Enovix Corp

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Organization and Basis of Presentation

Organization

Enovix Corporation (“we,” “us,” “our,” or “Enovix” or the “Company”) was incorporated in Delaware in 2006. We design, develop, manufacture, and commercialize next generation Lithium-ion, or Li-ion, battery cells that significantly increase the amount of energy density and storage capacity relative to conventional battery cells. Our batteries’ mechanical design, or “architecture,” allows us to use high performance chemistries while enabling safety and charge time advantages. Enovix is headquartered in Silicon Valley, a region of California, with offices and facilities in Asia.

Note 2. Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying condensed consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”). The condensed consolidated financial statements include our accounts, our wholly-owned subsidiaries and majority-owned subsidiaries and the business combination from the closing date. All intercompany balances and transactions have been eliminated in consolidation.

Unaudited Interim Condensed Consolidated Financial Statements

These accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (“SEC”) for interim financial reporting. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the related notes in our Annual Report on Form 10-K for the fiscal year ended December 29, 2024 (the “Form 10-K”).

In the opinion of management, these unaudited condensed consolidated financial statements reflect all adjustments, consisting of normal recurring items, considered necessary to present fairly our financial condition, results of operations, comprehensive income (loss), stockholders’ equity and cash flows for the periods presented above. The results of operations for the fiscal quarter and fiscal year to-date ended June 29, 2025 are not necessarily indicative of the operating results for the full year, and therefore should not be relied upon as an indicator of future results.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the condensed consolidated financial statements and accompanying notes during the reporting periods. Estimates and assumptions include but are not limited to: depreciable lives for property and equipment and intangible assets, valuation for assets acquired in business acquisition, valuation for inventory, valuation allowance on deferred tax assets, assumptions used in income tax provisions, valuation of goodwill and intangible assets, assumptions used in stock-based compensation, assumptions used in the calculation of earnings per share related to the warrant dividend, incremental borrowing rate for operating right-of-use assets and lease liabilities and estimates to fair value common stock warrants. Management bases its estimates on historical experience and on various other market-specific and relevant assumptions that it believes to be reasonable under the circumstances.

Liquidity and Capital Resources

We have incurred operating losses and negative cash flows from operations since our inception through June 29, 2025 and expect to incur operating losses for the foreseeable future. As of June 29, 2025, we had working capital of $176.1 million and an accumulated deficit of $889.1 million. Based on the anticipated spending and timing of expenditures, we currently expect that our cash will be sufficient to meet our funding requirements over the next twelve months. Going forward, we may require additional financing for our future operations and expansion. The accompanying condensed consolidated financial statements have been prepared assuming we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.

Summary of Significant Accounting Policies

There have been no changes to our significant accounting policies disclosed in Note 2 “Summary of Significant Accounting Policies,” of the notes to the consolidated financial statements for the fiscal year ended December 29, 2024, included in Part II, Item 8 of our Form 10-K.

Segment Reporting

We operate inone segment. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker (“CODM”) in making decisions regarding resource allocation and assessing performance. Our Chief Executive Officer (“CEO”) has been identified as our CODM, who reviews operating results to make decisions and assesses performance for the Company as a whole. Total available cash and cash equivalents, total revenues and net loss are used by our CEO to evaluate key operating decisions, such as company strategy, and determine and allocate resources on a consolidated basis. Since we operate in one segment, all significant segment expenses and financial information required by “Segment Reporting” can be found in the condensed consolidated financial statements and the accompanying notes of the condensed consolidated financial statements.

Revenue

We recognize revenue in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, issued by Financial Accounting Standards Board (“FASB”). Our revenue consists of product revenue, resulting from the sale of lithium-ion batteries and battery pack products (“Product Revenue”), and service revenue, resulting from payments received from our customers based on executed engineering revenue contracts for the development of lithium-ion battery technology (“Service Revenue”).

