908 Devices (MASS) grows H1 2026 revenue to $29.5M but records $23.8M loss
908 Devices Inc. develops handheld and program devices for chemical analysis serving defense, public safety and industrial customers. For the six months ended June 30, 2026, revenue from continuing operations was $29.5 million, up from $24.8 million, driven mainly by handheld product sales. Q2 revenue was $16.1 million.
The company reported a continuing-operations net loss of $23.8 million for the first half of 2026 and an accumulated deficit of $247.2 million. Results were pressured by operating expenses of $40.9 million, including a $12.8 million non-cash increase in contingent consideration tied to recent acquisitions.
Liquidity remains solid with $63.0 million of cash and $38.5 million of marketable securities and positive operating cash flow of $4.4 million in the first half. The company closed the NIRLAB acquisition, expanding narcotics-detection capabilities, and continues to recognize the effects of its 2025 Desktop Portfolio divestiture and related transition services. A new $20 million undrawn revolving credit facility extends financial flexibility.
Positive
- Revenue from continuing operations grew to $29.5 million for the first half of 2026 from $24.8 million a year earlier, with Q2 revenue of $16.1 million supported by higher handheld device sales.
- Operating cash flow turned positive, with $4.4 million of net cash provided by operating activities in the first six months of 2026 compared with $20.8 million used in the prior-year period.
- The company ended June 30, 2026 with $63.0 million in cash and $38.5 million in marketable securities, and added an undrawn $20 million revolving credit facility, supporting near-term liquidity.
- The NIRLAB acquisition added $11.1 million of goodwill and $10.7 million of identifiable intangibles, broadening the product portfolio in narcotics detection and near‑infrared spectroscopy.
Negative
- The business continues to generate substantial losses, with a $23.8 million net loss from continuing operations in the first half of 2026 and an $11.9 million Q2 loss.
- A large non-cash $12.8 million increase in contingent consideration for acquisitions weighed on operating results, and total contingent consideration liabilities rose to $33.8 million.
- Customer concentration is significant, with two customers representing 12% and 11% of revenue for the first half of 2026 and one customer accounting for 32% of accounts receivable at June 30, 2026.
Filing Explained
Existing holders face completed dilution from 3,213,583 RedWave earnout shares and a separate conditional issuance of up to $8.0 million in NIRLAB stock.
This Form 10-Q is an unaudited quarterly report updating interim financial statements, and it discloses one completed and one conditional equity obligation tied to acquisitions.
On
The NIRLAB acquisition closed on
The NIRLAB purchase-price allocation remains preliminary; the valuation of acquired assets and liabilities is due to be finalized within one year of the acquisition date. The relevant resolution points are NIRLAB’s milestones through
Key Figures
Key Terms
contingent consideration financial
Desktop Portfolio financial
Transition Services Agreement financial
Amended 2026 Revolver financial
relief from royalty method financial
Earnings Snapshot
AI-generated analysis. How Rhea-AI works. Not financial advice.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to .
Commission File Number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer |
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(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| | ||
Large accelerated filer ☐ | | Accelerated filer | ☐ |
| Smaller reporting company | ||
| | Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of August 7, 2026, the registrant had
Table of Contents
908 DEVICES INC.
Table of Contents
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| | | Page |
PART I. | FINANCIAL INFORMATION | | 4 |
Item 1. | Condensed Consolidated Financial Statements (Unaudited) | | 4 |
| Condensed Consolidated Balance Sheets | | 4 |
| Condensed Consolidated Statements of Operations | | 5 |
| Condensed Consolidated Statements of Comprehensive Income (loss) | | 6 |
| Condensed Consolidated Statements of Stockholders’ Equity | | 7 |
| Condensed Consolidated Statements of Cash Flows | | 8 |
| Notes to Unaudited Condensed Consolidated Financial Statements | | 9 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | | 32 |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | | 48 |
Item 4. | Controls and Procedures | | 48 |
PART II. | OTHER INFORMATION | | 49 |
Item 1. | Legal Proceedings | | 49 |
Item 1A. | Risk Factors | | 49 |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | | 49 |
Item 3. | Defaults Upon Senior Securities | | 49 |
Item 4. | Mine Safety Disclosures | | 49 |
Item 5. | Other Information | | 49 |
Item 6. | Exhibits | | 50 |
Signatures | | 51 | |
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Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements, which reflect our current views with respect to, among other things, our operations and financial performance. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations and financial position, business strategy and plans and our objectives for future operations, are forward-looking statements, and are made under the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,” “could,” “target,” “predict,” “seek” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short- and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those referenced in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. Moreover, we operate in a competitive and rapidly changing environment and new risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this Quarterly Report on Form 10-Q may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
The forward-looking statements included in this Quarterly Report on Form 10-Q are made only as of the date of this report. You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. We undertake no obligation to update publicly any forward-looking statements for any reason after the date of this Quarterly Report on Form 10-Q to conform these statements to actual results or to changes in our expectations.
