NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. Nature of Operations
Azenta, Inc. (“Azenta”, or the “Company”) is a leading global provider of biological and chemical compound sample exploration and management solutions for the life sciences industry. The Company entered the life sciences market in 2011, leveraging its in-house precision automation and cryogenics capabilities that it was then applying in the semiconductor manufacturing market. This led the Company to develop and provide solutions for automated ultra-cold storage. Since then, the Company has expanded its life sciences offerings through internal investments and a series of acquisitions. The Company supports its customers from research and clinical development to commercialization with its sample management and automated storage, as well as genomic services expertise to help its customers bring impactful therapies to market faster. The Company understands the importance of sample integrity and offers a broad portfolio of products and services supporting customers at every stage of the life cycle of samples, including procurement, automated storage systems, genomic services and a multitude of sample consumables, informatics and data software, and sample repository services. The Company’s expertise, global footprint, and leadership positions enable it to be a trusted global partner to pharmaceutical, biotechnology, and life sciences research institutions.
Discontinued Operations
During the first quarter of fiscal year 2025, following approval by the Board of Directors of the Company, the Company publicly announced its plan to sell the B Medical Systems business. The B Medical Systems business operated as a separate business unit within the Company. The B Medical Systems business focuses on the manufacturing and distribution of temperature-controlled storage and transportation solutions in international markets to governments, health institutions, and non-government organizations.
On December 23, 2025, the Company, through a wholly-owned subsidiary, entered into a definitive Sale and Purchase Agreement (as amended, the “Share Purchase Agreement”) with Thelema S.À R.L. (“Thelema”) for the sale of the B Medical Systems business. On July 1, 2026, the Company completed the sale of the B Medical Systems business to Thelema (the “B Medical Transaction”) for $63.0 million, consisting of $28.0 million cash paid to the Company prior to closing and $35.0 million funded through a Vendor Loan Agreement (the “Vendor Loan Agreement”) between a wholly-owned subsidiary of the Company and Thelema described in Note 3, Discontinued Operations.
The Company determined that the B Medical Systems business met the “held for sale” criteria and “discontinued operations” criteria in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 205, Presentation of Financial Statements (“FASB ASC 205”) as of November 12, 2024. Results related to the B Medical Systems business are included within discontinued operations. Please refer to Note 3, Discontinued Operations for further information about the discontinued business. The Condensed Consolidated Balance Sheet and Condensed Consolidated Statements of Operations, as well as the notes to the Condensed Consolidated Financial Statements, have been reclassified for all periods presented to reflect the discontinuation of the B Medical Systems business in accordance with FASB ASC 205. The discussion in these notes to Condensed Consolidated Financial Statements, unless otherwise stated, relate solely to the Company’s continuing operations.
Also included in discontinued operations is a loss contingency related to the Company’s July 2019 sale of its semiconductor cryogenics business to Edwards Vacuum LLC, a member of the Atlas Copco Group. Based on recent developments and the current status of the matter, the Company reduced the accrued liability for the loss contingency by $1.8 million during the three months ended June 30, 2026 and had an accrued liability of $0.3 million as of June 30, 2026. For additional information, see Note 3, Discontinued Operations.
2. Summary of Significant Accounting Policies
Principles of Consolidation and Basis of Presentation
The accompanying Condensed Consolidated Financial Statements include the accounts of the Company and all entities where it has a controlling financial interest and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). All intercompany balances and transactions have been eliminated in consolidation.
The accompanying year-end balance sheet as of September 30, 2025 was derived from audited, consolidated financial statements but does not include all disclosures required by GAAP. The unaudited interim Condensed Consolidated Financial Statements have been prepared on the same basis as the audited, consolidated financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair statement of the Company’s financial position, results of operations, and cash flows for the periods presented.
Certain information and disclosures normally included in the Company’s annual consolidated financial statements have been condensed or omitted and, accordingly, the accompanying financial information should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2025 as filed with the U.S. Securities and Exchange Commission (“SEC”) on December 4, 2025 (the “2025 Annual Report on Form 10-K”).
Revisions to Previously Issued Financial Statements
As previously disclosed in the 2025 Annual Report on Form 10-K, in connection with the preparation of its fiscal year 2025 consolidated financial statements, the Company identified errors in its consolidated financial statements for the years ended September 30, 2024 and 2023, as well as for interim periods within those years and the first three quarters and year-to-date periods within fiscal year 2025. Specifically, the Company’s historical classification of certain operating expenses was misclassified between cost of revenue and operating expenses in its Consolidated Statement of Operations. The Company revised the previously issued financial statements for those periods to correct this error. Additionally, the Company corrected other previously identified immaterial misstatements, including (i) an understatement of the loss from discontinued operations for the interim period ended March 31, 2025, (ii) the effects of exchange rate changes on the Company’s foreign denominated restricted cash for periods within fiscal 2024, and (iii) certain other immaterial prior period errors. Information regarding the impact of the revision to the Company’s previously issued Condensed Consolidated Statements of Operations, Condensed Consolidated Statements of Comprehensive Income (Loss), Condensed Consolidated Statements of Cash flows and Condensed Consolidated Balance Sheets for periods within fiscal 2025 is included in Note 20, Revision of Previously Issued Unaudited Quarterly Information in the notes to the audited consolidated financial statements included in the section titled “Financial Statements and Supplementary Data” in Part II, Item 8 of the 2025 Annual Report on Form 10-K. The applicable accompanying notes to the Condensed Consolidated Financial Statements have also been revised for the impact of these adjustments.
The Company assessed the effect of the errors on prior periods under the guidance of ASC 250. Based on its assessment, the Company determined that the errors were not material to any previously issued financial statements.
The following table summarizes the impact of the revisions in the Condensed Consolidated Statement of Operations for the interim periods ended June 30, 2025 (in thousands, except per share data):
| | | | | | | | | | | | | | | | | |
| Three months ended June 30, 2025 |
| (unaudited) | As Previously Reported | | Adjustments | | As Revised |
| Revenue | | | | | |
| Services | $ | 104,555 | | | $ | (87) | | | $ | 104,468 | |
| Total revenue | 143,942 | | | (87) | | | 143,855 | |
| Cost of revenue | | | | | |
| Products | 19,592 | | | (20) | | | 19,572 | |
| Services | 56,590 | | | 1,289 | | | 57,879 | |
| Total cost of revenue | 76,182 | | | 1,269 | | | 77,451 | |
| Gross profit | 67,760 | | | (1,356) | | | 66,404 | |
| Operating expenses | | | | | |
| Research and development | 6,685 | | | 732 | | | 7,417 | |
| Selling, general and administrative | 61,035 | | | (952) | | | 60,083 | |
| Total operating expenses | 68,474 | | | (220) | | | 68,254 | |
| Operating loss | (714) | | | (1,136) | | | (1,850) | |
| Income from continuing operations before income taxes | 3,438 | | | (1,135) | | | 2,303 | |
| Income tax expense | 2,758 | | | (123) | | | 2,635 | |
| Income (loss) from continuing operations | 680 | | | (1,012) | | | (332) | |
| Loss from discontinued operations, net of tax | (53,486) | | | 5,831 | | | (47,655) | |
| Net loss | $ | (52,806) | | | $ | 4,819 | | | $ | (47,987) | |
| | | | | |
| Basic net loss per share: | | | | | |
| Income (loss) from continuing operations | $ | 0.01 | | | $ | (0.02) | | | $ | (0.01) | |
| Loss from discontinued operations, net of tax | (1.17) | | | 0.13 | | | (1.04) | |
| Basic net loss per share | $ | (1.16) | | | $ | 0.11 | | | $ | (1.05) | |
| | | | | |
| Diluted net loss per share: | | | | | |
| Income (loss) from continuing operations | $ | 0.01 | | | $ | (0.02) | | | $ | (0.01) | |
| Loss from discontinued operations, net of tax | (1.17) | | | 0.13 | | | (1.04) | |
| Diluted net loss per share | $ | (1.16) | | | $ | 0.11 | | | $ | (1.05) | |
| | | | | |
| Weighted average shares used in computing net income (loss) per share: | | | | | |
| Basic | 45,780 | | | | 45,780 |
| Diluted | 45,823 | | | | 45,780 |
| | | | | | | | | | | | | | | | | |
| Nine months ended June 30, 2025 |
| (unaudited) | As Previously Reported | | Adjustments | | As Revised |
| Revenue | | | | | |
| Services | $ | 309,701 | | | $ | (241) | | | $ | 309,460 | |
| Total revenue | 434,870 | | | (241) | | | 434,629 | |
| Cost of revenue | | | | | |
| Products | 68,085 | | | 522 | | | 68,607 | |
| Services | 164,468 | | | 3,548 | | | 168,016 | |
| Total cost of revenue | 232,553 | | | 4,070 | | | 236,623 | |
| Gross profit | 202,317 | | | (4,311) | | | 198,006 | |
| Operating expenses | | | | | |
| Research and development | 19,934 | | | 2,198 | | | 22,132 | |
| Selling, general and administrative | 205,836 | | | (5,982) | | | 199,854 | |
| Total operating expenses | 230,535 | | | (3,784) | | | 226,751 | |
| Operating loss | (28,218) | | | (527) | | | (28,745) | |
| Loss from continuing operations before income taxes | (12,919) | | | (524) | | | (13,443) | |
| Income tax expense | 14,007 | | | (255) | | | 13,752 | |
| Loss from continuing operations | (26,926) | | | (269) | | | (27,195) | |
| Loss from discontinued operations, net of tax | (79,676) | | | 231 | | | (79,445) | |
| Net loss | $ | (106,602) | | | $ | (38) | | | $ | (106,640) | |
| | | | | |
| Basic net loss per share: | | | | | |
| Loss from continuing operations | $ | (0.59) | | | $ | — | | | $ | (0.59) | |
| Loss from discontinued operations, net of tax | $ | (1.74) | | | $ | — | | | $ | (1.74) | |
| Basic net loss per share | $ | (2.33) | | | $ | — | | | $ | (2.33) | |
| | | | | |
| Diluted net loss per share: | | | | | |
| Loss from continuing operations | $ | (0.59) | | | $ | — | | | $ | (0.59) | |
| Loss from discontinued operations, net of tax | $ | (1.74) | | | $ | — | | | $ | (1.74) | |
| Diluted net loss per share | $ | (2.33) | | | $ | — | | | $ | (2.33) | |
| | | | | |
| Weighted average shares used in computing net income (loss) per share: | | | | | |
| Basic | 45,712 | | | | 45,712 |
| Diluted | 45,712 | | | | 45,712 |
The following table summarizes the impact of the revisions in the Condensed Consolidated Statement of Comprehensive Income (Loss) for the interim periods ended June 30, 2025 (in thousands): | | | | | | | | | | | | | | | | | |
| Three months ended June 30, 2025 |
| (unaudited) | As Previously Reported | | Adjustments | | As Revised |
| Net loss | $ | (52,806) | | | $ | 4,819 | | | $ | (47,987) | |
| Other comprehensive income (loss), net of tax: | | | | | |
| Foreign currency translation adjustments | 57,321 | | | (223) | | | 57,098 | |
| Total other comprehensive income (loss), net of tax | 22,514 | | | (223) | | | 22,291 | |
| Comprehensive income (loss) | $ | (30,292) | | | $ | 4,596 | | | $ | (25,696) | |
| | | | | | | | | | | | | | | | | |
| Nine months ended June 30, 2025 |
| (unaudited) | As Previously Reported | | Adjustments | | As Revised |
| Net loss | $ | (106,602) | | | $ | (38) | | | $ | (106,640) | |
| Other comprehensive income (loss), net of tax: | | | | | |
| Foreign currency translation adjustments | 33,462 | | | (286) | | | 33,176 | |
| Total other comprehensive income (loss), net of tax | (6,171) | | | (286) | | | (6,457) | |
| Comprehensive income (loss) | $ | (112,773) | | | $ | (324) | | | $ | (113,097) | |
The impact of the revisions on the Condensed Consolidated Statements of Stockholders’ Equity for the three- and nine-month interim periods ended June 30, 2025 was solely within net loss for errors impacting accumulated deficit and foreign currency translation adjustments as shown above.