Product Revenue

Product Revenue mainly relates to sales of lithium-ion batteries or battery packs. We recognize Product Revenue at a point in time when the performance obligation has been satisfied upon transfer of control of goods, which is upon product shipment, delivery or customer acceptance, depending on the applicable contract terms. For certain customized products with customer acceptance criteria specified in the contract, the performance obligation is satisfied upon our customer’s formal acceptance.

For the fiscal quarters ended June 29, 2025 and June 30, 2024, our product revenue were $7.5 million and $3.8 million, respectively. Of our total product revenue for the fiscal quarters ended June 29, 2025 and June 30, 2024, approximately 69% and 39%, respectively, were from South Korea based on the billing location of the customers.

For the fiscal years-to-date ended June 29, 2025 and June 30, 2024, our product revenue were $12.6 million and $9.0 million, respectively. Of our total product revenue for thefiscal years-to-date ended June 29, 2025 and June 30, 2024, approximately 60% and 41%, respectively, were from South Korea based on the billing location of the customers.

Service Revenue

We did not recognize Service Revenue for either of the fiscal quarters and fiscal years-to-date ended June 29, 2025 and June 30, 2024.

Income Tax

In accordance with the Accounting Standards Update (“ASU”) 740-270, Income Taxes - Interim Reporting, issued by FASB for interim reporting for income tax, we calculate our income tax provision using the annualized effective tax rate method. The effective tax rate for the fiscal years-to-date ended June 29, 2025 and June 30, 2024 were 1.49% and 2.83%, respectively. Our effective tax rate differs from the statutory tax rate primarily due to valuation allowances on the U.S. operations, and a mix of income and losses among foreign jurisdictions. The decrease in our tax benefit for the fiscal quarter and year-to-date ended June 29, 2025 as compared to the same periods for prior year was attributable to a decrease in our estimated annualized effective tax for the current year resulting from the losses generated from certain foreign jurisdictions.

On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was signed into U.S. law, which includes significant changes to the corporate income tax provisions. We are currently evaluating the impact of the OBBBA on our condensed consolidated financial statements.

Recently Adopted Accounting Pronouncements

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which is intended to improve the reportable segment disclosure requirements. The amendments require disclosure of significant segment expenses that are regularly provided to the CODM, one or more measures of segment profit or loss, and other segment items on an annual and interim basis. This ASU is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

We adopted this ASU for our fiscal year 2024 annual financial statements and interim financial statements beginning in the first quarter of fiscal year 2025. The adoption of ASU 2023-07 did not change the way that we identify our reportable segment. Please see “Segment Reporting” above for our interim segment reporting disclosure.

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topics 740): Improvements to Income Tax Disclosures, which expanded the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for the annual reporting periods beginning December 15, 2024, with early adoption permitted. As ASU 2023-09 only has an impact to our financial statement disclosures, we do not expect this ASU to have a significant impact to our consolidated financial statements and plan to adopt this ASU in our Annual Report on Form 10-K for the fiscal year ending December 28, 2025.

In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures,” which requires disclosure of certain costs and expenses on an interim and annual basis in the notes to the financial statements. The standard is effective for the annual reporting periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted. We are currently evaluating the potential impact of the adoption of this ASU on our financial statement disclosures.

Note 3. Business Acquisition

On April 1, 2025, we entered into an asset transfer agreement for the acquisition of battery cell manufacturing assets from SolarEdge Technologies, Inc. (the “Seller”), located in South Korea, for a total purchase consideration of $10.0 million in cash (the “2025 Acquisition”). These assets includea battery cell manufacturing facility with approximately 330,000 square feet, land and certain machinery and equipment for manufacturing battery cells. We believe this acquisition will help further expand our manufacturing footprint, expedite scaled production and better position us to meet growing demand in the defense industry.