We own various trademark registrations and applications, and unregistered trademarks, including MX908, ThreatID, ProtectIR, XplorIR, VipIR, NIRLab, 908 Devices and our corporate logo. All other trade names, trademarks and service marks of other companies appearing in this Quarterly Report on Form 10-Q are the property of their respective holders. Solely for convenience, the trademarks and trade names in this Quarterly Report on Form 10-Q may be referred to without the ®,™ or RTM symbols, but such references should not be construed as any indicator that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto. We do not intend to use or display other companies’ trademarks and trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies.
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PART I—FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited)
908 DEVICES INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except share and per share amounts)
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| | June 30, | | December 31, | ||
| | 2026 | | 2025 | ||
Assets |
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Current assets: |
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Cash and cash equivalents | | $ | | | $ | |
Marketable securities | | | | | | |
Accounts receivable, net of allowance for credit losses of $ | |
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Inventory | |
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Prepaid expenses and other current assets | | | | | | |
Total current assets | |
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Operating lease, right-of-use assets | |
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Property and equipment, net | |
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Goodwill | | | | | | — |
Intangible assets, net | | | | | | |
Other long-term assets | | | | | | |
Total assets | | $ | | | $ | |
Liabilities and Stockholders' Equity | |
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Current liabilities: | |
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Accounts payable | | $ | | | $ | |
Accrued expenses | |
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Deferred revenue | |
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Operating lease liabilities | |
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Contingent consideration | | | | | | |
Other current liabilities | | | | | | — |
Total current liabilities | |
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Operating lease liabilities, net of current portion | |
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Deferred revenue, net of current portion | |
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Deferred tax liabilities | | | | | | — |
Contingent consideration, net of current portion | | | | | | — |
Other long-term liabilities | | | | | | |
Total liabilities | |
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Commitments and contingencies (Note 14) | |
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Stockholders' equity: | |
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Preferred stock, $ | | | — | | | — |
Common stock, $ | |
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Additional paid-in capital | |
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Accumulated other comprehensive income (loss) | | | ( | | | |
Accumulated deficit | |
| ( | |
| ( |
Total stockholders' equity | |
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Total liabilities and stockholders' equity | | $ | | | $ | |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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908 DEVICES INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except share and per share amounts)
| | | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | |
| ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | |
| ||||
Revenue: | | | | | | | | | | | | | | |
Product revenue | | $ | | | $ | | | $ | | | $ | | | |
Service and contract revenue | | | | | | | | | | | | | | |
Total revenue | |
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Cost of revenue: | |
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Product cost of revenue | |
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Service and contract cost of revenue | | | | | | | | | | | | | | |
Total cost of revenue | |
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Gross profit | |
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Operating expenses: | |
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Research and development | |
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Selling, general and administrative | |
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Change in fair value of contingent consideration | |
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Total operating expenses | |
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Loss from continuing operations | |
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| ( | |
| ( | | |
Other income, net: | |
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Interest income | | | | |
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Income from transition services agreement, net | |
| — | |
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| — | |
