Redwire Corp

Previous wording

•Gross margin increased to 27% for the three months ended March 31, 2026 from 15% during the same period in 2025.

Current wording

•Gross margin increased to 28% for the three months ended June 30, 2026 from (31)% during the same period in 2025.

Previous wording

•Backlog increased to $498.1 million as of March 31, 2026 from $411.2 million as of December 31, 2025.

Current wording

•Backlog increased to $542.1 million as of June 30, 2026 from $411.2 million as of December 31, 2025.

Previous wording

In March 2025, the European Commission introduced the Readiness 2030 package (previously dubbed “ReArm Europe”), to deploy nearly €800 billion over four years for collective defense, including drone systems, missile defense, cyber and autonomous platforms. The package includes a suspension of fiscal constraints allowing up to 1.5% of Gross Domestic Product (“GDP”) to be put toward additional defense spending and launched the €150 billion Safe Action for Europe (“SAFE”) loan facility. During the first quarter of 2026, implementation of the Readiness 2030 initiative advanced, including adoption of implementing decisions for multiple member states under the SAFE financing mechanism and expected initial loan disbursements beginning in the second quarter of 2026.

Current wording

In March 2025, the European Commission introduced the Readiness 2030 package (previously dubbed “ReArm Europe”), to deploy nearly €800 billion over four years for collective defense, including drone systems, missile defense, cyber and autonomous platforms. The package includes a suspension of fiscal constraints allowing up to 1.5% of Gross Domestic Product (“GDP”) to be put toward additional defense spending and launched the €150 billion Safe Action for Europe (“SAFE”) loan facility. During 2026, implementation of the Readiness 2030 initiative continues to advance, including adoption of implementing decisions for multiple member states under the SAFE financing mechanism and expected initial loan disbursements beginning in the second quarter of 2026.

Previous wording

The European Commission formally introduced the EU Space Act in June 2025 as a proposed regulation to harmonize legal frameworks across the EU for space activities. It establishes a single market for space service providers and applies to EU and non-EU operators whose activities impact the EU internal market. The regulatory structure will be focused on three areas: safety (including orbital debris mitigation and space situational awareness), resilience (including space-based cybersecurity), and sustainability (including in-orbit servicing). If enacted by the European Parliament and Council, the regulation is designed to apply from January 1, 2030, with a two‑year transition period for existing missions not yet launched by that date. Discussions and commentary on the EU Space Act progressed during the first quarter of 2026, but no comprehensive language has yet been agreed by relevant stakeholders.

Current wording

The European Commission formally introduced the EU Space Act in June 2025 as a proposed regulation to harmonize legal frameworks across the EU for space activities. It establishes a single market for space service providers and applies to EU and non-EU operators whose activities impact the EU internal market. The regulatory structure will be focused on three areas: safety (including orbital debris mitigation and space situational awareness), resilience (including space-based cybersecurity), and sustainability (including in-orbit servicing). If enacted by the European Parliament and Council, the regulation is designed to apply from January 1, 2030, with a two‑year transition period for existing missions not yet launched by that date. Discussions and commentary on the EU Space Act continues to progress, but no comprehensive language has yet been agreed by relevant stakeholders.

Previous wording

The Company evaluates the contract value and cost estimates at completion for performance obligations no less frequently than quarterly, and more frequently when circumstances significantly change. Changes in contract estimates occur for a variety of reasons including, but not limited to, changes in contract scope, labor productivity, the nature and technical complexity of the work to be performed, availability and cost volatility of materials, subcontractor and vendor performance, volume assumptions, inflationary trends, and schedule and performance delays. We utilize information available to us at the time when revising our estimates and apply consistent judgment across the full portfolio of programs. The gross unfavorable EAC adjustments in 2026 were primarily due to $6.8 million unfavorable adjustments in the Space segment as a result of an increase in estimates made for the programmatic and technical assumptions based on the nature and technical complexity of the work to be performed to meet customer specifications. This was partially offset by $5.6 million of favorable adjustments in the Defense Tech segment, inclusive of the reversal of loss reserves in the amount of $3.6 million. Refer to Note N – Revenues of the accompanying notes to thecondensed consolidated financial statements for additional information.

