AEVA 10-K & 10-Q changes, risk factors and insider trading

We may be affected by the interruptionInterruption or failure of ourAeva’s information technology and communicationcommunications systems andcould cybersecurityimpact risksour ability to effectively provide our operational systems, security systems, infrastructure,products and integrated software in our LiDAR solutions.services

These initiativesinitiatives, including our strategic collaboration with LG Innotek Co., Ltd. (“LGIT”), may prove more expensive than we currently anticipate, and we may not succeed in increasing our revenue, if at all, in an amount sufficient to offset these higher expenses and to achieve and maintain profitability. The market opportunities we are pursuing are at an early stage of development, and it may be many years before the end markets we expect to serve generate demand for our products at scale, if at all. Our ability to generate revenue may be adversely affected for a number of reasons, including the development and/or market acceptance of new technology that competes with Aeva’s products, failure of our customers to develop and commercialize the programs that include Aeva’s products or technology, our inability to effectively manage inventory or manufacture products at scale, our inability to enter new markets or help our customers adapt Aeva’s products for new applications or our failure to attract new customers or expand orders from existing customers or increasing competition. Furthermore, it is difficult to predict the size and growth rate of our target markets, customer demand for Aeva’s products, commercialization timelines, developments in autonomous sensing and related technology, the entry of competitive products, or the success of existing competitive products and services. For these reasons, we do not expect to achieve profitability in the near term. If Aeva’s revenue does not grow over the long term, our ability to achieve and maintain profitability will be adversely affected, and the value of Aeva's business may significantly decrease.

We have a global supply chain and the loss or disruption of such supply arrangements for any reason, including as a result of geopolitical conflicts, including tensions with China and Taiwan; ongoing conflict arising out of the Russian invasion of Ukraine and the hostilities and conflict in the Middle East; other acts of war or terrorism; trade sanctions; tariffs; inflation; health epidemics or pandemics; labor disputes, work stoppages or interruptions; loss or impairment of key manufacturing sites, including due to a supplier's financial distress, natural disasters, looting or other external factors; inability to procure sufficient raw materials and/or quality control issues, may adversely affect our ability to source components in a timely or cost-effective manner from our third-party suppliers. For example, Aeva’s products depend on external semiconductor foundries. Any disruptions to those foundries could materially adversely affect our ability to manufacture Aeva's products. In addition, the lead times associated with certain components are lengthy and preclude rapid changes in quantities and delivery schedules. We have in the past experienced, and may in the future experience, component shortages and price fluctuations of certain key components and materials, and the predictability of the availability and pricing of these components may be limited. Component shortages or pricing fluctuations could be material in the future. In the event of a component shortage, supply interruption or material pricing change from suppliers of these components, we may not be able to develop alternate sources in a timely manner or at all in the case of sole or limited sources. Developing alternate sources of supply for these components may be time-consuming, difficult, and costly and we may not be able to source these components on terms that are acceptable to us, or at all, which may undermine our ability to meet our requirements or to fill customer orders in a timely manner. Any interruption or delay in the supply of any of these parts or components, or the inability to obtain these parts or components from alternate sources at acceptable prices and within a reasonable amount of time, would adversely affect our ability to meet scheduled product deliveries to our customers. This could adversely affect our relationships with our customers and channel partners and could cause delays in shipment of our products and adversely affect Aeva’s operating results. In addition, increased component costs could result in lower gross margins. Even where we are able to pass increased component costs along to customers, there may be a lapse of time before we are able to do so such that we must absorb the increased cost. If we are unable to buy these components in quantities sufficient to meet our requirements on a timely basis, we will not be able to deliver products to customers, which may result in such customers using competitive products instead of Aeva’s.

Cost-cutting initiatives adopted by our customers often result in increased downward pressure on pricing. We expect that our agreements with automotive OEMs including the OEM who selected us for the Supplier Award, may require step-downs in pricing over the term of the agreement or, if commercialized, over the period of production. In addition, our automotive OEM customers often reserve the right to terminate their supply contracts for convenience, which enhances their ability to obtain price reductions. Automotive OEMs also possess significant leverage over their suppliers, including Aeva, because the automotive component supply industry is highly competitive, serves a limited number of customers and has a high fixed cost base.

