ATEC 10-K & 10-Q changes, risk factors and insider trading
Alphatec Holdings, Inc. · Nasdaq · Surgical & Medical Instruments & Apparatus · CIK 1350653 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “Tariffs and other trade measures could adversely affect our business, results of operations, financial position and cash flows”
Largest changes
“The loan agreements we entered into in connection with our Revolving Credit Facility and the Braidwell Term Loan as well as the indenture governing our outstanding 0.75% Convertible Senior Notes due 2026 (the "2026 Notes") and our outstanding 0.75% Convertible Senior Notes due 2030 (the "2030 Notes") contain certain affirmative, operating or financial covenants. …”see in full comparison
“The loan agreements we entered into in connection with our Revolving Credit Facility and the Braidwell Term Loan as well as the indenture governing our outstanding 0.75% Convertible Senior Notes due 2026 (the "2026 Notes") contain certain affirmative, operating or financial covenants. …”see in full comparison
“Tariffs and other trade measures could adversely affect our business, results of operations, financial position and cash flows”see in full comparison
“Our business and results of operations may be adversely affected by uncertainty and changes in U.S. trade policies, including tariffs, trade agreements or other trade restrictions imposed by the U.S. or other governments. While most of our suppliers are based in the U.S., some of the materials we use to manufacture our products are directly affected by tariffs imposed on products imported into the U.S. Additionally, we are increasing our international sales, which may be subject to retaliatory measures by other countries. …”see in full comparison
“approval policies or regulations of the applicable regulatory authorities change significantly in a manner rendering our clinical data or regulatory filings insufficient for clearance or approval; or changes in regulatory policies, increased submission volumes, or reduced staffing and administrative capacity at regulatory agencies such as the FDA.”see in full comparison
“our manufacturing process or facilities we use may not meet applicable requirements; or approval policies or regulations of the applicable regulatory authorities change significantly in a manner rendering our clinical data or regulatory filings insufficient for clearance or approval.”see in full comparison
Full comparison: every changed paragraph (12)
The market in which we operate is highly competitive, subject to rapid technological change and affected by new products and market activities of industry participants. Our competitors include numerous large and well-capitalized companies such as Medtronic Sofamor Danek, a subsidiary of Medtronic; Depuy Spine, a subsidiary of Johnson & Johnson; Stryker; Zimmer Biomet; and Globus Medical. Several of our competitors enjoy competitive advantages over us, including:
Net sales of our systems that include polyaxial pedicle screws represented approximately 40% and 41% our net sales for the years ended December 31, 2024 and 2023, respectively, and are expected to continue to be significant in the future. A decline in sales of these systems for any reason would have a significant adverse impact on our business, financial condition and results of operations. We rely on third-party licenses related to our polyaxial pedicle screw systems in order to use various proprietary technologies that are material to these systems, including the enforceability of the intellectual property rights in such technologies. Certain of our licenses may be terminated upon specific conditions. Our rights under each of the licenses are subject to our continued compliance with the terms of the license, including certain diligence, disclosure and confidentiality obligations and the payment of royalties and other fees. Because of the complexity of our product and the patents we have licensed, determining the scope of the license and related obligations can be difficult and can lead to disputes between us and the licensor. An unfavorable resolution of such a dispute could lead to an increase in the royalties payable pursuant to the license or termination of the license. Any action that would prevent us from manufacturing, marketing and selling these systems or increase the costs associated with these systems would have a significant adverse effect on our business, financial condition and results of operations.
our manufacturing process or facilities we use may not meet applicable requirements;
approval policies or regulations of the applicable regulatory authorities change significantly in a manner rendering our clinical data or regulatory filings insufficient for clearance or approval; or changes in regulatory policies, increased submission volumes, or reduced staffing and administrative capacity at regulatory agencies such as the FDA.
Net sales of our systems that include polyaxial pedicle screws represented approximately 38% and 40% our net sales for the years ended December 31, 2025 and 2024, respectively, and are expected to continue to be significant in the future. A decline in sales of these systems for any reason would have a significant adverse impact on our business, financial condition and results of operations. We rely on third-party licenses related to our polyaxial pedicle screw systems in order to use various proprietary technologies that are material to these systems, including the enforceability of the intellectual property rights in such technologies. Certain of our licenses may be terminated upon specific conditions. Our rights under each of the licenses are subject to our continued compliance with the terms of the license, including certain diligence, disclosure and confidentiality obligations and the payment of royalties and other fees. Because of the complexity of our product and the patents we have licensed, determining the scope of the license and related obligations can be difficult and can lead to disputes between us and the licensor. An unfavorable resolution of such a dispute could lead to an increase in the royalties payable pursuant to the license or termination of the license. Any action that would prevent us from manufacturing, marketing and selling these systems or increase the costs associated with these systems would have a significant adverse effect on our business, financial condition and results of operations.
our manufacturing process or facilities we use may not meet applicable requirements; or approval policies or regulations of the applicable regulatory authorities change significantly in a manner rendering our clinical data or regulatory filings insufficient for clearance or approval.
