DAKTRONICS INC /SD/

(dollar and share amounts in thousands, except per share data)

Note 1. Basis of Presentation

Daktronics, Inc. and its subsidiaries (collectively, the “Company”, “Daktronics”, “we”, “our”, or “us”) is engaged principally in the design, marketing, and manufacturing of a wide range of integrated electronic display systems and related products which are sold in a variety of markets throughout the world and the rendering of related maintenance and professional services. Our products are designed primarily to inform and entertain people through the communication of content.

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. In the opinion of management, these financial statements reflect all adjustments necessary for a fair presentation of the Company’s financial position, results of operations, and cash flows for the periods presented. All such adjustments are of a normal recurring nature.

The preparation of these financial statements requires us to make estimates and judgments affecting the reported amounts of assets, liabilities, revenues, and expenses and related disclosure of contingent assets and liabilities. Significant estimates include, but are not limited to, revenue recognition, warranty obligations, the fair value of long-term debt and investments in affiliates, income tax provisions, and stock-based compensation. Due to the inherent uncertainty involved in making estimates, actual results in future periods may differ from those estimates.

Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to SEC rules and regulations. The balance sheet as of May 2, 2026, has been derived from the audited financial statements as of that date but does not include all disclosures required for annual financial statements. These interim financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in its Annual Report on Form 10-K for the fiscal year ended May 2, 2026 (the “Form 10-K”).

Daktronics operates on a 52- or 53-week fiscal year, with our fiscal year ending on the Saturday closest to April 30 of each year. When April 30 falls on a Wednesday, the fiscal year ends on the preceding Saturday. Within each fiscal year, each quarter is comprised of a 13-week period following the beginning of each fiscal year. In each 53-week year, an additional week is added to the first quarter, and each of the last three quarters is comprised of a 13-week period. The three months ended August 1, 2026, and August 2, 2025, contained operating results for 13 and 14 weeks, respectively.

There have been no material changes to the Company’s significant accounting policies and estimates as disclosed in the Form 10-K.

Cash and cash equivalents

Cash and cash equivalents are presented in the Condensed Consolidated Balance Sheets with the corresponding totals reported in the Condensed Consolidated Statements of Cash Flows.

We have foreign currency cash accounts to operate our global business. These accounts are impacted by changes in foreign currency rates.

As of August 1, 2026, of our $154,585 in cash and cash equivalents, $144,294 was denominated in United States dollars, of which $10,675 was held by our foreign subsidiaries, and $10,291 was denominated in foreign currencies, of which $8,501 was maintained in accounts of our foreign subsidiaries.

Recent Accounting Pronouncements

Accounting Standards Adopted

In July 2025, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2025-05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and

Contract Assets("ASU 2025-05"). ASU 2025-05 provides a practical expedient that all entities can use when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers. Under this practical expedient, an entity is allowed to assume that the current conditions it has applied in determining credit loss allowances for current accounts receivable and current contract assets remain unchanged for the remaining life of those assets. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025, and interim reporting periods in those years. The Company adopted the guidance prospectively in this fiscal year beginning May 3, 2026. The adoption of this standard did not have a material impact on our unaudited condensed consolidated financial statements and related disclosures.

Accounting Standards Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”), requiring disclosure in the notes to the financial statements for specified information about certain costs and expenses. ASU 2024-03 is effective for annual periods beginning after December 15, 2026 and for interim periods beginning after December 15, 2027; however, early adoption is permitted and can be applied either prospectively or retrospectively. We are currently evaluating the impact of ASU 2024-03 on our expense disaggregation disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40) (“ASU 2025-06”), which modernizes the accounting for internal-use software costs to reflect current development practices. The update eliminates the previous three-stage model (preliminary, application development, and post-implementation) and instead introduces a principles-based approach. Under the new guidance, capitalization begins when (1) management authorizes and commits to funding the project, and (2) it is probable the project will be completed and the software will be used for its intended purpose. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, with early adoption permitted and transition options including prospective, retrospective, or modified retrospective application. We are currently evaluating the impact of ASU 2025-06 on our accounting policies and disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements (“ASU 2025-11”). The update provides clarifications intended to improve the consistency and usability of interim disclosure requirements, including a comprehensive listing of required interim disclosures and a new disclosure principle for reporting material events occurring after the most recent annual period. The amendments do not change the underlying objectives of interim reporting but are designed to enhance clarity in application. ASU 2025-11 is effective for annual periods beginning after December 15, 2027, including interim periods within that annual period. We are currently evaluating the impact of ASU 2025-11 on our accounting policies and disclosures.