The following table summarizes the impact of the revisions in the Condensed Consolidated Statement of Cash Flows for the interim period ended June 30, 2025 (in thousands):
| | | | | | | | | | | | | | | | | |
| Nine months ended June 30, 2025 |
| As Previously Reported | | Adjustments | | As Revised |
| Cash flows from operating activities | | | | | |
| Net loss | $ | (106,602) | | | $ | (38) | | | $ | (106,640) | |
| Adjustments to reconcile net loss to net cash provided by operating activities: | | | | | |
| Loss on assets held for sale | 93,025 | | | (319) | | | 92,706 | |
| Stock-based compensation | 15,887 | | | 829 | | | 16,716 | |
| Deferred income taxes | (20,025) | | | (360) | | | (20,385) | |
| Changes in operating assets and liabilities: | | | | | |
| Inventories | (10,069) | | | 71 | | | (9,998) | |
| Accounts Payable | (702) | | | 337 | | | (365) | |
| Accrued compensation and tax withholdings | 3,010 | | | 594 | | | 3,604 | |
| Other assets and liabilities | (535) | | | (1,116) | | | (1,651) | |
| Net cash provided by operating activities | $ | 70,011 | | | $ | — | | | $ | 70,011 | |
| | | | | |
Use of Estimates
The preparation of financial statements in accordance with GAAP requires management to make certain estimates and assumptions that affect amounts reported in the financial statements and notes thereto. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may differ from these estimates. Estimates are associated with recording accounts receivable, inventories, goodwill, intangible assets other than goodwill, long-lived assets, derivative financial instruments, deferred income taxes, warranty obligations, revenue over time, stock-based compensation expense, contingent consideration, and other accounts. The Company assesses the estimates on an ongoing basis and records changes in estimates in the period they occur and become known.
Foreign Currency Translation
Certain transactions of the Company and its subsidiaries are denominated in currencies other than their functional currency. Foreign currency exchange gains (losses) generated from the settlement and remeasurement of these transactions are recognized in earnings and presented within “Other income” in the Condensed Consolidated Statements of Operations. Net foreign currency transaction and remeasurement gains were $0.1 million for the three months ended June 30, 2026 and net foreign currency transaction and remeasurement losses were $0.2 million for the three months ended June 30, 2025. Net foreign currency transaction and remeasurement losses were $1.4 million and $1.3 million for the nine months ended June 30, 2026 and 2025, respectively.
Recently Issued Accounting Pronouncements
In December 2023, the FASB issued Accounting Standards Update (“ASU”), 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU is intended to enhance the transparency and decision usefulness of income tax disclosures primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 on a prospective basis, with the option to apply the standard retrospectively. The Company will adopt this standard for the year ended September 30, 2026. The adoption of this standard will enhance the Company’s annual income tax disclosures but will not have an impact on its financial position or results of operations.
In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures: Disaggregation of Income Statement Expenses. The ASU requires companies to disaggregate operating expenses into specific categories such as employee compensation, depreciation, and intangible asset amortization, by relevant expense caption on the statement of operations. Additionally, in January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures, to clarify the effective date of ASU 2024-03. ASU 2025-01 is effective for fiscal years beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, on a retrospective or prospective basis, with early adoption permitted. The Company is currently evaluating the standard to determine the impact of adoption on its consolidated financial statements and disclosures.
In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The ASU simplifies the capitalization guidance by removing all references to software development project stages so that the guidance is neutral to different software development methods. This update is effective for annual periods beginning after December 15, 2027. The ASU may be applied prospectively, retrospectively or using a modified transition approach. The Company is currently evaluating the impact of adoption of this ASU on its consolidated financial statements.
Other
For further information regarding the Company’s significant accounting policies, please refer to Note 2, Summary of Significant Accounting Policies in the notes to the audited consolidated financial statements included in the section titled “Financial Statements and Supplementary Data” in Part II, Item 8 of the 2025 Annual Report on Form 10-K. There were no material changes to the Company’s critical accounting policies during the nine months ended June 30, 2026.
3. Discontinued Operations
Disposition of B Medical Systems Business
On December 23, 2025, the Company entered into the Share Purchase Agreement with Thelema for the sale of the B Medical Systems business. On July 1, 2026, the Company completed the B Medical Transaction for $63.0 million, consisting of $28.0 million cash paid to the Company prior to closing and $35.0 million funded through the Vendor Loan Agreement described below.
Thelema is a private limited liability company incorporated under the laws of Luxembourg. Thelema deposited $9.0 million with the Company upon entering into the Share Purchase Agreement in December 2025 and subsequently made an advance payment of $19.0 million on June 30, 2026. The aggregate amount of $28.0 million was recorded in the Condensed Consolidated Balance Sheets as “Cash and cash equivalents” and “Deposit received for the sale of B Medical Systems business” as of June 30, 2026. The $9.0 million deposit had previously been recorded within the Condensed Consolidated Balance Sheets “Accrued expenses and other current liabilities” as of December 31, 2025 and March 31, 2026.
The Vendor Loan Agreement was entered into on July 1, 2026 to support and facilitate the completion of the B Medical Transaction through a $35.0 million secured term loan from the Company’s wholly-owned subsidiary, Azenta Germany GmbH, to Thelema. The loan bears interest at a rate of 6.0% per annum, with accrued interest payable in full at maturity, and matures three months following the funding date, which occurred on July 1, 2026. The loan is required to be repaid in full at maturity and may be prepaid, in whole or in part, at any time without premium or penalty subject to five (5) business days’ prior notice (or such shorter period as the parties may agree). The obligations of Thelema under the Vendor Loan Agreement are secured by a first-priority pledge over 100% of the equity interests of B Medical Systems S.à r.l. in
favor of Azenta Germany GmbH pursuant to a Share Pledge Agreement (the “Share Pledge Agreement”) entered into on July 1, 2026.
The Vendor Loan Agreement includes customary covenants restricting Thelema’s ability to incur additional indebtedness, make distributions, or otherwise dispose of assets, subject to exceptions, including the incurrence of acquisition financing. The Company has agreed to cooperate with Thelema and prospective third-party lenders in connection with any such acquisition financing or refinancing of the loan, including by entering into customary intercreditor, subordination or priorities arrangements and by releasing the pledge upon repayment of the loan in full. As a result, the first-priority pledge may be subordinated to, or released in connection with, acquisition or refinancing indebtedness subsequently incurred by Thelema.
The B Medical Transaction, the Vendor Loan Agreement and the Share Pledge Agreement are with a related party, an individual who served as a Vice President of the Company and Chief Executive Officer of the B Medical Systems business through the closing of the transaction, is Thelema’s majority owner. The Company’s former Vice President did not participate on behalf of the Company in the review, negotiation or approval of these arrangements, which were reviewed and approved by the Audit Committee of the Company’s Board of Directors in accordance with the Company’s policies and procedures governing related-person transactions. Additionally, the terms of the Share Purchase Agreement were negotiated through a competitive auction process.
The Company measured the B Medical Systems business at the lower of carrying value or fair value less cost to sell at each reporting period. During the three months ended June 30, 2026, the Company recognized a $6.5 million partial reversal of the previously recorded held for sale valuation allowance, primarily because the carrying value of the B Medical Systems business decreased during the period. The reversal did not exceed the cumulative loss previously recognized on assets held for sale. During the nine months ended June 30, 2026, the Company recorded $9.5 million of loss on assets held for sale based on the purchase price pursuant to the Share Purchase Agreement less estimated costs to sell and the change in the carrying value of the business between December 23, 2025 and June 30, 2026. The gain (loss) on assets held for sale is included in “Income (loss) from discontinued operations, net of tax” on the Condensed Consolidated Statements of Operations for the three and nine months ended June 30, 2026 and is included as a valuation allowance or contra-asset account within “Noncurrent assets held for sale” on the Condensed Consolidated Balance Sheet as of June 30, 2026.
The Company’s post-closing involvement with B Medical Systems business through the Vendor Loan and the Share Pledge Agreements is limited to creditor rights and collateral protection and does not provide the Company with control over the ongoing operations of B Medical Systems business. Based on assessments under both the voting interest entity and variable interest entity models, the Company concluded that deconsolidation of B Medical Systems business was appropriate effective July 1, 2026. The Company also evaluated the fair value of the $35.0 million secured term loan under the Vendor Loan Agreement and concluded that the principal amount thereof approximated fair value of the loan as of the closing date, considering the contractual terms of the loan, the expected repayment period, borrower credit risk, and the estimated value of the underlying collateral. Based on information available, the Company does not currently expect to recognize a material additional loss on the assets held for sale in the fourth quarter of fiscal year 2026.
