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To remain competitive, we must continue to enhance and improve the functionality and features of our e-commerce business, particularly those that attract and retain buyers and sellers. As an e-commerce company, we must continuously improve and upgrade our technology, transaction processing systems, and network infrastructure to allow our operations to grow in both size and scope. Without such continuous improvements, our operations might suffer from unanticipated system disruptions, slow transaction processing, unreliable service levels, or impaired quality or delays in reporting accurate financial information, any of which could negatively affect our reputation and ability to attract and retain sellers and buyers. We may also face material delays in introducing new services, assets, and enhancements. The e-commerce industry is rapidly changing.changing with increasing deployment of artificial intelligence (AI) driven platforms, which have the potential to alter the competitive dynamics of digital advertising by changing the way in which users consume information and interact with content over the internet. If competitors introduce new assetscapabilities and services using new technologies, such as generative artificial intelligence (AI),AI, or if new industry standards and practices emerge, our existing online marketplaces and our proprietary technology and systems may become obsolete. If we are unable to address these new technologies, adapt to evolving market expectations, or compete effective with AI-driven ecosystems, our growth and market position could be adversely impacted. In addition, the expansion and improvement of our systems and infrastructure may require us to commit substantial financial, operational, and technical resources, with no assurance our business will grow as a result. We may lack sufficient resources to continue to make the significant investments in information technology to compete with our competitors. If we fail to respond to technological change or to adequately maintain, expand, upgrade, and develop our systems and infrastructure promptly, our ability to grow and remain competitive could be limited and our revenue could decrease.

We expect that our continuing initiatives to increase our efficiency and productivity, the functionality of our marketplaces, and our cross-selling opportunities, will drive our scale and growth and have a positive effect on our business, competitive position, and results of operations over time. We cannot assure you that these initiatives will be beneficial to the extent, or within the timeframes, expected, or that the estimated efficiency, cost savings, and other improvements will be realized as anticipated or at all. If our initiatives are not implemented successfully and within budget, or if our systems do not perform in a satisfactory manner, it could disrupt or otherwise materially adversely affect our business and results of operations, as well as divert management resources.

We continue to decommission non-scalable legacy IT platform technology with modular technology including key modules for unified management of sellers and buyers, property handling, transaction processing and finance functions across our entire Company. Our AllSurplus marketplace is designed to provide our buyers with access to all of the property listed directly on AllSurplus as well as the GovDeals marketplaces,marketplaces. This provides our sellers with a common account experience,experience and simplifies our operations. We continue to expand our AllSurplus direct-to-consumer channel for returned and overstock inventory from retailers and manufacturers, which is referred to as AllSurplus Deals . Iterative information technology and digital marketing improvements require management time and resources to educate employees, redesign internal processes, and implement new ways of conducting business with our sellers and buyers. If we do not effectively manage improvements to our marketplaces, including digital marketing and data driven improvements or the timing, costs, and adoption by sellers and buyers, it could negatively affect our business and our operating results, as well as damage our reputation and our prospects. In addition, the dedication of resources to sustain, secure, and enhance our existing sites constrains the ability to undertake transformation initiatives focused on growth opportunities.

Our future success, including our ability to successfully implement recent initiatives, depends substantially on the continued service of our senior management and other key personnel, particularly William P. Angrick, III, our Chairman and Chief Executive Officer. We do not have key-person insurance onfor any of our officers or employees. Losing any member of our existing senior management team could damage key seller relationships, result in the loss of key information, expertise, or know-how, lead to unanticipated recruitment and training costs, and make it more difficult to operate our business and achieve our business goals. Our future success also depends on our ability to continue to attract, retain, and motivate highly skilled employees, particularly employees with technology, sales, marketing, operations, and administrative technical expertise. As AI-enabled tools and technology evolve at an accelerated pace, attracting talent, across all disciplines, that are able to safely leverage these technologies becomes of increasing importance. Competition for employees in our industry is intense. We have experienced occasional difficulty in attracting personnel to support the growth of our business,business due to labor market volatility among other factors, and we may experience similar difficulties in the future. If we cannot attract, assimilate, and retain employees with the skills we require, we may not grow our business and revenue as expected and we could experience increased turnover, decreased levels of buyer and seller service, low morale, inefficiency or internal control failures. Further changes to immigration policies in the U.S. and other key jurisdictions that restrain the flow of technical and professional talent may inhibit our ability to adequately recruit and retain highly skilled employees.

We must also attract, train, and retain a large and growing number of qualified employees in our RSCG and GovDeals warehouses and storage lots, while controlling related labor costs and maintaining our core values. Our ability to control labor and benefit costs is subject to numerous internal and external factors, regulatory changes, prevailing wage rates, and healthcare and other insurance costs. We compete with other retail and non-retail businesses for these employees and invest significant resources in training and motivating them. We may not be able to attract or retain highly qualified employees in the future, which could have a material adverse effect on our business, financial condition, and results of operations.

In addition, we may face competition from certain of our retail clients and smaller actors. For example, a retail client may invest in its warehouse operational capacity to handle higher volumes of online returns which may cause such retailerretailers to send us a reduced volume of returned merchandise or a product mix that is lower in value due to the removal of high value returns. Furthermore, a smaller competitor may achieve scale by means of competitive advantage over our company, resulting in their ability to directly compete with us for the same source of inventory that we currently acquire.

Our operating results depend on the availability and performance of our websites,marketplace technology, network infrastructure, and transaction processing systems, andwhich our software runs onleverage public clouds.cloud Serviceinfrastructure. Significant service interruptions or system failuresfailures, whether internal or within the broader cloud ecosystem, could negatively affect the demand for our services and our ability to grow our revenue.

We use a combination of licensed and open-source software, software as a service (SAAS), and platform as a service (PAAS) offerings from multiple third parties. We use, among others, the following: [Akamai, Algonomy, Amazon Web Services, Google, Postmark, HubSpot, Jenkins, LeaseQuery, Liferay, Microsoft Azureparties and Microsoftglobal 365,public MuleSoft,cloud MySQL, Oracle Fusion, and various Linux distributions, and we may use additional open-source software.providers. Licenses to third-party software and global public cloud providers may not continue to be available on terms that are acceptable to us, or at all.

