are a global business that generated approximately 56% of our 2024 net revenue outside of the United States.

Current wording

Ranpak is a leading provider of environmentally sustainable, systems-based, product protection and end-of-line automation solutions for e-commerce and industrial supply chains. We provide our Protective Packaging Solutions (“PPS”) systems and paper consumables to distributors and certain select end-users. We operate manufacturing facilities in the United States, Europe and Asia. For our Automation product lines, we currently have dedicated facilities in Shelton, Connecticut and the Netherlands. R Squared Robotics, a division of Ranpak, uses three-dimensional computer vision and artificial intelligence technologies to improve end-of-line packaging and logistics functions.

Previous wording

We have two segments, North America and Europe/Asia. Management evaluates segment performance by net revenue and Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) by geographic region.

Current wording

We generated net revenue of $101.2 million and $91.2 million in the three months ended March 31, 2026 and 2025, respectively. We have two segments, North America and Europe/Asia. Management evaluates segment performance by net revenue and Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) by geographic region.

Previous wording

Paper and Other Costs. Paper is a key component of our cost of goods sold and paper costs can fluctuate significantly between periods. We purchase both 100% virgin and 100% recycled paper, as well as blends, from various suppliers for conversion into the paper consumables we sell. The cost of paper supplies is our largest input cost, and we historically have negotiated supply and pricing arrangements with most of our paper suppliers annually, with a view towards mitigating fluctuations in paper cost. Nevertheless, as paper is a commodity, its price on the open market, and in turn the prices we negotiate with suppliers at a given point in time, can fluctuate significantly, and is affected by several factors outside of our control, including inflationary pressures, supply and demand and the cost of other commodities that are used in the manufacture of paper, including wood, energy, and chemicals. For example, energy prices in Europe have experienced recent increased volatility, and such volatility has, in the past, increased the cost of paper. The market for our solutions is competitive and it may be difficult to pass on increases in paper prices to our customers immediately, or at all, which has in the past, and could in the future, adversely affect our operating results. Although we look to pass increased market costs on to our customers to mitigate the impact of these costs, we are unable to predict our ability to pass these costs on to our customers and how much of these increases we will be able to pass on to our customers. As such, we expect some continued pressure on our gross margin in the medium term relative to our historical margin profile.

Current wording

Paper and Other Costs. Paper is a key component of our cost of goods sold and paper costs can fluctuate significantly between periods. We purchase both 100% virgin and 100% recycled paper, as well as blends, from various suppliers for conversion into the paper consumables we sell. The cost of paper supplies is our largest input cost, and we historically have negotiated supply and pricing arrangements with most of our paper suppliers annually, with a view towards mitigating fluctuations in paper cost. Nevertheless, as paper is a commodity, its price on the open market, and in turn the prices we negotiate with suppliers at a given point in time, can fluctuate significantly, and is affected by several factors outside of our control, including inflationary pressures, supply and demand and the cost of other commodities that are used in the manufacture of paper, including wood, energy, and chemicals. For example, energy prices in Europe have experienced recent increased volatility, and such volatility has, in the past, increased the cost of paper. The market for our solutions is competitive and it may be difficult to pass on increases in paper prices to our customers immediately, or at all, which has in the past, and could in the future, adversely affect our operating results. Although we look to pass increased market costs on to our customers to mitigate the impact of these costs, we are unable to predict the extent to which we will be able to do so. As such, we expect some continued pressure on our gross margin in the medium term relative to our historical margin profile.

Previous wording

Effect of Currency Fluctuations. As a result of the geographic diversity of our operations, we are exposed to the effects of currency translation, which has affected the comparability of our results of operations between the periods presented in this Quarterly Report and may affect the comparability of our results of operations in future periods. Currency transaction exposure results when we generate net revenue in one currency at one time and incur expenses in another currency at another time, or when we realize gain or loss on intercompany transfers. While we seek to limit currency transaction exposure by matching the currencies in which we incur sales and expenses, we may not always be able to do so.