Note 2. Investments in Affiliates

We use the equity method to account for investments in companies if our investment provides us with the ability to exercise significant influence over operating and financial policies of the investee. Our judgment regarding the level of influence over each equity method investee includes considering key factors such as our ownership interest, representation on the board of directors, participation in policy-making decisions, other commercial arrangements, and material intercompany transactions.

Miortech

We evaluated the nature of our investment in an affiliate of Miortech (dba Etulipa) (“Miortech”), which is focused on developing low power outdoor electrowetting technology. Our ownership in Miortech was 55.9 percent as of August 1, 2026. The aggregate amount of our investments accounted for under the equity method was zero as of both August 1, 2026 and May 2, 2026. We had no Miortech-related activity during the three months ended August 1, 2026. Miortech filed for bankruptcy with the Dutch courts in May 2026, and the ultimate outcome of the bankruptcy proceedings remains uncertain.

Our proportional share of the affiliate earnings or losses is included in the “Other expense, net” line item in our Condensed Consolidated Statements of Operations. For the three months ended August 1, 2026 and August 2, 2025, our share of the losses of our affiliate in Miortech waszero and $224, respectively.

We also have advanced loans to Miortech under convertible and promissory notes (collectively, the “Miortech Affiliate Notes”). We hadno advances during the three months ended August 1, 2026 and had advanced $1,283 in fiscal 2026 under the Miortech Affiliate Notes. We hadno accrued interest related to the Miortech Affiliate Notes as of August 1, 2026 and had accrued interest of $228 as of May 2, 2026. The total face value of the outstanding amount of the Miortech Affiliate

Notes was $5,429 as of both August 1, 2026 and May 2, 2026. The balances of Miortech Affiliate Notes are included in the “Right of use, investment in affiliates, and other assets” line item in our Consolidated Balance Sheets. We evaluate the Miortech Affiliate Notes for impairment and credit losses. During the fourth quarter of fiscal 2026, we recorded a provision of $3,750 related to the Miortech Affiliate Notes which were deemed to be uncollectible.

The balance of our Miortech Affiliate Note totaled zero as of both August 1, 2026 and May 2, 2026.

XDC

On December 22, 2025, the Company acquired a display business (the “Display Business”) consisting of intellectual property, equipment assets, technical expertise, contract rights, other personal property, and related assets (collectively, the “Display Business Assets”) from X Display Company Technology Limited (“XDC,” and such acquisition, the “XDC Acquisition”). Prior to the XDC Acquisition, the Company held an equity interest in XDC that was accounted for under the equity method and engaged in various related party transactions with XDC. As a result of the XDC Acquisition, XDC is no longer accounted for as an equity method investee and the Company no longer has related party transactions with XDC. Accordingly, there were no equity method earnings or losses, affiliate note activity, or related party transactions with XDC during the three months ended August 1, 2026. The disclosures below are presented solely for comparability to the prior-year period, which was before the XDC Acquisition.

Our proportional share of the affiliate earnings or losses is included in the “Other expense, net” in our Condensed Consolidated Statements of Operations. For the three months ended August 2, 2025, our share of affiliate losses recognized was $581.

We had provided funding to XDC through promissory notes, some of which were convertible (collectively, the “XDC Affiliate Notes”). During fiscal year 2026, we advanced $4,100 to XDC under the XDC Affiliate Notes. Accrued interest on the XDC Affiliate Notes was $449 as of May 2, 2026.