Our future growth depends on developing Aeva’s products, on our own and with other third-party partners, penetrating new markets, adapting existing products to new applications and customer requirements, and introducing new products that achieve market acceptance. We plan to continue to incur substantial R&D costs as part of our efforts to design, develop, manufacture and commercialize new products, and enhance existing products, and as such these costs may increase in the future. Because we account for R&D as an operating expense, these expenditures will adversely affect Aeva’s results of operations in the future. Further, our R&D program may not produce successful results, and our new products may never achieve market acceptance, create additional revenue or become profitable.

While Aeva’s 4D LiDAR technology can be applied to different use cases across end markets, a significant portion of our revenue is primarily generated from the development of automotive applications. Despite the fact that the automotive industry has engaged in considerable effort to research and test LiDAR products, including our 4D LiDAR technology, for ADAS and AD applications, the automotive industry may not introduce LiDAR products in commercially available vehicles. We continually study emerging and competing sensing technologies and methodologies and may add new sensing technologies. However, LiDAR products remain relatively new and it is possible that other sensing modalities, or a new disruptive modality based on new or existing technology, including a combination of technologies, will achieve acceptance or leadership in the ADAS and AD industries. Even if LiDAR products are used in initial generations of AD technology and certain ADAS products, we cannot guarantee that LiDAR products will be designed into or included in subsequent generations of such commercialized technology. In addition, we expect that initial generations of autonomous vehicles will be focused on limited applications, such as robo-taxis, and that mass market adoption of autonomous technology may lag behind these initial applications significantly. The speed of market growth for ADAS or autonomous vehicles is difficult if not impossible to predict, and it is more difficult to predict this market’s future growth in light of recent economic downturns and instability. In addition, we expect competition among providers of sensing technology based on LiDAR and other modalities to increase substantially. If commercialization of LiDAR products is not successful, or not as successful as we or the market expects, or if other sensing modalities gain acceptance by market participants, regulators, safety organizations or other market participants, Aeva’s business, results of operations and financial condition will be materially and adversely affected.

We are investing in and pursuing market opportunities outside of the automotive markets, including industrial automation, consumer device applications, robotics and security markets. We believe that Aeva’s future revenue growth, if any, will depend in part on our ability to expand within new markets such as these and to enter new markets as they emerge. Each of these markets presents distinct risks and, in many cases, requires us to address the particular requirements of that market.

We had $112$121.9 million in cash, cash equivalents and marketable securities as of December 31, 2024,2025, and an available equity facility of up to $125 million. Although we expect our current cash balance, combined with our future cash flows and financing available to us through such facility, will address our capital needs through 2025,2026, we cannot assure you that this will be the case. Our operating environment is increasingly challenging, and our business and strategic plans may consume resources faster than we presently anticipate. In order to remain competitive, we must make substantial investments in research and development. Our products may require significant resources to develop both hardware and software solutions. Challenges of integrating new functionality into vehicles and the evolution of our customers’ performance requirements during development may also increase R&D costs. Customer demands for changes to our products to meet such performance requirements are difficult to predict both in terms of timing and cost. We may be unable to fund all of our research and development and capital investment needs or possible acquisitions or joint ventures, and we may have to pass on valuable long-term opportunities that arise if we do not have sufficient capital resources. We may be required to raise additional capital which may not be available on acceptable terms or at all. See the risk factor titled “Future issuances of equity or debt securities, including from the issuance of preferred stock to Sylebra or upon Sylebra’s exercise of warrants for our common stock, or the conversion of our convertible notes, may adversely affect us, including the market price of the common stock and may be dilutive to existing stockholders.” An inability to fund our future R&D, capital expenditures and product development needs could have a material adverse effect on our business, results of operations and financial condition.