Certain aspects of our marketing technology depend on third parties over whom we have no direct control.

Additionally, ourOur marketing technology relies heavily on our ability to track our promotional campaign performance across marketing channels (i.e., email, search engines, social media, and third-party banner ads). If industry leading software browsers, such as Google Chrome, Microsoft Edge, or Apple Safari, disable user analytics tracking or other similar capabilities, our ability to track our promotional campaign performance could be affected, which could in turn prevent us from fully optimizing the marketing spend associated with our promotional campaigns. Like many other e-commerce marketplaces, Apple’s recent upgrades to provide greater transparency as to Identifier for Advertisers (IDFA) has, with respect to some categories of assets, made it harder and more expensive for us to target customers with an interest in purchasing those categories of assets.

IncreasedThe cyber security threatsthreat landscape is rapidly evolving, driven by the emergence of AI-enabled fraudsters who are leveraging advanced automation and morepersonalization tools to orchestrate increasingly sophisticated cyber misconduct pose a risk to our e-commerce marketplaces, information technology systems, networks, and services.targeted attacks. We rely upon IT systems and networks, some of which are managed by third parties, in connection with virtually all of our business activities. Additionally, we collect, store and process information relating to our business, sellers, buyers, and employees. Operating these IT systems and networks, and processing and maintaining this data, in a secure manner, is critical to our business operations and strategy. Losing confidential seller or buyer information could also expose us to the risk of liability and costly litigation. In addition, if there is any perception that we cannot protect our users’ confidential information, we may lose the ability to retain existing, and attract new, sellers and buyers, and therefore our revenue could decline.

Threats designed to gain unauthorized access to systems, networks and data, both ours and third parties with whom we work, are increasing in frequency and sophistication. New developments in the fields of AI, machine learning, and robotics may create new vulnerabilities and cybersecurity risks, and remote work has also increased the possible attack surfaces. These threats pose a risk to the security of our systems and networks and the confidentiality, integrity, and availability of our data. Cybersecurity incidents may range from random attempts to coordinated and targeted attacks, including sophisticated computer crimes and advanced persistent threats. Phishing attacks have also emerged, including as vectors for ransomware attacks, which have increased in breadth, frequency, and sophistication for the Company. In addition, it is possible that our IT systems and networks, or those managed by third parties such as cloud providers or suppliers that otherwise host confidential information, could have vulnerabilities, which could go unnoticed for a period of time. The actions and controls we and our third-party service providers have implemented and are implementing, may not be sufficient to protect our systems, information, or other property. We currently expend, and we may be required to expend in the future, significant additional capital and other resources to protect against such security breaches or to alleviate problems caused by such breaches.

Moreover,Furthermore, cybersecurity has becomeis a highsignificant priorityfocus for legislators and regulators.regulators, resulting in an increasingly complex landscape of global and state privacy laws. The SEC adoptedhas rulesimplemented thatrequirements requiremandating us to provide greaterenhanced disclosures aroundregarding our cybersecurity risk management, strategystrategy, and governance, as well as to disclose the occurrencereporting of material cybersecurity incidents. If we fail to complyNon-compliance with the relevantapplicable laws and regulations,regulations wemay couldlead sufferto financial loss,losses, abusiness disruptiondisruptions, ofinvestor liabilities, regulatory actions, or damage to our business,reputation. liabilityAt this time, it is not possible to investors,accurately regulatory intervention and/or reputational damage. We cannot predict or estimateforecast the amount of additional costs we will incur to complyassociated with these rulescompliance or the timingtimeline offor incurring such costs.expenses. OurAdditionally, our insurance coverage may benot inadequatefully toaddress compensatelosses usarising for anyfrom related losses we incur.incidents.

We experience seasonality in each portion of our business at various times during the year. As a result, we expect a disproportionate number of transactions on our marketplaces to occur at certain times during the year. If we cannot effectively manage increased demand, or the increased flow of goods we typically experience during these times, it could adversely affect our revenue and our future growth. If too many buyers and sellers access our websites within a short period of time due to increased demand, we may experience system interruptions that make our websites unavailable or prevent us from providing efficient service, which may reduce our financial and operational results and the attractiveness of our value-added services. In addition, we may not or may be unable to adequately staff our network of warehouses during these peak periods. If we cannot staff warehouses adequately, we may not be able to process assets quickly enough which, in turn, could mean dissatisfaction of sellers or increased third-party storage costs and reduced profitability.

We have completed and may complete additional acquisitions in the future. The success of any acquisition, including anticipated synergies, benefits and cost savings, will depend, in part, on our ability to successfully combine and integrate our current operations with the acquisition. Our ability to successfully integrate the acquired businesses and operations with our existing businesses plays a significant role in realizing the anticipated benefits of any acquisitions. The integration process could cause the loss of key employees, buyers, sellers, or other vendors, increase our operating or other costs, decrease our profit margins, disrupt our other businesses, or divert management’s attention and Company’s resources from our existing businesses. If, as a result of these or other integration risks, we cannot achieve our acquisition objectives in a cost-effective and timely manner, we may not realize the anticipated benefits of the acquisition, or it may take us longer to realize the benefits of the acquisition than we expect. Any failure to timely and cost-effectively realize the anticipated benefits of thean acquisition could have a material adverse effect on our revenues, expenses, and operating results AcquisitionsAdditionally, acquisitions could cause dilutive issuances of equity securities, the incurrence of debt, one-time write-offs of goodwill, and substantial amortization expenses of other intangible assets. We may not obtain any required acquisition financing on favorable terms, or at all, which could make it impossible or costlier to acquire other businesses. If we can obtain financing, the terms may be onerous and restrict our operations. Further, certain acquisitions may be subject to regulatory approval, which can be time-consuming and costly to obtain, and the terms of such regulatory approvals may impose limitations on our ongoing operations or require us to divest assets or lines of business. Additionally, businesses that we acquire outside the U.S. may present unique challenges or increase our exposure to risks associated with foreign operations, including foreign currency risks and risks associated with local regulatory regimes.