Current wording

The Company evaluates the contract value and cost estimates at completion for performance obligations no less frequently than quarterly, and more frequently when circumstances significantly change. Changes in contract estimates occur for a variety of reasons including, but not limited to, changes in contract scope, labor productivity, the nature and technical complexity of the work to be performed, availability and cost volatility of materials, subcontractor and vendor performance, volume assumptions, inflationary trends, and schedule and performance delays. We utilize information available to us at the time when revising our estimates and apply consistent judgment across the full portfolio of programs. The gross unfavorable EAC adjustments for the six months ended June 30, 2026 were primarily due to $16.2 million unfavorable adjustments in the Space segment as a result of an increase in estimates made for the programmatic and technical assumptions based on the nature and technical complexity of the work to be performed to meet customer specifications. The gross favorable adjustments are primarily due to $10.2 million of favorable adjustments in the Defense Tech segment, inclusive of the reversal of loss reserves in the amount of $6.7 million. Refer to Note N – Revenues of the accompanying notes to thecondensed consolidated financial statements for additional information.

Previous wording

March 31, 2025. The increase in revenues is primarily driven by $36.4 million of revenues related to the Edge Autonomy Acquisition and $4.0 million of revenue related to a favorable shift in the Company’s contract mix. The increase is partially offset by $4.8 million of net unfavorable EAC adjustments for the three months ended March 31, 2026 as compared to $3.1 million of net unfavorable EAC adjustments for the same period in 2025.

Current wording

Revenues increased by $55.3 million, or 90%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase in revenues is primarily driven by $49.1 million of revenues related to the Edge Autonomy Acquisition, which was completed on June 13, 2025 and therefore has minimal comparable amounts year-over-year. The increase is also due to lower net unfavorable EAC adjustments of $3.2 million for the three months ended June 30, 2026 as compared to $17.7 million of net unfavorable EAC adjustments for the same period in 2025.

Previous wording

Gross profit increased $16.8 million for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. Further, as a percentage of revenues, gross margin increased to 27% for the three months ended March 31, 2026 from 15% during the same period in 2025. The year-over-year increase in gross profit and margin was primarily driven by the Edge Autonomy Acquisition amounting to $17.1 million. Further, this amount was offset by $1.1 million due to net unfavorable EAC adjustments for the three months ended March 31, 2026. Please refer to Note N – Revenues of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s net EAC adjustments.

Current wording

Gross profit increased $51.6 million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. Further, as a percentage of revenues, gross margin increased to 28% for the three months ended June 30, 2026 from (31)% during the same period in 2025. The increase in gross profit and margin was primarily driven by a decrease in net unfavorable EAC adjustments of $25.2 million year-over-year. The increase is also due to $32.3 million of contributed gross profit from the Edge Autonomy acquisition which impacted changes in the contract mix, including increases of contracts with higher margins and the completion or near completion of larger contracts with lower margins. Please refer to Note N – Revenues of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s net EAC adjustments.

Previous wording

SG&A expenses increased $64.1 million for the three months ended March 31, 2026, as compared with the same period in 2025. This contributed to a year-over-year increase of SG&A as a percentage of revenue to 85% for the three months ended March 31, 2026 from 31% for the same period in 2025. The year-over-year increase was primarily due to $59.1 million in SG&A expenses related to the Edge Autonomy Acquisition, including $42.1 million related to the accelerated vesting of the Edge Incentive Units, for which there was no comparable cost in the same period of 2025. The increase was further driven by increased costs for acquisition integration support and increased investment in bid and proposal solicitation activities.

Current wording

SG&A expenses decreased $12.4 million for the three months ended June 30, 2026, as compared with the same period in 2025. This contributed to a year-over-year decrease of SG&A as a percentage of revenue to 36% for the three months ended June 30, 2026 from 88% for the same period in 2025. The year-over-year decrease was primarily due to the non-recurring $29.6 million expense in 2025 related to the Edge Incentive Units. The decrease was partially offset by an increase of $13.4 million in SG&A expenses, other than equity-based compensation, related to the Edge Autonomy Acquisition, which was completed at the end of the second quarter of 2025 and therefore has minimal comparable amounts year-over-year.

Previous wording

Transaction expenses decreased $3.8 million for the three months ended March 31, 2026, as compared with the same period in 2025. The decrease is primarily due to pre-acquisition costs incurred during the three months ended March 31, 2025, consisting of due diligence and expenses related to prospective acquisitions, including the Edge Autonomy Acquisition of which there is minimal comparable expense during the three months ended March 31, 2026.