Aeva, our outsourcing partners and suppliers may rely on complex machinery for the production, assembly and installation of Aeva’s products, which involves a significant degree of uncertainty and risk in terms of operational performance and costs. The facilities of our outsourcing partners and suppliers consist of large-scale machinery combining many components. These components may suffer unexpected malfunctions from time to time and will depend on repairs and spare parts to resume operations, which may not be available when needed. Unexpected malfunctions of these components may significantly affect the intended operational efficiency. In addition, Aeva and any of our other outsourcing partners and suppliers also rely on highly skilled labor for assembly and production. If such highly skilled labor is unavailable, Aeva’s business could be adversely affected. Operational performance and costs can be difficult to predict and are often influenced by factors outside of our control, including scarcity of natural resources, environmental hazards and remediation, costs associated with decommissioning of machines, labor disputes and strikes, difficulty or delays in obtaining governmental permits, damages or defects in electronic systems, industrial accidents, fire, seismic activity and other natural disasters. Should operational risks materialize, it may result in injury to or the death of workers, the loss of production equipment, damage to production facilities, monetary losses, delays and unanticipated fluctuations in production, environmental damage, administrative fines, increased insurance costs and potential legal liabilities, all which could have a material adverse effect on Aeva’s business, prospects, financial condition or operating results.

When we secure design wins and Aeva’s products are included in our customers’ applications, including AD and ADAS products or consumer electronics, consumer health, industrial or security applications, we expect to enter into supply agreements with the relevant customer. For AD and ADAS products, market practice dictates that these supply agreements typically require us to supply a customer’s requirements for a particular vehicle model or AD or ADAS product, rather than supply a set number of products. These contracts can have short terms and/or can be subject to renegotiation, sometimes as frequently as annually, all of which may affect product pricing, and may be terminated by our customers at any time. Therefore, for AD and ADAS products, even if the systems into which Aeva’s products are built are commercialized, the discontinuation of, the loss of business with respect to, or a lack of commercial success of a particular vehicle model or technology package for which we are a significant supplier could mean that the expected sales of Aeva’s products will not materialize, which would materially and adversely affect our business. For example, there can be no assurance that any OEM products for which we are selected will be commercially successful. In addition, the loss of business with respect to a customer’s application in the consumer electronics, consumer health, security or industrial application for which we are a significant supplier could reduce our sales and adversely affect Aeva’s financial condition.

Although we continue to pursue a broad customer base, we are currently dependent on a small number of customers with strong purchasing power. In fiscal year 2025, Aeva’s top three customers accounted for 64% of revenue. For fiscal year 2024, Aeva’s top two customers accounted for 72% of revenue. For fiscal year 2023, Aeva’s top two customers accounted for 45% of revenue. The loss of business from any of our major customers (whether by lower overall demand for our products, cancellation of existing contracts or product orders or the failure to design in Aeva’s products or award us new business) could have a material adverse effect on our business.

There is also a risk that one or more of our major customers could be unable to pay our invoices as they become due or that a customer will simply refuse to make such payments if it experiences financial difficulties. As of December 31, 2025 three customers accounted for 72% and as of December 31, 2024 five customers accounted for 68% and as of December 31, 2023 one customer accounted for 42% of accounts receivable, respectively. If a major customer were to enter into bankruptcy proceedings or similar proceedings whereby contractual commitments are subject to stay of execution and the possibility of legal or other modification, we could be forced to record a substantial loss.

Future issuances of equity or debt securities, including from the issuance of preferred stock to Sylebra orSylebra, upon Sylebra’s exercise of warrants for our common stock, or the conversion of our convertible notes, may adversely affect us, including the market price of our common stock and may be dilutive to existing stockholders.

In addition, as of December 31, 2024,2025, we had warrants to purchase an aggregate of 5.5 million shares of our common stock outstanding. As of December 31, 2024,2025, the Companywe had 12.1 million public warrants and 0.4 million private warrants outstanding, exercisable for 2.5 million shares of common stock. Every five public and private warrant entitles the registered holder to purchase one share of common stock at a price of $57.50 per share. TheThese Companywarrants expired on March 12, 2026, and trading of the public warrants was suspended upon expiration. We also had 3.0 million Series A Warrants exercisable for 3.0 million shares of common stock at an exercise price of $5.00 per share. To the extent remaining warrants are exercised, additional shares of common stock will be issued, which will result in dilution to the then-existing holders of common stock and increase the number of shares eligible for resale in the public market. Sales of substantial numbers of such shares in the public market or the fact that such warrants may be exercised could adversely affect the market price of our common stock.