We have expanded our business in part through acquisitions such as that of Sierra Auction Management, Inc. (Sierra Auction) in January 2024. We may continue to do so. The success of any future growth strategy involving acquisitions will depend on our ability to identify, and the availability of, suitable acquisition targets. We may incur costs, perhaps significant costs, in connection with evaluating and/or pursuing a potential acquisition but may be unable or unwilling to consummate the proposed transaction for various reasons.

About us. Liquidity Services is athe leading global commerceprovider companyof providinge-commerce trustedmarketplaces onlineand marketplacesoftware platformssolutions that powerpowering the circular economy. We create a better future for organizations, individuals, and the planet by using technology to capture and unleash the intrinsic value of surplus. We connect millions of buyers and thousands of sellers through our leading e-commerce auction marketplaces, search engines, asset management and auction software, and related services. Our comprehensive solutions enable the transparent, efficient, sustainable recovery of value from excess items owned by business and government sellers.

Our business delivers value to shareholders by unleashing the intrinsic value of surplus through our online marketplace platforms. These platforms ignite and enable a self-reinforcing cycle of value creation where buyers and sellers attract one another in greater numbers. The result of this cycle is a continuous flow of goods that becomes increasingly valuable as more participants join the platforms, thereby creating positive network effects that benefit sellers, buyers, and shareholders. During the past three fiscal years, we have conducted over 2.93.1 million online transactions generatingthat $3.7generated $4.1 billion in gross merchandise volume or GMV. GMV is the total sales value of all transactions for which we earned compensation upon their completion through our marketplaces or other channels during a given period of time.

During the year ended September 30, 2024,2025, the number of registered buyers grew from 5.15.5 million to 5.56.0 million.million, or 9%. We believe the continuous flow of goods in our marketplaces attracts a growing buyer base which creates a self-sustaining cycle for our buyers and sellers. We generated GMV of $1.4$1.6 billion and revenue of $363.3$477.7 million through multiple sources, including transaction fees from sellers and buyers, proceeds from the sale of products we purchased from sellers, and value-added service charges during the year ended September 30, 2024.2025. Over the prior 5 years, our GMV has grown at a compound annual growth rate of 16.4%.20.4%.

The Company has fourfive operating segments and three reportable segments under which we conduct business: GovDeals, Retail Supply Chain Group (RSCG), and Capital Assets Group (CAG),. Our separate Machinio and Machinio.Software Solutions operating segments, which do not individually meet the quantitative thresholds to be reportable segments, are combined and presented together as Machinio & Software Solutions for segment reporting purposes. Further information and operating results of our reportable segments can be found in Note 1716 - Segment Information.

GovDeals. The GovDeals reportable segment provides solutions that enable government entities including city, county, state and federal agencies located in the United States and Canada and related commercial businesses to sell surplus property and real estate assets through ourits GovDeals, Bid4Assets and Sierra marketplaces; see Note 3 - Bid4Assets Acquisition and Note 4 - Sierra Acquisition, respectively.Acquisitions.

CAG. The CAG reportable segment enables commercial businesses to sell surplus assets on our AllSurplus marketplace.and TheGovDeals coremarketplace, verticalsspecializing in whichasset CAGcategories operatessuch includeas heavy equipment, industrial manufacturing, oil and gas, heavybiopharma, equipment,fast-moving biopharma,consumer goods and electronics. CAG also offers a suite of services that includes surplus management, asset valuation, asset sales and marketing. CAG benefitsclients benefit from aits global base of buyers and sellerssellers, enabling the sale and redeployment of assets wherever they’re most likely tothey generate the best value and highest use across the world. This segment primarily uses the AllSurplus and GovDeals marketplaces.

Machinio.Machinio & Software Solutions. The Machinio reportableoperating segment operates the Machinio marketplace, a global search engine platform for listing equipment for sale in the construction, machine tool, processing, transportation, printing, agricultureagriculture, and laboratory/medical sectors.sectors, Machinio also offersand the Machinio System serviceplatform that provides equipment sellers with a suite of software tools that includesincluding website hosting, email marketing, and inventory management, to support and enable equipment sellers’ online business. The Software Solutions operating segment separately serves as the Company's private-label auction and software-as-a-service (SaaS) arm, offering scalable auction platform services to entrepreneurs and businesses.

Supply chain challenges and consumer sentiment. The supply of used vehicles available for sale on our marketplaces may be impacted by proposedongoing tariffs inimplemented, or actively being considered, by the U.S., as well as the slowing adoption of electric vehicles as a replacement to internal combustion vehicle fleets. Further, used car market price indices continue to experience heightened volatility. In addition, general consumer behavior can be turbulent, and changes in consumer sentiment can cause fluctuation in the mix, volumes, and demand for the products we receive. Change in these conditions or other challenges that may emerge in other key asset categories can impact our financial performance.

International armed and geopolitical conflicts. The global financial markets have experienced volatility subsequent to the invasion of Ukraine by Russia in February 2022, a conflict which remains ongoing, as well as the ongoing conflict in and adjacent to Israel. The Russia-Ukraine conflict specifically resulted in numerous countries, including the United States, imposing significant new sanctions and export controls against Russia, Russian banks, and certain Russian individuals. These sanctions and export controls and international responses to the ongoing conflict in and adjacent to Israel, have further heightened global supply chain disruptions and impacted the international trade markets. For the fiscal years ended September 30, 20242025 and 2023,2024, the Company's total revenues directly associated with Russia, Ukraine, and Israel were not material to our consolidated financial results. We will continue monitoring these armed and geopolitical conflicts around the world and any potential future impacts on our business.

Other — fee revenue. We also earn non-consignment fee revenue from Machinio'sour Machinio and Software Solution subscription services, auction listing service fees for foreclosed real estate at our GovDeals segment (payable regardless of whether or not an auction is completed), as well as other services including asset valuation, product handling, and storage fees. Non-consignment fee revenue is recorded within the Consignment and other fee revenues line-item on the Consolidated Statements of Operations.