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Other expense, net | |
| ( | |
| ( | |
| ( | |
| ( | | |
Total other income, net | |
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Loss from continuing operations before income taxes | | | ( | | | ( | | | ( | | | ( | | |
Income tax benefit (expense), net | | | | | | ( | | | | | | ( | | |
Net loss from continuing operations | | $ | ( | | $ | ( | | $ | ( | | $ | ( | | |
Net income (loss) from discontinued operations, net of tax | |
| — | |
| ( | |
| — | |
| | | |
Net income (loss) attributable to common stockholders | | $ | ( | | $ | ( | | $ | ( | | $ | | | |
Net loss from continuing operations per share attributable to common stockholders, basic and diluted | | $ | ( | | $ | ( | | $ | ( | | $ | ( | | |
Net income (loss) from discontinued operations per share attributable to common stockholders, basic and diluted | | $ | — | | $ | ( | | $ | — | | $ | | | |
Net income (loss) per share attributable to common stockholders, basic and diluted | | $ | ( | | $ | ( | | $ | ( | | $ | | | |
Weighted average common shares outstanding | |
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Basic and diluted | | | | | | | | | | | | | | |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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908 DEVICES INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Unaudited)
(in thousands, except share amounts)
| | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | | ||||
Net income (loss) attributable to common stockholders | | $ | ( | | $ | ( | | $ | ( | | $ | | |
Other comprehensive loss | | | | | | | | | | | | | |
Foreign currency translation adjustments reclassed out of accumulated other comprehensive income related to discontinued operations | | | — | | | — | | | — | | | ( | |
Foreign currency translation adjustments | | | ( | | | — | | | ( | | | ( | |
Unrealized loss on marketable securities, net of tax of $ | | | ( | | | ( | | | ( | | | ( | |
Total other comprehensive loss | | $ | ( | | $ | ( | | $ | ( | | $ | ( | |
Comprehensive income (loss) | | $ | ( | | $ | ( | | $ | ( | | $ | | |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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908 DEVICES INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)
(in thousands, except share amounts)
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | Accumulated | | | | | | | |
| | | | Additional | | Other | | | | Total | |||||||
| | Common Stock | | Paid-in | | Comprehensive | | Accumulated | | Stockholders' | |||||||
| | Shares | | Amount | | Capital | | Income (Loss) | | Deficit | | Equity | |||||
Balances at December 31, 2025 | | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
Issuance of common stock upon exercise of stock options | | | | | — | | | | | | — | | | — | | | |
Stock-based compensation expense | | — | | | — | | | | | | — | | | — | | | |
Vesting of restricted stock units | | | | | | | | ( | | | — | | | — | | | — |
Net loss | | — | | | — | | | — | | | — | | | ( | | | ( |
Unrealized loss on marketable securities | | — | | | — | | | — | | | ( | | | — | | | ( |
Balances at March 31, 2026 | | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
Issuance of common stock upon exercise of stock options | | | | | — | | | | | | — | | | — | | | |
Stock-based compensation expense | | — | | | — | | | | | | — | | | — | | | |
Issuance of common stock pursuant to the acquisition of NIRLAB | | | | | | | | | | | — | | | — | | | |
Issuance of common stock upon ESPP purchase | | | | | — | | | | | | — | | | — | | | |
Vesting of restricted stock units | | | | | — | | | — | | | — | | | — | | | — |
Net loss | | — | | | — | | | — | | | — | | | ( | | | ( |
Unrealized loss on marketable securities | | — | | | — | | | — | | | ( | | | — | | | ( |
Foreign currency translation adjustments | | — | | | — | | | — | | | ( | | | — | | | ( |
Balances at June 30, 2026 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | |
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| | | | | | | | | | Accumulated | | | | | | | |
| | | | Additional | | Other | | | | Total | |||||||
| | Common Stock | | Paid-in | | Comprehensive | | Accumulated | | Stockholders' | |||||||
| | Shares | | Amount | | Capital | | Income (Loss) | | Deficit | | Equity | |||||
Balances at December 31, 2024 | | | | $ | | | $ | | | $ | | | $ | ( | | $ | |
Issuance of common stock upon exercise of stock options |
| | | | — | | | | | | — | | | — | | | |
Stock-based compensation expense |
| — | | | — | | | | | | — | | | — | | | |
Vesting of restricted stock units | | | | | | | | — | | | — | | | — | | | |
Net income |
| — | | | — | | | — | | | — | | | | | | |
Foreign currency translation adjustments | | — | | | — | | | — | | | ( | | | — | | | ( |
Foreign currency translation adjustments reclassed out of accumulated other comprehensive income related to discontinued operations | | — | | | — | | | — | | | ( | | | — | | | ( |
Unrealized loss on marketable securities | | — | | | — | | | — | | | ( | | | — | | | ( |
Balances at March 31, 2025 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | |
Issuance of common stock upon exercise of stock options | | | | | — | | | | | | — | | | — | | | |
