Azenta, Inc.

Current report

We are exposed to credit risk under the $35.0 million secured vendor loan extended in connection with the divestiture of our B Medical Systems business, and we may not be repaid on a timely basis or at all.

Current report

In connection with the July 1, 2026 sale of our B Medical Systems business, our wholly owned subsidiary, Azenta Germany GmbH, extended a $35.0 million secured term loan to the buyer, Thelema S.à r.l., representing a substantial portion of the $63.0 million purchase price. The loan bears interest at 6.0% per annum and matures three months following the July 1, 2026 funding date, at which time all principal and accrued interest are due. The buyer's obligations are secured by a first-priority pledge over 100% of the equity interests of B Medical Systems S.à r.l. We expect the buyer to repay the loan from permanent third-party financing, and there can be no assurance that the buyer will obtain such financing or otherwise repay the loan when due. The collateral consists solely of the equity of the divested business, the value of which depends on that business's performance and financial condition and may be insufficient to satisfy the obligation upon a default. The buyer is majority owned by an officer of the Company, and although the loan and related arrangements were reviewed and approved through our related-party transaction procedures, the related-party nature of the arrangement may complicate enforcement. If the buyer fails to repay the loan, or if we are unable to realize the full value of our collateral, we could be required to recognize a charge, write-down or impairment, which could adversely affect our results of operations and financial condition.

Previous report

Our business could be adversely affected if Thelema S.À R.L. fails to secure financing necessary to complete its acquisition of the B Medical Systems business.

Previous report

As discussed in Note 3, Discontinued Operations in the notes to the unaudited condensed consolidated financial statements included in the section titled “Financial Statements” in Part I, Item 1 of this Quarterly Report on Form 10-Q, the completion of our sale of the B Medical Systems business was conditioned upon the acquirer securing final residual financing for the remaining acquisition payment of $54.0 million on or before March 31, 2026. On March 27, 2026, we were informed by Thelema that it had not yet secured the financing required to complete the transaction and, solely as a result of the non‑satisfaction of that financing condition, the transaction did not close by March 31, 2026. Thelema has indicated that it requires additional time to complete its financing arrangements. The transaction remains subject to the satisfaction of all closing conditions, including Thelema’s securing of the required financing, and there can be no assurance that the transaction will be completed on a revised timeline or at all. The parties have not amended or terminated the Share Purchase Agreement and we are evaluating potential paths forward with respect to the transaction while Thelema continues to complete its financing arrangements. As a result of Thelema not satisfying the financing condition by March 31, 2026, either party may terminate the Share Purchase Agreement, in which case we will retain $5.0 million from the $9.0 million deposit as a break-up fee. A prolonged delay in closing the acquisition or Thelema’s failure to complete the acquisition, however, may require us to continue operating the B Medical Systems business for an indeterminate period of time and to include the results of the business in the results of our continuing operations. We would likely experience adverse consequences as a result thereof, including a negative and dilutive impact on our top and bottom-line performance, the distraction of management away from our core Sample Management Solutions and Multiomics segments and the potential need to recognize additional impairment charges related to the B Medical Systems business, any of which could have a material adverse effect on our business, results of operations, or financial condition.

Previous report

Our goodwill and intangible assets may become impaired.

Previous report

As of March 31, 2026, we had $553.1 million of goodwill and $91.4 million in net intangible assets as a result of our acquisitions. We periodically review our goodwill and the estimated useful lives of our identifiable intangible assets, taking into consideration any events or circumstances that might result in either a diminished fair value, or for intangible assets, a revised useful life. These events and circumstances include significant changes in the business climate, legal factors, operating performance indicators, advances in technology and competition. Any impairment or revised useful life could have a material and adverse effect on our financial position and results of operations and could harm the trading price of our common stock.

Previous report

During the second quarter of fiscal year 2026, we assessed several events and circumstances that could affect the significant inputs used to determine the fair value of our reporting units, including updates to forecasted cash flows, increased uncertainty in the macroeconomic and geopolitical environment, and a sustained decline in our stock price. We concluded it was more likely than not the fair value of each of the SMS and Multiomics reporting units was less than their respective carrying amounts due to the combined impact of declining stock price and revised forecasts. As a result, we completed a quantitative goodwill impairment test for our reporting units. Based on the results of the quantitative impairment test performed as of March 31, 2026, the carrying amounts of the SMS and Multiomics reporting units exceeded their respective fair values, resulting in non-cash impairment charges of $36.6 million for SMS and $112.4 million for Multiomics. Please refer to Note 7, Goodwill and Intangible Assets in the notes to the unaudited condensed consolidated financial statements included in the section titled “Financial Statements” in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

Previous report

In the event the performance of any of our reporting units does not meet management expectations in the future, we experience a prolonged macroeconomic or market downturn, or there are other negative revisions to key assumptions used in the analysis used to estimate fair value, we may be required to perform additional impairment analyses which could result in one or more additional impairment charges, any one of which could have a material and adverse effect on our financial position, results of operations and trading price of our common stock.