Additionally, prior to the XDC Acquisition, we engaged in related party transactions with XDC, primarily for research and development services. For the three months ended August 2, 2025, we recorded expenses of $32 in “Product design and development.” Unpaid amounts related to these services were $109 as of August 2, 2025 and are included in “Accounts payable.”

Note 3. Earnings Per Share

We compute earnings per share (“EPS”) in accordance with the provisions of Accounting Standards Codification Topic 260, Earnings Per Share. Basic EPS is calculated by dividing net income attributable to holders of our common stock, par value $0.00001 per share (“Common Stock”), by the weighted average number of common shares outstanding during the reporting period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised, converted, or otherwise resulted in the issuance of common shares that participate in our earnings.

The following is a reconciliation of the net income and shares of Common Stock amounts used in the calculation of basic and diluted EPS for the three months ended August 1, 2026, and August 2, 2025:

For the three months ended August 2, 2025,29 shares of potential common stock related to stock-based compensation plans were excluded from the computation of diluted EPS because their inclusion would have been anti-dilutive. The excluded shares included options outstanding to purchase 24 shares of common stock with a weighted average exercise price of $11.87.

Note 4. Revenue Recognition

Disaggregation of revenue

In accordance with ASC 606-10-50, we disaggregate revenue from contracts with customers by the type of performance obligation and the timing of revenue recognition. We determined that disaggregating revenue in these categories achieves the disclosure objective to depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors and to enable users of financial statements to understand the relationship to each reportable segment.

The following table presents our disaggregated revenue by segment:

See "Note 5. Segment Reporting" for a disaggregation of revenue by geography.

Contract balances

Contract assets represent revenue recognized in excess of amounts billed and include unbilled receivables. Unbilled receivables, which represent an unconditional right to payment subject only to the passage of time, are reclassified to accounts receivable when they are billed according to the contract terms. Contract liabilities represent amounts billed to clients in excess of revenue recognized to date.

The following table reflects the changes in our contract assets and liabilities:

The changes in our contract assets and contract liabilities from May 2, 2026 to August 1, 2026 were due to the timing of billing schedules and revenue recognition, which can vary significantly depending on the contractual payment terms and the seasonality of the sports markets. We hadno significant impairments of contract assets for the three months ended August 1, 2026.

For service-type warranty contracts, we allocate revenue to the performance obligation, recognize the revenue over time, and recognize costs as incurred. Earned and unearned revenues for these contracts are included in the “Contract assets” and “Contract liabilities” line items of our Consolidated Balance Sheets. Changes in unearned service-type warranty contracts, net were as follows:

The loss provision on contracts in process identified as loss contracts as of August 1, 2026 and May 2, 2026 were immaterial. Loss provisions are recorded in the “Accrued expenses” line item in our Condensed Consolidated Balance Sheets.

During the three months ended August 1, 2026, we recognized $45,347 related to our contract liabilities as of May 2, 2026.

Remaining performance obligations and revenue recognized from past performance obligations

As of August 1, 2026, the aggregate amount of the transaction price allocated to the remaining performance obligations was $380,403. Remaining performance obligations related to product and service agreements as of August 1, 2026 were $311,280 and $69,123, respectively. We expect approximately $328,354 of our remaining performance obligations to be recognized over the next 12 months, with the remainder recognized thereafter. Although remaining performance obligations reflect business that is considered to be legally binding, cancellations, deferrals, or scope adjustments may occur. Any known project cancellations, revisions to project scope and cost, foreign currency exchange fluctuations, and project deferrals are reflected or excluded in the remaining performance obligation balance, as appropriate. The amount of revenue recognized associated with performance obligations satisfied in prior periods during the three months ended August 1, 2026 and August 2, 2025 was immaterial.