Other fee revenues accounted for 5.9%, 7.3%, 7.5%, and 7.6%7.5% of our total revenues for the years ended September 30, 2025, 2024, and 2023, and 2022, respectivelyrespectively.

Commercial agreements. We have multiple vendor contracts with Amazon.com, Inc. under which weit acquireacquires and sellsells commercial merchandise. While purchase model transactions account for less than 20% of our total GMV, the cost of inventory for purchase model transactions is the most significant component of our consolidated Costs of goods sold. $12.2$10.1 million and $5.8$12.2 million of inventory purchased under such contracts with Amazon.com, Inc. is included in our Consolidated Inventory balances on our Consolidated Balance Sheets as of September 30, 20242025 and 2023,2024, respectively. OurThe Company's vendor contracts with respect to sourcing or consigning merchandise for ourits RSCG segment generally reflect the concentration dynamics inherent to the retail industry.

Total registered buyers. We grow our buyer base through a combination of marketinginternal and external marketing, as well as other promotional efforts. AAn personindividual or company becomes a registered buyer by completing anour online registration process on one offor our marketplaces. AsDuring part of this process,registration, we collect businesspersonal and personalbusiness information, including name, title, company name, business address, andemail, contactphone number, taxation information, and information on how the person intends tointended use of our marketplaces. Each prospective buyer must also accept our termsUser Agreement (Terms and conditions of use. Following the completion of the online registration process, we verify each prospective buyer’s e-mail address and confirm that the person is not listed on any banned persons list maintained internally or by the U.S. federal government. After the verification process, which is completed generally within 24 hours, the registration is approved and activated, and the prospective buyer is addedConditions) to our registered buyer list.proceed.

Total registered buyers, as of a given date, represent the aggregate number of persons or entities who have registered on one of our marketplaces. We use this metric to evaluate how well our marketing and promotional efforts are performing. Total registered buyers exclude duplicate registrations, buyers who are suspended from utilizing our marketplaces and buyers who have voluntarily removed themselves from our registration database. In addition, if we become aware of registered buyers that are no longer in business, we remove them from our database. As of September 30, 2025, 2024, 2023, and 2022,2023, we had 5.56.0 million, 5.15.5 million, and 4.95.1 million, registered buyers, respectively. None of our buyers represented more than 10% of our revenue during the year ended September 30, 2024.

Total auction participants. For each auction we manage, the number of auction participants represents the total number of registered buyers who have bid one or more times in that auction. As a result, a registered buyer who bids, or participates, in more than one auction is counted as an auction participant in each auction in which he or she participates. Thus, total auction participants for a given period is the sum of the auction participants in each auction conducted during that period. We use this metric to allow us to compare our online auction marketplaces to our competitors, including other online auction sites and traditional on-site auctioneers. In addition, we measure total auction participants on a periodic basis to evaluate the activity level of our base of registered buyers and to measure the performance of our marketing and promotional efforts. During the years ended September 30, 2024, 2023, and 2022, 4.0 million, 3.3 million, and 3.1 million participants participated in auctions on our marketplaces, respectively.

Intangible assets. The fair valuation of intangible assets acquired in a business combination consists of customer and supplier relationships, technology, trade names, and other intangibles (comprised of patents and related assets). Intangible assets are amortized using the straight-line method over their estimated useful lives. The preliminary fair value of acquired intangible assets, excluding goodwill, arising from the SierraAuction Software acquisition was $5.4$2.6 million. This balance consisted of the following identified intangible assets, each with their own significant assumptions used, as follows:

CustomerContract and Supplier RelationshipsIntangibles - We valued the customer and supplier relationshipscontract intangibles using the multi-period excess earnings method, an income approach valuation model. The significant assumptions used in the income approach includes estimates about future expected cash flows from supplier contracts, the attrition rate, and the discount rate.

Goodwill. Goodwill represents the costs in excess of the fair value of net assets acquired through acquisitions by the Company. Pursuant to our preliminary purchase price allocation, goodwill arising from the acquisition of SierraAuction Software was determined to be $7.9$5.1 million; see Note 43 - Sierra Acquisition,Acquisitions, for further information.

Technology and operations. Technology expenses primarily consist of the cost of technical staff (including stock compensation), third-party services, licenses, and infrastructure, all as required to develop, configure, deploy, maintain, and secure our marketplace platforms, business operational systems, and facilities. Technology expenses are net of the required capitalization of costs associated with enhancing our marketplace platforms and other software development activities. Depreciation and amortization of capitalized software development costs, purchased software, acquired developed software intangible assets, and computer hardware are included within Depreciation and amortization in the accompanying Condensed Consolidated Statements of Operations. Technology expenses are presented separately from Costs of goods sold (excluding depreciation and amortization) in the Condensed Consolidated Statements of Operations, as these expenses provide for the general availability of our marketplace platforms and other business operational systems and are not attributable to specific revenue generating transaction activity occurring on our marketplaces.

Because our marketplaces and support systems require frequent upgrades and enhancements to maintain viability, we have determined that the useful life for certain internally developed software is less than one year. As a result, we expense those costs as incurred. However, where we determine that the useful life of the internally developed software will be greater than one year, we capitalize development costs in accordance with ASC 350-40, Internal-use software. As such, we are capitalizing certain development costs associated with our marketplaces and support systems, as well as other software development activities.

Income taxes. Income taxes include current and deferred income tax expense for the U.S. federal, state, and foreign jurisdictions. During the years ended September 30, 2024, 2023 and 2022, the Company had an effective income tax rate of 26.7%, 27.7% and 15.4%, respectively, which included federal, state, and foreign income taxes.

Machinio.Machinio & Software Solutions. Revenue from our Machinio & Software Solutions reportable segment increased 16.9%, or $2.3 million, due to price increases and continued growth in subscribers. As a result of the increase in revenues, Segment direct profit increased 17.2%, or $2.3 million. Segment direct profit as a percentage of total revenue remained relatively consistent between the period.