Current wording

Transaction expenses decreased $16.6 million for the three months ended June 30, 2026, as compared with the same period in 2025. The decrease is primarily due to acquisition costs incurred during the three months ended June 30, 2025, consisting of due diligence and expenses related to the Edge Autonomy Acquisition of which there is minimal comparable expense during the three months ended June 30, 2026.

Previous wording

Research and development expenses increased $11.8 million during the three months ended March 31, 2026, as compared with the same period in 2025. The increase is primarily related to $7.9 million of costs related the Edge Autonomy Acquisition for which there was no comparable costs during same period in 2025. The remaining increase of $3.9 million is primarily driven by strategic investments in the development of high potential, emerging opportunities within the Space segment.

Current wording

Research and development expenses increased $10.8 million during the three months ended June 30, 2026, as compared with the same period in 2025. The increase is primarily related to $6.1 million of costs related the Edge Autonomy Acquisition, which was completed on June 13, 2025 and therefore has minimal comparable amounts year-over-year. The remaining increase is primarily driven by strategic investments in the development of high potential, emerging opportunities within the Space segment.

Previous wording

Interest expense, net decreased $1.1 million for the three months ended March 31, 2026, as compared with the three months ended March 31, 2025. The decrease was due to a decrease in the effective interest rate year-over-year primarily due to a reduced interest rate on the JPM A&R Credit Agreement entered into during the three months ended March 31, 2026 and the Company no longer holding the term loans and revolver loans under the Adams Street Credit Agreement. Refer to Note H – Debt of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s debt obligations.

Current wording

Interest expense, net decreased $23.0 million for the three months ended June 30, 2026, as compared with the same period in 2025. The decrease was primarily due to the non-recurring interest expense of $20.0 million recognized in 2025 related to the repayment of the Seller Note. The change was also due to a decrease in the effective interest rate year-over-year primarily due to a reduced interest rate on the JPM A&R Credit Agreement, as amended, and the Company no longer holding the term and revolver loans under the Adams Street Credit Agreement. Refer to Note H – Debt of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s debt obligations.

Previous wording

The Company recognized $2.5 million as a loss on extinguishment of debt related to the write-off of unamortized discount and deferred financing costs associated with the refinancing of the JPM A&R Credit Agreement and the termination of the Adams Street Credit Agreement. Please refer to Note H – Debt of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s debt obligations.

Current wording

The Company recognized $1.2 million as a loss on extinguishment of debt for the three months ended June 30, 2026, related to the write-off of unamortized discount and deferred financing costs associated with the amendment of the JPM A&R Credit Agreement. Please refer to Note H – Debt of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s debt obligations.

Previous wording

The Company recorded tax expense of$0.6 million for thethree months ended March 31, 2026, as compared to a tax benefit of$0.2 million for thethree months ended March 31, 2025. This change in income tax expense isprimarily related to the increase in the valuation allowance for the three months ended March 31, 2026. Refer to Note K – Income Taxes of the accompanying notes to thecondensed consolidated financial statements for further discussion.

Current wording

The Company recorded tax expense of$1.9 million for thethree months ended June 30, 2026, as compared to a tax benefit of$32.6 million for thethree months ended June 30, 2025. This change in income tax expense isprimarily related to the increase in the valuation allowance for the three months ended June 30, 2026 compared to a decrease in the Company’s valuation allowance for the same period in 2025 and the mix in earnings between U.S. and foreign jurisdictions year-over-year. Refer to Note K – Income Taxes of the accompanying notes to thecondensed consolidated financial statements for further discussion.

Previous wording

Other (income) expense, net increased by $15.9 million for the three months ended March 31, 2026, from net income to net expense as compared to the same period in 2025. The year-over-year change was primarily due to loss recognized as a result of changes in the fair value of the private warrant liability of $0.3 million during the three months ended March 31, 2026 as compared to a $13.6 million gain recognized during the same period of 2025, resulting in a total change of $14.0 million. Refer to Note D – Fair Value of Financial Instruments of the accompanying notes to the condensed consolidated financial statements for additional information related to the fair value of private warrants.