Current wording

Effect of Currency Fluctuations. We are a global business that generated approximately 53% of our 2025 net revenue outside of the United States. As a result of the geographic diversity of our operations, we are exposed to the effects of currency translation, which has affected the comparability of our results of operations between the periods presented in this Quarterly Report and may affect the comparability of our results of operations in future periods. Currency transaction exposure results when we generate net revenue in one currency at one time and incur expenses in another currency at another time, or when we realize gain or loss on intercompany transfers. While we seek to limit currency transaction exposure by matching the currencies in which we incur sales and expenses, we may not always be able to do so.

Previous wording

Inflationary Pressures and Other Costs. We have continued to experience inflationary pressures in 2025, which have adversely impacted some of our end-users, such as automotive companies; distributors; electronic manufacturers; machinery manufacturers; e-commerce and mail order fulfillment firms; and other end-users that are particularly sensitive to reductions in business and consumer spending by their respective customers, and which in turn have impacted our net revenue. Higher costs due to inflation were partially offset by price increases, which mitigated the impact on our operating results. However, our ability to predict or further offset inflationary cost increases in the future or during economic downturns or recessions may be limited or impacted by heightened competition for market share, an unwillingness by our customers to accept price increase or pressure to reduce selling prices if end-users reduce their volume of purchases. Inflationary pressures and associated higher interest rates and borrowing costs may also impact the ability of some of our end-users and suppliers to obtain funds for operations and capital expenditures, which could negatively impact our ability to obtain necessary supplies as well as the sales of materials and equipment to affected end-users. This could also result in reduced or delayed collections of outstanding accounts receivable from end-users, which could impact our cash flows. As a result, to the extent inflationary pressures continue, we expect additional pressure on our net revenue and gross margin. We will continue to evaluate the impact of inflationary pressures on our profitability and cash flows as well as our end-users.

Current wording

Inflationary Pressures and Other Costs. We have continued to experience inflationary pressures in 2026, which have adversely impacted some of our end-users, such as automotive companies; electronic manufacturers; machinery manufacturers; e-commerce and mail order fulfillment firms; and other end-users that are particularly sensitive to reductions in business and consumer spending by their respective customers, and which in turn have impacted our net revenue. Higher costs due to inflation were partially offset by price increases, which mitigated the impact on our operating results. However, our ability to predict or further offset inflationary cost increases in the future or during economic downturns or recessions may be limited or impacted by heightened competition for market share, an unwillingness by our customers to accept price increase or pressure to reduce selling prices if end-users reduce their volume of purchases. Inflationary pressures and associated changing interest rates and borrowing costs may also impact the ability of some of our end-users and suppliers to obtain funds for operations and capital expenditures, which could negatively impact our ability to obtain necessary supplies as well as the sales of materials and equipment to affected end-users. This could also result in reduced or delayed collections of outstanding accounts receivable from end-users, which could impact our cash flows. As a result, to the extent inflationary pressures continue, we expect additional pressure on our net revenue and gross margin. We will continue to evaluate the impact of inflationary pressures on our profitability and cash flows as well as our end-users.

Previous wording

In addition to inflationary pressures, our U.S. operations are subject to the impact of tariffs, largely related to our capital expenditures of our PPS converters, some of which are sourced from China or contain parts and components from China and other Asian countries. We are taking steps to minimize the potential impact of these tariffs by evaluating alternative parts and global suppliers as well as stepping up our efforts to refabricate and refurbish existing machines in our fleet to reduce cost. Our box customization equipment is currently made in Europe and shipped to the United States and thus will be subject to the European tariff rate. We are focused on cost out and efficiencies to minimize the impact to our customers, and believe in the ongoing value proposition of our equipment.