Note 5. Segment Reporting

We organize and manage our business by the following five segments which meet the definition of reportable segments under ASC 280-10, Segment Reporting: Commercial, Live Events, High School Park and Recreation, Transportation, and

International. These segments are based on the customer type or geography and are the same as our operating segments/business units.

The following table sets forth certain financial information for each of ourfive reporting segments for the periods indicated:

The following table presents depreciation and amortization by reportable segment, which are included within operating expenses in the table above:

No single country comprises a material amount of our net sales or property and equipment, net of accumulated depreciation, other than the United States. The following table presents information about net sales, which are based on where the end user is located, and property and equipment, net of accumulated depreciation, in the United States and elsewhere:

We have numerous customers worldwide for sales of our products and services, and no customer accounted for 10 percent or more of net sales; therefore, we are not economically dependent on a limited number of customers for the sale of our products and services.

We have numerous raw material and component suppliers, and no supplier accounts for 10 percent or more of our cost of sales; however, we have a complex global supply chain subject to geopolitical and transportation risks and a number of single-source suppliers that could limit our supply or cause delays in obtaining raw materials and components needed in manufacturing.

Note 6. Goodwill

The changes in the carrying amount of goodwill related to each reportable segment for the three months ended August 1, 2026 were as follows:

We perform an analysis of goodwill on an annual basis, and it is tested for impairment more frequently if events or changes in circumstances indicate that an asset might be impaired. Our annual analysis is performed during the third quarter of each fiscal year based on the goodwill amount as of the first business day of our third fiscal quarter. As of August 1, 2026, no indicators of goodwill impairment has been identified since our most recently completed annual impairment test.

The amount of accumulated impairments to goodwill as of August 1, 2026 and May 2, 2026 was $4,576.

Note 7. Financing Agreements

Long-term debt consists of the following:

Credit Agreements

On November 26, 2025, the Company entered into a $71,500 senior secured credit facility (the “Credit Facility”) pursuant to a Credit Agreement (the “Credit Agreement”), between and among the Company, JPMorgan Chase Bank, N.A., as administrative agent (the “Administrative Agent”), the Lenders, and the other Loan Parties. The following capitalized terms have specific meanings as defined in the Credit Agreement: Lenders; Loan Parties; Adjusted Term SOFR Rate; Adjusted Daily Simple SOFR; CB Floating Rate; Total Leverage Ratio; and Fixed Charge Coverage Ratio.

The Credit Facility created pursuant to the Credit Agreement is comprised of:

• a $60,000 revolving credit facility (the “Revolver”), maturing on November 26, 2028 (the “Maturity Date”); and

•an $11,500 term loan (the “Term Loan”), amortizing in equal quarterly installments of $288, with the remaining principal due on the Maturity Date.

The Revolver and the Term Loan are guaranteed by the Loan Parties and are secured by perfected, first‑priority liens on substantially all personal property and assets of the Company and the other Loan Parties, including intellectual property, pursuant to a pledge and security agreement and related collateral documents (collectively, the “Security Agreement”).

Borrowings under the Credit Facility bear interest, at one of the following rates to be selected by the Company, in its discretion: (i) the Adjusted Term SOFR Rate plus a 0.10% margin; (ii) the Adjusted Daily Simple SOFR plus a 0.10% margin; or (iii) the CB Floating Rate with a 0.00% margin. Amounts repaid under the Term Loan may not be reborrowed. Undrawn commitments under the Revolver accrue a commitment fee of 0.20% per year.

Letters of credit issued under the Revolver accrue customary fees and generally must expire no later than five business days prior to the Maturity Date.

The financial covenants under the Credit Agreement require the Company to maintain (i) a maximum quarterly Total Leverage Ratio of 3.00 to 1.00 and (ii) a minimum Fixed Charge Coverage Ratio of 1.25 to 1.00. There is a limited ability to exclude certain unfinanced capital expenditures from these calculations when specified liquidity thresholds are met.