Tariffs and other trade measures could adversely affect our business, results of operations, financial position and cash flows
Our business and results of operations may be adversely affected by uncertainty and changes in U.S. trade policies, including tariffs, trade agreements or other trade restrictions imposed by the U.S. or other governments. While most of our suppliers are based in the U.S., some of the materials we use to manufacture our products are directly affected by tariffs imposed on products imported into the U.S. Additionally, we are increasing our international sales, which may be subject to retaliatory measures by other countries. The imposition of tariffs and other trade restrictions, as well as the escalation of trade disputes and any downturns in the global economy resulting therefrom, could adversely affect our business, financial condition and results of operations.
The loan agreements we entered into in connection with our Revolving Credit Facility and the Braidwell Term Loan as well as the indenture governing our outstanding 0.75% Convertible Senior Notes due 2026 (the "2026 Notes") contain certain affirmative, operating or financial covenants. These covenants could adversely affect our ability to operate our business, our liquidity or our results of operations, and our inability to comply with any of these covenants could result in a default under the applicable loan agreement or indenture, which could result in an increase the applicable interest rate or all amounts borrowed under the applicable debt instrument, together with accrued interest and other fees, to become due and payable or, with respect to our Revolving Credit Facility, could result in MidCap refusing to make further extensions of credit to us. If our indebtedness under the Revolving Credit Facility, the Braidwell Term Loan or the 2026 Notes were to be accelerated, if the amount of interest owing under such debt or, in the case of the Revolving Credit Facility, if MidCap refuses to make further extensions of credit to us, we may not have sufficient cash available to repay the amounts due, and we may be forced to seek an amendment to the applicable loan terms or obtain alternative financing, which may not be available to us on acceptable terms, if at all. In addition, if we are unable to repay outstanding borrowings when due or upon an event of default, in the case of the Revolving Credit Facility and Braidwell Term Loan, the lender would also have the right to proceed against the collateral, including substantially all of our assets, granted to secure the indebtedness under the debt obligation. If the applicable lender proceeds against the collateral, such assets would no longer be available for use in our business, which would have a significant adverse effect our business, financial condition and results of operations.
We have typically incurred net losses since our inception. As of December 31, 2024,2025, we had an accumulated deficit of $1.3$1.4 billion. We have incurred significant net losses since inception and have relied on our ability to fund our operations through revenues from the sale of our products and equity and debt financings. Successful transition to profitability is dependent upon achieving a level of revenues adequate to support our cost structure. This may not occur and, unless and until it does, we will continue to need to raise additional capital. We may seek additional funds from public and private equity or debt financings, borrowings under new debt facilities or other sources to fund our projected operating requirements. However, we may not be able to obtain further financing on reasonable terms or at all. If we are unable to raise additional funds on a timely basis, or at all, we would be materially adversely affected.
As a result of our domestic and global business operations, our revenues are impacted by changes in domestic and global macroeconomic conditions. A weakening of economic conditions, including from a worsening of the ongoing labor shortagemarket constraints and wage pressures, or rising in inflation, could lead to increased costs to our business and reductions in demand for our products. Weakened economic conditions or a recession could reduce the amounts that customers are willing or able to spend on our products. Furthermore, a high percentage of our expenses, including those related to inventory, capital investments, and operating costs are generally fixed in nature in the short term. If we are not able to timely and appropriately adapt to changes resulting from a weak or uncertain economic environment, our business, financial condition, results of operations and cash flows could be adversely impacted.
The loan agreements we entered into in connection with our Revolving Credit Facility and the Braidwell Term Loan as well as the indenture governing our outstanding 0.75% Convertible Senior Notes due 2026 (the "2026 Notes") and our outstanding 0.75% Convertible Senior Notes due 2030 (the "2030 Notes") contain certain affirmative, operating or financial covenants. These covenants could adversely affect our ability to operate our business, our liquidity or our results of operations, and our inability to comply with any of these covenants could result in a default under the applicable loan agreement or indenture, which could result in an increase the applicable interest rate or all amounts borrowed under the applicable debt instrument, together with accrued interest and other fees, to become due and payable or, with respect to our Revolving Credit Facility, could result in MidCap refusing to make further extensions of credit to us. If our indebtedness under the Revolving Credit Facility, the Braidwell Term Loan or the 2026 Notes and 2030 Notes were to be accelerated, if the amount of interest owing under such debt or, in the case of the Revolving Credit Facility, if MidCap refuses to make further extensions of credit to us, we may not have sufficient cash available to repay the amounts due, and we may be forced to seek an amendment to the applicable loan terms or obtain alternative financing, which may not be available to us on acceptable terms, if at all. In addition, if we are unable to repay outstanding borrowings when due or upon an event of default, in the case of the Revolving Credit Facility and Braidwell Term Loan, the lender would also have the right to proceed against the collateral, including substantially all of our assets, granted to secure the indebtedness under the debt obligation. If the applicable lender proceeds against the collateral, such assets would no longer be available for use in our business, which would have a significant adverse effect our business, financial condition and results of operations.