The following table presents the financial results of the B Medical Systems business, included within discontinued operations (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, | | Nine Months Ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Revenue | | | | | | | |
| Products | $ | 9,249 | | | $ | 14,333 | | | $ | 39,529 | | | $ | 44,507 | |
| Services | 1,451 | | | 1,969 | | | 7,067 | | | 6,592 | |
| Total revenue | 10,700 | | | 16,302 | | | 46,596 | | | 51,099 | |
| Cost of revenue | | | | | | | |
| Products | 5,671 | | | 9,793 | | | 26,937 | | | 31,333 | |
| Services | 3,159 | | | 1,600 | | | 8,849 | | | 6,321 | |
| Total cost of revenue | 8,830 | | | 11,393 | | | 35,786 | | | 37,654 | |
| Gross profit | 1,870 | | | 4,909 | | | 10,810 | | | 13,445 | |
| Operating expenses | | | | | | | |
| Research and development | 1,301 | | | 1,533 | | | 4,024 | | | 4,369 | |
| Selling, general and administrative | 3,538 | | | 6,939 | | | 12,441 | | | 20,855 | |
| (Gain) loss on assets held for sale | (6,474) | | | 60,858 | | | 9,491 | | | 92,706 | |
| Restructuring charges | 135 | | | 373 | | | 434 | | | 1,051 | |
| Total operating (income) expenses | (1,500) | | | 69,703 | | | 26,390 | | | 118,981 | |
| Operating income (loss) | 3,370 | | | (64,794) | | | (15,580) | | | (105,536) | |
| Interest income (expense), net | — | | | (10) | | | 1 | | | (20) | |
| Other income (expense), net | 65 | | | (92) | | | 1,231 | | | (166) | |
| Income (loss) before income taxes | 3,435 | | | (64,896) | | | (14,348) | | | (105,722) | |
| Income tax expense (benefit) | 1,163 | | | (17,542) | | | (3,138) | | | (26,959) | |
| Income (loss) from discontinued operations, net of tax | $ | 2,272 | | | $ | (47,354) | | | $ | (11,210) | | | $ | (78,763) | |
The following table presents the significant non-cash items and capital expenditures with respect to the B Medical Systems business that are included in the Condensed Consolidated Statements of Cash Flows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, | | Nine Months Ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Depreciation and amortization | $ | — | | | $ | — | | | $ | — | | | $ | 3,846 | |
| Capital expenditures | 381 | | | 1,472 | | | 1,326 | | | 2,600 | |
| (Gain) loss on assets held for sale | (6,474) | | | 60,858 | | | 9,491 | | | 92,706 | |
The carrying value of the assets and liabilities of the discontinued operations with respect to the B Medical Systems business reflected as “held for sale” on the Condensed Consolidated Balance Sheets as of June 30, 2026 and September 30, 2025 was as follows (in thousands):
| | | | | | | | | | | |
| June 30, 2026 | | September 30, 2025 |
| Assets | | | |
| Cash and cash equivalents | $ | 8,363 | | | $ | 13,206 | |
| Accounts receivable, net | 6,998 | | | 10,090 | |
| Inventories | 43,109 | | | 42,137 | |
| Prepaid expenses and other current assets | 12,917 | | | 8,102 | |
| Current assets held for sale | $ | 71,387 | | | $ | 73,535 | |
| | | |
| Property, plant and equipment, net | $ | 50,673 | | | $ | 50,968 | |
| Intangibles, net | 122,530 | | | 126,065 | |
| Other assets | 6,835 | | | 4,828 | |
| Valuation allowance | (103,349) | | | (96,855) | |
| Noncurrent assets held for sale | $ | 76,689 | | | $ | 85,006 | |
| | | |
| Liabilities | | | |
| Accounts payable | $ | 11,307 | | | $ | 11,710 | |
| Deferred revenue | 1,371 | | | 1,543 | |
| Accrued warranty and retrofit costs | 5,785 | | | 5,248 | |
| Accrued compensation and benefits | 5,179 | | | 3,909 | |
| Accrued income taxes | 732 | | | 760 | |
| Accrued expenses and other current liabilities | 4,952 | | | 5,098 | |
| Current liabilities held for sale | $ | 29,326 | | | $ | 28,268 | |
| | | |
| Long-term deferred tax liabilities | 8,275 | | | 9,639 | |
| Long-term operating lease liabilities | 3,218 | | | 2,077 | |
| Other long-term liabilities | 1,487 | | | 2,575 | |
| Noncurrent liabilities held for sale | $ | 12,980 | | | $ | 14,291 | |
Disposition of Semiconductor Business
On February 1, 2022, the Company completed the sale of the semiconductor automation business for $2.9 billion in cash to Thomas H. Lee Partners, L.P. On July 1, 2019, the Company completed the sale of the semiconductor cryogenics business for $659.8 million to Edwards Vacuum LLC (a member of the Atlas Copco Group) (“Edwards”). Both the semiconductor automation business and the semiconductor cryogenics business are considered discontinued operations. In the third quarter of fiscal year 2020, Edwards asserted claims for indemnification under the definitive agreement relating to alleged breaches of representations and warranties relating to customer warranty claims and inventory (the “2020 Claim”). In addition, in January 2023, Edwards filed a lawsuit against the Company in the Supreme Court of the State of New York in the County of New York seeking indemnification from the Company under such definitive agreement for $1.0 million and other related damages, including interest and attorney’s fees, arising from a third-party claim that was included as part of their initial claims (the “2023 Claim”).
In April 2023, the Company responded to and filed a counterclaim against Edwards for the 2023 Claim alleging breach of the definitive agreements by Edwards and seeking a declaratory judgment. During the third quarter of fiscal year 2023, the Company and Edwards entered into a settlement agreement related to the 2023 Claim to avoid the costs and uncertainties of potential litigation. Under the settlement agreement, the Company paid Edwards $0.8 million from one of the indemnification escrows established at closing of the sale in return for the release of the 2023 Claim and the release to
the Company of $1.0 million from a separate indemnification escrow. The Company accrued a liability of $2.5 million for the 2020 Claim and 2023 Claim of which $0.8 million was paid during the third quarter of fiscal year 2023. The Company accrued an additional liability of $0.4 million for the 2020 Claim during the three months ended March 31, 2025 resulting in a total accrual of $2.1 million as of September 30, 2025.
The Company had been informed that Edwards sought recovery for the 2020 Claim from the representation and warranty insurance Edwards obtained in connection with the closing of the sale of the semiconductor cryogenics business. During the first quarter of fiscal year 2025, the Company was further informed that Edwards agreed to a payment under such insurance for claimed amounts more than the applicable indemnification deductibles established under the definitive agreement, but less than the total of claimed amounts submitted for recovery.
On September 12, 2025, Edwards filed a lawsuit against the Company in the Supreme Court of the State of New York in the County of New York seeking indemnification from the Company under such definitive agreement seeking more than $13.0 million, including attorney’s fees, arising from alleged breaches of representations and warranties relating to financial information provided by the Company in connection with the 2019 transaction (the “2025 Claim”). On October 21, 2025, the Company filed a motion to dismiss the 2025 Claim on the basis that all claims asserted in that action are time-barred.
On July 7, 2026, subsequent to the end of the quarter, the Supreme Court of the State of New York, Commercial Division, granted the Company’s motion to dismiss Edwards Vacuum LLC’s lawsuit (filed September 12, 2025) in its entirety, dismissing both of Edwards Vacuum LLC’s causes of action on statute of limitations grounds, and denied Edwards Vacuum LLC’s request for leave to amend its complaint. The court directed that the action be marked as disposed. Based on the nature of the court’s ruling, the Company believes that the dismissal is unlikely to be appealed or, if appealed, to be reversed. The statute of limitations defense underlying the dismissal existed as of June 30, 2026 and the ruling therefore provides additional evidence about conditions that existed at the balance sheet date. Accordingly, in accordance with ASC 855, Subsequent Events, the Company recognized the effect of the ruling in these condensed consolidated financial statements and reduced its accrual for the loss contingency by $1.8 million to $0.3 million as of June 30, 2026 which represents incurred and unpaid legal fees related to this matter. While Edwards Vacuum LLC may seek to appeal the dismissal and the ultimate outcome of any appeal cannot be assured, the Company does not currently believe that the resolution of this matter will have a material adverse effect on its consolidated financial position or results of operations.
4. Business Combination
On March 4, 2026, the Company acquired UK Biocentre Limited (“UK Biocentre”), for a purchase price of approximately $27.5 million, net of cash acquired, including the $2.5 million estimated fair value of contingent consideration as of the acquisition date. UK Biocentre is a provider of sample management, sample storage and high-throughput sample processing services in the United Kingdom. The Company paid a total cash purchase price of $11.2 million, as adjusted for cash acquired.
Components of the purchase price as set forth below (in thousands):
| | | | | |
| Purchase Price | Fair Value |
| Cash paid at closing | $ | 14,455 | |
| Transaction bonus paid | 1,329 | |
| Transaction expense paid | 133 | |
| Preexisting contractual liability settlement | 13,841 | |
| Contingent consideration | 2,483 | |
| $ | 32,241 | |
UK Biocentre cash balance at closing | $ | 4,767 | |
| Purchase price, net of cash acquired | $ | 27,474 | |
| |
| Cash paid, net of cash acquired | $ | 11,150 | |
The Company had a preexisting contractual relationship with UK Biocentre which was settled as part of the business combination. As a result, the Company recognized $3.9 million of non-cash gain from the settlement during the quarter ended March 31, 2026, which is included in “Other income, net” on the Condensed Consolidated Statements of Operations for the nine months ended June 30, 2026. The settlement of a $13.8 million payable to the Company under this preexisting contractual relationship is included in the $27.5 million purchase price.
UK Biocentre is eligible to receive a contingent cash payment of $2.5 million if and when a UK Biocentre contract with one of its key customers is renewed no later than September 28, 2028. Based on a long-term partnership and the customer’s reliance on specialized services provided by UK Biocentre, the Company determined that the contract renewal is highly probable. Pursuant to ASC 805, Business Combinations (“ASC 805”), the Company estimated the fair value of the contingent consideration to equal the $2.5 million payment amount and recorded a $2.5 million liability within “Accrued expenses and other current liabilities” on the Condensed Consolidated Balance Sheets as of June 30, 2026. The Company remeasures this liability at fair value on a quarterly basis, with any resulting changes in fair value recognized in “Operating expenses” in the Company’s Consolidated Statements of Operations. As there were no changes in the assumptions underlying the fair value measurement during the three months ended June 30, 2026, no adjustment to the carrying value of the liability was recorded. The fair value measurement of the contingent consideration was based on significant inputs not observable in the market and classified within Level 3 of the fair value hierarchy described further in Note 2, Summary of Significant Accounting Policies in the notes to the audited consolidated financial statements included in the section titled “Financial Statements and Supplementary Data” in Part II, Item 8 of the 2025 Annual Report on Form 10-K and in Note 13, Fair Value Measurements below.
The purchase price was allocated to UK Biocentre’s tangible and identifiable intangible assets acquired and liabilities assumed based on the estimated fair values as of March 4, 2026, as set forth below (in thousands):
| | | | | |
| Purchase Price Allocation | Fair Value |
| Accounts Receivable | $ | 2,053 | |
| Inventory | 846 | |
| Other assets | 795 | |
| Operating lease right-of-use assets | 7,191 | |
| Property and Equipment | 22,157 | |
| Identifiable Intangible Assets: | |
| Trademarks | 1,039 | |
| Accounts Payable | (930) | |
| Accruals | (3,708) | |
| Operating lease liabilities | (3,176) | |
| Goodwill | 1,207 | |
| Total purchase price, net of cash acquired | $ | 27,474 | |
During the three months ended June 30, 2026, the purchase price, net of cash acquired, remained unchanged. The Company recorded a measurement period adjustment to its preliminary purchase price allocation upon obtaining additional information, resulting in a $4.0 million increase to operating lease right-of-use assets and a corresponding decrease to goodwill.