These covenants apply to borrowings under both the Revolver and the Term Loan. The Credit Agreement includes customary representations, covenants, and events of default, including limitations on incurring additional debt, liens, investments, asset sales, restricted payments, dividends, share repurchases, and affiliate transactions.

Proceeds from the Credit Facility may be used to refinance existing indebtedness and for working capital and other general corporate purposes.

As of August 1, 2026, the Company was in compliance with all covenants under the Credit Agreement and other agreements related to the Credit Facility. There wereno advances under the Revolver portion of our line of credit, and the balance of letters of credit issued and outstanding under the Revolver was approximately $1,858. As of August 1, 2026, $58,142 of the Credit Facility remains in place and available for borrowing.

On September 1, 2026, the Company entered into an amendment to the Credit Agreement (“Amendment No. 1”). For additional information, see “Note 13. Subsequent Events” of the Notes to our Consolidated Financial Statements included in this Form 10-Q.

In connection with entering into the Credit Agreement, the Company terminated its prior senior credit facility dated May 11, 2023 (as amended, the “Prior Credit Agreement”), which consisted of an asset‑based revolving credit facility and a delayed draw term loan. All outstanding obligations under the Prior Credit Agreement were repaid in full, and all related liens, including the mortgage on the Company’s Brookings, South Dakota real property, were released. No material early termination penalties were incurred in connection with the termination of the Prior Credit Agreement. Certain customary obligations, including indemnification and confidentiality provisions, survive the termination of the Prior Credit Agreement.

Debt Issuance Costs

Debt issuance costs incurred in connection with our financing agreements are capitalized and amortized on a straight‑line basis over the term of the related debt agreement. In the event of early principal repayments or the termination of a debt agreement, any remaining unamortized debt issuance costs associated with such agreement are expensed.

Amortization of debt issuance costs totaled $14 and $403 for thethree months ended August 1, 2026 and August 2, 2025, respectively. The amortization for thethree months ended August 1, 2026 includes amortization related to the Credit Facility, whereas the amortization for thethree months ended August 2, 2025 includes amortization related to the Prior Credit Agreement.

As of August 1, 2026, the remaining unamortized debt issuance costs of$132 were being amortized over the remaining term of the Credit Facility.

Future Maturities

Aggregate contractual maturities of debt in future fiscal years are as follows:

Note 8. Commitments and Contingencies

Litigation: We are a party to legal proceedings and claims which arise during the ordinary course of business. We review our legal proceedings and claims, regulatory reviews and inspections, and other legal matters on an ongoing basis and follow appropriate accounting guidance when making accrual and disclosure decisions. We establish accruals for those contingencies when the incurrence of a loss is probable and can be reasonably estimated, and we disclose the amount accrued and the amount of a reasonably possible loss in excess of the amount accrued if such disclosure is necessary for our financial statements to not be misleading. We do not record an accrual when the likelihood of loss being incurred is probable, but the amount cannot be reasonably estimated, or when the loss is believed to be only reasonably possible or remote, although disclosures will be made for material matters as required by ASC 450-20, Contingencies - Loss Contingencies.

Our assessment of whether a loss is reasonably possible or probable is based on management’s assessment and consultation with legal counsel regarding the ultimate outcome of each matter following all appeals.

For other unresolved legal proceedings or claims, we do not believe there is a reasonable probability that any material loss would be incurred. Accordingly, no material accrual or disclosure of potential loss range has been made related to these matters. We do not expect the ultimate liability of these unresolved legal proceedings or claims to have a material effect on our financial position, liquidity, or capital resources.

Warranties: Changes in our warranty obligation for the three months ended August 1, 2026 consisted of the following:

Performance guarantees: We have entered into standby letters of credit, bank guarantees, and surety bonds with financial institutions to support our contractual obligations, primarily related to construction-type contracts. These instruments serve as guarantees of our future performance, including the operation and installation of equipment and the completion of contractual deliverables.