Management's Discussion & Analysis (MD&A)
New heading “Recent Developments”
New heading “0.75% Senior Convertible Notes due 2030”
Largest changes
“We evaluate our intangible assets with finite lives for indications of impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors that could trigger an impairment review include significant under-performance relative to expected historical or projected future operating results, significant changes in the manner of our use of the acquired assets or the strategy for our overall business or significant negative industry or economic trends. …”see in full comparison
Our intangible assets are comprised primarily of purchased technology, internally developed software, customer relationships, trade name, trademarks, and in-process research and development. We make significant judgments in relation to the valuation of intangible assets resulting from business combinations and asset acquisitions. Intangible assets are generally amortized on a straight-line basis over their estimated useful lives of 2 to 12 years. We base the useful lives and related amortization expense on the period of time we estimate the assets will generate net sales or otherwise be used. We also periodically review the lives assigned to our intangible assets to ensure that our initial estimates do not exceed any revised estimated periods from which we expect to realize cash flows. If a change were to occur in any of the above-mentioned factors or estimates, the likelihood of a material change in our reported results would increase.see in full comparisonWe evaluate our intangible assets with finite lives for indications of impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors that could trigger an impairment review include significant under-performance relative to expected historical or projected future operating results, significant changes in the manner of our use of the acquired assets or the strategy for our overall business or significant negative industry or economic trends. If this evaluation indicates that the value of the intangible asset may be impaired, we make an assessment of the recoverability of the net carrying value of the asset over its remaining useful life. If this assessment indicates that the intangible asset is not recoverable, based on the estimated undiscounted future cash flows of the asset over the remaining amortization period, we reduce the net carrying value of the related intangible asset to fair value and may adjust the remaining amortization period. Significant judgment is required in the forecasts of future operating results that are used in the discounted cash flow valuation models. It is possible that plans may change and estimates used may prove to be inaccurate. If our actual results, or the plans and estimates used in future impairment analyses, are lower than the original estimates used to assess the recoverability of these assets, we could incur additional impairment charges.
“In March 2025, we issued $405.0 million principal amount of unsecured senior convertible notes with a stated interest rate of 0.75% (the "2030 Notes"). The 2030 Notes began accruing interest immediately and interest is payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2025. The 2030 Notes are convertible into shares of our common stock based upon an initial conversion rate of 64.3407 shares of our common stock per $1,000 principal amount of 2030 Notes (equivalent to an initial conversion price of approximately $15.54 per share). …”see in full comparison
Litigation-related expenses. Litigation-related expensessee in full comparisondecreasedincreased by$12.5$14.0 million, or56%,143%, during the year ended December 31,2024,2025, compared to the year ended December 31,2023.2024. Thedecreaseincrease was primarily related to adecreaselitigationinsettlementlegalduringfeestheassociatedyearwithendedourDecemberpreviously31,settled2025, and ongoing litigation matters. Refer to Note 7 of our Notes to Consolidated Financial Statements includedelsewherein this Annual Report on Form 10-K for further information regarding litigation matters.
Full comparison: every changed paragraph (28)
We are a medical technology company, headquartered in Carlsbad, California, focused on the design, development, and advancement of technology for better surgical treatment of spine disorders. By applying our unique, 100% spine focus and deep industry know-how, we aim to revolutionize spine surgery through clinical distinction. The sophisticated approaches that we create from the ground up integrate with our expanding Alpha InformatiX™ ("AIXIX") platform to objectively inform surgery and achieve the goals of spine surgery more predictably and more reproducibly. We have a comprehensive product portfolio designed to address the spine’s various pathologies and we are perpetually innovating to accomplish our vision to be the standard bearer in spine.
Recent Developments
0.75% Senior Convertible Notes due 2030
In March 2025, we issued $405.0 million principal amount of unsecured senior convertible notes with a stated interest rate of 0.75% (the "2030 Notes"). The 2030 Notes began accruing interest immediately and interest is payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2025. The 2030 Notes are convertible into shares of our common stock based upon an initial conversion rate of 64.3407 shares of our common stock per $1,000 principal amount of 2030 Notes (equivalent to an initial conversion price of approximately $15.54 per share). The net proceeds from the sale of the 2030 Notes were approximately $392.9 million after deducting the offering expenses. The 2030 Notes will mature on March 15, 2030, unless earlier converted, redeemed, or repurchased. We used $42.5 million of the net proceeds from the 2030 Notes offering to enter into separate capped call instruments with certain financial institutions. The capped call transactions effectively limit the premium for conversion of the 2030 Notes to 100% and are generally expected to reduce potential dilution to our common stock upon any conversion of the 2030 Notes and/or offset any payments we make upon conversion. In addition, we repurchased 80% of our 2026 convertible notes (the "2026 Notes") for approximately $268.4 million. We intend to use the remainder of the net proceeds from the 2030 Notes for general corporate purposes.