This acquisition of assets met the criteria for a business in accordance with FASB Accounting Standards Codification (“ASC”) (Topic 805), Business Combinations (“ASC 805”) and was accounted for as a business combination using the acquisition method of accounting. The values assigned in these financial statements represent management’s best estimate of fair values as of the acquisition date.

The following table summarizes the preliminary purchase price allocation based on the fair values of the assets acquired as of the acquisition date, which are subject to change within the measurement period as the fair value assessments are finalized (in thousands). We expect to finalize the purchase price allocation as soon as practicable, but no later than one year from the acquisition date.

In connection with the 2025 Acquisition, we incurred $0.7 million of acquisition related costs associated with this acquisition for the fiscal quarter and fiscal year-to-date ended June 29, 2025, which were included in Selling, general and administrative expense in the Condensed Consolidated Statements of Operations.

Bargain Purchase

In accordance with ASC 805, we assessed whether all assets acquired have been appropriately identified, measured and recognized, subject to re-measurements to verify that the consideration paid and assets acquired have been properly valued. We recognized a gain on bargain purchase from the 2025 Acquisition as the estimated fair value of the identifiable assets acquired exceeded the purchase consideration by approximately $4.8 million, net of deferred tax liability recognized from this acquisition. The bargain purchase gain is reported in Other income (loss), net on the Condensed Consolidated Statement of Operations. Management believes the primarily reason for the bargain purchase is because we were able to complete the acquisition in an expedited manner with a good offer of a cash payment and no financial contingencies.

Pro forma Information

Pro forma results of operations have not been presented because the effects of this acquisition were not material to our consolidated results of operations during the fiscal quarter and fiscal year-to-date ended June 29, 2025. The results of operations for this acquisition are included in our condensed consolidated financial statements from the date of acquisition onwards.

Note 4. Fair Value Measurement

The fair value of our financial assets and liabilities are determined in accordance with the fair value hierarchy established in ASC 820, Fair Value Measurements, issued by the FASB. The fair value hierarchy of ASC 820 requires an entity to maximize the use of observable inputs when measuring fair value and classifies those inputs into three levels:

Our financial instruments consist primarily of cash and cash equivalents, short-term investments, accounts receivable, notes receivable, accounts payable, short-term and long-term debt, and warrant liabilities. Cash and cash equivalents are reported at their respective fair values on our Condensed Consolidated Balance Sheets. As of June 29, 2025 and December 29, 2024, the carrying values of accounts and notes receivables, accounts payable, short-term debt and accrued liabilities approximated the fair value based on the short maturity of those instruments. As of June 29, 2025 and December 29, 2024, we had cash and cash equivalents of $136.0 million and $272.9 million, respectively.

The following table details the fair value measurements of assets and liabilities that were measured at fair value on a recurring basis based on the following three-tiered fair value hierarchy per ASC 820, Fair Value Measurement, as of June 29, 2025 and December 29, 2024 (in thousands).

Cash Equivalents and Short-term Investments:

The following is a summary of cash equivalents and short-term investments (in thousands).

As of June 29, 2025 and December 29, 2024, the short-term investments had contractual maturity due within one year.

Private Placement Warrants

Our liabilities are measured at fair value on a recurring basis, including warrants that were held by Rodgers Capital, LLC (the “Sponsor”) and certain of its members (the “Private Placement Warrants”). The fair value of the Private Placement Warrants is considered a Level 3 valuation and is determined using the Black-Scholes valuation model. Each whole Private Placement Warrant became exercisable forone whole share of our common stock at a price of $11.50 per share on December 5, 2021. As of both periods ended June 29, 2025 and December 29, 2024, we had 5,500,000 Private Placement Warrants outstanding. The fair value of the Private Placement Warrants was $3.36 per share as of June 29, 2025. The following tables summarize the changes for Level 3 items measured at fair value on a recurring basis using significant unobservable inputs (in thousands).

The following table summarizes the key assumptions used for determining the fair value of the Private Placement warrants.