Current wording

Other (income) expense, net increased by $17.0 million for the six months ended June 30, 2026, from net income to net expense as compared to the six months ended June 30, 2025. This year-over-year change was primarily due to an increase in the loss recognized as a result of an increase in the fair value of the Company’s private warrant liability of $12.1 million and change to a net loss on foreign currency transactions during the six months ended June 30, 2026 compared to a net gain during the six months ended June 30, 2025. Please refer to Note D – Fair Value of Financial Instruments of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s private warrants.

Previous wording

Revenues, gross profit and operating profit of our business segments exclude inter-segment sales, cost of sales and profit as these activities are eliminated in consolidation and thus are not included in management’s evaluation of performance of each segment.

Current wording

Results of our business segments exclude inter-segment sales, cost of sales and profit as these activities are eliminated in consolidation and thus are not included in management’s evaluation of performance of each segment. Additionally, business segment operating results exclude a portion of corporate costs not considered allowable or allocable to contracts, and other items not considered part of management’s evaluation of segment operating performance.

Previous wording

Corporate charges mainly consists of corporate overhead costs maintained at the corporate level, including gains and losses related to financial instruments measured at fair value. These expenses include costs relating to treasury, accounting, consulting, advisory, legal, tax and audit, insurance, financial reporting services and various administrative expenses related to the corporate headquarters.

Current wording

Corporate charges presented in the tables below mainly consist of corporate overhead costs maintained at the corporate level. These expenses include costs relating to treasury, accounting, consulting, advisory, legal, tax and audit, insurance, financial reporting services and various administrative expenses related to the corporate headquarters.

Previous wording

Revenues, cost of sales and operating profit for each of our business segments were as follows:

Current wording

Revenues, cost of sales, operating income (loss) and Segment Adjusted EBITDA for each of our business segments were as follows:

Previous wording

Space segment revenues increased by $0.5 million, or 1%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The year-over-year increase in revenues is primarily related to timing in the stage of production cycles year-over-year for certain contracts in the next-generation space and space infrastructure offering. This increase is partially offset by $6.8 million of net unfavorable EAC adjustments for the three months ended March 31, 2026 as compared to $2.6 million of net unfavorable EAC adjustments for the same period in 2025.

Current wording

Space segment revenues decreased by $1.5 million, or (3)%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The year-over-year decrease in revenues is primarily related to timing in the stage of production cycles year-over-year for certain contracts in the large space infrastructure offerings. The foregoing resulted in decreased volume of production and therefore decreased revenue compared to the same period in 2025. The decrease was partially offset by a reduction in net unfavorable EAC adjustments of $5.2 million year-over-year.

Previous wording

Operating income (loss) decreased by $7.2 million for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. Operating margin also decreased from 6% to (8)% year-over-year. The decrease in operating income (loss) and margin is partially due to a decrease in gross margin as a result of the unfavorable EAC adjustments recognized during the three months ended March 31, 2026, further reducing the portfolio margin compared with the same period in 2025. The decrease is also due to increased costs for research and development of $3.8 million year-over-year as a result of the Company investing in high potential opportunities.

Current wording

Operating income (loss) decreased by $1.3 million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. Operating margin deccreased to (10)% from (12)% year-over-year. The decrease in operating income (loss) and decrease in margin is partially due to an increase in gross margin as a result of a reduction in the net unfavorable EAC adjustments recognized year-over-year. The increase was partially offset due to increased costs for research and development of $4.8 million year-over-year as a result of the Company investing in high potential opportunities.

Previous wording

Defense Tech segment revenues increased by $35.0 million for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The year-over-year increase in revenues was primarily due to $36.4 million of revenue related to the Edge Autonomy Acquisition.

Current wording

Defense Tech segment revenues increased by $91.8 million for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The year-over-year increase in revenues was primarily due to $85.6 million of revenue related to the Edge Autonomy Acquisition, which was completed on June 13, 2025 and therefore has minimal comparable amounts year-over-year. The increase was also due to net favorable EAC adjustments for the six months ended June 30, 2026 compared to net unfavorable adjustments in the same period of 2025.