Current wording

In addition to inflationary pressures, our U.S. operations are subject to the impact of tariffs, largely related to our capital expenditures for our PPS converters, some of which are sourced from China or contain parts and components from China and other Asian countries. We are taking steps to minimize the potential impact of these tariffs by evaluating alternative parts and global suppliers as well as stepping up our efforts to refabricate and refurbish existing machines in our fleet to reduce cost. Our box customization equipment is currently made in Europe and shipped to the United States and thus will be subject to the U.S. tariff on European goods. We are focused on cost reduction and efficiencies to minimize the impact to our customers, and believe in the ongoing value proposition of our equipment.

Previous wording

In addition, in our discussion below, we include certain other unaudited, non-GAAP data and Constant Currency (Non-GAAP) % Change data for the three months ended September 30, 2025 and 2024. This data is based on our historical financial statements included elsewhere in this Quarterly Report. Refer to “Non-GAAP Measures” and “Reconciliation of GAAP to Non-GAAP Measures” for additional information and a reconciliation of EBITDA and AEBITDA to our net loss under GAAP.

Current wording

In addition, in our discussion below, we include certain other unaudited, non-GAAP data and Constant Currency (Non-GAAP) % Change data for the three months ended March 31, 2026 and 2025. This data is based on our historical financial statements included elsewhere in this Quarterly Report. Refer to “Non-GAAP Measures” and “Reconciliation of GAAP to

Previous wording

Net revenue for the third quarter of 2025 was $99.6 million compared to $92.2 million for the third quarter of 2024, an increase of $7.4 million or 8.0% (4.4% on a constant currency basis) and includes a non-cash reduction of $0.8 million to void-fill net revenue from the provision for warrants. Net revenue was positively impacted primarily by increases in automation, void-fill, and wrapping. Cushioning increased $0.1 million, or 0.3%, to $35.8 million from $35.7 million; void-fill increased $2.0 million, or 4.8%, to $43.4 million from $41.4 million; wrapping increased $0.7 million, or 9.0%, to $8.5 million from $7.8 million; and automation net revenue increased $4.6 million, or 63.0% to $11.9 million from $7.3 million for the third quarter of 2025 compared to the third quarter of 2024.

Current wording

Net revenue for the first quarter of 2026 was $101.2 million compared to $91.2 million for the first quarter of 2025, an increase of $10.0 million or 11.0% (4.5% on a constant currency basis) and includes a non-cash reduction of $0.9 million to void-fill and $0.8 million to automation net revenue from the provision for warrants in the current period. Net revenue for the first quarter of 2025 includes a non-cash reduction of $0.8 million to void-fill from the provision for warrants. Net revenue was positively impacted primarily by increases in automation equipment sales. The increase in void-fill and cushioning was primarily driven by favorable foreign currency fluctuations. Cushioning increased $1.4 million, or 4.0%, to $36.6 million from $35.2 million; void-fill increased $1.6 million, or 4.0%, to $41.9 million from $40.3 million; wrapping decreased $0.1 million, or 1.1%, to $9.3 million from $9.4 million; and automation net revenue increased $7.1 million, or 112.7% to $13.4 million from $6.3 million for the first quarter of 2026 compared to the first quarter of 2025.

Previous wording

The increase in net revenue for the third quarter of 2025 compared to the third quarter of 2024 is quantified by a 4.5% increase in the automated equipment sales, a 3.6% increase from foreign currency fluctuations, and a 1.0% increase in the price or mix of our paper consumable products, partially offset by a decrease in the volume of sales of our paper consumable products of approximately 0.3%, and includes a 0.8% non-cash decrease from the provision for warrants.

Current wording

The increase in net revenue for the first quarter of 2026 compared to the first quarter of 2025 is quantified by a 6.8% increase in automation equipment sales, a 6.5% increase from foreign currency fluctuations, and a 0.8% increase in the volume of sales of our paper consumable products, partially offset by a 2.1% decrease in the price or mix of our paper consumable products and a 1.0% non-cash decrease from the provision for warrants.