Convertible Senior Notes and Long-term Loans

We consider the fair value of our convertible senior notes to be a Level 2 measurement as they are not actively traded in the market. As of June 29, 2025, the fair value of the convertible senior notes was approximately $161.3 million. As of June 29, 2025, our long-term loans are approximately close to their carrying value of $0.6 million.

Note 5. Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets. Property and equipment as of June 29, 2025 and December 29, 2024, consisted of the following (in thousands).

The following table summarizes the depreciation and amortization expenses related to property and equipment, which are recorded within cost of revenue, research and development expense and selling, general and administrative expense in the Condensed Consolidated Statements of Operations (in thousands).

In connection with our strategic realignment in 2023, we recognized accelerated depreciation expenses of approximately $18.4 million for Fab1 equipment in the first quarter of 2024, of which approximately $18.3 million and $0.1 million were recorded as research and development expense, and selling, general and administrative expense, respectively, in the Condensed Consolidated Statements of Operations. After the first quarter of 2024 and thereafter, we didnot record any accelerated depreciation expenses for Fab1 equipment.

Fab1 Long-Lived Asset Disposals

During the quarter and fiscal year-to-date ended June 30, 2024, we recorded $35.1 million of loss on disposal of our Fab1 long-lived assets, including machinery and equipment, leasehold improvements and other assets located in Fremont, California as a part of the 2024 Restructuring Plan (as defined below) and it was recorded as Restructuring Cost in the Condensed Consolidated Statement of Operations. See Note 12 “Restructuring Costs” for more information.

Note 6. Inventory

Inventory consists of the following components (in thousands).

Inventory is stated at the lower of cost or net realizable value (“NRV”) on a first-in and first-out basis. Inventory costs include direct materials, direct labor, and manufacturing overhead. When the estimated net realizable values are below the manufacturing costs, a charge to cost of revenue is recorded for finished goods and work in process inventories.

As of both June 29, 2025 and December 29, 2024, we had animmaterial amount of inventory reserve, including excess or obsolete inventory reserve.

Note 7. Leases

We have operating lease agreements primarily for offices and manufacturing spaces located in various locations with lease periods expiring between 2024 and 2030, some of which include options to extend the leases for up tofive years.

The components of lease costs were as follows (in thousands):

Supplemental lease information:

Supplemental cash flow information related to leases are as follows (in thousands):

Maturities of Lease Liabilities

The following is a schedule of maturities of lease liabilities as of June 29, 2025 (in thousands).

Note 8. Borrowings

Short-Term Debt

Our asset secured loans have fixed and floating interest rates with various maturity dates. From time to time, we renew our short-term loans once they reach the maturity dates. The current portion of long-term loans is recorded as short-term debt based on time remaining until maturity. As of June 29, 2025, short-term debt was $10.4 million, which comprised of $10.2 million of short-term loans with less than one-year term and $0.2 million of the current portion of long-term loans. As of December 29, 2024, short-term debt was $9.5 million, which comprised of $9.3 million of short-term loans with less than one-year term and $0.2 million of the current portion of long-term loans. As of June 29, 2025 and December 29, 2024, the weighted average interest rates on the short-term loans were approximately 4.8%. and 5.2%, respectively.

Long-Term Debt

Our long-term debt, net consists of the following (in thousands).

Long-term Loans

Our long-term loans bear interest at either fixed or floating rates, as indicated in the table above. As of June 29, 2025, total long-term loans outstanding was $0.6 million, including a current portion of the long-term loans of $0.2 million. As of December 29, 2024, total long-term loans outstanding was $1.5 million, including a current portion of the long-term loans of $0.2 million.

Convertible Senior Notes

On April 20, 2023, we issued $172.5 million aggregate principal amount of 3.0% convertible senior notes due 2028 (the “Convertible Senior Notes”), including $10.0 million principal amount of the Convertible Senior Notes (the “Affiliate Notes”) issued to an entity affiliated with Thurman John Rodgers, Chairman of our Board of Directors, in a concurrent private placement. As of both periods ended June 29, 2025 and December 29, 2024, total outstanding Convertible Senior Notes was $172.5 million.