Stock-based compensation expense | | — | | | — | | | | | | — | | | — | | | |
Issuance of common stock upon ESPP purchase | | | | | — | | | | | | | | | | | | |
Vesting of restricted stock units | | | | | — | | | — | | | — | | | — | | | — |
Net loss | | — | | | — | | | — | | | — | | | ( | | | ( |
Unrealized loss on marketable securities | | — | | | — | | | — | | | ( | | | — | | | ( |
Balances at June 30, 2025 | | | | $ | | | $ | | | $ | ( | | $ | ( | | $ | |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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908 DEVICES INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
| | | | | | |
| | Six Months Ended June 30, | ||||
| | 2026 | | 2025 | ||
Cash flows from operating activities: | | | | | | |
Net income (loss) | | $ | ( | | $ | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |
| | |
| |
Depreciation and amortization expense | |
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Stock-based compensation expense | |
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Provision for inventory obsolescence | |
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Net amortization of premiums and accretion of discounts on marketable securities | | | | | | ( |
Loss on disposal of property and equipment | | | | | | |
Gain on sale of Desktop Portfolio, net of transaction costs | | | — | | | ( |
Change in provision for credit losses | | | ( | | | |
Change in fair value of contingent consideration | | | | | | |
Amortization of debt issuance costs | | | | | | — |
Deferred tax liabilities | | | ( | | | — |
Changes in operating assets and liabilities, net of business combinations: | |
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Accounts receivable, net | |
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Inventory | |
| ( | |
| ( |
Prepaid expenses and other current assets | |
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| ( |
Other long-term assets | |
| ( | |
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Accounts payable and accrued expenses | |
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| ( |
Deferred revenue | |
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Right-of-use operating lease assets | |
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Operating lease liabilities | |
| ( | |
| ( |
Net cash provided by (used in) operating activities | |
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Cash flows from investing activities: | |
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Purchases of property and equipment | |
| ( | |
| ( |
Purchases of marketable securities | | | ( | | | ( |
Acquisition of businesses, net of cash acquired | | | ( | | | — |
Proceeds from sale of Desktop Portfolio | | | — | | | |
Proceeds from maturities of marketable securities | | | | | | |
Net cash provided by (used in) investing activities | |
| ( | |
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Cash flows from financing activities: | |
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| |
Payments for withholding taxes on vested awards | | | ( | | | ( |
Proceeds from issuance of common stock | | | | | | |
Payment of deferred financing costs | | | ( | | | — |
Net cash used in financing activities | |
| ( | |
| ( |
Effect of foreign exchange rate changes on cash and cash equivalents | | | ( | | | |
Net increase (decrease) in cash, cash equivalents and restricted cash | |
| ( | |
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Cash, cash equivalents and restricted cash at beginning of period | |
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Cash, cash equivalents and restricted cash at end of period | | $ | | | $ | |
Supplemental disclosure of noncash investing and financing information: | |
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Property and equipment included in account payable | | $ | | | $ | |
Transfers of inventory to property and equipment | | $ | | | $ | |
Fair value of common stock issued for acquisition of NIRLAB | | $ | | | $ | — |
Reconciliation of cash, cash equivalents and restricted cash: | | | | | | |
Cash and cash equivalents | | $ | | | $ | |
Restricted cash included in prepaid expenses and other current assets | | | | |
| — |
Restricted cash included in other long-term assets | | | | | | |
Total cash, cash equivalents and restricted cash shown in the statement of cash flows | | $ | | | $ | |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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908 DEVICES INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Nature of the Business and Basis of Presentation
908 Devices Inc. (the “Company”) was incorporated in the State of Delaware on February 10, 2012. The Company is revolutionizing chemical analysis with its simple handheld devices, addressing life-altering applications. The Company’s devices are used at the point-of-need to interrogate unknown and invisible materials and provide quick, actionable answers in vital health, safety and defense tech applications, addressing the fentanyl and illicit drug crisis, toxic carcinogen exposure, and global security threats. The Company designs and manufactures innovative products that bring together the power of complementary analytical technologies, software automation, and machine learning.