Depreciation and amortization. Depreciation and amortization expense increased $0.9 million, or 7.7%, in connection with our acquisition of Sierra; see Note 43 - Sierra Acquisition.Acquisitions.

RSCG. The RSCG reportable segment consists of marketplaces that enable corporations located in the United States and Canada to sell excess, returned, and overstocked consumer goods. RSCG also offers a suite of services that includes returns management, asset recovery, and e-commerce solutions. This segment uses multiple selling channels across our network of marketplaces and others to optimize the best combination of velocity, volume, and value. This segment primarily conducts its business-to-business sales on its Liquidation.com marketplace and through Direct Sales, and managed direct-to-consumer sales onacross itsa network of online sale channels, including Retail Rush, AllSurplus Deals andDeals, Secondipity marketplaces and other third-partyonline sales channels.marketplaces.

International armed and geopolitical conflicts. The global financial markets have experienced volatility subsequent to the invasion of Ukraine by Russia in February 2022, a conflict which remains ongoing, as well as the ongoing conflict in and adjacent to Israel and Iran, and instability in Venezuela. Escalating tensions involving Iran have also contributed to volatility in global energy markets, including increases in oil prices, which in turn have placed upward pressure on transportation, logistics, and other operating costs and contributed to broader inflationary effects. Additionally, the Russia-Ukraine conflict resulted in numerous countries, including the United States, imposing significant new sanctions and export controls against Russia, Russian banks, and certain Russian individuals. These sanctions and export controls and international responses to the ongoing conflict in and adjacent to Israel and Iran, have further heightened global supply chain disruptions, increased energy and commodity price volatility, and impacted the international trade and financial markets. For the three and nine months ended MarchJune 31,30, 2026 and 2025, the Company's total revenues directly associated with Russia, Ukraine, Israel, Iran, and Venezuela were not material to our consolidated financial results individually nor collectively. We will continue monitoring these armed and geopolitical conflicts around the world and any potential future impacts on our business.

We believe our marketplaces benefit over time from greater scale and adoption by our users creating a continuous flow of goods benefiting our buyers and sellers. As of MarchJune 31,30, 2026, we had 6.36.4 million registered buyers in our marketplaces. We had access to millions of additional end-users through a range of external consumer marketplaces. Aggregating this level of buyer demand and market data enables us to generate a continuous flow of goods from corporate and government sellers, which in turn attracts more buyers. During the twelve months ended MarchJune 31,30, 2026, the approximate number of registered buyers increased from 5.85.9 million to 6.36.4 million, or approximately 8%.9%. As buyers continue to discover and use our e-commerce marketplaces as an effective method to source assets, we believe our solutions become a more attractive sales channel for corporate and government agency sellers. We believe this self-reinforcing cycle results in greater transaction volume and enhances the value of our marketplaces.

PurchaseTransaction modelModel Mix. Most of our transactions are aconducted smallerunder proportionthe ofconsignment ourmodel, consolidatedwhich GMV,represented representing 19.1%83.1% and 19.1%81.7% of our consolidated GMV for the three and sixnine months ended MarchJune 31,30, 2026, respectively, and 19.9%82.5% and 20.1%80.9% of our consolidated GMV for the three and sixnine months ended MarchJune 31,30, 2025, respectively. However, allonly the consignment fee, representing a small portion of the GMVconsignment associated with the purchase model transactionGMV, is generally able to be recognized as revenue, causing purchaseconsignment revenues to account for 64.5%30.9% and 64.1%30.1% of our total revenues for the three and sixnine months ended MarchJune 31,30, 2026, respectively, and 66.9%30.0% and 67.3%28.1% of our total revenues for the three and sixnine months ended MarchJune 31,30, 2025, respectively.

In assessing buyer concentration risk, we consider a number of quantitative factors, which can include the buyer's proportionate share of our consolidated GMV, revenues and direct profit, including any impacts based upon the transaction model mix they purchase. We also consider qualitative factors, such as the level of differentiation in the products sold and whether there are alterative buyers accessible in the market, among other relevant factors. For the three and sixnine months ended MarchJune 31,30, 2026 and 2025, we were not dependent on any single buyer in a manner material to our business.

The Company has multiple vendor contracts with Amazon.com, Inc. under which it acquires and sells commercial merchandise. While purchase model transactions account for less than 20% of our total GMV, the cost of inventory for purchase model transactions is the most significant component of our consolidated Costs of goods sold. $15.9$11.1 million and $10.1 million of inventory purchased under such contracts with Amazon.com, Inc. is included in our Inventory balances on our Condensed Consolidated Balance Sheets as of MarchJune 31,30, 2026 and September 30, 2025, respectively. The Company's vendor contracts with respect to sourcing or consigning merchandise for our RSCG segment generally reflect the concentration dynamics inherent to the retail industry.

Other fee revenues accounted for 6.3%6.0% and 6.4%6.2% of our total revenues for three and sixnine months ended MarchJune 31,30, 2026, respectively, and 5.8%6.2% and 5.6%5.8% of our total revenues for the three and sixnine months ended MarchJune 31,30, 2025, respectively.

Gross merchandise volume (GMV). GMV is the total sales value of all transactions for which we earned compensation upon their completion through our marketplaces or other channels during a given period of time. We review GMV because it provides a measure of the volume of goods being sold in our marketplaces and thus the activity of those marketplaces. GMV also provides a means to evaluate the effectiveness of investments that we have made and continue to make, including in the areas of buyer and seller support, value-added services, product development, sales and marketing, and operations. Our GMV for the three and sixnine months ended MarchJune 31,30, 2026, was $389.9$453.0 million and $787.8$1.2 million,billion, respectively, increasing from the three and sixnine months ended MarchJune 31,30, 2025 by $22.5$40.0 million, or 6.1%,9.7%, and $34.4$74.4 million, or 4.6%,6.4%, respectively.

Total registered buyers, as of a given date, represent the aggregate number of persons or entities who have registered on one of our marketplaces. We use this metric to evaluate how well our marketing and promotional efforts are performing. Total registered buyers exclude duplicate registrations, buyers who are suspended from utilizing our marketplaces and buyers who have voluntarily removed themselves from our registration database. In addition, if we become aware of registered buyers that are no longer in business, we remove them from our database. As of MarchJune 31,30, 2026 and 2025, we had 6.36.4 million and 5.85.9 million registered buyers, respectively.