The Convertible Senior Notes are unsecured obligations of the Company and bear interest at a rate of 3.0% per year from April 20, 2023, and will be payable semiannually in arrears on May 1 and November 1 of each year, beginning on November 1, 2023. The Convertible Senior Notes will mature on May 1, 2028 unless earlier converted, redeemed or repurchased.

The following table summarizes the interest expenses related to Convertible Senior Notes and loans, which are recorded within Interest expense in the Condensed Consolidated Statements of Operations (in thousands).

As of both periods ended June 29, 2025 and December 29, 2024, we had $0.9 million of accrued interest liability, respectively.

Debt Maturity

The following table summarizes our long-term debt maturities, based on outstanding principal by years (in thousands).

Note 9. Commitments and Contingencies

Purchase Commitments

As of June 29, 2025 and December 29, 2024, our commitments included approximately $5.6 million and $17.4 million, respectively, of our open purchase orders and contractual obligations that occurred in the ordinary course of business, including commitments with contract manufacturers and suppliers for which we have not received goods or services, commitments for capital expenditures and construction-related activities for which we have not received the goods or services. Although open purchase orders are considered enforceable and legally binding, the terms generally allow us an option to cancel, reschedule, and adjust the requirements based on our business needs prior to the delivery of goods or performance of services. For lease obligations, please refer to Note 7 “Leases” for more details. For the Convertible Senior Notes obligation and other borrowings, please refer to Note 8 “Borrowings” for more details.

Performance Obligations

As of June 29, 2025, we had $8.4 million of performance obligations, which comprised of total deferred revenue and customer order deposits. We currently expect to recognize approximately 96% of deferred revenue as revenue within the next twelve months.

Litigation

From time to time, we are subject to a variety of claims, lawsuits, investigations, and proceedings concerning matters arising in connection with our business activities, including product liability, intellectual property, commercial, insurance, securities laws, contract disputes, and employment matters. Certain of these lawsuits and claims are described in further detail below. We intend to vigorously defend against each of these allegations.

A liability and related charge to earnings is recorded in the condensed consolidated financial statements for legal contingencies when the loss is considered probable and the amount can be reasonably estimated. The assessment is re-evaluated each accounting period and is based on all available information, including the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to each case. The outcomes of outstanding legal matters are inherently unpredictable and subject to uncertainties. While there can be no assurance of favorable outcome of these legal matters, we currently believe that the outcome of these matters will not have a material adverse effect on our results of operations, liquidity or financial position.

Former Employee Class Action Lawsuit

In 2023, a former employee filedtwo complaints against Enovix. The first complaint asserted a putative class action, alleging various wage and hour violations, and individual claims alleging constructive discharge and adverse employment actions. The second complaint asserted claims under California’s Private Attorney General Act (“PAGA”) for alleged wage and hour violations. The cases are captioned Kody Walker v. Enovix Corporation, 23CV028923 and 23CV039290 (the “Walker Complaints”). The Walker Complaints were consolidated in April 2024. In November 2024, the parties entered into settlement agreements resolving the individual and PAGA claims, and plaintiff dismissed without prejudice the putative class action claims. The court approved a final settlement in March 2025.

Securities Class Action Complaint

In January 2023, purported Company stockholders filed securities class action complaints in the U.S. District Court for the Northern District of California against Enovix and certain of its current and former officers and directors (collectively, the “defendants”). The complaints, which were later consolidated, allege violations of Sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5 promulgated thereunder, relating to alleged material misstatements or omissions in public statements related to our manufacturing scale-ups and testing of new equipment. Following consolidation of the cases and court appointment oftwo purported Company stockholder lead plaintiffs, a consolidated complaint, In re Enovix Corp. Securities Litigation, Case No. 23-cv-00071-SI (N.D. Cal.), was filed on July 7, 2023. The consolidated complaint alleges substantially similar claims, including allegations that the defendants made material misstatements or omissions in public statements related to testing of new equipment.