Amortization expense. Amortization expense includes amortization of acquired intangible assets and amortization of internally-developed software that has been placed in service.assets. Amortization of acquired intangible assets consists of intangible assets acquired in business combinations and asset purchases.acquisitions.
Transaction-related expenses. Transaction-related expenses consist of certain costs incurred related primarily to theour acquisitionterm andloan integration of Valence.amendment.
Total interest and other expense, net. Total interest and other expense, net includes interest income, interest expense, gains and losses from foreign currency exchangesexchanges, loss on debt extinguishment, gain on derivative liability, and other non-operating gains and losses.
Income tax provision.provision (benefit). Income tax provision primarily consists of an estimate of federal, state, and foreign income taxes based on enacted state and foreign tax rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in the valuation of our deferred tax assets and liabilities, and changes in tax laws.
Cost of sales increased by $45.0 million, or 24%, during the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase was primarily due to an increase in product volume.
Cost of sales increased by $15.2 million, or 9%, during the year ended December 31, 2024, compared to the year ended December 31, 2023. The increase was primarily due to an increase in product volume offset by a decrease in stock-based compensation. We have entered into Development Service Agreements for the development of a wide variety of potential products and intellectual property. Under these agreements, future royalty payments for product and/or intellectual property rights may be paid in either cash or restricted shares of our common stock at the election of the developer, depending on the terms of the agreement. Certain of these agreements were amended to remove the cash royalty option and require settlement in restricted shares of our common stock. Stock-based compensation associated with these awards was higher during the year ended December 31, 2023 as the vesting conditions of certain of these amended awards that met the requirements for presentation within cost of sales were deemed probable at that time.
Research and development expenses. Research and development expenses increaseddecreased by $10.6$4.5 million, or 15%,6%, during the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The increasedecrease was primarily due to ana increase in personnel to support the expansion of our new product portfolio and an increasedecrease in stock-based compensation associated with Development Service Agreements (asfor describedthe above),development of a wide variety of potential products and intellectual property, as the vesting conditions offor certainmore of these amended awards,awards that met the requirements for presentation within research and development, were deemed probable during the prior year than during the current year.
Litigation-related expenses. Litigation-related expenses decreasedincreased by $12.5$14.0 million, or 56%,143%, during the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The decreaseincrease was primarily related to a decreaselitigation insettlement legalduring feesthe associatedyear withended ourDecember previously31, settled2025, and ongoing litigation matters. Refer to Note 7 of our Notes to Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for further information regarding litigation matters.
Amortization expense.of acquired intangible assets. Amortization expenseof increasedacquired $2.0intangible assets decreased $1.2 million, or 14%,7%, during the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The increasedecrease in amortization expense is primarily due to amortizationseveral ofacquired intangible assets acquiredbecoming infully amortized during the acquisitionyear ofended ValenceDecember in31, April 2023 and internally-developed software placed in service during 2024.2025.
Transaction-related expenses. Transaction-related expenses decreased $1.9$0.2 million, or 90%,100%, during the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The decrease in transaction-related expenses is due to the Valenceterm acquisitiondebt amendment in Aprilthe 2023.prior year that did not recur.
Restructuring expenses. Restructuring expenses increaseddecreased $2.5$2.9 million, or 352%,88%, during the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The increasedecrease in restructuring expenses is primarily due to costs associated with the relocation of office facilities in Paris, France, and severance and related tax costs incurred in connection with cost rationalization efforts.efforts in the prior year that did not recur.
Total interest and other expense, net
Interest expense, net, increased $8.2$21.0 million, or 50%,85%, during the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The increase in interest expense, net, was primarily due to drawing an additional $50.0 million on the Braidwell Term Loan in bothOctober September 20232024, and Octoberthe 2024.amortization of debt discount associated with the 2030 Notes. Net cash interest was $21.1 million and net non-cash interest was $24.8 million for the year ended December 31, 2025.
OtherLoss (expense)on income,debt net,extinguishment increased $4.1$17.6 million, or 133%,100%, during the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. The increase in otherloss (expense)on income,debt net,extinguishment was primarily duerelates to foreignthe currency rates and recognitionredemption of an80% employee retention credit duringof the year2026 ended December 31, 2023.Notes.
Gain on derivative liability increased $0.6 million, or 100%, during the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase in gain on derivative liability relates to the change in the valuation of the derivative liability associated with 2030 Notes from inception to June 12, 2025, the date the conditions necessary for separate accounting of the conversion option as a derivative liability were no longer met.
Other income (expense), net, increased $2.6 million, or 256%, during the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase in other income (expense), net, was primarily due to foreign currency rates and recognition of an employee retention credit.