We use this metric to allow us to compare our online auction marketplaces to our competitors, including other online auction sites and traditional on-site auctioneers. In addition, we measure total auction participants on a periodic basis to evaluate the activity level of our base of registered buyers and to measure the performance of our marketing and promotional efforts. During the three months ended MarchJune 31,30, 2026 and 2025, 985,0001,046,000 and 982,0001,098,000 participants participated in auctions on our marketplaces, respectively. During the sixnine months ended MarchJune 31,30, 2026 and 2025, 1,968,0003,014,000 and 1,942,0003,040,000 participants participated in auctions on our marketplaces, respectively.

Completed transactions. Completed transactions representsrepresent the number of auctions in a given period from which we have recorded revenue. Similar to GMV, we believe that completed transactions is a key business metric because it provides an additional measurement of the volume of activity flowing through our marketplaces. During the three months ended MarchJune 31,30, 2026 and 2025, we completed 280,000334,000 and 258,000286,000 transactions, respectively. During the sixnine months ended MarchJune 31,30, 2026 and 2025, we completed 544,000878,000 and 511,000797,000 transactions, respectively.

Three Months Ended MarchJune 31,30, 2026, Compared to the Three Months Ended MarchJune 31,30, 2025

GovDeals. Total revenues from our GovDeals reportable segment increased 10.7%,6.5%, or $2.1$1.6 million, due to a $10.4$21.7 million, or 5.1%,8.6%, increase in GMV, driven by continued marketplace adoption, new seller acquisition and service expansion, partially offset by lower real estate transaction activity and disruptions from significant winter weather events.expansion. Revenue grew at a higherlower rate than GMV due to thean expansionincrease of service offerings to higher-volume sellers and a lowerin transaction mix of the lower take-rate real estate.estate category. Segment direct profit increased by $2.2$2.0 million, or 12.2%,9.0%, and Segment direct profit as a percentage of total revenue increased from 92.1%92.5% to 93.4%,94.7%, due to lower transaction processing fees.

RSCG. Revenue from our RSCG reportable segment increased by $0.5$6.3 million, or 0.6%,7.7%, reflecting athat relativelythe stable level of purchase revenues, and a $10.2$19.0 million, or 9.9%,18.5%, increase in GMV was primarily driven by consignment transactions in our lower-touchasset-light, dropshipsell-in-place marketplace solutions and managed direct-to-consumer channels.channels, while there was a modest increase in our purchase programs. Segment direct profit increased by $4.8$5.8 million, or 28.9%,29.9%, and Segment direct profit as a percentage of total revenue increased from 20.0%23.8% to 25.7%,28.7%, driven by improved recovery on selected purchase-model flows, robust buyer demanddemand, forchannel purchase transactions of sortable goods, strong multi-channel consignment buyer participation,optimization, and lower transaction processing fees.

CAG. Revenue fromin our CAG reportable segment increased by $1.2$1.6 million, or 12.3%,17.8%, due toas a $1.9slight decrease in GMV of $0.7 million, or 3.2%, increase in GMV1.2%, driven by increasedvariability heavyin equipmentproject timing and energyregional consignmentactivity transactionlevels, activity,was partiallymore than offset by a decreasefavorable intransaction mix of complex, multinational industrial consignmentprojects transactionthat activity. Revenue grew atcommand a higher ratetake-rate. than GMV due to higher take-rates, primarily in our industrial and energy categories. WhileAs there are inherent variations in the mix of assets sourced and sold by the CAG segment in any given period, Segment direct profit as a percentage of total revenue remaineddecreased relativelyfrom consistent92.4% betweento the periods.88.6%. As a result of the increase in revenues, Segment direct profit increased by $1.0$1.1 million, or 11.6%.13.0%. Global supply chains may experience heightened disruptions due to international tensions and other factors,factors which could limit the volume of assets made available for sale in any period.

Machinio & Software Solutions. Revenue from our Machinio & Software Solutions reportable segment increased 11.7%,4.2%, or $0.6$0.2 million, due to pricemodest increases,subscription growth and pricing, and expansion of our Machinio System offering to marine dealers, and the acquisition of Auction Software; see Note 3 - Acquisitions.dealers. As a result of the increase in revenues, segment direct profit increased 10.1%,3.5%, or $0.5$0.2 million. Segment direct profit as a percentage of total revenue remained relatively consistent between the periods.

Total revenues. Total consolidated revenue increased $4.4$9.7 million, or 3.7%.8.1%. Refer to the discussion of Segment Results above for discussion of the increase in revenue.

Cost of goods sold (excludes depreciation and amortization). Cost of goods sold decreasedincreased $4.1$0.6 million, primarily due to improveda marginsmodest fromincrease robust buyer demand optimized throughin our multi-channelpurchase approachprograms inat our RSCG reportable segment, aspartially welloffset asby lower transaction processing fees,fees. duringRefer to the threeSegment monthsResults endedabove Marchfor 31,discussion 2026.of changes in Segment direct profit as a percentage of total revenue.

Technology and operations expenses. Technology and operations expenses increased $1.4$2.0 million, or 8.5%11.4% ($1.1$1.7 million, or 7.2%,10.4%, after the effect of a $0.3$0.2 million increase in stock compensation primarily from variable stock awards tied to financial performance targets), driven by continued investment in our proprietary marketplace platform technology and the acquisition of Auction Software (see Note 3 - Acquisitions), partially offset by the streamlining of operational costs includingassociated warehousewith consolidationmultinational effortsindustrial inprojects at our RSCGCAG reportable segment.

General and administrative expenses. General and administrative expenses increased $2.0$1.9 million, or 27.6%23.4% ($1.0$0.8 million, or 17.6%,13.4%, after the effect of a $1.0$1.1 million increase in stock compensation primarily from variable stock awards tied to financial performance targets), predominantlyprimarily due to thechanges timingin andexpected mixattainment of certain variable compensation and benefit-related costs, which can vary from period to period and resulted in a higher-than-typical fluctuation during the three months ended March 31, 2026.targets.