On January 30, 2024, the court granted the defendants’ motion to dismiss the consolidated complaint. Plaintiffs subsequently filed a second amended complaint on March 19, 2024. On July 23, 2024, the court granted in part and denied in part defendants’ motion to dismiss the second amended complaint. The plaintiffs seek unspecified damages, interest, fees and costs on behalf of a putative class of persons and entities that purchased and/or acquired shares of Enovix or its predecessor entity’s common stock between August 10, 2021 and October 3, 2023.

In June 2025, we filed a motion to dismiss. A hearing on the motion to dismiss action is scheduled for September 5, 2025.

In September 2024, we received two Section 220 demands for corporate books and records related to this matter, which could result in separate proceedings. In November 2024, a related derivative lawsuit was filed in Alameda County, California, which lawsuit has been stayed pending resolution of the securities action.

Based on information currently available, we have not recorded a liability related to these matters in our condensed consolidated financial statements as of June 29, 2025, because we cannot reasonably estimate the amount or range of potential losses.

Guarantees and Indemnifications

In the normal course of business, we enter into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications. In addition, we purchased performance bonds for guarantee of our performance obligations for certain projects. Our exposure under these agreements is unknown because it involves claims that may be made against us in the future but have not yet been made. To date, we have not paid any claims or been required to defend any action related to our indemnification obligations. However, we may record charges in the future as a result of these indemnification obligations.

We also have indemnification obligations to our officers and directors for specified events or occurrences, subject to some limits, while they are serving at our request in such capacities. There have been no claims to date and we have director and officer insurance that may enable us to recover a portion of any amounts paid for future potential claims. We believe the fair value of these indemnification agreements is minimal. Accordingly, we have not recorded any liabilities relating to these obligations for the period presented.

Note 10. Net Loss per Share

The following table sets forth the computation of our basic and diluted net EPS of common stock for the periods presented below (in thousands, except share and per share amount).

(1) As required by ASC 260, Earnings Per Share, the share and per share amounts for the periods presented in the above table have been retroactively adjusted to reflect the warrant dividends issued in July 2025. The following reconciliation table showed the effect of the warrant dividends to the previously reported shares and net loss per share amount (in thousands, except share and per share amount).

For warrant dividends, please refer to Note 14 “Subsequent Events” for more details.

The following table discloses shares of the securities that were not included in the diluted EPS calculation above because they are anti-dilutive for the periods presented above.

The holders of Private Placement Warrants, unvested restricted stock units and stock options do not have rights to receive common stock dividends or common stock dividend equivalents.

Note 11. Stock-based Compensation

We issue equity awards to our employees and non-employees in the form of stock options, restricted stock units (“RSUs”) and performance based RSUs (“PRSUs”). Additionally, we also offer an employee stock purchase plan (“ESPP”) to our eligible employees. We use Black-Scholes option pricing model to value our stock options granted and the estimated shares to be purchased under the ESPP. For both RSUs and PRSUs, we use our common stock price, which is the last reported sales price on the grant date to value those securities.

In general, we recognize stock-based compensation expense on a straight-line basis over the requisite service period and records forfeitures as they occur. For PRSUs, we use the graded vesting method to calculate the stock-based compensation expense. At each reporting period, we would recognize and adjust the stock-based compensation expense based on its probability assessment in meeting its PRSUs' performance conditions.

Stock-based Compensation Expense

The following table summarizes the total stock-based compensation expense, by operating expense category, recognized in the Condensed Consolidated Statements of Operations for the periods presented below (in thousands).

(1) During the fiscal quarter ended June 30, 2024, we engaged a consulting company for its services and issued RSUs in exchange for its services. In connection with this service agreement, we recorded approximately $4.6 million of stock-based compensation expense for the fiscal quarter and fiscal year-to-date ended June 30, 2024.