The Company is subject to risks and uncertainties common to technology companies in the device industry and of similar size, including, but not limited to, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, uncertainty of market acceptance of products, and the need to obtain additional financing to fund operations. Potential risks and uncertainties also include, without limitation, uncertainties regarding elevated inflation and interest rates, and changes in countries’ trade policies and tariffs. Products currently under development will require additional research and development efforts prior to commercialization and will require additional capital and adequate personnel and infrastructure. The Company’s research and development may not be successfully completed, adequate protection for the Company’s technology may not be obtained, and approved products may not prove commercially viable. The Company operates in an environment of rapid change in technology and competition.
Acquisitions
The Company acquired KAF Manufacturing Company, Inc. (“KAF”), located in Stamford, Connecticut in July 2025. KAF is a precision machining company focused on providing precision components, diamond-turned optics and components for laboratory and medical instrument original equipment manufacturers and for the aerospace industry. This acquisition provided the Company with strength and sustainability over its supply chain for critical Fourier Transform Infrared (“FTIR”) components.
On May 4, 2026, the Company completed its acquisition of NIRLab SA, a corporation organized under the laws of Switzerland, and its wholly owned subsidiary, NIRLab Forensics Sàrl, a limited liability company organized under the laws of Switzerland (together “NIRLAB”). NIRLAB develops near-infrared spectroscopy solutions for instant material identification. This acquisition expands the Company's analytical portfolio and strengthens its leadership in narcotics detection with NIRLAB’s solution for fast, high-volume screening for everyday law enforcement patrol. See Note 15, Acquisitions, for further information.
Divestment of Desktop Portfolio
The Company sold its wholly-owned subsidiary, 908 Devices GmbH and certain liabilities and specified assets of the Company which together constituted the entirety of the Company’s portfolio of desktop devices used in the field of bioprocessing Process Analytical Technology (the “Desktop Portfolio”) to Repligen Corporation and Repligen GmbH (“Repligen Corporation” or “Repligen”) on March 4, 2025 (the “Closing Date”). See Note 3, Discontinued Operation, for further information.
On the Closing Date, the Company entered into a Transition Services Agreement (the “TSA”) with Repligen, which provides for services to be performed by the Company in order to facilitate a transition of the business associated with the Desktop Portfolio. Under the TSA, the Company provided certain technology, financial, manufacturing and other operational transition services to Repligen for a period of time, and will maintain the personnel and facilities required to provide such services for the duration specified for each such service. Repligen has agreed to pay the Company for certain costs of the transition services performed by the Company under the TSA and these services are recorded within Other Income, net in the Company’s condensed consolidated statement of operations.
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On the Closing Date, the parties entered into a Lease Assignment Assumption and Consent Agreement (the “Assignment and Assumption Agreement”). Under the Assignment and Assumption Agreement, the Company assigned to Repligen the Company’s rights in, to and under the real property lease for its North Carolina facility, and Repligen assumed the liabilities related thereto. In addition, as a result of the sale of 908 Devices GmbH, Repligen assumed the liabilities related to the real property lease in Braunschweig, Germany.
On the Closing Date, the Company entered into an UNC Intellectual Property Sublicense Agreement with Repligen (the “Sublicense Agreement”) under which the Company granted a sublicense to license certain Company rights to in-licensed technologies under the Company’s license agreement with the University of North Carolina (“UNC”). See Note 14, Commitments and Contingencies.
On the Closing Date, the company entered into a Supply Agreement with Repligen under which the Company will supply certain components to Repligen related to the Rebel product offering.
Unaudited Interim Financial Information
The accompanying condensed consolidated financial statements have been prepared based on continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. The Company has incurred recurring losses since inception, including net losses from continuing operations of $
Basis of Presentation
The Company’s consolidated financial statements have been prepared in conformity with GAAP. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).
The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, 908 Devices Securities Corporation, CAM2 Technologies, LLC (d/b/a RedWave Technology) (“RedWave”) and NIRLAB. All intercompany balances and transactions have been eliminated.