As of August 1, 2026, we had $36,745 of bonded work outstanding and $1,858 in letters of credit outstanding. Performance guarantees are issued to certain customers to guarantee the operation and installation of the equipment and our ability to complete a contract. These performance guarantees have various terms but are generally one year. We enter into written agreements with our customers, and those agreements often contain indemnification provisions that require us to make the customer whole if certain acts or omissions by us cause the customer financial loss. We make efforts to negotiate reasonable caps and limitations on the recovery of such damages. As of August 1, 2026, we were not aware of any indemnification claim from a customer.

Note 9. Income Taxes

The provision for income taxes during interim reporting periods is calculated by applying an estimate of the annual effective tax rate to “ordinary” income or loss for the reporting period, adjusted for discrete items. Due to various factors, including our estimate of annual income, our effective tax rate is subject to fluctuation.

Our effective tax rate for the three months ended August 1, 2026 was 24.3 percent. The tax rate was primarily attributable to nontaxable and nondeductible items, State and Local income taxes, and tax credits in proportion to estimated pre-tax earnings for fiscal 2027. The effective tax rate for the three months ended August 2, 2025 of 25.9 percent was driven by nontaxable and nondeductible items and valuation allowances in proportion to estimated pre-tax earnings for fiscal 2026.

As of August 1, 2026, we had $579 of unrecognized tax benefits which would reduce our effective tax rate if recognized.

In July 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant tax related provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions. The OBBBA has multiple effective dates with the earliest provisions taking effect in fiscal 2026 and others beginning in fiscal 2027 and beyond. ASC 740, “Income Taxes,” requires the effects of changes in tax rates and laws affecting current taxes to be reflected in the estimated annual effective tax rate going forward, and adjustments to existing deferred taxes to be recognized on deferred tax balances to be recognized in the period in which the legislation is enacted. We note that as of August 1, 2026, there were no material impacts to the Company’s financial statements. We will continue to evaluate the future tax and other provisions of the OBBBA and the potential effects on our financial position, results of operations, and cash flows.

In October 2021, the Organization for Economic Co-Operation and Development (“OECD”) introduced a 15% global minimum tax under the Pillar Two GloBE model rules for multinational enterprises with annual global revenue exceeding €750 million. In January 2026, the OECD announced a “side-by-side” system under which U.S.-parented groups would be able to elect to be exempt from certain Pillar Two provisions. Additional guidance on the “side-by-side” system and implementation of such system remain subject to further discussions and clarifications from the OECD and local implementation by each OECD member country. We will be subject to Pillar Two compliance and reporting in fiscal 2027, but Pillar Two has not had a material impact on our provision for income taxes; however, we will continue to monitor as additional guidance is released by the OECD, OECD member countries based on their enacted law changes, and other standard-setting bodies.

Note 10. Fair Value Measurement

The following table sets forth by level within the fair value hierarchy our financial assets and liabilities that were accounted for at fair value on a recurring basis as of August 1, 2026 and May 2, 2026 according to the valuation techniques we used to determine their fair values. There have been no transfers of assets or liabilities among the fair value hierarchies presented.

Note 11. Share Repurchase Program

On June 17, 2016, our Board of Directors of the Company (the “Board” or “Board of Directors”) authorized a share repurchase program (the “FY17 Repurchase Program”) under which the Company may repurchase up to $40,000 of the Company’s outstanding shares of Common Stock. The Board approved increases to the limit under the FY17 Repurchase Program of $10,000 on March 4, 2025, $10,000 on June 23, 2025, $20,000 on December 9, 2025, and $25,897 on June 22, 2026. Following these increases, the maximum authorized value under the FY17 Repurchase Program was $105,897 as of August 1, 2026.

Repurchases under the FY17 Repurchase Program may be made from time to time in open market transactions or privately negotiated transactions, subject to business and market conditions, applicable legal requirements, and other relevant factors. The FY17 Repurchase Program does not obligate the Company to repurchase any specific number of shares, may be suspended or terminated at any time at the discretion of the Board and has no fixed expiration date.