In performing the purchase price allocation, the Company considered, among other factors, the intended future use of acquired assets, and historical financial performance and estimates of future performance of UK Biocentre’s business. The allocation of the purchase price is preliminary as the Company continues to gather information supporting the acquired assets and liabilities. As part of the purchase price allocations, the Company determined the identifiable intangible assets were trademarks. The fair value of the intangible asset was estimated using the income approach, specifically the relief from royalty method for trademarks. The cash flows used in this estimate were based on estimates used to price the transaction, and the discount rate applied was benchmarked to the implied rate of return from the transaction and the weighted average cost of capital. The estimated useful life of trademarks is 7 years. The intangible assets acquired are expected to be amortized over the estimated useful life that approximates the pattern in which the economic benefits are expected to be realized. The calculation of the excess of the purchase price over the estimated fair value of the tangible net assets and intangible assets acquired was recorded to goodwill. The goodwill recorded in connection with the transaction largely reflects the expansion of Sample Repository Services in Europe. The goodwill is not expected to be deductible for income tax purposes.
The Company did not present pro forma financial information for its consolidated results of operations for the acquisition because such results are immaterial. UK Biocentre’s results of operations are reported in the Company’s Sample Management Solutions (“SMS”) segment from the date of acquisition.
5. Marketable Securities
The Company had sales and maturities of marketable securities of $29.0 million and $57.9 million in the three months ended June 30, 2026 and 2025, respectively. The Company had sales and maturities of marketable securities of $295.5 million and $242.5 million in the nine months ended June 30, 2026 and 2025, respectively. There were immaterial realized gains or losses in each of the three and nine months ended June 30, 2026 and 2025 on sales and maturities of marketable securities.
The following is a summary of the amortized cost and the fair value, including accrued interest receivable as well as unrealized gains (losses) on the Company’s short-term and long-term marketable securities as of June 30, 2026 and September 30, 2025 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Amortized
Cost | | Gross
Unrealized
Losses | | Gross
Unrealized
Gains | | Fair Value |
| June 30, 2026: | | | | | | | |
| U.S. Treasury securities and obligations of U.S. government agencies | $ | 244,688 | | | $ | (853) | | | $ | 2 | | | $ | 243,837 | |
| Bank certificates of deposit | 1,253 | | | (1) | | | — | | | 1,252 | |
| Corporate securities | 72,907 | | | (468) | | | — | | | 72,439 | |
| Municipal securities | 14,722 | | | (28) | | | 8 | | | 14,702 | |
| $ | 333,570 | | | $ | (1,350) | | | $ | 10 | | | $ | 332,230 | |
| September 30, 2025: | | | | | | | |
| U.S. Treasury securities and obligations of U.S. government agencies | $ | 245,691 | | | $ | (94) | | | $ | 168 | | | $ | 245,765 | |
| Bank certificates of deposit | 1,640 | | | — | | | 1 | | | 1,641 | |
| Corporate securities | 4,199 | | | — | | | — | | | 4,199 | |
| Municipal securities | 11,048 | | | — | | | 69 | | | 11,117 | |
| $ | 262,578 | | | $ | (94) | | | $ | 238 | | | $ | 262,722 | |
The amortized cost and fair value of the marketable securities by contractual maturities as of June 30, 2026 are presented below (in thousands):
| | | | | | | | | | | |
| Amortized
Cost | | Fair Value |
| Due in one year or less | $ | 136,293 | | | $ | 136,143 | |
| Due after one year through five years | 192,988 | | | 191,798 | |
| Due after ten years | 4,289 | | | 4,289 | |
| Total marketable securities | $ | 333,570 | | | $ | 332,230 | |
Expected maturities could differ from contractual maturities because the security issuers may have the right to prepay obligations without prepayment penalties.
Unrealized gains and losses from fixed-income securities are primarily attributable to changes in interest rates. The Company does not believe any unrealized losses represent impairments based on the evaluation of the available evidence.
6. Derivative Instruments
The Company has transactions and balances denominated in currencies other than the functional currency of the transacting entity. Most of these transactions carry foreign exchange risk in Germany, the United Kingdom and China. The Company enters into foreign exchange contracts to reduce its exposure to currency fluctuations. Net gains and losses related to foreign exchange contracts are recorded as a component of “Other income, net” in the Condensed Consolidated Statements of Operations and were as follows for the three and nine months ended June 30, 2026 and 2025 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended
June 30, | | Nine Months Ended
June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Realized gains (losses) on derivatives not designated as hedging instruments | $ | 575 | | | $ | (4,242) | | | $ | 822 | | | $ | (4,246) | |
The notional amounts of the Company’s derivative instruments as of June 30, 2026 and September 30, 2025 were as follows (in thousands):
| | | | | | | | | | | | | | |
| Hedge Designation | June 30,
2026 | | September 30,
2025 |
| | | | |
| Cross-currency swap | Net Investment Hedge | $ | 260,025 | | | $ | 260,025 | |
| Foreign exchange contracts | Undesignated | 38,219 | | | 44,603 | |
The fair values of the foreign exchange contracts are recorded in the Condensed Consolidated Balance Sheets as “Prepaid expenses and other current assets” and “Accrued expenses and other current liabilities”. Foreign exchange contract assets and liabilities are measured and reported at fair value based on observable market inputs and classified within Level 2 of the fair value hierarchy described further in Note 2, Summary of Significant Accounting Policies in the notes to the audited consolidated financial statements included in the section titled “Financial Statements and Supplementary Data” in Part II, Item 8 of the 2025 Annual Report on Form 10-K and in Note 13, Fair Value Measurements below due to a lack of an active market for these contracts.
Hedging Activities
On February 1, 2024, the Company entered into a cross-currency swap agreement to hedge the variability of exchange rate impacts between the U.S. dollar and the Euro. Under the terms of the cross-currency swap agreement, the Company notionally exchanged $76.0 million for €70.0 million at a weighted average interest rate of 1.44%. The Company designated the cross-currency swap as a hedge of net investments against one of its Euro denominated subsidiaries, which requires an exchange at maturity of the notional amounts. At the maturity of the cross-currency swap on February 3, 2025, the Company delivered a notional amount of €70.0 million and received a notional amount of $73.0 million at a Euro to U.S. dollar exchange rate of 1.0419, which included a gain of $3.0 million.
On February 3, 2025, the Company entered into another cross-currency swap agreement to hedge the variability of exchange rate impacts between the U.S. dollar and the Euro. Under the terms of the cross-currency swap agreement, the Company notionally exchanged $260.0 million for €250.0 million at a weighted average interest rate of 1.80%. The Company designated the cross-currency swap as a hedge of net investments against one of its Euro denominated subsidiaries. The maturity date of the agreement was extended from February 2, 2026 to February 2, 2028 with a weighted average interest rate of 0.6%.
The unrealized losses of the cross-currency swaps were $28.4 million and $33.4 million and are recorded within a “Derivative liability” as of June 30, 2026 and September 30, 2025, respectively, in the Condensed Consolidated Balance Sheets.
The outstanding cross-currency swap is marked to market at each reporting period, representing the fair value of the cross-currency swap, any changes in fair value are recognized as a component of “Accumulated other comprehensive loss” in the Condensed Consolidated Balance Sheets. The cross-currency swap is classified within Level 2 of the fair value hierarchy described in Note 2, Summary of Significant Accounting Policies in the notes to the audited consolidated financial statements included in the section titled “Financial Statements and Supplementary Data” in Part II, Item 8 of the 2025 Annual Report on Form 10-K and in Note 13, Fair Value Measurements below.
Interest earned on the cross-currency swaps is recorded within “Interest income, net” in the Condensed Consolidated Statements of Operations. For the three months ended June 30, 2026 and 2025, the Company recorded interest income of $0.4 million and $1.2 million, respectively, on these instruments. For the nine months ended June 30, 2026 and 2025, the Company recorded interest income of $2.1 million and $2.2 million, respectively, on these instruments.
7. Goodwill and Intangible Assets
The Company conducts an impairment assessment annually on April 1, or more frequently if impairment indicators are present. During the second quarter of fiscal year 2026, the Company assessed several events and circumstances that could affect the significant inputs used to determine the fair value of its reporting units, including updates to forecasted cash flows, increased uncertainty in the macroeconomic and geopolitical environment, and a sustained decline in its stock price. The Company concluded it was more likely than not the fair value of each of the SMS and Multiomics reporting units was less than their respective carrying amounts due to the combined impact of declining stock price and revised forecasts. As a result, the Company completed a quantitative goodwill impairment test for each of its reporting units in accordance with ASC 350, Intangibles – Goodwill (“ASC 350”) as of March 31, 2026.
For the quantitative goodwill impairment analysis performed, the Company compared the estimated fair values of each of its reporting units to their respective carrying amounts. The estimated fair value for each reporting unit was derived using the income approach and the market approach, weighted at 50% each as of March 31, 2026. The Discounted Cash Flow (“DCF”) Method was used in the income approach which reflected the Company’s assumptions regarding revenue growth rates, forecasted gross profit margins, operating expenses, capital expenditures, discount rates, terminal period growth rates, economic and market trends, and other expectations about the anticipated operating results of the SMS and Multiomics reporting units. The guideline company method was used in the market approach and publicly-traded companies in similar lines of business were identified and used in an analysis to estimate the fair value. Under the guideline company method, the Company made significant estimates and assumptions, primarily including the selection of appropriate peer group companies, control premiums appropriate for acquisitions in the industries in which the Company competes, and specific valuation multiples utilized to estimate the fair value of each reporting unit. Although the Company determined that estimates and assumptions used in the income approach and the market approach were reasonable, actual results may vary significantly and may expose it to material impairment charges in the future.
Based on the results of the Company’s quantitative goodwill impairment analysis as of March 31, 2026, the carrying amounts of its Multiomics and SMS reporting units exceeded their respective fair values, resulting in non-cash impairment charges of $112.4 million for Multiomics and $36.6 million for SMS. The total goodwill impairment charge of $149.1 million was recorded during the quarter ended March 31, 2026, which is included within “Impairment of goodwill and intangible assets” on the Condensed Consolidated Statements of Operations for the nine months ended June 30, 2026.
Prior to the quantitative goodwill impairment test, the Company tested the recoverability of long-lived assets and other assets of the SMS and Multiomics reporting units and concluded that such assets were not impaired as of March 31, 2026.
On April 1, 2026, the Company completed its annual goodwill impairment test for the SMS and Multiomics reporting units. In light of the quantitative tests performed as of March 31, 2026 and after considering events and circumstances through the annual testing date, the Company performed qualitative assessments and concluded that it was not more likely than not that the fair value of either reporting unit was less than its carrying amount. Accordingly, no additional quantitative goodwill impairment test was required and no additional impairment loss was recognized as part of the annual test.
From April 1, 2026 through June 30, 2026, the Company evaluated whether any events or changes in circumstances occurred that would indicate the need to perform either a qualitative or quantitative assessment of goodwill impairment subsequent to the annual impairment testing date of April 1, 2026. In conducting this evaluation, the Company considered, among other factors, macroeconomic conditions, industry and market developments, overall financial performance, entity-specific events, and changes in its market capitalization and stock price. Based on these considerations, the Company did not identify any triggering events or significant adverse changes in its business, operations, financial performance, or outlook during the three months ended June 30, 2026. In addition, the Company’s market capitalization and stock price improved during the period. As such, the Company concluded that it was not more likely than not that the fair value of its each reporting unit was less than its carrying value as of June 30, 2026 and no goodwill impairment charges were recognized during the three months ended June 30, 2026.