WeOperating usedactivities provided net cash of $44.7$45.2 million from operating activities for the year ended December 31, 2024.2025, Thewhich cash used in operating activitiesis primarily related to cash collections offset by costs associated with the continued expansion of our business and inventory purchases, offset by the timing of cash payments and receipts.purchases.
Financing activities provided net cash of $56.2$30.0 million for the year ended December 31, 2024,2025, which is primarily related to proceeds from our term2030 loanNotes offset by the repurchase of 80% of the 2026 Notes, the purchase of capped calls and the net drawsrepayment onof our revolvingRevolving lineCredit of credit.Facility.
As of December 31, 2024,2025, we had $200.0 million outstanding under the Braidwell Term Loan. The outstanding loans under the Braidwell Term Loan bear interest at the sum of Term Secured Overnight Financing Rate ("SOFR") plus 5.75% per annum. The Braidwell Term Loan matures on January 6, 2028.
As of December 31, 2024,2025, we had $63.3$15.0 million outstanding under the Revolving Credit Facility. The outstanding loans bear interest at the sum of SOFR plus 3.5% per annum. The Revolving Credit Facility matures on the earlier of September 29, 2027, or 90 days prior to the final maturity date of any of our outstanding 0.75% Convertible Senior Notes due 2026 (the "2026 Notes").2027.
As of December 31, 2025, we had $405.0 million outstanding under the 2030 Notes. The 2030 Notes accrue interest at a rate of 0.75%, payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2025. Prior to maturity in March 2030, the holders of the 2030 Notes may, under certain circumstances, choose to convert their notes into shares of our common stock. Based on the terms, we have the option to pay or deliver cash, shares of our common stock, or a combination thereof, when a conversion notice is received.
Our intangible assets are comprised primarily of purchased technology, internally developed software, customer relationships, trade name, trademarks, and in-process research and development. We make significant judgments in relation to the valuation of intangible assets resulting from business combinations and asset acquisitions. Intangible assets are generally amortized on a straight-line basis over their estimated useful lives of 2 to 12 years. We base the useful lives and related amortization expense on the period of time we estimate the assets will generate net sales or otherwise be used. We also periodically review the lives assigned to our intangible assets to ensure that our initial estimates do not exceed any revised estimated periods from which we expect to realize cash flows. If a change were to occur in any of the above-mentioned factors or estimates, the likelihood of a material change in our reported results would increase. We evaluate our intangible assets with finite lives for indications of impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors that could trigger an impairment review include significant under-performance relative to expected historical or projected future operating results, significant changes in the manner of our use of the acquired assets or the strategy for our overall business or significant negative industry or economic trends. If this evaluation indicates that the value of the intangible asset may be impaired, we make an assessment of the recoverability of the net carrying value of the asset over its remaining useful life. If this assessment indicates that the intangible asset is not recoverable, based on the estimated undiscounted future cash flows of the asset over the remaining amortization period, we reduce the net carrying value of the related intangible asset to fair value and may adjust the remaining amortization period. Significant judgment is required in the forecasts of future operating results that are used in the discounted cash flow valuation models. It is possible that plans may change and estimates used may prove to be inaccurate. If our actual results, or the plans and estimates used in future impairment analyses, are lower than the original estimates used to assess the recoverability of these assets, we could incur additional impairment charges.
We evaluate our intangible assets with finite lives for indications of impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors that could trigger an impairment review include significant under-performance relative to expected historical or projected future operating results, significant changes in the manner of our use of the acquired assets or the strategy for our overall business or significant negative industry or economic trends. If this evaluation indicates that the value of the intangible asset may be impaired, we make an assessment of the recoverability of the net carrying value of the asset group in which the intangible asset resides over its remaining useful life of the primary asset in the asset group. The asset group is determined based on the lowest level for which identifiable cash flows can be identified. If this assessment indicates that the asset group is not recoverable, based on the estimated undiscounted future cash flows of the asset group, we reduce the net carrying value of the related intangible assets in the asset group to fair value and may adjust the remaining amortization period. Significant judgment is required in the forecasts of future operating results that are used in the discounted cash flow valuation models. It is possible that plans may change and estimates used may prove to be inaccurate. If our actual results, or the plans and estimates used in future impairment analyses, are lower than the original estimates used to assess the recoverability of these assets, we could incur additional impairment charges.
Stock-based compensation expense for equity-classified awards, principally related to restricted stock units ("RSUs") and performance restricted stock units ("PRSUs") is measured at the grant date based on the estimated fair value of the award. The fair value of equitycommon instrumentsstock that areis expected to vest is recognized and amortized over the requisite service period. We have granted awards with up to four year graded or cliff vesting terms. No exercise price or other monetary payment is required for receipt of the shares issued in settlement of the respective award; instead, consideration is furnished in the form of the participant’s service.
What changed in the latest 10-Q
Risk Factors
There have been no material changes to the risk factors described under Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on February 24, 2026.
No wording changes found in this section.