During the three months ended August 1, 2026, the Company repurchased 225 shares of Common Stock at a total cost of $4,410. As of August 1, 2026, $35,957 of the $105,897 authorized amount remained available for repurchase under the FY17 Repurchase Program.

For information on restrictions on the Company’s ability to repurchase shares under the Credit Agreement, please refer to “Note 7. Financing Agreements” of the Notes to the Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q and “Item 2. Unregistered Sales of Equity Securities and Use of Proceeds” of Part II of this Quarterly Report on Form 10-Q. For additional information, see “Note 13. Subsequent Events” of the Notes to the Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.

Note 12. Related Party Transactions

Daktronics Related Person Transaction Policy: The Board of Directors has adopted the Daktronics Related Person Transaction Policy, a written policy and procedures with respect to related party transactions (the “RPT Policy”), which the Audit Committee of the Board (the "Audit Committee") oversees. Under the RPT Policy, a “Related Person Transaction” is generally defined as a transaction, arrangement, or relationship (or any series of similar transactions, arrangements, or relationships) in which: (i) the Company was, is, or will be a participant; (ii) the amount involved exceeds $120; and (iii) any “Related Person” had, has, or will have a direct or indirect material interest. The RPT Policy generally defines a "Related Person" as: (a) a director, director nominee, or executive officer of the Company at any time during the last fiscal year; (b) a beneficial owner of more than five percent of any class of our voting securities; (c) any immediate family member of any of the foregoing persons; or (d) an entity that employs any of the foregoing persons or in which any of the foregoing persons is a general partner or principal or owns a five percent or greater ownership interest. Our Chief Financial Officer is responsible for overseeing the monitoring and identification of Related Person Transactions and the appropriate reporting of any potential Related Person Transactions to the Audit Committee. The Audit Committee reviews and, if appropriate, approves Related Person Transactions, including certain transactions which are deemed to be pre-approved under the RPT Policy. On an annual basis, the Audit Committee reviews any previously approved Related Person Transactions that are ongoing.

Transactions with Milwaukee Bucks Inc.: On April 29, 2025, the Company entered into a contract with Milwaukee Bucks Inc. The total value of the contract was $683. The terms of the above-referenced arrangement between the Company and Milwaukee Bucks Inc. were arm’s-length transactions made in the ordinary course of the Company’s business. Peter Feigin, a member of the Board, was the President of Milwaukee Bucks Inc. at the time of the transaction.

Note 13. Subsequent Events

Share Repurchase Program

On September 1, 2026, the Board voted to terminate the FY17 Repurchase Program and to implement a new program authorizing repurchases of outstanding shares of Common Stock (the “FY27 Repurchase Program”), in each case effective immediately. The total amount authorized for repurchases under the FY27 Repurchase Program is $34,500.

Share repurchases under the FY27 Repurchase Program may occur from time to time in open market purchases, private transactions, or other transactions. The timing, volume, and nature of share repurchases will be at the sole discretion of the Company’s management and will be dependent on market conditions, applicable securities laws and other legal requirements, business considerations, and other factors. The FY27 Repurchase Program does not require the Company to repurchase a certain amount of shares and does not have a fixed expiration date and may be suspended, discontinued, or terminated at any time. Under the FY27 Repurchase Program, the Company may conduct share repurchases in accordance with all applicable securities laws and regulations, including Rule 10b5-1 and Rule 10b-18 under the Exchange Act. No assurance can be given that any particular number of shares of Common Stock will be repurchased.

First Amendment to Credit Agreement

On September 1, 2026, the Company entered into Amendment No. 1. Amendment No. 1 allows the Company to transfer certain non-material patents acquired in connection with the XDC Acquisition for consideration below the threshold otherwise required under the Credit Agreement. Amendment No. 1 did not otherwise materially modify the terms of the Credit Agreement. For additional information on the Credit Agreement, see “Note 7. Financing Agreements” of the Notes to our Consolidated Financial Statements included in this Form 10-Q.