Previous wording

We use Adjusted EBITDA to evaluate our operating performance, generate future operating plans, and make strategic decisions, including those relating to operating expenses and the allocation of internal resources which are not calculated in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and are considered to be Non-GAAP financial performance measures. These Non-GAAP financial performance measures are used to supplement the financial information presented on a U.S. GAAP basis and should not be considered in isolation or as a substitute for the relevant U.S. GAAP measures and should be read in conjunction with information presented on a U.S. GAAP basis. Because not all companies use identical calculations, our presentation of Non-GAAP measures may not be comparable to other similarly titled measures of other companies.

Current wording

We use Adjusted EBITDA and Adjusted EPS to evaluate our operating performance, generate future operating plans, and make strategic decisions, including those relating to operating expenses and the allocation of internal resources which are not calculated in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and are considered to be Non-GAAP financial performance measures. These Non-GAAP financial performance measures are used to supplement the financial information presented on a U.S. GAAP basis and should not be considered in isolation or as a substitute for the relevant U.S. GAAP measures and should be read in conjunction with information presented on a U.S. GAAP basis. Because not all companies use identical calculations, our presentation of Non-GAAP measures may not be comparable to other similarly titled measures of other companies.

Previous wording

Our book-to-bill ratio was 1.92 for the three months ended March 31, 2026, as compared to 0.92 for the three months ended March 31, 2025. For the three months ended March 31, 2026 and 2025, none of the contracts awarded balance relates to acquired contract value.

Current wording

Our book-to-bill ratio was 1.42 for the three months ended June 30, 2026, as compared to 1.47 for the three months ended June 30, 2025. For the three months ended June 30, 2026 none of the contracts awarded balance relates to acquired contract value. For the three months ended June 30, 2025, the contracts awarded includes $73.7 million of acquired contract value from the Edge Autonomy acquisition.

Previous wording

Our book-to-bill ratio was 1.54 for the Last Twelve Months (“LTM”) ended March 31, 2026, as compared to 0.90 for the LTM ended March 31, 2025. For the LTM ended March 31, 2026, contracts awarded includes $73.7 million of acquired contract value from the Edge Autonomy acquisition, which was completed in the second quarter of 2025, and included in the Defense Tech segment. For the LTM ended March 31, 2025, contracts awarded includes $21.9 million of acquired contract value from the Hera Systems acquisition, which was completed in the third quarter of 2024, and included in the Space segment.

Current wording

Our book-to-bill ratio was 1.52 for the Last Twelve Months (“LTM”) ended June 30, 2026, as compared to 0.87 for the LTM ended June 30, 2025. For the LTM ended June 30, 2026 none of the contracts awarded balance relates to acquired contract value. For the LTM ended June 30, 2025, contracts awarded includes $73.7 million of acquired contract value from the Edge Autonomy acquisition, which was completed in the second quarter of 2025 and included in the Defense Tech segment, and $21.9 million of acquired contract value from the Hera Systems acquisition, which was completed in the third quarter of 2024 and included in the Space segment.

Previous wording

The following table presents our contracted backlog as of March 31, 2026 and December 31, 2025, and related activity for the three months ended March 31, 2026 as compared to the year ended December 31, 2025:

Current wording

The following table presents our contracted backlog as of June 30, 2026 and December 31, 2025, and related activity for the six months ended June 30, 2026 as compared to the year ended December 31, 2025:

Previous wording

We view growth in backlog as a key measure of our business growth. Contracted backlog represents the estimated dollar value of firm funded executed contracts for which work has not been performed (also known as the remaining performance obligations on a contract). Our contracted backlog includes $104.7 million and $81.0 million in remaining contract value from contracts which recognize revenue at a point in time as of March 31, 2026 and December 31, 2025, respectively.

Current wording

We view growth in backlog as a key measure of our business growth. Contracted backlog represents the estimated dollar value of firm funded executed contracts for which work has not been performed (also known as the remaining performance obligations on a contract). Our contracted backlog includes $186.2 million and $81.0 million in remaining contract value from contracts which recognize revenue at a point in time as of June 30, 2026 and December 31, 2025, respectively.

Previous wording

Organic contract value includes the remaining contract value as of January 1 not yet recognized as revenue and additional orders awarded during the period for those entities treated as organic. Acquisition-related contract value includes remaining contract value as of the acquisition date not yet recognized as revenue and additional orders awarded during the period for entities not treated as organic. Organic revenue includes revenue earned during the period presented for those entities treated as organic, while acquisition-related revenue includes the same for all other entities, excluding any pre-acquisition revenue earned during the period. The acquisition-related backlog activity presented in the table above is related to the Edge Autonomy acquisition completed during the second quarter of 2025.