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
New heading “Recent Developments”
New heading “JP Morgan Credit Agreement”
Largest changes
“In May 2026, we entered into a senior secured credit agreement (the "Credit Agreement") with JP Morgan Chase Bank, N.A., consisting of a $175.0 million term loan facility (the "JPM Term Loan") and a $125.0 million revolving credit facility (the "JPM Revolving Credit Facility" and, together with the JPM Term Loan, the "JPM Credit Facilities"), each maturing on May 1, 2031. On May 1, 2026, we borrowed $175.0 million under the term loan and $40.0 million under the revolving credit facility. …”see in full comparison
Interest expense, net,see in full comparisonincreaseddecreased$3.9$1.3 million, or49%,11%,duringand increased $2.5 million, or 13%, for the three and six months ended June 30, 2026, respectively, compared to the same periods in 2025. The decrease in interest expense, net, for the three months endedMarchJune31,30, 2026,comparedwas primarily due totheasame perioddecrease in2025.cash interest expense. The increase in interest expense, net, for the six months ended June 30, 2026 was primarily due to the amortization of debt discount associated with the 2030 Notes. Net cash interest was$4.9$4.3 million and $9.3 million for the three and six months endedMarchJune31,30,2026.2026, respectively. Net non-cash interest was$6.8$6.6 million and $13.4 million for the three and six months endedMarchJune31,30,2026.2026, respectively.
Loss on debt extinguishment decreasedsee in full comparison$17.6$11.9 million, or 100%,duringand $5.7 million, or 32%, for the three and six months endedMarchJune31,30, 2026, compared to the sameperiodperiods in 2025. The decrease in loss on debt extinguishment relates to the redemption of 80% of the 2026 Notes in March2025.2025 offset by the extinguishment of the Braidwell Term loan and MidCap Revolving credit facilities during the three months ended June 30, 2026.
As ofsee in full comparisonMarchJune31,30, 2026, we had$200.0$175.0 million outstanding under theBraidwellJPM Term Loan. The outstanding loans under theBraidwellJPM Term Loan bear interest at the sum of Term SOFR plus5.75%anperapplicableannum.margin determined by reference to the Company’s Senior Secured Net Leverage Ratio. TheBraidwellJPM Term LoanmaturesMatures onJanuaryMay6,1,2028.2031.
Full comparison: every changed paragraph (29)
Recent Developments
JP Morgan Credit Agreement
In May 2026, we entered into a senior secured credit agreement (the "Credit Agreement") with JP Morgan Chase Bank, N.A., consisting of a $175.0 million term loan facility (the "JPM Term Loan") and a $125.0 million revolving credit facility (the "JPM Revolving Credit Facility" and, together with the JPM Term Loan, the "JPM Credit Facilities"), each maturing on May 1, 2031. On May 1, 2026, we borrowed $175.0 million under the term loan and $40.0 million under the revolving credit facility. We used the proceeds, together with cash on hand, to repay in full all outstanding obligations under our prior Braidwell term loan and MidCap revolving credit facility, which were concurrently terminated. The new credit facilities bear interest at variable rates based on Term SOFR or an alternate base rate, plus an applicable margin, and are subject to customary financial maintenance covenants and other terms.
Critical accounting policies are those that, in management’s view, are most important in the portrayal of our financial condition and results of operations. Management believes there have been no material changes during the three months ended MarchJune 31,30, 2026, to the critical accounting policies discussed in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC.
Revenue from products and services increased $22.9$28.0 million, or 15%, and $50.9 million, or 14%, duringfor the three and six months ended MarchJune 31,30, 2026, respectively, compared to the same periodperiods in 2025. The increase was primarily due to an increase in product volume that was due to the increase in our surgeon user base, continued expansion of our new product portfolio, and increasing adoption of our technology.
Cost of sales increased $2.4$3.0 million, or 5%, and $5.4 million, or 5% for the three and six months ended MarchJune 31,30, 2026, respectively, compared to the same periodperiods in 2025. The increase was primarily due to an increase in product volume offset by a decrease in stock-based compensation.volume.
Research and development expenses. Research and development expenses increasedremained $1.0 million, or 6%,consistent for the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025. The increase was primarily due to an increase in compensation expense.
Sales, general and administrative expenses. Sales, general and administrative expenses increased $10.0$15.5 million, or 8%,13%, duringand $25.5 million, or 10%, for the three and six months ended MarchJune 31,30, 2026, respectively, compared to the same periodperiods in 2025. The increase was primarily due to higher compensation-related costs and variable selling expenses associated with the increase in revenue, and our continued investment in building our strategic distribution channel.
Litigation-related expenses. Litigation-related expenses decreased $11.7$1.7 million, or 96%,105%, and $13.4, or 97%, for the three and six months ended MarchJune 31,30, 2026, respectively, compared to the same periodperiods in 2025. The decrease was primarily related to a litigation settlement during the threesix months ended MarchJune 31,30, 2025.