Previous wording

Cost of sales for the third quarter of 2025 totaled $65.2 million, an increase of $7.4 million, or 12.8% (9.3% at constant currency), compared to $57.8 million in the third quarter of 2024. We have quantified the change in cost of sales as follows:

Current wording

Cost of sales for the first quarter of 2026 totaled $66.3 million, an increase of $6.0 million, or 10.0% (4.1% at constant currency), compared to $60.3 million in the first quarter of 2025. We have quantified the change in cost of sales as follows:

Previous wording

The increase in cost of sales was primarily due to an increase in production costs of 9.5% and fluctuations in foreign currency rates of 3.5%, partially offset by a decrease in the volume of products sold of 0.2% compared to the third quarter of 2024. Production costs include costs from materials, labor and overhead, and depreciation expense.

Current wording

The increase in cost of sales was primarily due to an increase in the volume/mix of products sold of 7.9% and fluctuations in foreign currency rates of 5.9%, partially offset by a decrease in production costs of 3.8% compared to the first quarter of 2025. The 7.9% change in volume/mix is primarily attributable to an increase in automation equipment sales, which drove a 7.2% increase in cost of sales. Production costs include costs from materials, labor and overhead, and depreciation expense.

Previous wording

Selling, General, and Administrative (“SG&A”) Expenses. SG&A expenses for the third quarter of 2025 were $29.6 million, an increase of $0.8 million, or 2.8%, from $28.8 million in the third quarter of 2024. The increase in SG&A expenses was primarily due to a $2.1 million increase in professional services fees, partially offset by a $1.2 million decrease in compensation and temporary labor costs, compared to the third quarter of 2024. SG&A expenses were further impacted by foreign currency headwinds in the third quarter of 2025 as compared to 2024.

Current wording

Selling, General, and Administrative (“SG&A”) Expenses. SG&A expenses for the first quarter of 2026 were $29.2 million, an increase of $0.3 million, or 1.0%, from $28.9 million in the first quarter of 2025. The net increase in SG&A expenses includes a $1.5 million unfavorable impact from foreign currency fluctuations and a $2.3 million increase in compensation expense, partially offset by a $0.9 million decrease in stock-based compensation and reductions in discretionary spend from cost reduction initiatives.

Previous wording

Foreign currency loss for the third quarter of 2025 was $0.2 million, consistent with the third quarter of 2024.

Current wording

Depreciation and Amortization Expense. Depreciation and amortization expense for the first quarter of 2026 was $9.0 million, consistent with the first quarter of 2025.

Previous wording

Other Operating Expense, Net. Other operating expense, net for the third quarter of 2025 was $1.3 million, a decrease of $0.3 million from $1.6 million in the third quarter of 2024, due to decreased loss on the disposal of property, plant, and equipment for the third quarter of 2025 compared to the third quarter of 2024.

Current wording

Other Operating Expense, Net. Other operating expense, net for the first quarter of 2026 was $0.5 million, a decrease of $0.5 million from $1.0 million in the first quarter of 2025, due to decreased research and development expense of $0.4 million for the first quarter of 2026 compared to the first quarter of 2025.

Previous wording

Interest expense for the third quarter of 2025 was $8.7 million, a decrease of $0.6 million, or 6.5%, from $9.3 million in the third quarter of 2024. The decrease was primarily due to a $1.0 million increase in interest income from the effects of our swap agreements and a $0.4 million decrease in amortization of deferred financing costs, partially offset by a $0.6 million increase in interest expense associated with our First Lien Credit Facilities in the third quarter of 2025 compared to the third quarter of 2024.

Current wording

Interest expense for the first quarter of 2026 was $8.6 million, a decrease of $0.1 million, or 1.1%, from $8.7 million in the first quarter of 2025. The decrease was primarily due to the decrease in interest expense associated with our First Lien Credit Facilities in the first quarter of 2026 compared to the first quarter of 2025.

Previous wording

Foreign currency gain for the nine months ended September 30, 2025 was $5.0 million, an increase of $3.9 million, from foreign currency gain of $1.1 million in the nine months ended September 30, 2024 due to the volatility in Euro exchange rates compared to USD.