In the event the performance of any of the reporting units does not meet management expectations in the future, the Company experiences a prolonged macroeconomic or market downturn, or there are other negative revisions to key assumptions used in the analysis used to estimate fair value, the Company may be required to perform additional impairment analyses which could result in one or more additional impairment charges, any one of which could have a material and adverse effect on the Company’s financial position and results of operations.
The following table sets forth the changes in the carrying amount of goodwill by operating and reportable segment since September 30, 2025 (in thousands).
| | | | | | | | | | | | | | | | | |
| Sample
Management
Solutions | | Multiomics | | Total |
| Balance - September 30, 2025 | $ | 505,635 | | | $ | 196,760 | | | $ | 702,395 | |
| Acquisition of UK Biocentre | 1,207 | | | — | | | 1,207 | |
| Impairment | (36,647) | | | (112,436) | | | (149,083) | |
| Currency translation adjustments | (7,062) | | | — | | | (7,062) | |
| Balance - June 30, 2026 | $ | 463,133 | | | $ | 84,324 | | | $ | 547,457 | |
| | | | | |
| Accumulated goodwill impairments, June 30, 2026 | $ | (36,647) | | | $ | (112,436) | | | $ | (149,083) | |
The components of the Company’s identifiable intangible assets as of June 30, 2026 and September 30, 2025 are as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| June 30, 2026 | | September 30, 2025 |
| Cost | | Accumulated
Amortization | | Net Book
Value | | Cost | | Accumulated
Amortization | | Net Book
Value |
| Patents | $ | 1,220 | | | $ | 1,220 | | | $ | — | | | $ | 1,220 | | | $ | 1,220 | | | $ | — | |
| Completed technology | 110,872 | | | 69,513 | | | 41,359 | | | 111,501 | | | 63,408 | | | 48,093 | |
| Trademarks and trade names | 1,741 | | | 410 | | | 1,331 | | | 727 | | | 293 | | | 434 | |
| Customer relationships | 249,378 | | | 206,380 | | | 42,998 | | | 248,846 | | | 195,559 | | | 53,287 | |
| Total | $ | 363,211 | | | $ | 277,523 | | | $ | 85,688 | | | $ | 362,294 | | | $ | 260,480 | | | $ | 101,814 | |
Amortization expenses for intangible assets were $5.7 million and $6.2 million, respectively, for the three months ended June 30, 2026 and 2025. Amortization expenses for intangible assets were $16.8 million and $18.4 million, respectively, for the nine months ended June 30, 2026 and 2025.
Estimated future amortization expense for the intangible assets as of June 30, 2026 is as follows for the remainder of fiscal year 2026, the subsequent four fiscal years and thereafter (in thousands):
| | | | | |
| Remainder of fiscal year 2026 | $ | 5,650 | |
| 2027 | 17,988 | |
| 2028 | 15,107 | |
| 2029 | 12,474 | |
| 2030 | 10,893 | |
| Thereafter | 23,576 | |
| Total | $ | 85,688 | |
8. Restructuring
2024 Restructuring Plan
In the second quarter of fiscal year 2024, the Company launched initiatives designed to optimize resources for future growth and improve efficiency across its organization. The focus of the initiatives is to improve the Company’s profitability, which includes facilities consolidation, portfolio optimization, and organization structure simplification. The Company had additional restructuring actions during the three and nine months ended June 30, 2026 under these initiatives and expects to complete the activities included in these initiatives by the end of fiscal year 2026. The Company expects to identify additional actions as it further refines its plan, and impact of the related initiatives will be recorded in future periods when specified criteria are met, including but not limited to, communication of benefit arrangements or when the costs have been incurred. As of the date of issuance of the accompanying Condensed Consolidated Financial Statements, the Company has not identified restructuring actions related to these initiatives that will result in additional material charges.
The majority of the restructuring expenses associated with the initiatives described above for the three and nine months ended June 30, 2026 are severance costs. Of the total restructuring expenses for the three months ended June 30, 2026, $0.2 million related to the SMS segment, $0.1 million related to the Multiomics segment, and $0.2 million related to Corporate. Of the total restructuring expenses for the nine months ended June 30, 2026, $1.5 million related to the SMS segment, $1.4 million related to the Multiomics segment, $0.2 million related to Corporate.
The majority of restructuring expenses associated with the initiatives described above for the three and nine months ended June 30, 2025 are severance and other related costs. Of the total restructuring expenses for the three months ended June 30, 2025, $0.3 million related to the SMS segment and $0.4 million related to the Multiomics segment. Of the total restructuring expenses for the nine months ended June 30, 2025, $1.9 million related to the SMS segment, $2.1 million related to the Multiomics segment, and $0.8 million related to Corporate.
The following table presents restructuring charges recognized for the three and nine months ended June 30, 2026 and 2025 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, | | Nine Months Ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Severance and related costs | $ | 529 | | | $ | 971 | | | $ | 3,090 | | | $ | 4,740 | |
| Other | (16) | | | (217) | | | (12) | | | 25 | |
| Total restructuring charges | $ | 513 | | | $ | 754 | | | $ | 3,078 | | | $ | 4,765 | |
The following table presents activity in the severance and related costs accruals for the nine months ended June 30, 2026 and 2025 (in thousands):
| | | | | | | | | | | |
| Nine Months Ended June 30, |
| 2026 | | 2025 |
| Balance at beginning of period | $ | 127 | | | $ | 755 | |
| Provisions | 3,090 | | | 4,740 | |
| Payments | (3,120) | | (4,637) |
| Balance at end of period | $ | 97 | | | $ | 858 | |
9. Supplementary Balance Sheet Information
Allowance for Expected Credit Losses
The allowance for expected credit losses for the nine months ended June 30, 2026 and 2025 is as follows (in thousands):
| | | | | | | | | | | |
| Nine Months Ended June 30, |
| 2026 | | 2025 |
| Balance at beginning of period | $ | 4,649 | | | $ | 5,349 | |
| Provisions | 2,839 | | | 2,546 | |
| Payments received | (2,910) | | | (1,819) | |
| Write-offs and adjustments | (625) | | | (550) | |
| Balance at end of period | $ | 3,953 | | | $ | 5,526 | |
Inventories
The following is a summary of inventories at June 30, 2026 and September 30, 2025 (in thousands):
| | | | | | | | | | | |
| June 30,
2026 | | September 30,
2025 |
| | | |
| Raw materials and purchased parts | $ | 32,496 | | | $ | 33,319 | |
| Work-in-process | 15,589 | | | 5,050 | |
| Finished goods | 30,997 | | | 36,587 | |
| Total inventories | $ | 79,082 | | | $ | 74,956 | |
Total inventories were net of inventory reserves of $8.0 million and $5.9 million, respectively, at June 30, 2026 and September 30, 2025.
Warranty and Retrofit Costs
The following is a summary of product and warranty retrofit activity for the nine months ended June 30, 2026 and 2025 (in thousands):
| | | | | | | | | | | |
| Nine Months Ended June 30, |
| 2026 | | 2025 |
| | | |
| Balance at beginning of period | $ | 4,713 | | | $ | 5,213 | |
| Accruals for warranties during the period | 704 | | | 587 | |
| Costs incurred during the period | (1,370) | | | (427) | |
| Balance at end of period | $ | 4,047 | | | $ | 5,373 | |
10. Stockholders’ Equity
Share Repurchases
On November 4, 2022, the Company’s Board of Directors approved an authorization to repurchase up to $1.5 billion of the Company’s common stock (the “2022 Repurchase Authorization”). As of September 30, 2024, the Company had repurchased and retired 30.0 million shares of common stock for the full $1.5 billion approved under the 2022 Repurchase Authorization. All shares repurchased under the 2022 Repurchase Authorization were retired and accounted for as a reduction to stockholders’ equity in the Consolidated Balance Sheets and treated as a repurchase of common stock for
purposes of calculating earnings per share as of the applicable settlement dates. During the nine months ended June 30, 2025, the Company paid the remaining excise tax due in connection with the 2022 Repurchase Authorization, totaling $11.4 million.
On December 8, 2025, the Board of Directors approved a share repurchase program authorizing the repurchase of up to $250.0 million of the Company’s common stock through December 31, 2028 (the “2025 Repurchase Program”). Repurchases under the 2025 Repurchase Program may be made in the open market or through privately negotiated transactions (including under an accelerated share repurchase agreement), or by other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, subject to market and business conditions, legal requirements, and other factors. During the three months ended June 30, 2026, the Company repurchased 2.3 million shares of common stock for $50.0 million (excluding fees, commissions, and excise tax) in open market repurchases pursuant to the 2025 Repurchase Program. As of June 30, 2026, $200.0 million remained available for future repurchases under the 2025 Repurchase Program. All shares repurchased under the 2025 Repurchase Program were retired and accounted for as a reduction to stockholders’ equity in the Consolidated Balance Sheets and treated as a repurchase of common stock for purposes of calculating earnings per share as of the applicable settlement dates. As of June 30, 2026, the Company accrued $0.4 million for excise tax related to these share repurchases, which is considered an additional cost of the share repurchases and a reduction to stockholders’ equity in the Condensed Consolidated Balance Sheets.
Accumulated Other Comprehensive Income (Loss)
The following is a summary of the components of accumulated other comprehensive income (loss), net of tax for the nine months ended June 30, 2026 and 2025 (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Currency
Translation
Adjustments | | Unrealized
Gains (Losses)
on Available-
for-Sale
Securities
Net of Tax | | Gains (Losses)
on Derivative
Net of Tax | | Pension
Liability
Adjustments
Net of Tax | | Total |
| Balance at September 30, 2025 | $ | (12,918) | | | $ | 213 | | | $ | (8,729) | | | $ | (779) | | | $ | (22,213) | |
| Other comprehensive income (loss) before reclassifications | (9,869) | | | (1,558) | | | 4,985 | | | (132) | | | (6,574) | |
| Amounts reclassified from accumulated other comprehensive income (loss) | — | | | 72 | | | — | | | (25) | | | 47 | |
| Balance at June 30, 2026 | $ | (22,787) | | | $ | (1,273) | | | $ | (3,744) | | | $ | (936) | | | $ | (28,740) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Currency
Translation
Adjustments | | Unrealized
Gains (Losses)
on Available-
for-Sale
Securities
Net of Tax | | Gains (Losses)
on Derivative
Net of Tax | | Pension
Liability
Adjustments
Net of Tax | | Total |
| Balance at September 30, 2024 | $ | (34,170) | | | $ | (263) | | | $ | 21,468 | | | $ | (499) | | | $ | (13,464) | |
| Other comprehensive income (loss) before reclassifications | 33,176 | | | 262 | | | (39,744) | | | (205) | | | (6,511) | |
| Amounts reclassified from accumulated other comprehensive income (loss) | — | | | — | | | — | | | 54 | | | 54 | |
| Balance at June 30, 2025 | $ | (994) | | | $ | (1) | | | $ | (18,276) | | | $ | (650) | | | $ | (19,921) | |
As described in Note 2, Summary of Significant Accounting Policies in the notes to the audited consolidated financial statements included in the section titled “Financial Statements and Supplementary Data” in Part II, Item 8 of the 2025 Annual Report on Form 10-K, unrealized gains (losses) on available-for-sale marketable securities are reclassified from “Accumulated other comprehensive income (loss)” into results of operations at the time of the securities’ sale, gains (losses) on derivatives are the effective portions of changes in the fair value of the net investment hedges which are
recorded in “Accumulated other comprehensive income (loss)”, and amounts reclassified from “Accumulated other comprehensive income (loss)” related to pension liability adjustments represent amortization of actuarial gains and losses.