Amortization of acquired intangible assets. Amortization of acquired intangible assets remained consistent for the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025.
Restructuring expenses. Restructuring expenses decreased $0.4 million, or 100%, duringfor the threesix months ended MarchJune 31,30, 2026, compared to the same period in 2025. The decrease in restructuring expenses is primarily due to personnel related expenses in the prior period that did not recur.
Interest expense, net, increaseddecreased $3.9$1.3 million, or 49%,11%, duringand increased $2.5 million, or 13%, for the three and six months ended June 30, 2026, respectively, compared to the same periods in 2025. The decrease in interest expense, net, for the three months ended MarchJune 31,30, 2026, comparedwas primarily due to thea same perioddecrease in 2025.cash interest expense. The increase in interest expense, net, for the six months ended June 30, 2026 was primarily due to the amortization of debt discount associated with the 2030 Notes. Net cash interest was $4.9$4.3 million and $9.3 million for the three and six months ended MarchJune 31,30, 2026.2026, respectively. Net non-cash interest was $6.8$6.6 million and $13.4 million for the three and six months ended MarchJune 31,30, 2026.2026, respectively.
Loss on debt extinguishment decreased $17.6$11.9 million, or 100%, duringand $5.7 million, or 32%, for the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025. The decrease in loss on debt extinguishment relates to the redemption of 80% of the 2026 Notes in March 2025.2025 offset by the extinguishment of the Braidwell Term loan and MidCap Revolving credit facilities during the three months ended June 30, 2026.
Gain(Loss) gain on derivative liability decreased $17.4$16.8 million, or 100%, duringand $0.6 million, or 100%, for the three and six months ended MarchJune 31,30, 2026, respectively, compared to the same periodperiods in 2025. The decrease in (loss) gain on derivative liability relates to the change in the valuation of the derivative liability associated with 2030 Notes from inception to MarchJune 31,30, 2025. As of June 12, 2025 the conditions necessary for separate accounting of the conversion option as a derivative liability were no longer met.
Other (expense) income, net, increased $0.1$1.9 million, or 32%,188%, duringand $1.8 million, or 132%, for the three and six months ended MarchJune 31,30, 2026, respectively, compared to the same periodperiods in 2025. The increase in other income, net, during the threesix months ended MarchJune 31,30, 2026, was primarily due to fluctuations in foreign currency rates.
The change in the income tax provision (benefit) for the three and six months ended MarchJune 31,30, 2026, compared to the same period in 2025, was primarily related to the recognition of income taxes in several jurisdictions.
Our principal sources of liquidity are our existing cash and cash equivalents, our JPM Revolving Credit Facility and cash from operations. Our liquidity and capital structure are evaluated regularly within the context of our annual operating and strategic planning process. We consider the liquidity necessary to fund our operations, which includes working capital needs, investments in research and development, investments in inventory and instrument sets to support our customers, as well as other operating costs. Our future capital requirements will depend on many factors including our rate of revenue growth, the timing and extent of spending to support development efforts, the expansion of sales, marketing and administrative activities, the timing of introductions of new products and enhancements to existing products, and the international expansions of our business.
Cash and cash equivalents were $139.9118.7 million and $160.8 million at MarchJune 31,30, 2026, and December 31, 2025, respectively. We believe that our existing funds, cash generated from our operations and our existing sources of and access to financing are adequate to satisfy our needs for working capital, capital expenditure and debt service requirements, and other business initiatives we plan to strategically pursue.
Operating activities provided net cash of $1.3$21.8 million for the threesix months ended MarchJune 31,30, 2026, which is primarily related to cash collections offset by costs associated with the continued expansion of our business and inventory purchases.
We used cash of $19.9$42.6 million in investing activities for the threesix months ended MarchJune 31,30, 2026, which is primarily related to the purchase of surgical instruments to support the growth of our business and commercial launch of new products and a $5.0 million note receivable.
Financing activities used cash of $1.8$21.3 million for the threesix months ended MarchJune 31,30, 2026, which is primarily related to cashproceeds paidfrom for net settlementissuance of shares,term and revolving credit facilities, offset by proceedsrepayment fromof financedterm insurance.and revolving credit facilities.
As of MarchJune 31,30, 2026, we had $200.0$175.0 million outstanding under the BraidwellJPM Term Loan. The outstanding loans under the BraidwellJPM Term Loan bear interest at the sum of Term SOFR plus 5.75%an perapplicable annum.margin determined by reference to the Company’s Senior Secured Net Leverage Ratio. The BraidwellJPM Term Loan maturesMatures on JanuaryMay 6,1, 2028.2031.
As of MarchJune 31,30, 2026, we had $15.1$40.0 million outstanding under the JPM Revolving Credit Facility. The outstanding loans under the JPM Revolving Credit Facility bear interest at the sum of Term SOFR plus 3.5%an perapplicable annum.margin determined by reference to the Company’s Senior Secured Net Leverage Ratio. The JPM Revolving Credit Facility matures on SeptemberMay 29,1, 2027.2031.