Current wording

Organic contract value includes the remaining contract value as of January 1 not yet recognized as revenue and additional orders awarded during the period for those entities treated as organic. Acquisition-related contract value includes remaining contract value as of the acquisition date not yet recognized as revenue and additional orders awarded during the period for entities not treated as organic. Organic revenue includes revenue earned during the period presented for those entities treated as organic, while acquisition-related revenue includes the same for all other entities, excluding any pre-acquisition revenue earned during the period. There is no acquisition-related backlog activity presented in the table above as all acquired entities have completed four fiscal quarters post-acquisition.

Previous wording

Although contracted backlog reflects business associated with contracts that are considered to be firm, terminations, amendments or contract cancellations may occur, which could result in a reduction in our total backlog. In addition, some of our multi-year contracts are subject to annual funding. Management expects all amounts reflected in contracted backlog to ultimately be fully funded. Contracted backlog from international operations was $195.4 million and $193.1 million as of March 31, 2026 and December 31, 2025, respectively. These amounts are subject to foreign exchange rate translations from their respective local currencies to U.S. dollars that could cause the remaining backlog balance to fluctuate with the foreign exchange rate at the time of measurement.

Current wording

Although contracted backlog reflects business associated with contracts that are considered to be firm, terminations, amendments or contract cancellations may occur, which could result in a reduction in our total backlog. In addition, some of our multi-year contracts are subject to annual funding. Management expects all amounts reflected in contracted backlog to ultimately be fully funded. Contracted backlog from international operations was $229.0 million and $193.1 million as of June 30, 2026 and December 31, 2025, respectively. These amounts are subject to foreign exchange rate translations from their respective local currencies to U.S. dollars that could cause the remaining backlog balance to fluctuate with the foreign exchange rate at the time of measurement.

Previous wording

Our operations are primarily funded with cash flows provided by operating activities, proceeds from equity offerings, including the ATM facility, and access to existing credit facilities. As of March 31, 2026, we had $144.5 million in cash and cash equivalents and $30.0 million in available borrowings from our existing credit facilities.

Current wording

Our operations are primarily funded with cash flows provided by operating activities, proceeds from equity offerings, including the ATM facilities, and access to existing credit facilities. As of June 30, 2026, we had $557.0 million in cash and cash equivalents and $50.0 million in available borrowings from our existing credit facilities.

Previous wording

During the three months ended March 31, 2026, there were no material changes to the Company’s contractual obligations as presented in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Annual Report that were outside the ordinary course of our business.

Current wording

During the six months ended June 30, 2026, there were no material changes to the Company’s contractual obligations as presented in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Annual Report that were outside the ordinary course of our business, except the following.

Previous wording

As of March 31, 2026 and December 31, 2025, respectively, we had $0.7 million of standby letters of credit. Our standby letters of credit outstanding generally relate to submitted proposals and performance guarantees, which are secured by our restricted cash. Refer to Note B of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s restricted cash.

Current wording

We had $0.8 million and $0.7 million of standby letters of credit as of June 30, 2026 and December 31, 2025, respectively. Our standby letters of credit outstanding generally relate to submitted proposals and performance guarantees, which are secured by our restricted cash. Refer to Note B of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s restricted cash.