We have been, and may be from time to time, involved in litigation, regulatory proceedings and commercial or contractual disputes that may be significant. These matters may include, without limitation, disputes with our suppliers and customers, intellectual property claims, stockholder litigation (including the Delaware Stockholder Litigation), government investigations, class action lawsuits, personal injury claims, environmental issues, customs and value-added tax disputes and employment and tax issues. In addition, we could face in the future a variety of labor and employment claims against us, which could include general discrimination, wage and hour, privacy, ERISA or disability claims. In such matters, government agencies or private parties may seek to recover very large, indeterminate amounts in penalties or monetary damages (including, in some cases, treble or punitive damages) or seek to limit our operations in some way. These types of lawsuits could require significant management time and attention or could involve substantial legal liability, adverse regulatory outcomes, and/or substantial expenses to defend. Often these cases raise complex factual and legal issues and create risks and uncertainties. No assurances can be given that any proceedings and claims will not have a material adverse impact on Aeva’s operating results and financial position or that our established reserves or available insurance will mitigate this impact. For example, in connection with the Delaware Stockholder Litigation settlement, we have agreed to paypaid a total settlement cost of $14.0 million in exchange for a release of all claims and expect to recoverreceived $2.5 million from our insurance carrier.

Your percentage ownership in our common stock could be diluted in the future as a result of equity or convertible issuances for acquisitions, capital market transactions or otherwise, including any equity awards that we grant to our directors, officers and employees. Such awards could have a dilutive effect on our earnings per share, which could adversely affect the market price of our common stock. In addition, our certificate of incorporation authorizes us to issue, without the approval of our stockholders, one or more classes or series of preferred shares having such designation, powers, preferences and relative, participating, optional and other special rights as our board of directors generally may determine. Your ownership in our common stock could also be diluted by the exercise of securities convertible into our common stock, including our outstanding warrants and the convertible redeemable non-voting preferred stock that may be issued pursuant to the Facility Agreement. The terms of one or more classes or series of preferred shares could dilute the voting power or reduce the value of our common stock. In addition, your interest may be diluted to the extent that we satisfy our obligations under the Notes by delivering shares of our common stock.

Commercialization of LiDAR-based Applications. We expect that our results of operations, including revenue and gross margins, will fluctuate on a quarterly basis for the foreseeable future as our customers continue on research and development projects and begin to commercialize advanced driver assist, autonomous and industrial automation solutions that rely on LiDAR technology. The development cycles of our products with new customers varies widely depending on the application, market, customer and the complexity of the product, and can vary from several months to seven or more years depending on the industry. These development cycles result in us investing our resources prior to realizing any revenue from the commercialization or obtaining any firm commitments of pricing, volume or timing of purchases of our products by our customers. As customers reach the commercialization phase and as the market for LiDAR solutions matures, these fluctuations in our operating results may become less pronounced.

Other income and expense primarily consist of changes in the fair value of Series A warrants, fair value of private placement warrantswarrants, interests expense on convertible notes and foreign currency transaction gains and losses, as well as realized gains and losses on marketable securities.

Revenue increased by $4.8$9.0 million, or 110%,99%, to $9.1$18.1 million during the year ended December 31, 2024,2025, from $4.3$9.1 million for the year ended December 31, 2023.2024. This increase was primarily due to an increase in the sale of prototype units sold in 20242025 as compared to 2023,2024, and activity related to non-recurring engineering services which is dependent upon the timing of the work performed for our customers.