11. Revenue from Contracts with Customers
Disaggregated Revenue
The Company disaggregates revenue from contracts with customers in a manner that depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. The following is revenue by significant business line for the three and nine months ended June 30, 2026 and 2025 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three months ended June 30, | | Nine months ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Significant Business Line | | | | | | | |
| Multiomics | $ | 72,889 | | | $ | 66,235 | | | $ | 203,811 | | | $ | 196,054 | |
Core Products (1) | 47,682 | | | 45,663 | | | 139,589 | | | 143,177 | |
| Sample Repository Services | 40,607 | | | 31,957 | | | 111,215 | | | 95,398 | |
| Total revenue | $ | 161,178 | | | $ | 143,855 | | | $ | 454,615 | | | $ | 434,629 | |
(1)Core Products are Automated Stores, Cryogenic Systems, Automated Sample Tube, Consumables and Instruments and Controlled Rate Thawing Devices.
Contract Balances
Accounts Receivable, Net. Accounts receivable represents rights to consideration in exchange for products or services that have been transferred by the Company, when payment is unconditional and only the passage of time is required before payment is due. Accounts receivable do not bear interest and are recorded at the invoiced amount. The Company maintains an allowance for expected credit losses representing its best estimate of probable credit losses related to its existing accounts receivable and their net realizable value. The Company determines the allowance for expected credit losses based on a number of factors, including an evaluation of customer credit worthiness, the age of the outstanding receivables, economic trends, historical experience, and other information through the payment periods. Accounts receivable, net were $143.7 million and $142.2 million at June 30, 2026 and September 30, 2025, respectively.
Contract Assets. Contract assets represent rights to consideration in exchange for products or services that have been transferred by the Company and payment is conditional on something other than the passage of time. These amounts typically relate to contracts where the right to invoice the customer is not present until completion of the contract or the achievement of specified milestones and the value of the products or services transferred exceed this constraint. Contract assets are classified as current as they are expected to convert to cash within one year. Contract asset balances which are included within “Prepaid expenses and other current assets” in the Condensed Consolidated Balance Sheet, were $29.0 million and $37.3 million at June 30, 2026 and September 30, 2025, respectively. Revenue of $20.2 million and $30.5 million recognized, respectively, during the nine months ended June 30, 2026 and 2025 contributed to the contract asset balances at June 30, 2026 and June 30, 2025, respectively. As part of the preparation of the accompanying Condensed Consolidated Financial Statements for the quarter ended March 31, 2026, the Company corrected the previously disclosed amount of revenue contributed to the contract asset balance from $29.2 million to $19.8 million during the six months ended March 31, 2025 and from 49.4 million to $30.5 million during the nine months ended June 30, 2025.
Contract Liabilities. Contract liabilities represent the Company’s obligation to transfer products or services to a customer for which consideration has been received, or for which an amount of consideration is due from the customer. Contract assets and liabilities are reported on a net basis at the contract level, depending on the contract’s position at the end of each reporting period. Contract liabilities are included within “Deferred revenue” and "Other long-term liabilities" in the Condensed Consolidated Balance Sheet. Contract liabilities were $39.5 million and $34.5 million at June 30, 2026 and September 30, 2025, respectively. The Company recognized revenues of $22.7 million and $19.0 million in the nine months ended June 30, 2026 and 2025, respectively, that were included in the contract liability balance at the beginning of each period.
Remaining Performance Obligations. Remaining performance obligations represent the transaction price of unsatisfied or partially satisfied performance obligations within contracts with an original expected contract term that is greater than
one year and for which fulfillment of the contract has started as of the end of the reporting period. The aggregate amount of transaction consideration allocated to remaining performance obligations as of June 30, 2026 was $64.0 million. The following table summarizes when the Company expects to transfer control of the remaining performance obligations and recognize the corresponding revenue (in thousands):
| | | | | | | | | | | | | | | | | |
| As of June 30, 2026 |
| Less than 1 Year | | Greater than 1 Year | | Total |
| Remaining performance obligations | $ | 53,721 | | | $ | 10,294 | | | $ | 64,015 | |
12. Stock-Based Compensation
In accordance with the Company’s 2020 Equity Incentive Plan, the Company may issue to eligible employees options to purchase shares of the Company’s common stock, restricted stock units and other equity incentives which vest upon the satisfaction of a performance condition and/or a service condition. In addition, the Company issues common stock to participating employees pursuant to an employee stock purchase plan, and may issue common stock awards and deferred restricted stock units to members of its Board of Directors in accordance with its Board of Director compensation program.
2020 Equity Incentive Plan
The following table reflects stock-based compensation expense for continuing operations recorded during the three and nine months ended June 30, 2026 and 2025 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, | | Nine Months Ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Restricted stock units | $ | 4,455 | | | $ | 2,803 | | | $ | 14,125 | | | $ | 15,238 | |
| Employee stock purchase plan | 237 | | | 242 | | | 697 | | | 711 | |
| Total stock-based compensation expense | $ | 4,692 | | | $ | 3,045 | | | $ | 14,822 | | | $ | 15,949 | |
The Company recorded $0.1 million and $0.2 million of stock-based compensation expense for discontinued operations during the three months ended June 30, 2026 and 2025, respectively. The Company recorded $0.4 million and $0.8 million of stock-based compensation expense for discontinued operations during the nine months ended June 30, 2026 and 2025, respectively.
Restricted Stock Unit Activity
The following table summarizes restricted stock unit activity for the nine months ended June 30, 2026:
| | | | | | | | | | | |
| Shares | | Weighted
Average
Grant-Date
Fair Value |
| Outstanding as of September 30, 2025 | 1,029,834 | | $ | 49.29 | |
| Granted | 849,633 | | $ | 39.88 | |
| Vested | (290,880) | | $ | 46.37 | |
| Forfeited | (266,222) | | $ | 54.03 | |
| Outstanding as of June 30, 2026 | 1,322,365 | | $ | 42.93 | |
Awards vested during the nine months ended June 30, 2026 per the table above include 7,071 shares for discontinued operations. The fair value of restricted stock units vested during the nine months ended June 30, 2026 was $8.2 million for continuing operations.
As of June 30, 2026, the future unrecognized stock-based compensation expense related to restricted stock units for continuing operations expected to vest is $32.9 million and is expected to be recognized over an estimated weighted average amortization period of 1.7 years.
Restricted stock units granted with performance goals may also have a required service period following the achievement of all or a portion of the performance goals. The following table reflects restricted stock units granted during the nine months ended June 30, 2026 and 2025:
| | | | | | | | | | | |
| Nine Months Ended June 30, |
| 2026 | | 2025 |
| Time-based restricted stock units | 539,162 | | 448,375 |
| Performance-based restricted stock units | 310,471 | | 193,468 |
| Total units | 849,633 | | 641,843 |
All restricted stock units granted during the nine months ended June 30, 2026 and 2025 included in the table above relate to continuing operations.
Time-Based Restricted Stock Unit Grants
Restricted stock units granted with a required service period typically have three-year vesting schedules in which one-third of awards vest at each annual anniversary of the grant date, subject to the award holders meeting service requirements.
Performance-Based Restricted Stock Unit Grants
Performance-based restricted stock units are earned based on the achievement of performance criteria established by the Human Resources and Compensation Committee and approved by the Company’s Board of Directors. The criteria for performance-based awards are weighted and have threshold, target, and maximum performance goals.
In October 2023, the Company’s Board of Directors approved an amendment to the performance goals associated with the previously issued performance-based restricted stock units for all impacted employees, excluding members of the Company’s executive team. The performance goals, as amended, were more reflective of the then current macroeconomic environment and consideration toward employee retention in the competitive life sciences industry. Before the amendment, the original performance goals were not expected to be satisfied. Subsequent to the amendment, vesting became probable based on the forecasted achievement of the amended performance goals. The amendment of these restricted stock units is treated as a modification with the total compensation cost of $2.2 million recognized over the service period through November 2025. The Company recorded expense of $0.0 million and $0.2 million in the three and nine months ended June 30, 2026, respectively, related to the modified awards. The Company recorded expense of $0.1 million and $1.0 million in the three and nine months ended June 30, 2025, respectively, related to the modified awards.
These performance-based restricted stock unit awards granted allow participants to earn 100% of restricted stock units if the Company’s performance meets or exceeds its target goal for each applicable financial metric, and up to a maximum of 200% if the Company’s performance for such metrics meets or exceeds the maximum or stretch goal. Performance below the minimum threshold for each financial metric results in award forfeiture. Performance goals are measured over a three-year period for each year’s restricted stock unit awards and at the end of the period to determine the number of restricted stock units earned, if any, by recipients who continue to meet the service requirement. Upon the third anniversary of each year’s restricted stock unit awards’ grant date, the Company’s Board of Directors approves the number of restricted stock units earned for participants who continue to meet the service requirements on the vesting date. For restricted stock unit awards that include vesting based on performance conditions, the fair values are estimated based on the intrinsic values of the awards at the grant date.
In November 2024 and 2025, the Company issued restricted stock unit awards with vesting based on market conditions, which will vest based on achievement of the Company’s relative total shareholder return against the defined peer group over a three-year period. The fair values for those grants that include vesting based on market conditions are estimated using the Monte Carlo simulation model. The key assumptions used in the Monte Carlo simulation included (i) the expected volatility of 48.8% to 51.2% based on the three-year daily historical volatility as measured on the grant date, (ii) risk-free interest rate of 3.49% to 4.27% based on U.S. Treasury constant maturities yields as of the grant date, (iii)
correlation assumption based on daily share price changes over three years between the Company and the peer companies measured on the grant date, and (iv) no expected dividend yield. The compensation cost is recognized ratably over the requisite service period for those grants, which will not be reversed even if the market condition is not satisfied.
13. Fair Value Measurements
See Note 2, Summary of Significant Accounting Policies in the notes to the audited consolidated financial statements included in the section titled “Financial Statements and Supplementary Data” in Part II, Item 8 of the 2025 Annual Report on Form 10-K for information on the fair value hierarchy and the level of inputs used by the Company in determining fair value.
Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following tables summarize assets and liabilities measured and recorded at fair value on a recurring basis in the Condensed Consolidated Balance Sheets as of June 30, 2026 and September 30, 2025 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | As of June 30, 2026 |
| Description | | Total Fair Value | | Level 1 | | Level 2 | | Level 3 |
| Assets: | | | | | | | | |
| Cash equivalents | | $ | 70,824 | | | $ | 70,824 | | | $ | — | | | $ | — | |
| Available-for-sale securities | | 332,230 | | | 75,491 | | | 256,739 | | | — | |
| Investment in equity securities | | 2,100 | | | — | | | — | | | 2,100 | |
| Foreign exchange contracts | | 28 | | | — | | | 28 | | | — | |
| Total assets | | $ | 405,182 | | | $ | 146,315 | | | $ | 256,767 | | | $ | 2,100 | |
| Liabilities: | | | | | | | | |
| Net investment hedge | | 28,435 | | | — | | | 28,435 | | | — | |
Contingent consideration | | 2,437 | | | — | | | — | | | 2,437 | |
| Foreign exchange contracts | | 84 | | | — | | | 84 | | | — | |
| Total liabilities | | $ | 30,956 | | | $ | — | | | $ | 28,519 | | | $ | 2,437 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | As of September 30, 2025 |
| Description | | Total Fair Value | | Level 1 | | Level 2 | | Level 3 |
| Assets: | | | | | | | | |
| Cash equivalents | | $ | 149,790 | | | $ | 148,539 | | | $ | 1,251 | | | $ | — | |
| Available-for-sale securities | | 262,722 | | | 8,027 | | | 254,695 | | | — | |
| Investment in equity securities | | 2,100 | | | — | | | — | | | 2,100 | |
| Foreign exchange contracts | | 21 | | | — | | | 21 | | | — | |
| Total assets | | $ | 414,633 | | | $ | 156,566 | | | $ | 255,967 | | | $ | 2,100 | |
| Liabilities: | | | | | | | | |
| Net investment hedge | | 33,420 | | | — | | | 33,420 | | | — | |
| Foreign exchange contracts | | 120 | | | — | | | 120 | | | — | |
| Total liabilities | | $ | 33,540 | | | $ | — | | | $ | 33,540 | | | $ | — | |
Cash Equivalents
The Company considers all highly liquid interest-earning investments with a maturity of three months or less at the date of purchase to be cash equivalents. Cash equivalents primarily consist of money market funds and U.S. government backed securities with a maturity of three months or less. They are classified as Level 1 because they are valued using quoted market prices in active markets. The fair values of these investments approximate their carrying values. Investments
classified as Level 2 consist of debt securities valued using matrix pricing benchmarking because they are not actively traded and bank certificates of deposit with a maturity of three months or less. Matrix pricing is a mathematical technique used to value securities by relying on the securities’ relationship to other benchmark quoted prices.
Available-For-Sale Securities
Available-for-sale securities primarily consist of U.S. government backed securities and highly rated corporate debt securities, which are classified as Level 1. Investments classified as Level 2 consist of debt securities that are valued using matrix pricing and benchmarking because they are not actively traded and bank certificates of deposit with a maturity of more than three months.
Investment in Equity Securities
During the first quarter of fiscal year 2025, the Company converted $2.0 million in principal amount of convertible notes it purchased in the third quarter of fiscal year 2024 from a private company into 420,000 shares of preferred stock of the private company. As of the conversion, the fair value of the convertible notes was $2.1 million and the conversion did not result in the recognition of additional gain or loss on the convertible notes. The shares of preferred stock are equity securities and within the scope of ASC 321, Investments - Equity Securities. The Company elected the measurement alternative for its investment in the shares of preferred stock because the shares do not have a readily determinable fair value. As of June 30, 2026, the carrying value of the investment in the shares of preferred stock was $2.1 million and is included in “Other assets” on the Condensed Consolidated Balance Sheets. The fair value determination is classified as Level 3 based on unobservable inputs which were based on the best information available in the circumstance, including transaction pricing, recent acquisition, and market participant assumptions. The unobservable inputs used in the determination of the fair value of assets classified as Level 3 have an inherent measurement uncertainty that if changed could result in higher or lower fair value measurements of the assets as of the reporting date.
Foreign Exchange Contracts & Net Investment Hedge
The Company’s foreign exchange contract assets and liabilities, and its net investment hedge assets and liabilities are measured and reported at fair value using the market method valuation technique. The inputs to this technique utilize current foreign currency exchange forward market rates published by third-party leading financial news and data providers. These are observable data that represent the rates that the financial institution uses for contracts entered into at that date; however, they are not based on actual transactions, so they are classified as Level 2.
Contingent Consideration
Contingent consideration is measured and reported at fair value based on the unobservable inputs and classified as Level 3 of the fair value hierarchy. The amount is contingent based on the renewal of a certain contract of the acquired business no later than September 28, 2028. Please refer to Note 4, Business Combination for further detail. Changes in the fair value of contingent consideration resulting from a change in the underlying inputs will be recognized in results of operations until the arrangement is settled.
Financial Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
During the three and nine months ended June 30, 2026 and 2025, the Company did not record any impairments on its financial assets or liabilities required to be measured at fair value on a nonrecurring basis.
14. Income Taxes
The Company recorded income tax expense of $2.4 million and $5.2 million during the three and nine months ended June 30, 2026, respectively, which were primarily driven by the profit mix in foreign jurisdictions, valuation allowance implications in the United States and state income taxes in jurisdictions where the Company does not have a net operating loss carry over.
The Company recorded income tax expense of $2.6 million and $13.8 million during the three and nine months ended June 30, 2025, respectively. The tax expense for both periods was primarily driven by a $6.6 million tax expense related to the outside basis difference in a China subsidiary. The tax expense in each period was also driven by the profits in foreign jurisdictions and state income taxes in jurisdictions where the Company does not have a net operating loss carryover.
The Company evaluates the realizability of its deferred tax assets and assesses the need for a valuation allowance on a quarterly basis. The Company operates in multiple countries under many legal forms and, as a result, is subject to domestic and foreign tax authorities in numerous jurisdictions. The Company evaluates the profitability of its operations in each jurisdiction on a historic cumulative basis and on a forward-looking basis, while carefully considering carry-forward periods of tax attributes and ongoing tax planning strategies in assessing the need for the valuation allowance.
The Company maintains a valuation allowance against U.S. net deferred tax assets and against net deferred tax assets on certain foreign tax-paying components.
The Company is subject to U.S. federal, state, local and foreign income taxes in various jurisdictions. The amount of income taxes paid is subject to the Company’s interpretation of applicable tax laws in the jurisdictions in which it files.
During the fourth quarter of fiscal year 2025, the Company recorded an unrecognized tax benefit of $2.5 million related to a capital loss on one of its foreign subsidiaries based on its estimated tax return filing position. The Company filed its U.S. federal tax return in July 2026, which increased the amount of the capital loss and resulting tax refund claim. As the incremental capital loss claimed on the tax return filed has been determined to not meet the more-likely-than-not recognition standard under ASC 740, Income Taxes, the Company has recorded an additional unrecognized tax benefit of $17.5 million. The claim is expected to be subject to examination by the Internal Revenue Service and review by the Joint Committee on Taxation, and the ultimate resolution may differ from the amount currently recognized in the financial statements. The unrecognized tax benefit is reflected as a reduction to “Long-term income tax receivables” recorded in the Condensed Consolidated Balance Sheets.
In the normal course of business, the Company is subject to income tax audits in various global jurisdictions in which it operates. The years subject to examination vary for the United States and international jurisdictions, with the earliest tax year being 2018. Based on the outcome of these examinations or the expiration of statutes of limitations for specific jurisdictions, it is reasonably possible that the related unrecognized tax benefits could change from those recorded in the Condensed Consolidated Balance Sheets. The Company currently does not anticipate that it is reasonably possible that the unrecognized tax benefits and accrued interest on those benefits will be reduced in the next twelve months. These unrecognized tax benefits would impact the effective tax rate if recognized.
15. Net Income (Loss) per Share
The calculations of basic and diluted net income (loss) per share and basic and diluted weighted average shares outstanding are as follows for the three and nine months ended June 30, 2026 and 2025 (in thousands, except per share data):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended
June 30, | | Nine Months Ended
June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Loss from continuing operations | $ | (1,529) | | | $ | (332) | | | $ | (163,740) | | | $ | (27,195) | |
| Income (loss) from discontinued operations, net of tax | 3,985 | | | (47,655) | | | (10,034) | | | (79,445) | |
| Net income (loss) | $ | 2,456 | | | $ | (47,987) | | | $ | (173,774) | | | $ | (106,640) | |
| | | | | | | |
| Weighted average common shares outstanding used in computing basic income (loss) per share | 45,286 | | 45,780 | | 45,759 | | 45,712 |
| Weighted average common shares outstanding used in computing diluted income (loss) per share | 45,286 | | 45,780 | | 45,759 | | 45,712 |
| | | | | | | |
| Basic net income (loss) per share: | | | | | | | |
| Loss from continuing operations | $ | (0.03) | | | $ | (0.01) | | | $ | (3.58) | | | $ | (0.59) | |
| Income (loss) from discontinued operations, net of tax | $ | 0.09 | | | $ | (1.04) | | | $ | (0.22) | | | $ | (1.74) | |
| Basic net income (loss) per share | $ | 0.05 | | | $ | (1.05) | | | $ | (3.80) | | | $ | (2.33) | |
| | | | | | | |
| Diluted net income (loss) per share: | | | | | | | |
| Loss from continuing operations | $ | (0.03) | | | $ | (0.01) | | | $ | (3.58) | | | $ | (0.59) | |
| Income (loss) from discontinued operations, net of tax | $ | 0.09 | | | $ | (1.04) | | | $ | (0.22) | | | $ | (1.74) | |
| Diluted net income (loss) per share | $ | 0.05 | | | $ | (1.05) | | | $ | (3.80) | | | $ | (2.33) | |
For the three and nine months ended June 30, 2026 and 2025, outstanding restricted stock units and shares issued by the Company under the employee stock purchase plan were excluded from the computation of diluted loss per share as their effect would be antidilutive to earnings per share for continuing operations. The following table contains all potentially dilutive common stock equivalents for the three and nine months ended June 30, 2026 and 2025.
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, | | Nine Months Ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Time-based restricted stock units | 12,755 | | 7,285 | | 60,421 | | 79,776 |
| Performance-based restricted stock units | 87,980 | | 36,086 | | 102,533 | | 51,971 |
| Employee stock purchase plan | — | | — | | 2,140 | | 7,043 |
| Total | 100,735 | | 43,371 | | 165,094 | | 138,790 |
16. Segment and Geographic Information
Operating segments are defined as components of an enterprise that engage in business activities from which it may recognize revenues and incur expenses, and for which discrete financial information is available and regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources and to assess performance. The Company’s Chief Executive Officer is the Company’s CODM. The Company’s operations are organized and managed by type of products and services and segment information is reported accordingly. There have been no operating segments aggregated to arrive at the Company’s reportable segments. Revenues for all operating segments include only transactions with unaffiliated customers and include no intersegment revenues. The accounting policies of the reportable segments are
the same as those described in Note 2, Summary of Significant Accounting Policies, in the notes to the audited consolidated financial statements included in the section titled “Financial Statements and Supplementary Data” in Part II, Item 8 of the 2025 Annual Report on Form 10-K.