For the fiscal years-to-date ended June 29, 2025 and June 30, 2024, we capitalized $0.2 million and $1.3 million, respectively, of stock-based compensation as property and equipment, net on the Condensed Consolidated Balance Sheets. There wasno recognized tax benefit related to stock-based compensation for the periods presented. In addition, we accrued animmaterial amount of bonus to be settled in equity awards as accrued compensation on the Condensed Consolidated Balance Sheet as of June 29, 2025.

As of June 29, 2025, there was approximately $114.2 million of unrecognized stock-based compensation expense related to unvested equity awards, which are expected to be recognized over a weighted-average period of 3.1 years. As of June 29, 2025, there was approximately $0.9 million of unrecognized stock-based compensation related to the ESPP, which is expected to be recognized over a period of 1.4 years.

Stock Option Activity

The following table summarizes stock option activities for the fiscal quarter ended June 29, 2025 (in thousands, except share and per share amount).

Unvested early exercised stock options which are subject to repurchase by us are not considered participating securities as those shares do not have non-forfeitable rights to dividends or dividend equivalents. Unvested early exercised stock options are not considered outstanding for purposes of the weighted average outstanding share calculation until they vest.

Early Exercise of Options

As of June 29, 2025,10,769 shares remained subject to our right of repurchase as a result of early exercised stock options. The remaining liability related to early exercised shares as of June 29, 2025 was immaterial and was recorded in other current liabilities in the Condensed Consolidated Balance Sheet.

Restricted Stock Unit and Performance Restricted Stock Unit Activities

The following table summarizes RSUs and PRSUs activities for the fiscal quarter ended June 29, 2025 (in thousands, except share and per share amount).

Equity Award Modification

In connection with the 2024 Restructuring Plan (as defined in Note 12 “Restructuring Costs”), there wasone equity award modification, which accelerated the vesting condition of a former executive’s RSUs as a part of his consulting and separation agreement. Accordingly, we recognized $1.1 million of stock-based compensation expense related to the modification for the fiscal quarter and fiscal year-to-date ended June 30, 2024.

For the fiscal quarter and fiscal year-to-date ended June 29, 2025, there wasone equity award modification, which extended the exercise period for the vested options. Accordingly, we recognized animmaterial amount of stock-based compensation related to the modification for the fiscal quarter and fiscal year-to-date ended June 29, 2025.

Note 12. Restructuring Costs

2024 Restructuring Plan

In May 2024, our Board of Directors approved a restructuring plan (the “2024 Restructuring Plan”) designed to reduce operating costs and support our strategic goals. The restructuring liability was included in Other current liability on our Condensed Consolidated Balance Sheets. The 2024 Restructuring Plan was substantially complete in fiscal year 2024. As of December 29, 2024, we had $0.4 million of the restructuring liability and the restructuring liability was paid in cash during the fiscal year-to-date ended June 29, 2025. As of June 29, 2025, we did not have restructuring liability on our Condensed Consolidated Balance Sheets.

In connection with the 2024 Restructuring Plan, we recorded estimated pre-tax restructuring and related charges of $38.1 million during the fiscal quarter ended June 30, 2024, which included non-cash charges of $35.1 million of loss on disposals of Fab1 long-lived asset in Fremont, California and $1.1 million of stock-based compensation expense, and cash charges of $1.3 million of severance and termination benefits and $0.6 million of other charges. These restructuring costs were reflected in Restructuring cost in the Condensed Consolidated Statements of Operations. For the fiscal quarter and fiscal year-to-date ended June 29, 2025, we didnot record any restructuring and related charges.

Note 13. Related Party Transactions

Employment Relationship

As of June 29, 2025, we employedone family member of our CEO, who assists with sales in North America.