General and administrative expense increased by $1.5$1.6 million, or 5%, to $33.3$34.9 million during the year ended December 31, 2024,2025, from $31.8$33.3 million for the year ended December 31, 2023.2024. General and administrative expense increased primarily due to a $2.2$2.1 million increase in stock based compensation, a $1.0 million increase in payroll and other employee related expenses, a $0.7$0.4 million for provision for doubtful debt, and a $0.3 million increase in stocksubscription based compensation, a $0.5 million increase professional expenses, a $0.2 million increase in travel expense, a $0.2 increase in facility expenses, and $0.1 million increase in otherrelated expenses; this was partially offset by a $1.1 million decrease in insurance expenses, a $0.7$1.6 million decrease in legal expenses, and a $0.3$0.6 million decrease in depreciationprofessional and a $0.3 million decrease in recruiting expense.expenses.

Selling and marketing expense decreased by $0.4$0.5 million, or 6%,7%, to $7.2$6.7 million during the year ended December 31, 2024,2025, from $7.6$7.2 million for the year ended December 31, 2023.2024. Selling and marketing expense decreased due to a $0.3 million decrease in travelpayroll expenses,and other employee related expenses and a $0.2 million decrease in recruitingstock expenses,based and a $0.1 million decrease in marketing program expenses; this was partially offset by a $0.2 million increase in payroll and other employee related expenses.compensation.

During the year ended December 31, 2024, we recorded a litigation settlement expense (net) of $11.5 million, related to the Delaware Stockholder Litigation (as defined in Note 15 to our consolidated financial statements included elsewhere in this report). No expense related to litigation settlement was recorded during the year ended December 31, 2025.

Interest income decreased by $1.2$5.0 millionmillion, or 64%, during the year ended December 31, 2025, as compared to the year ended December 31, 2024. The decrease was due to a decrease in the overallaverage balance of interest-bearing cash equivalents and marketable securities.securities for the year ended December 31, 2025 as compared to the year ended December 31, 2024.

Other income (expense), net decreasedincreased by $9.0$0.5 million for the year ended December 31, 2024.2025 Indue 2023interest we issued Series A Warrantsexpense of $6.7$0.7 million andrecorded paidon $3.8convertible milliondebt, inpartially financingoffset transaction fees for the Facility Agreement (as defined below). In 2024 we recordedby a changegain inon fairforeign valuecurrency of Series A warrants of $1.5 million.transactions.

On July 2, 2024, Aeva and the parties to the Delaware Stockholder Litigation entered into a term sheet, and on December 6, 2024 entered into a formal settlement agreement, which will be subject to court approval, to fully and finally resolve the Delaware Stockholder Litigation. In connection with the settlement,where we have agreed to pay a total settlement cost of $14.0 million in exchange for a release of all claims related to the business combination and expect to recover $2.5 million from insurance carrier.claims. The settlement is beingwas paid pursuant to our indemnification obligations and from available director and officer insurance policies. AsOn September 12, 2025, the Delaware Court of DecemberChancery 31, 2024, we have accruedissued a contingentfinal liabilityorder ofapproving $14.0the millionterms connectionand withconditions set forth in the settlement of the Delaware Stockholder Litigation, and a $2.5 million insurance recovery.agreement. See Note 15 to our consolidated financial statements included elsewhere in this reportAnnual Report on Form 10-K for more information about the Delaware Stockholder Litigation. As of December 31, 2025, we have paid in full the $14.0 million previously accrued in connection with the settlement of the Delaware Stockholder Litigation. We have also recovered $2.5 million from an insurance carrier.

NetFor the year ended December 31, 2025, net cash used in operating activities duringwas the year ended December 31, 2024 of $106.9$115.1 million, was primarily attributable to a $152.3$145.4 million net loss, partially offset by a $13.0$25.1 million net change in net operating assets and liabilitiesliabilities, andpartially offset by $32.3a $55.4 million of non-cash charges. Non-cash charges primarily consisted of $23.7$21.8 million in stock-based compensation, $5.5$21.5 million in depreciation of property, plant and equipment and amortization of intangibles, $3.5 million in amortization of right-of-use assets, $1.5 million in change in the fair value of warrant liabilities,liability, $3.8 million of loss on joint development agreement, $5.4 million of depreciation and $1.1amortization expense, $3.1 million of amortization of right of use assets, $0.4 of provision for doubtful debts and $0.5 million in impairment of inventory,inventories, partially offset by $3.5a $1.1 million inof accretion of discount on available for sale securities. The net change in operating assets and liabilities of $13.0$25.1 million was primarily due to a $16.6 million increase in other current liabilities arising from a $14.0 million accrual for litigation settlement cost, a $2.3 million increase in accrued liabilities, a $1.8 million increase in accounts payable and a 0.3$18.3 million decrease in other noncurrentcurrent assets;liabilities, partiallya offset by $3.6$0.5 million decrease in leaseaccounts liability,payable, a $1.1 million increase in inventories, a $0.6 million increase in accounts receivable, a $2.6$8.7 million increase in other current assets, a $3.9 million increase in inventories, a $2.5 million increase in accounts receivable, and a $2.8 million decrease in lease liability, partially offset by a $8.2 million increase in accrued employee cost, a $3.3 million increase in accrued liabilities, and a $0.3 million decrease in accruedother employeenon-current cost.assets.