As of November 12, 2024, the Company’s B Medical Systems business met the “held for sale” criteria and “discontinued operations” criteria in accordance with FASB ASC 205 and the results of the B Medical Systems business are included within discontinued operations. As a result, the Company’s continuing operations includes the following two operating and reportable segments:
•Sample Management Solutions. The SMS business resources operate as a single business unit offering end-to-end sample management products and services, including: Sample Repository Services and Core Products (Automated Stores, Cryogenic Systems, Automated Sample Tube, Consumables and Instruments and Controlled Rate Thawing Devices).
•Multiomics. The Multiomics business resources operate as a single business unit offering genomic and other sample analysis services, including gene sequencing, gene synthesis and related services.
Management considers adjusted operating income (loss) as the performance metric when evaluating each segment’s operations. The Company uses this measure because it enables the CODM and management to understand and evaluate the segments’ core operating results and facilitates comparison of performance for determining compensation.
The CODM regularly uses segment adjusted operating income (loss) in the monthly and quarterly business review processes, and this measure serves as the basis for the CODM’s evaluation of segment performance and related resource allocation considerations. During these processes, the CODM considers budget-to-actual variances in adjusted operating income (loss) to evaluate both internal factors (for example, changes in selling prices, strategic growth investments, productivity and business mix) and external factors (for example, inflation, tariffs and foreign currency), events and conditions.
The following is the summary of the financial information for the Company’s reportable segments for the three and nine months ended June 30, 2026 and 2025 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, | | Nine Months Ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Revenue: | | | | | | | |
| Sample Management Solutions | $ | 88,289 | | | $ | 77,620 | | | $ | 250,804 | | | $ | 238,575 | |
| Multiomics | 72,889 | | | 66,235 | | | 203,811 | | | 196,054 | |
| Total revenue | $ | 161,178 | | | $ | 143,855 | | | $ | 454,615 | | | $ | 434,629 | |
| | | | | | | |
| Adjusted operating income (loss): | | | | | | | |
| Sample Management Solutions | $ | 4,944 | | | $ | 10,737 | | | $ | 13,035 | | | $ | 18,318 | |
| Multiomics | (348) | | | (3,958) | | | (14,777) | | | (11,801) | |
| Segment adjusted operating income (loss) | $ | 4,596 | | | $ | 6,779 | | | $ | (1,742) | | | $ | 6,517 | |
| | | | | | | |
| Amortization of completed technology | 2,082 | | | 2,068 | | | 6,017 | | | 5,876 | |
| Amortization of other intangible assets | 3,616 | | | 4,123 | | | 10,730 | | | 12,499 | |
Transformation costs(1) | 272 | | | 1,542 | | | 1,913 | | | 9,771 | |
| Restructuring charges | 513 | | | 754 | | | 3,078 | | | 4,765 | |
| Impairment of goodwill and intangible assets | — | | | — | | | 149,083 | | | — | |
Merger and acquisition costs(2) | 2,248 | | | 58 | | | 4,436 | | | 2,316 | |
| Purchase accounting and other adjustments | 43 | | | 84 | | | 206 | | | 35 | |
| Total operating loss | (4,178) | | | (1,850) | | | (177,205) | | | (28,745) | |
| Interest income, net | 3,825 | | | 4,973 | | | 13,310 | | | 13,760 | |
| Other income (expenses), net | 1,199 | | | (820) | | | 5,337 | | | 1,542 | |
| Income (loss) from continuing operations before income taxes | $ | 846 | | | $ | 2,303 | | | $ | (158,558) | | | $ | (13,443) | |
(1)Transformation costs represent expenses associated with discrete strategic initiatives undertaken to simplify, standardize, streamline, and optimize the Company's operations, processes, and systems. These initiatives are intended to generate long-term operational efficiencies and productivity improvements and do not meet the definition of restructuring charges. Transformation costs primarily include asset write-downs associated with technology changes, inventory write-downs related to restructuring activities, and third-party consulting costs incurred to support process and systems redesign efforts.
(2)Merger and acquisition costs consist primarily of legal, accounting, valuation, and strategic advisory fees incurred in connection with acquisition and integration activities.
Adjusted operating income (loss) excludes charges related to amortization of intangible assets, transformation costs, restructuring charges, merger and acquisition costs, purchase accounting adjustments, and other miscellaneous expenses.
The segment expenses regularly provided to the CODM are adjusted cost of revenues, which primarily consist of costs of direct materials and direct labor, freight, warranty, depreciation expenses, and facilities costs and adjusted operating expenses, which primarily consists of employee salaries and benefits for research and development, selling, marketing, and administrative personnel, commissions, advertising and promotional expenses, audit, legal and strategic consulting fees,
depreciation expenses, facilities costs, insurance, and information systems costs. Centrally incurred costs are primarily allocated to segments using a percentage of budgeted segment revenue over total revenue.
The following is the summary of the adjusted operating income information for the Company’s reportable segments for the three and nine months ended June 30, 2026 and 2025 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Sample Management Solutions | Three Months Ended June 30, | | Nine Months Ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| | | | | | | |
| Total revenue | $ | 88,289 | | | $ | 77,620 | | | $ | 250,804 | | | $ | 238,575 | |
| Less: Adjusted cost of revenue | 47,770 | | | 36,207 | | | 134,853 | | | 119,732 | |
| Less: Adjusted operating expenses | 35,575 | | | 30,676 | | | 102,916 | | | 100,525 | |
| Adjusted operating income | $ | 4,944 | | | $ | 10,737 | | | $ | 13,035 | | | $ | 18,318 | |
| | | | | | | |
| Other Information | | | | | | | |
| Depreciation Expense | $ | 4,155 | | | $ | 2,939 | | | $ | 10,603 | | | $ | 8,491 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Multiomics | Three Months Ended June 30, | | Nine Months Ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| | | | | | | |
| Total revenue | $ | 72,889 | | | $ | 66,235 | | | $ | 203,811 | | | $ | 196,054 | |
| Less: Adjusted cost of revenue | 38,970 | | | 39,151 | | | 115,648 | | | 110,939 | |
| Less: Adjusted operating expenses | 34,267 | | | 31,042 | | | 102,940 | | | 96,916 | |
| Adjusted operating loss | $ | (348) | | | $ | (3,958) | | | $ | (14,777) | | | $ | (11,801) | |
| | | | | | | |
| Other Information | | | | | | | |
| Depreciation Expense | $ | 2,647 | | | $ | 4,024 | | | $ | 10,588 | | | $ | 11,346 | |
The following is the summary of the asset information for the Company’s reportable segments as of June 30, 2026 and September 30, 2025 (in thousands):
| | | | | | | | | | | |
| Assets: | June 30, 2026 | | September 30, 2025 |
| Sample Management Solutions | $ | 822,668 | | | $ | 854,402 | |
| Multiomics | 324,984 | | | 445,212 | |
| Total assets | $ | 1,147,652 | | | $ | 1,299,614 | |
The following is a reconciliation of the segment assets to the corresponding amounts presented in the Condensed Consolidated Balance Sheets as of June 30, 2026 and September 30, 2025 (in thousands):
| | | | | | | | | | | |
| June 30,
2026 | | September 30,
2025 |
| Segment assets | $ | 1,147,652 | | | $ | 1,299,614 | |
| Cash and cash equivalents, restricted cash and marketable securities | 528,538 | | | 546,201 | |
| Deferred tax assets | 494 | | | 726 | |
| General corporate assets | 51,451 | | | 54,500 | |
| Current and noncurrent assets held for sale | 148,076 | | | 158,541 | |
| Total assets | $ | 1,876,211 | | | $ | 2,059,582 | |
Revenue from external customers is attributed to geographic areas based on locations in which the product is shipped. Net revenue by geographic area for the three and nine months ended June 30, 2026 and 2025 are as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, | | Nine Months Ended June 30, |
| 2026 | | 2025 | | 2026 | | 2025 |
| Geographic Location: | | | | | | | |
| United States | $ | 91,516 | | | $ | 87,819 | | | $ | 261,953 | | | $ | 271,220 | |
| China | 18,791 | | | 14,321 | | | 53,615 | | | 41,947 | |
| United Kingdom | 12,095 | | | 9,297 | | | 32,481 | | | 25,036 | |
| Rest of Europe | 29,986 | | | 25,430 | | | 82,356 | | | 75,009 | |
| Asia Pacific (Excluding China) | 6,903 | | | 5,762 | | | 20,113 | | | 17,839 | |
| Other | 1,887 | | | 1,226 | | | 4,097 | | | 3,578 | |
| Total revenue | $ | 161,178 | | | $ | 143,855 | | | $ | 454,615 | | | $ | 434,629 | |
Net long-lived assets, excluding goodwill and other intangible assets, by geographic area as of June 30, 2026 and September 30, 2025 (in thousands):
| | | | | | | | | | | |
| June 30,
2026 | | September 30,
2025 |
| United States | $ | 113,695 | | | $ | 116,681 | |
| China | 59,301 | | | 56,715 | |
| United Kingdom | 43,122 | | | 14,338 | |
| Rest of Europe | 14,676 | | | 16,674 | |
| Asia Pacific (Excluding China) | 2,885 | | | 3,505 | |
| Other | 169 | | | 89 | |
| Total long-lived assets, net | $ | 233,848 | | | $ | 208,002 | |
For the three and nine months ended June 30, 2026 and 2025, the Company did not have any individual customers that accounted for 10% or more of its consolidated revenue. As of June 30, 2026 and September 30, 2025, there were no customers that accounted for more than 10% of the Company’s accounts receivable balance.
17. Commitments and Contingencies
Contingencies
The Company is subject to various legal proceedings, both asserted and unasserted, that arise in the ordinary course of business. The Company cannot predict the ultimate outcome of such legal proceedings or, in certain instances, provide reasonable ranges of potential losses. The Company considers all claims on a quarterly basis and based on known facts
assesses whether potential losses are considered reasonably possible, probable, and estimable. Based upon this assessment, the Company then evaluates disclosure requirements and whether to accrue for such claims in the Condensed Consolidated Financial Statements. At June 30, 2026 and as of the date of filing of these Condensed Consolidated Financial Statements, the Company believes that no new material provision for liability nor new disclosure is required related to any claims. As there is potential for unexpected subsequent developments and given the inherent unpredictability of these matters, there can be no assurance that the Company’s assessment of any claim will reflect the ultimate outcome, and an adverse outcome in certain matters could, from time to time, have a material adverse effect on the Company’s consolidated financial position or results of operations in particular quarterly or annual periods.
Purchase Commitments
As of June 30, 2026, the Company had non-cancellable commitments of $42.5 million, comprised of purchase orders for inventory of $23.0 million and other operating expense commitments of $19.5 million.