As of MarchJune 31,30, 2026, we had $63.3 million outstanding under the 2026 Notes. The 2026 Notes accrue interest at a rate of 0.75%, payable semi-annually in arrears on February 1 and August 1 of each year. Prior to maturity in August 2026, the holders of the 2026 Notes may, under certain circumstances, choose to convert their notes into shares of our common stock. Based on the terms we have the option to pay or deliver cash, shares of our common stock, or a combination thereof, when a conversion notice is received.
As of MarchJune 31,30, 2026, we had $405.0 million outstanding under the 2030 Notes. The 2030 Notes accrue interest at a rate of 0.75%, payable semi-annually in arrears on March 15 and September 15 of each year. Prior to maturity in March 2030, the holders of the 2030 Notes may, under certain circumstances, choose to convert their notes into shares of our common stock. Based on the terms we have the option to pay or deliver cash, shares of our common stock, or a combination thereof, when a conversion notice is received.
As of MarchJune 31,30, 2026, we had $1.6$1.3 million in other debts that are due in monthly and quarterly installments through maturity in 2027.
We have an inventory purchase commitment agreement with a third-party supplier, where we are obligated to meet certain minimum purchase commitment requirements through December 2026. As of MarchJune 31,30, 2026, the remaining minimum purchase commitment under the agreement was $3.7$2.4 million.
As of MarchJune 31,30, 2026, there have been no material changes, outside the normal course of business, in our outstanding contractual obligations from those disclosed within the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
Aside from the changes disclosed in Note 1 to the Notes to Condensed Consolidated Financial Statements (Unaudited) under the heading “Recently Issued Accounting Pronouncements,” if any, there have been no new accounting pronouncements or changes to accounting pronouncements during the threesix months ended MarchJune 31,30, 2026, as compared to the recent accounting pronouncements described in our Annual Report on Form 10-K for the year ended December 31, 2025, that was filed with the SEC.
ATEC insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 2 Form 4 filings (2 insiders, 4 trade dates, 250,000 shares, about $2.0M) and open-market sales in 2 filings (2 insiders, 2 trade dates, 14,218 shares, about $127.3K; 2 of these filings say the sales were made under a Rule 10b5-1 trading plan). Net open-market shares: 235,782 (purchases minus sales); net value about $1.9M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-10-05 | Carls Thomas Andrew |
Grant/award | 200,000 | — | — |
| 2026-09-10 | Miles Patrick |
Open-market purchase | 115,000 | $8.81 | $1.0M |
| 2026-08-05 | Marshall Tyson Eliot |
Open-market sale |
8,168 | $9.65 | $78.8K |
| 2026-06-11 | Mcginnis Karen K |
Open-market sale |
6,050 | $8.01 | $48.5K |
| 2026-06-10 | Mcginnis Karen K |
Grant/award |
32,012 | — | — |
| 2026-06-10 | Blackford Quentin S. |
Grant/award | 32,012 | — | — |
| 2026-06-10 | Valentine Keith |
Grant/award | 32,012 | — | — |
| 2026-06-10 | Pelizzon David R |
Grant/award | 32,012 | — | — |
| 2026-06-10 | Demski David M |
Grant/award | 32,012 | — | — |
| 2026-06-10 | Berkowitz Mortimer Iii |
Grant/award | 32,012 | — | — |
| 2026-05-11 | Valentine Keith |
Open-market purchase | 35,000 | $7.00 | $245.0K |
| 2026-05-08 | Valentine Keith |
Open-market purchase | 43,847 | $7.54 | $330.6K |
| 2026-05-07 | Valentine Keith |
Open-market purchase | 56,153 | $7.49 | $420.6K |
Well-known investors holding ATEC (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Point72 Asset Management (Steve Cohen) | 2026-06-30 | 2,493,575 | $27.1M | — | Sold out |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 2,461,400 | $21.3M | 0.01% | Added 187% |
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 2,386,326 | $20.6M | 0.01% | Added 72% |
| Millennium Management (Israel Englander) | 2026-06-30 | 1,145,837 | $9.9M | 0.01% | Reduced 59% |
| Oaktree Capital Management (Howard Marks) | 2026-06-30 | 0 | $9.1M | 0.17% | New position |
| First Eagle Investment Management | 2026-06-30 | 996,637 | $8.6M | 0.01% | Added 43% |
| Two Sigma Investments | 2026-06-30 | 823,496 | $7.1M | 0.01% | Reduced 60% |
| Renaissance Technologies | 2026-06-30 | 284,500 | $2.5M | 0.0% | Reduced 73% |
| Millennium Management (Israel Englander) | 2026-06-30 | 0 | $334.3K | 0.0% | No change |
| D. E. Shaw & Co. | 2026-06-30 | 18,522 | $201.5K | — | Sold out |