Current wording

Foreign currency loss for the first quarter of 2026 was $1.3 million, a change of $3.9 million, from foreign currency gain of $2.6 million for the first quarter of 2025 due to the volatility in Euro exchange rates compared to USD.

Previous wording

Income tax benefit for the third quarter of 2025 was $4.2 million, or an effective tax rate of 28.1%. Income tax benefit was $2.5 million in the third quarter of 2024, or an effective tax rate of 23.2%. The fluctuation in the effective tax rate between periods is primarily attributable to taxes related to foreign activities and no impact from stock-based compensation for the same period in 2024. The difference between the effective tax rate for the third quarter of 2025 and the combined federal and state statutory rates is primarily due to state income taxes.

Current wording

Income tax benefit for the first quarter of 2026 was $3.5 million, or an effective tax rate of 26.0%. Income tax benefit was $3.2 million in the first quarter of 2025, or an effective tax rate of 22.6%. The fluctuation in the effective tax rate between periods is primarily attributable to taxes related to foreign activities and the impact from stock-based compensation for the same period in 2025. The difference between the effective tax rate for the first quarter of 2026 and the combined federal and state statutory rates is primarily due to state income taxes.

Previous wording

EBITDA and AEBITDA are non-GAAP measures. Refer to the section “Reconciliation of GAAP to Non-GAAP Measures.” EBITDA for the third quarter of 2025 was $11.9 million, a decrease of $0.7 million, or 5.6%, compared to $12.6 million in the third quarter of 2024. AEBITDA for the third quarter of 2025 was $21.4 million, a decrease of $1.6 million, or 8.1% (3.5% on a constant currency basis), compared to $19.8 million in the third quarter of 2024. AEBITDA for the third quarter of 2025 includes a non-cash reduction to net revenue from the provision for warrants of $0.8 million.

Current wording

EBITDA and AEBITDA are non-GAAP measures. Refer to “Reconciliation of GAAP to Non-GAAP Measures.” EBITDA for the first quarter of 2026 was $11.7 million, an increase of $2.0 million, or 20.6%, compared to $9.7 million in the first quarter of 2025. AEBITDA for the first quarter of 2026 was $18.9 million, an increase of $1.6 million, or 9.2% (flat on a constant currency basis), compared to $17.3 million in the first quarter of 2025. AEBITDA for the first quarter of 2026 includes a non-cash reduction to net revenue from the provision for warrants of $1.7 million compared to $0.8 million for the first quarter of 2025.

Previous wording

The following tables set forth our net revenue by segment for the third quarter of 2025 and the third quarter of 2024, presented in millions of dollars:

Current wording

We have two segments, North America and Europe/Asia. Management evaluates segment performance by net revenue and EBITDA by geographic region. The following tables set forth our net revenue by segment for the first quarter of 2026 and the first quarter of 2025, presented in millions of dollars:

Previous wording

Net revenue in North America for the third quarter of 2025 totaled $44.7 million compared to $40.3 million in the third quarter of 2024. The increase of $4.4 million, or 10.9%, for the third quarter of 2025 compared to the third quarter of 2024 was attributable to increases in void-fill, automation, and wrapping sales, partially offset by a decrease in cushioning sales, and includes a non-cash reduction of $0.7 million in void-fill net revenue from the provision for warrants. The increase in net revenue for North America can be quantified by a 5.1% increase from automated equipment sales, a 3.8% increase in the price/mix of our paper consumable products, and an increase in volume of 3.7%, partially offset by a 1.7% non-cash decrease from the provision for warrants.

Current wording

Net revenue in North America for the first quarter of 2026 totaled $42.5 million compared to $42.6 million in the first quarter of 2025. The decrease of $0.1 million, or 0.2%, for the first quarter of 2026 compared to the first quarter of 2025 was attributable to decreases in wrapping, cushioning, and void-fill sales, partially offset by an increase in automation equipment sales, and includes a non-cash reduction of $0.8 million in void-fill and $0.8 million in automation net revenue from the provision for warrants. The decrease in net revenue for North America can be quantified by a decrease in the volume of sales of our paper consumable products of 3.6% and a 1.9% non-cash decrease from the provision for warrants, partially offset by a 5.2% increase from automation equipment sales and a 0.1% increase in the price/mix of our paper consumable products.