Depreciation and amortization. Depreciation and amortization expense was consistent between the three months ended MarchJune 31,30, 2026, and 2025.

Other operating expenses, net. Other operating expenses, net decreased $0.2$0.7 million due to acquisition-relatedbusiness costsrestructuring expenses incurred at our RSCG reportable segment during the three months ended MarchJune 31,30, 2025, in connection with the Auction Software acquisition; see Note 3 - Acquisitions.2025.

Provision for income taxes. Provision for income taxes increased $2.5$1.2 million due to the higher pre-tax income, a decrease in tax benefits from stock compensation and other nondeductible expenses.

SixNine Months Ended MarchJune 31,30, 2026, Compared to the SixNine Months Ended MarchJune 31,30, 2025

GovDeals. Total revenues from our GovDeals reportable segment increased 9.6%,8.4%, or $3.8$5.4 million, due to a $25.1$46.8 million, or 6.0%,7.0%, increase in GMV driven by continued marketplace adoption, new seller acquisition and service expansion, partially offset by disruptions from significant winter weather events during the three months ended March 31, 2026.expansion. Revenue grew at a higher rate than GMV due to the expansion of service offerings to higher-volume sellers. Segment direct profit increased by $4.5$6.5 million, or 12.4%,11.1%, and Segment direct profit as a percentage of total revenue increased from 91.9%92.1% to 94.3%, primarily94.4%, due to lower transaction processing fees.

RSCG. Revenue from our RSCG reportable segment decreasedincreased by $5.2$1.1 million, or 3.0%,0.4%, asreflecting a result of lower purchase transaction volumes. Despitethat the decrease in revenues, GMV increased by $13.9$32.9 million, or 6.6%,10.5% increase in GMV was driven by consignment transactions in our lower-touchasset-light, dropshipsell-in-place marketplace solutions and managed direct-to-consumer channels.channels, partially offset by a slight decline in our purchase programs. Segment direct profit increased by $7.8$13.5 million, or 22.1%,24.9%, and Segment direct profit as a percentage of total revenue increased from 20.6%21.6% to 25.9%,26.9%, driven by robust buyer demand for purchase transactions of sortable goods, strong multi-channel consignment buyer participation, robust buyer demand, channel optimization, and lower transaction processing fees.

Machinio & Software Solutions. Revenue in our Machinio & Software Solutions businesses increased 19.1%,13.7%, or $1.7$2.0 million, due to pricemodest increases,subscription growth and pricing and expansion of our Machinio System offering to marine dealers, and the acquisition of Auction Software; see Note 3 - Acquisitions.dealers. As a result of these increaseincreases in revenues, segment direct profit increased 16.3%,11.7%, or $1.4$1.6 million. Segment direct profit as a percentage of total revenue remaineddecreased relativelyfrom consistent93.0% betweento 91.4% due to the periods.Auction Software acquisition.

Total revenues. Total consolidated revenue increased $3.2$12.9 million, or 1.4%.3.6%. Refer to the discussion of Segment Results above for discussion of the increase in revenue.

Cost of goods sold (excludes depreciation and amortization). Cost of goods sold decreased $12.1$11.4 million, primarily due to improved margins from robust buyer demand optimized through our multi-channel approach in our RSCG reportable segment, as well as lower transaction processing fees, during the sixnine months ended MarchJune 31,30, 2026. Refer to the Segment Results above for discussion of changes in Segment direct profit as a percentage of total revenue.

Technology and operations expenses. Technology and operations expenses increased $2.3$4.3 million, or 8.3%, ($3.4 million, or 6.8%, ($1.7 million, or 5.0%, after the effect of a $0.6$0.9 million increase in stock compensation primarily from variable stock awards tied to financial performance targets), driven by continued investment in our proprietary marketplace platform technology and thecosts acquisitionassociated ofwith Auctionmultinational Softwareindustrial (seeprojects Noteat 3our -CAG Acquisitions),reportable segment, partially offset by a streamlining of operational costs including warehouse consolidation efforts in our RSCG reportable segment.

Sales and marketing expenses. Sales and marketing expenses increased $4.5$6.5 million, or 15.9%,14.6%, ($3.0$4.6 million, or 11.6%,11.0%, after the effect of a $1.5$1.9 million increase in stock compensation primarily from variable stock awards tied to financial performance targets), primarilydriven due toby continued market share expansion and multi-channel buyer participation initiatives.

General and administrative expenses. General and administrative expenses increased $3.5$5.4 million, or 22.5%,22.8%, ($1.1$1.9 million, or 8.6%,10.3%, after the effect of a $2.4$3.5 million increase in stock compensation primarily from variable stock awards tied to financial performance targets), primarily due to thechanges timingin andexpected mixattainment of certain variable compensation and benefit-related costs, which can vary from period to period and resulted in a higher-than-typical fluctuation during the three months ended March 31, 2026.targets.

Depreciation and amortization. Depreciation and amortization expense was consistent between the sixnine months ended MarchJune 31,30, 2026 and 2025.

Other operating expenses, net. Other operating expenses, net decreased $0.3$1.0 million, as the sixnine months ended MarchJune 31,30, 2025, included greaterbusiness restructuring expenses incurred at our RSCG reportable segment and transactions costs associated with the acquisition of Auction Software; see Note 3 - Acquisition.

Provision for income taxes. Provision for income taxes increased $3.1$4.3 million due to the higher pre-tax income, a decrease in tax benefits from stock compensation and other nondeductible expenses.

Our operational cash needs primarily relate to working capital, including staffing costs, technology expenses, leases of real estate, and equipment used in our operations, and capital used for inventory purchases, which we have funded through existing cash balances and cash generated from operations. The Company has not paid a dividend historically, nor do we have any intention to do so in the foreseeable future. From time to time, we may use our capital resources for other activities, such as contract start-up costs, joint ventures, share repurchases and acquisitions. As of MarchJune 31,30, 2026, we had $195.3$219.8 million in Cash and cash equivalents and $8.7$11.3 million in Short-term investments, which we believe is sufficient to meet the Company’s anticipated cash needs for at least one year from the date of these financial statements.