Previous wording

Net cash used in operating activities decreased by $38.4 million year-over-year. The change was primarily due to an increase of $71.2 million in the effects of reconciling adjustments to net income (loss) and a decrease in cash used by working capital of $40.8 million, partially offset by an increase of $73.6 million in cash used related to the Company’s net loss for the three months ended March 31, 2026 in comparison to 2025. The increase in non-cash adjustments is primarily related to increases in share-based compensation of $43.8 million and depreciation and amortization expense of $8.2 million both of which are primarily related to the Edge Autonomy Acquisition. The increase was also due to a loss recognized for the change in fair value of the outstanding private warrants of $0.3 million during the three months ended March 31, 2026 compared to gain of $13.6 million recognized in 2025. Please refer to Note D – Fair Value of Financial Instruments of the accompanying notes to the condensed consolidated financial statements for additional information related to the fair value of warrants. The decrease in cash used by working capital was primarily due to an increase of $19.8 million and $10.6 million in deferred revenue and accounts payable and accrued expenses, respectively, for 2026 compared to a decrease of $7.6 million and $8.2 million in deferred revenue and accounts payable and accrued expenses, respectively, for 2025 as well as an increase in cash provided by accounts receivable year-over-year. These changes were partially offset by an increase in cash used for inventory of $14.1 million year-over-year. The increases in accounts payable and accrued expenses were primarily a result of timing of payments and recognition of liability. The changes in deferred revenue and accounts receivable were primarily driven by the timing of billable milestones during the three months ended March 31, 2026 compared to 2025 and the changes in inventory are primarily related to the Edge Autonomy Acquisition.

Current wording

Net cash used in operating activities decreased by $101.1 million year-over-year. The change was primarily due to an increase of $85.7 million in the effects of reconciling adjustments to net income (loss) and a decrease in cash used by working capital of $33.0 million, partially offset by an increase of $17.5 million in cash used related to the Company’s net loss for the six months ended June 30, 2026 in comparison to 2025. The increase in non-cash adjustments is primarily related to increases in share-based compensation of $15.0 million and depreciation and amortization expense of $14.6 million both of which are primarily related to the Edge Autonomy Acquisition. The increase was also due to an increase in the loss recognized for the change in fair value of the outstanding private warrants of $12.1 million year-over-year. Please refer to Note D – Fair Value of Financial Instruments of the accompanying notes to the condensed consolidated financial statements for additional information related to the fair value of warrants. The increase in non-cash adjustments is also due to the recognition of $2.5 million in deferred tax expense for the six months ended June 30, 2026 compared to a $32.1 million deferred tax benefit for the same period in 2025. The decrease in cash used by working capital was primarily due to an increase of $25.3 million and $19.4 million in deferred revenue and accounts payable and accrued expenses, respectively, for 2026 compared to a decrease of $28.4 million and $5.6 million in deferred revenue and accounts payable and accrued expenses, respectively, for 2025, as well as an increase in cash provided by accounts receivable of $13.0 million year-over-year. These changes were partially offset by an increase in cash used for contract assets of $22.7 million and inventory of $31.6 million year-over-year. The increases in accounts payable and accrued expenses were primarily a result of timing of payments and recognition of liability. The changes in deferred revenue, contract assets and accounts receivable were primarily driven by the timing of billable milestones during the six months ended June 30, 2026 compared to 2025 and the changes in inventory are primarily related to the Edge Autonomy Acquisition.

Previous wording

Net cash used in investing activities increased by$2.0 million year-over-year. The change was due to an increase in capital expenditures primarily related to equipment and leasehold improvements.

Current wording

Net cash used in investing activities decreased by$145.3 million year-over-year. The change was due to cash used for the Edge Autonomy Acquisition in 2025 offset by an increase in capital expenditures primarily related to equipment and leasehold improvements.

Previous wording

Net cash provided by financing activities increased by$8.9 million during thethree months ended March 31, 2026, as compared to 2025. The change was primarily due to the Company repaying an advance from third-parties of $(7.8) million during the three months ended March 31, 2025 for which there is no comparable activity during the three months ended March 31, 2026.

Current wording

Net cash provided by financing activities increased by$188.0 million during thesix months ended June 30, 2026, as compared to 2025. The increase was primarily due to net proceeds received under the Company’s ATM facilities and exercise of private warrants of $552.4 million during 2026, compared to $328.7 million of net proceeds for an equity offering and exercise of public and private warrants during the same period in 2025. The increase was also due to the Company repurchasing shares of its Series A Convertible Preferred stock during the six months ended June 30, 2025 for which there is no comparable activity during the six months ended June 30, 2026. These increases were partially offset by a change to net debt payments of $39.8 million from net debt proceeds of $64.5 million year-over-year. The change is primarily due to the Company making a $40.0 million prepayment on the term loans under the JPM A&R Credit Agreement, as amended, during 2026, compared to the original issuance of $90.0 million in term loans under the same agreement in 2025. Please refer to Note H – Debt of the accompanying notes to the condensed consolidated financial statements for additional information related to the Company’s debt obligations.