Previous wording

Net revenue in Europe/Asia for the third quarter of 2025 totaled $54.9 million compared to net revenue of $51.9 million in the third quarter of 2024. The increase of $3.0 million, or 5.8%, for the third quarter of 2025 compared to the third quarter of 2024 was attributable to increases in automation, wrapping, and cushioning sales, partially offset by a decrease in void-fill sales. The increase in net revenue for Europe/Asia can be quantified by a 6.4% increase due to foreign currency fluctuations and a 4.0% increase from automated equipment sales, partially offset by a 2.5% decrease in volume, a 1.9% decrease in the price/mix of our paper consumable products, and a 0.2% non-cash decrease from the provision for warrants.

Current wording

Net revenue in Europe/Asia for the first quarter of 2026 totaled $58.7 million compared to net revenue of $48.6 million in the first quarter of 2025. The increase of $10.1 million, or 20.8%, for the first quarter of 2026 compared to the first quarter of 2025 was attributable to increases in automation equipment sales, cushioning, void-fill, and wrapping sales. The increase in net revenue for Europe/Asia can be quantified by a 12.2% increase due to foreign currency fluctuations and a 8.2% increase from automation equipment sales, and a 3.4% increase in volume of sales of our paper consumable products, partially offset by a 2.8% decrease in the price/mix of our paper consumable products and a 0.2% non-cash decrease from the provision for warrants.

Previous wording

North America and Europe/Asia segment EBITDA includes intersegment royalty charges from North America to Europe/Asia for use of trademarks of $3.8 million and $5.3 million for the three months ended September 30, 2025 and 2024, respectively, which eliminates on a consolidated basis.

Current wording

North America and Europe/Asia segment EBITDA includes intersegment royalty charges from North America to Europe/Asia for use of trademarks of $5.0 million and $5.2 million for the three months ended March 31, 2026 and 2025, respectively, which eliminates on a consolidated basis.

Previous wording

Segment EBITDA for Europe/Asia was $8.9 million for the third quarter of 2025 compared to $4.3 million in the third quarter of 2024, an increase of $4.6 million, or 107.0%. The increase was primarily due to increased net revenue as described in the paragraphs above.

Current wording

Segment EBITDA for Europe/Asia was $4.9 million for the first quarter of 2026 compared to $4.6 million in the first quarter of 2025, an increase of $0.3 million, or 6.5%. The increase was primarily due to increased net revenue as described above, partially offset by increased foreign currency losses for the three months ended March 31, 2026.

Previous wording

The following tables and related notes reconcile certain non-GAAP measures, including the non-GAAP constant currency measures, to GAAP information presented in this Quarterly Report for the three and nine months ended September 30, 2025 and 2024:

Current wording

The following table and related notes reconcile certain non-GAAP measures to GAAP information presented in this Quarterly Report for the three months ended March 31, 2026 and 2025:

Previous wording

(5)In the third quarter of 2024, Other adjustments represents primarily non-recurring costs incurred from the outsourcing of paper conversion services and other insignificant items.

Current wording

(5)In the first quarter of 2025, Other adjustments includes non-recurring warehouse and transitory costs incurred related to conversion services, non-recurring excess above market procurement costs, and other insignificant items.

Previous wording

(6)The Constant Currency (Non-GAAP) % Change excludes the impact of foreign currency translation effects when comparing to the prior year. In calculating the Constant Currency (Non-GAAP) % Change, the current year results are translated at the average exchange rate for the prior year period, which in this case was 1 Euro to 1.0985 USD. Refer to further discussion in “Non-GAAP Measures.”