We intend to indefinitely reinvest the earnings of our foreign subsidiaries outside the United States. As a result, we did not record a provision for deferred U.S. tax expense on the $9.6$9.9 million of undistributed foreign earnings as of MarchJune 31,30, 2026. A total of $25.8$28.5 million of cash and cash equivalents and short-term investments was held out of the U.S. as of MarchJune 31,30, 2026. These amounts are not currently considered in our evaluation of near-term liquidity needs in the U.S. due to the potential for adverse tax consequences upon repatriation.

Our capital expenditures consist primarily of capitalized software, warehouse equipment, computers and purchased software, office equipment, furniture and fixtures, and leasehold improvements. The timing and volume of such capital expenditures in the future will be affected by the addition of new sellers or buyers or expansion of existing seller or buyer relationships. We intend to fund those expenditures primarily from our existing cash balances and operating cash flows. Our capital expenditures for the sixnine months ended MarchJune 31,30, 2026 and 2025, were $4.4$6.2 million and $3.7$5.8 million, respectively. This increase was primarily driven by the timing of enhancements to our platforms and marketplaces. As of MarchJune 31,30, 2026, we had no significant outstanding commitments for capital expenditures.

The Company may draw upon the Credit Agreement for general corporate purposes. Repayments of any borrowings under the Credit Agreement shall become available for redraw at any time by the Company. The interest rate on borrowings under the Credit Agreement is a variable rate per annum equal to the Daily Simple Secured Overnight Financing Rate (SOFR) in effect plus a margin ranging from 1.25% to 1.75%. Interest is payable monthly. During the three and sixnine months ended MarchJune 31,30, 2026, the Company did not make any draws under the Line of Credit, had no outstanding borrowings under the Line of Credit and had $9.0$11.3 million of standby letters of credit outstanding. The amount of standby letters of credit are reserved against the Line of Credit and are not available for borrowing, resulting in $26.0$23.7 million of remaining borrowing capacity under the Line of Credit as of MarchJune 31,30, 2026.

The obligations under the Credit Agreement are unconditionally guaranteed by us and each of our existing and subsequently acquired or organized domestic subsidiaries and secured on a first priority basis by a security interest (subject to permitted liens) in substantially all assets owned by us, and each of our other domestic subsidiaries, subject to limited exceptions. The Credit Agreement contains certain financial and non-financial restrictive covenants including, among others, the requirement to maintain a minimum level of earnings before interest, income taxes, depreciation and amortization (EBITDA). The Credit Agreement contains a number of affirmative and restrictive covenants including limitations on mergers, consolidations and dissolutions, investments and acquisitions, indebtedness and liens, and dividends and other restricted payments. As of MarchJune 31,30, 2026, the Company was in full compliance with the terms and conditions of the Credit Agreement.

The Company made no repurchases during the three months ended June 30, 2026. The Company repurchased 1,430 shares for less than $0.1 million, and 56,676 shares for $1.5 million during the three and sixnine months ended MarchJune 31,30, 2026. As of MarchJune 31,30, 2026, the Company had $15.0 million of remaining authorization to repurchase shares through December 31, 2027.

Changes in Cash Flows: SixNine Months Ended MarchJune 31,30, 2026, Compared to the SixNine Months Ended MarchJune 31,30, 2025

Net cash provided by operating activities was $29.0$60.2 million and $9.5$28.8 million for the sixnine months ended MarchJune 31,30, 2026 and 2025, respectively. The $19.5$31.4 million increase in cash provided by operating activities between periods was primarily attributable to aan $13.4$11.3 million increase in Net income as adjusted for non-cash items, an $11.9 million increase in cash inflows associated with our Payables to Sellers due to higher buyer collection activity at the end of the current period in our GovDeals segment as there is inherent variability in the timing of payments processed across periods, as well asand a $7.2$7.3 million increase in cash inflows associated with Accounts receivable driven by a reduction of RSCG purchase transactions conducted with buyer credit terms in the current year.

Our working capital accounts are subject to natural variations depending on the rate of change of our transaction volumes, the timing of cash receipts and payments, and variations in our transaction volumes related to settlements between our buyers and sellers. RSCG's purchase program volume changes may cause operating cash flows from Accounts receivable, Accounts payable and Inventory to fluctuate. As GovDeals real estate sales with settlement services increase, operating cash flow fluctuations from Accounts payable and Payables to sellers may become more variable. The amount of cash received and settled will be substantially higher than our take-rate on such transactions, and the timing of auction events, cash collection period, and payment of settlements relative to period end dates can potentially drive substantial cash movements to the extent the timing of such activities cross fiscal periods. Our US income tax payments increased $0.3$1.9 million during the sixnine months ended MarchJune 31,30, 2026, due to higher pre-tax income. There have been no other significant changes to the working capital requirements for the Company.

Net cash used in investing activities was $1.8$6.5 million and $18.6$20.9 million for the sixnine months ended MarchJune 31,30, 2026 and 2025, respectively. The $16.7$14.4 million decrease in cash used in investing activities was primarily driven by a $10.3$7.4 million decrease in the Company's purchase of short-term investments during the sixnine months ended MarchJune 31,30, 2026, due to timing differences in the maturity and reinvestment dates of our short-term investments, and a $6.3$6.5 million decrease in acquisitions net of cash acquired driven by the prior year acquisition of Auction Software during the sixnine months ended MarchJune 31,30, 2025; see Note 3 - Acquisitions.

Net cash used in financing activities was $6.4$8.5 million and $4.8$5.1 million for the sixnine months ended MarchJune 31,30, 2026 and 2025, respectively. The $1.6$3.4 million increase in cash used in financing activities was primarily driven by a $1.4$2.9 million increase in sharetaxes repurchases.paid associated with the net settlement of stock compensation awards as a result of increased vesting of shares in the current period.