Affiliate Notes

On April 20, 2023, we issued $172.5 million aggregate principal amount of Convertible Senior Notes, which included $10.0 million principal amount of the Affiliate Notes that were issued to an entity affiliated with Thurman John “T.J.” Rodgers, our Chairman, in a concurrent private placement. The Affiliate Notes were recorded in Long-term debt, net on our Condensed Consolidated Balance Sheets. For fiscal quarters ended June 29, 2025 and June 30, 2024, we recorded $0.1 million for each respective quarter, of interest expense related to the Affiliate Notes in our Condensed Consolidated Statements of Operations. For fiscal years-to-date ended June 29, 2025 and June 30, 2024, we recorded $0.2 million for each respective period, of interest expense related to the Affiliate Notes. See Note 8 “Borrowings” for more information.

Note 14. Subsequent Events

Repurchase Plan

On June 30, 2025, our board of directors authorized a repurchase plan to repurchase up to $60.0 million worth of shares of our common stock, $0.0001 par value per share (the “common stock”), effective immediately (the “Repurchase Plan”). Any unused capacity under the Repurchase Plan will expire on December 31, 2026.

We may make repurchases from time to time through open market purchases or through privately negotiated transactions. The timing and number of shares of common stock repurchased will be determined at our discretion. We may modify, suspend or discontinued the Repurchase Plan at any time and we are not obligated to repurchase any specific number of shares of common stock.

Warrant Dividend

On July 7, 2025, we declared a warrant distribution (the “Warrant Distribution”) to the holders of record of our common stock as of the close of business on July 17, 2025 (the “Record Date”) in the form of warrants to purchase shares of our common stock (the “Warrants”). Pursuant to the terms of the Warrant Agreement, dated July 21, 2025, between us and Computershare Inc. and its affiliate, Computershare Trust Company N.A., as Warrant Agent (the “Warrant Agreement”), each holder of record of common stock on the Record Date receivedone Warrant for every seven shares of common stock held, rounded down to the nearest whole number. In addition, holders of our Convertible Senior Notes as of the Record Date received, at the same time and on the same terms, Warrants without having to convert their Notes, subject to the terms of the Warrant Agreement and the indenture governing the Convertible Senior Notes. Each Warrant entitles the holder to purchaseone share of common stock at an exercise price of $8.75 per Warrant, subject to certain adjustments. The Warrants may be exercised only for cash. On July 21, 2025,29,233,276 Warrants were issued and distributed to the holders of record of common stock and Convertible Senior Notes as of the Record Date.

Unless the expiration date of the Warrants is accelerated pursuant to the terms of the Warrant Agreement as a result of the Early Expiration Price Condition (defined below), the Warrants will expire and cease to be exercisable at 5:00 p.m. New York City time on October 1, 2026 (the “Expiration Date”), subject to the conditions as defined in the Warrant Agreement.

The Warrants are listed on the Nasdaq Stock Market LLC under the ticker “ENVXW” and commenced trading on July 22, 2025.

Early Expiration Price Condition and Date for the Warrants

Upon the occurrence of the first 30 consecutive trading day period (the “Reference Period”) that includes 20 trading days on which the daily volume-weighted average price (“VWAP”) of a share of common stock is at least equal to $10.50, subject to certain adjustments provided for in the Warrant Agreement (such occurrence, the “Early Expiration Price Condition”, and the last of such 20 trading days, the “Early Expiration Price Condition Date”), the Expiration Date of the Warrants will automatically accelerate to the date (the “Early Expiration Date”) that is the business day immediately following the Early Expiration Price Condition Date. Notwithstanding the foregoing, the Company may, in its sole discretion, elect to set the Early Expiration Date on a date falling after the business day immediately following the Early Expiration Price Condition Date (such date, an “Alternate Expiration Date”). Any such Alternate Expiration Date shall be specified in the Early Expiration Price Condition notice delivered under the Warrant Agreement, subject to the other terms of the Warrant Agreement.