Current wording

(6)The Constant Currency (Non-GAAP) % Change excludes the impact of foreign currency translation effects when comparing to the prior year. In calculating the Constant Currency (Non-GAAP) % Change, the current year results are translated at the average exchange rate for the prior year period, which in this case was 1 Euro to 1.0521 USD. Refer to further discussion in “Non-GAAP Measures.”

Previous wording

We evaluate liquidity in terms of cash flows from operations and other sources and the sufficiency of such cash flows to fund our operating, investing and financing activities. We believe that our $49.9 million in cash and cash equivalents as of September 30, 2025 and cash flows from operations, together with borrowing capacity under the revolving portion of our senior secured credit facilities, will provide us with sufficient resources to cover our current requirements.

Current wording

We evaluate liquidity in terms of cash flows from operations and other sources and the sufficiency of such cash flows to fund our operating, investing and financing activities. We believe that our $48.5 million in cash and cash equivalents as of March 31, 2026 and cash flow from operations, together with borrowing capacity under the revolving portion of our senior secured credit facilities, will provide us with sufficient resources to cover our current requirements.

Previous wording

Our main liquidity needs relate to capital expenditures and expenses for the production and maintenance of PPS systems placed at end-user facilities, working capital, including the purchase of paper raw materials, and payments of principal and interest on our outstanding debt. Our AS and APS businesses are for the sale of capital goods and we do not require significant capital expenditures for production equipment to support growth. We expect our capital expenditures to increase as we continue to grow our business, expand our manufacturing footprint, and upgrade our existing systems and facilities. We continue to evaluate our inventory requirements and adjust according to our volume forecasts. Our future capital requirements and the adequacy of available funds will depend on many factors, and if we are unable to obtain needed additional funds, we may have to reduce our operating costs or incur additional debt, which could impair our growth prospects and/or otherwise negatively impact our business. Further, volatility in the equity and credit markets from macroeconomic factors could make obtaining new equity or debt financing more difficult or expensive.

Current wording

Our main liquidity needs relate to capital expenditures and expenses for the production and maintenance of PPS systems placed at end-user facilities, working capital, including the purchase of paper raw materials, and payments of principal and interest on our outstanding debt. Our Automated Paper Solutions (“APS”) and Automated Solutions (“AS”) (collectively, “Automation”) product lines are for the sale of capital goods and we do not require significant capital expenditures for production equipment to support growth. We expect our capital expenditures to increase as we continue to grow our business, expand our manufacturing footprint, and upgrade our existing systems and facilities. We continue to evaluate our inventory requirements and adjust according to our volume forecasts. Our future capital requirements and the adequacy of available funds will depend on many factors, and if we are unable to obtain needed additional funds, we may have to reduce our operating costs or incur additional debt, which could impair our growth prospects and/or otherwise negatively impact our business. Further, volatility in the equity and credit markets from macroeconomic factors could make obtaining new equity or debt financing more difficult or expensive.

Previous wording

Including finance lease liabilities and financing arrangements and excluding deferred financing costs, we had $412.0 million in debt, $5.9 million of which was classified as short-term, as of September 30, 2025, compared to $415.7 million in debt, $5.6 million of which was classified as short-term, as of December 31, 2024. At September 30, 2025, we did not have amounts outstanding under our $50.0 million revolving credit facility, and we had no borrowings under such facility through October 30, 2025. No mandatory prepayments were required under our Facilities and the Company was in compliance with all debt covenants as of September 30, 2025.

Current wording

Including finance lease liabilities and financing arrangements and excluding deferred financing costs, we had $411.4 million in debt, $6.6 million of which was classified as short-term, as of March 31, 2026, compared to $410.5 million in debt, $5.5 million of which was classified as short-term, as of December 31, 2025.

Previous wording

The Revolving Facility includes borrowing capacity available for standby letters of credit of up to $50.0 million. Any issuance of letters of credit will reduce the amount available under the Revolving Facility. As of September 30, 2025, we had $5.9 million committed to outstanding letters of credit, leaving net availability of $44.1 million under the Revolving Facility.