NetFor year ended December 31, 2025, net cash provided by investing activities duringwas the year ended December 31, 2024 of $97.9$29.9 million, was attributable to $183.0$109.5 million of cash received from the maturity and sale of available-for-sale investments, partially offset by $80.0$75.0 million used in the purchase of investments, and $5.1$4.6 million used for the purchase of property, plant and equipment.

Other income and expense primarily consist of changes in the fair value of Series A warrants, fair value of private placement warrants, interest expense on convertible notes and foreign currency transaction gains and losses, as well as realized gains and losses on marketable securities.

Comparison of the Three Months Ended MarchJune 31,30, 2026, and 2025

Product revenue decreased by $0.1$1.7 million, or 2%,39%, to $2.4$2.5 million during the three months ended MarchJune 31,30, 2026, from $2.5$4.2 million for the three months ended MarchJune 31,30, 2025. This decrease was primarily due to a lower average selling price of units sold in the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025, partially offset by higher number of units sold in the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025.

Professional services revenue increased by $2.9$2.3 million, or 332%,174%, to $3.8$3.6 million during the three months ended MarchJune 31,30, 2026, from $0.9$1.3 million for the three months ended MarchJune 31,30, 2025. The increase was primarily due to a higher development activity for non-recurring engineering services during the three months ended MarchJune 31,30, 2026.

Cost of product revenue increaseddecreased by $0.5$1.4 million, or 18%,35%, during the three months ended MarchJune 31,30, 2026, from the three months ended MarchJune 31,30, 2025. The increasedecrease was primarily due to highera lower material cost and manufacturing overheads related to the units sold.

Cost of professional service revenues increaseddecreased by $0.8$2.9 million, or 170%,69%, during the three months ended MarchJune 31,30, 2026, from the three months ended MarchJune 31,30, 2025. The increasedecrease was primarily due to a $3.8 million loss recognized on a joint development agreement during three months ended June 30, 2025, partially offset by an increase in the activitiesnon related to non-recurringrecurring engineering servicesrevenue forduring the three months ended MarchJune 31,30, 2026.2026 as compared to the three months ended June 30, 2025.

GeneralResearch and administrativedevelopment expenses increased by $5.2$2.0 million, or 71%,9%, to $12.4$24.9 million for the three months ended MarchJune 31,30, 2026, from $7.2$22.8 million for the three months ended MarchJune 31,30, 2025. The increase was primarily due to a $3.8$1.5 million increase in stock based compensation expense ,expense, a $0.5$0.9 million increase in payrollresearch relatedand development expense, a $0.7$0.8 million increase in legalsoftware andlicense professionalsubscription expense andexpense, a $0.1$0.3 million increase in consulting expense, partially offset by a $1.4 million decrease in payroll related expense.

InterestGeneral incomeand decreasedadministrative expenses increased by $0.1$2.2 million, or 13%,28%, duringto $10.2 million for the three months ended MarchJune 31,30, 2026, asfrom compared$8.0 tomillion for the three months ended MarchJune 31,30, 2025. The decreaseincrease was primarily due to a decrease$0.8 in the interest rate, partially offset by anmillion increase in thepayroll overallrelated balanceexpense, ofa interest-bearing$0.6 cashmillion equivalentsincrease in stock based compensation expense and marketablea securities.$0.8 million increase in professional service expense.

The change during the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025, was due to an increasechange in the fair value of the Series A warrants issuedresulting from change in connectionthe withstock price of the Facilitycompany Agreement.at the end of the each period.

Interest expense increased by $1.2 million during the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025, due to interest expense related to the convertible notes.

On July 2, 2024, Aeva and the parties to the Delaware Stockholder Litigation entered into a term sheet, and on December 6, 2024 entered into a formal settlement agreement, which willwas beapproved subjectby tothe court approval,court, to fully and finally resolve the Delaware Stockholder Litigation. In connection with the settlement, we agreed to pay a total settlement cost of $14.0 million in exchange for a release of all claims. The settlement was paid pursuant to our indemnification obligations and from available director and officer insurance policies. As of MarchJune 31,30, 2026, we have paid in full the $14.0 million previously accrued in connection with the settlement of the Delaware Stockholder Litigation. We have also recovered $2.5 million from an insurance carrier.

To date, we have incurred negative cash flows from operating activities and incurred losses from operations as reflected in our accumulated deficit of $792.3$871.9 million as of MarchJune 31,30, 2026. We expect to continue to incur operating losses due to continued investments that we intend to make in our business, including development of products. As of MarchJune 31,30, 2026, we had cash and cash equivalents and marketable securities totaling $99.5$177.9 million. We also have the ability to draw on the Facility Agreement up to $125.0 million through November 8, 2026 in exchange for the issuance of preferred shares, and we intend to draw down on the Facility Agreement if and as required by our capital needs. As of MarchJune 31,30, 2026, all conditions to draw under the Facility Agreement were met. We believe that our sources of liquidity, including financing available to us through the Facility Agreement will be sufficient to fund our operating and capital expenditure for at least 12 months from the date of issuance of the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

For the threesix months ended MarchJune 31,30, 2026, net cash used in operating activities was $25.8$57.0 million, attributable to a net loss of $35.0$114.6 million and a net change in operating assets and liabilities of $1.3$9.7 million, partially offset by non-cash charges of $10.4$67.3 million. Non-cash charges primarily consisted of $9.4a $44.3 million change in the fair value of warrant liability, $17.9 million in stock-based compensation, $1.3$2.3 million for issuance of shares for convertible note interest payment, $2.6 million in depreciation and amortization expense, $0.5$1.1 million in amortization of right of use assets and $0.1$0.2 million in accretion for convertible notes, partially offset by a $0.5$1.0 million in accretion of discount on available for sale securities and a $0.5 million change in the fair value of warrant liability.securities. The change in net operating assets and liabilities was primarily due to a $6.1$10.0 million decrease in accrued employee costs, a $0.4$0.8 million decrease in lease liability, a $0.2 million decrease in accounts payable, a $0.2$2.6 million decrease in accrued liabilities, a $0.2 million increase in inventories and a $0.1$0.4 million increase in accounts receivable, partially offset by a $3.8$2.0 million decreaseincrease in otheraccounts current assets,payable, a $1.5$0.7 million increase in other current liabilities, a $0.6 million decrease in other current asset and a $0.6 million decrease in other noncurrent assets.

For the threesix months ended MarchJune 31,30, 2026, net cash used in investing activities was $20.5$86.5 million, attributable to purchase of investments of $36.8$148.1 million and purchase of property, plant and equipment of $2.2$2.4 million, partially offset by proceeds from maturities of available-for-sale investments of $18.5$64.0 million.

For the threesix months ended MarchJune 31,30, 2026, net cash provided by financing activities was $114.5 million, attributable to $109.2 million of cash received in from public offering net of expense paid and $5.5 million of cash received in connection with our joint development agreement with LGIT, partially offset by a $0.3 million payment of issuance cost for convertible notes.

As of MarchJune 31,30, 2026, we have not engaged in any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

For the three months ended MarchJune 31,30, 2026 there were no significant changes to our critical accounting estimates as noted below. For a more detailed discussion of our critical accounting policies and estimates, refer to our Annual Report on Form 10-K for the year ended December 31, 2025 and Note 1 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.