Current wording

At March 31, 2026, we did not have amounts outstanding under the Revolving Facility, and we had no borrowings under such facility through April 30, 2026. The Revolving Facility includes borrowing capacity available for standby letters of credit of up to $50.0 million. Any issuance of letters of credit will reduce the amount available under the Revolving Facility. As of March 31, 2026, we had $5.8 million committed to outstanding letters of credit, leaving net availability of $44.2 million under the Revolving Facility.

Previous wording

Cash Flows Provided by Operating Activities

Current wording

Cash Flows Provided by (Used in) Operating Activities

Previous wording

Net cash provided by operating activities was $3.6 million in the nine months ended September 30, 2025. Cash provided by operating activities was $34.9 million in the nine months ended September 30, 2024. The changes in operating cash flows are largely due to the increased net loss, primarily due to the non-recurring patent litigation settlement of $16.1 million in the second quarter of 2024. Non-cash adjustments decreased $2.9 million due primarily to the changes in unrealized (gain) loss on strategic investments, foreign currency gain, and deferred income taxes, partially offset by the non-recurring gain on sale of patents in the second quarter of 2024 and the current year provision for warrants. Working capital adjustments also decreased for the current period compared with prior year, primarily due to changes in accrued liabilities and inventory builds as of the third quarter of 2025.

Current wording

Net cash provided by operating activities was $4.4 million in the three months ended March 31, 2026. Net cash used in operating activities was $1.3 million in the three months ended March 31, 2025. The changes in operating cash flows are largely due to lower net loss and foreign currency changes.

Previous wording

Net cash used in investing activities was $27.6 million and $24.7 million in the nine months ended September 30, 2025 and 2024, respectively, and reflects cash used for production of converter equipment, purchases of machinery and equipment and cash paid for investments in Pickle. Net cash used in investing activities in the nine months ended September 30, 2024 also included $5.4 million in proceeds from sale of patents.

Current wording

Net cash used in investing activities was $18.3 million and $7.5 million in the three months ended March 31, 2026 and 2025, respectively, and reflects cash used for production of converter equipment and purchases of machinery and equipment. Net cash used in investing activities in the three months ended March 31, 2026 also included $10.0 million in cash paid for the additional investment in Pickle.

Previous wording

Cash Flows Used in Financing Activities

Current wording

Cash Flows Provided by (Used in) Financing Activities

Previous wording

Net cash used in financing activities was $5.3 million and $2.3 million in the nine months ended September 30, 2025 and 2024, respectively, and reflects principal payments on our term loans, payments on finance lease liabilities, tax payments for withholdings on stock compensation, and payments on financing arrangements, partially offset by proceeds from our hedging instruments and our financing arrangements.

Current wording

Net cash provided by financing activities was $0.2 million in the three months ended March 31, 2026 and reflects proceeds from our financing arrangements, partially offset by principal payments on our term loans, tax payments for withholdings on stock-based awards, payments on financing arrangements, and payments on finance lease liabilities. Net cash used in financing activities was $2.8 million in the three months ended March 31, 2025 and reflects tax payments for withholdings on stock-based awards, principal payments on our term loans, payments on finance lease liabilities, and payments on financing arrangements.

Previous wording

We have cash obligations under our leases for facilities and automobiles, under our financing arrangements, which are primarily related to equipment, and under our Term Facility, which are described in more detail in Note 12 — Leases and Note 7 — Long-Term Debt in the notes to our unaudited condensed consolidated financial statements. We have various contractual obligations and commercial commitments that are recorded as liabilities in our unaudited condensed consolidated financial statements.

Current wording

We have cash obligations under our financing arrangements, which are primarily related to our Term Facility, and under our leases for facilities, automobiles and equipment, which are described in more detail in Note 7 — Long-Term Debt and Note 12 — Leases in the notes to our unaudited condensed consolidated financial statements. We have various contractual obligations and commercial commitments that are recorded as liabilities in our unaudited condensed consolidated financial statements.