2. Summary of Significant Accounting Policies
Unaudited Condensed Interim Financial Information
The condensed consolidated balance sheet at December 31, 2025 was derived from audited consolidated financial statements but does not include all disclosures required by GAAP. The accompanying unaudited condensed consolidated financial statements as of June 30, 2026 and for the three and six months ended June 30, 2026 and 2025 have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 on file with the SEC. In the opinion of management, all adjustments, consisting only of
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normal recurring adjustments necessary for a fair statement of the Company’s financial position as of June 30, 2026 and results of operations for the three and six months ended June 30, 2026 and 2025 and statements of stockholders’ equity for the three and six months ended June 30, 2026 and 2025 and cash flows for the six months ended June 30, 2026 and 2025 have been made. The Company’s results of operations for the three and six months ended June 30, 2026 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2026 or any other period.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Significant estimates and assumptions reflected in these condensed consolidated financial statements include, but are not limited to, revenue recognition and accounts receivable, the valuation of inventory, fair value of assets acquired and liabilities assumed in acquisitions, fair value of contingent consideration, and the valuation of stock-based awards. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. Due to the impact of elevated inflation and interest rates, and changes in countries’ trade policies and tariffs and changes in interest rates, there has been uncertainty and disruption in the global economy and financial markets. The Company is not aware of any specific event or circumstance that would require further updates to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of the date of issuance of these condensed consolidated financial statements. These estimates may change, as new events occur and additional information is obtained. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results may differ from those estimates or assumptions.
Risk of Concentrations of Credit, Significant Customers and Significant Suppliers
Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents, marketable securities, and accounts receivable. The Company’s cash and cash equivalents and restricted cash are maintained in bank deposit accounts and money market funds that regularly exceed federally insured limits. The Company is exposed to credit risk on its cash, cash equivalents and restricted cash in the event of default by the financial institutions to the extent account balances exceed the amount insured by the Federal Deposit Insurance Corporation (“FDIC”). The Company’s marketable securities are invested in U.S. treasury securities and agency bond and as a result, the Company believes represent minimal credit risk.
Significant customers are those that accounted for
For the six months ended June 30, 2026, two customers represented 12% and 11% of total revenue, respectively. For the comparable six months ended June 30, 2025,
As of June 30, 2026,
Certain of the components included in the Company’s products are obtained from a sole source, a single source or a limited group of suppliers. Although the Company seeks to reduce dependence on those limited sources of suppliers and manufacturers, the partial or complete loss of certain of these sources, or the requirement to establish a new supplier for the components, could have a material adverse effect on the Company’s operating results, financial condition and cash flows and damage its customer relationships.
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Accounts Receivable
Accounts receivable are presented net of an allowance for credit losses, which is an estimate of amounts that may not be collectible. The Company performs ongoing credit evaluations of its customers and monitors economic conditions to identify facts and circumstances that may indicate its receivables are at risk of not being collected. The Company provides reserves against accounts receivable for estimated credit losses, if any, that may result from a customer’s inability to pay based on the composition of its accounts receivable, current economic conditions and historical credit loss activity, and relevant available forward-looking information. Amounts deemed uncollectible are charged or written off against the reserve.
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | ||||
Balance at beginning of period | | $ | | | $ | | | $ | | | | |
Current period change for expected credit loss | | | — | | | ( | | | — | | | ( |
Deduction / recoveries collected | | | — | | | ( | | | ( | | | ( |
Balance at end of period | | $ | | | $ | | | $ | | | | |
Goodwill and Intangible Assets
Goodwill is not amortized, but is evaluated for impairment on an annual basis, or on an interim basis when events or changes in circumstances indicate that the carrying value may not be recoverable. In assessing the recoverability of goodwill, the Company must make assumptions regarding the estimated future cash flows, and other factors, to determine the fair value. If these estimates or their related assumptions change in the future, the Company may be required to record impairment charges in the reporting period in which the impairment is determined.
The Company tests goodwill for impairment at the reporting unit level, which is the operating segment, in the fourth quarter of every fiscal year. The Company has the option of performing a qualitative assessment to determine whether further impairment testing is necessary before performing the quantitative assessment. If as a result of the qualitative assessment, it is more-likely-than-not that the fair value of its reporting unit is less than its carrying amount, a quantitative impairment test will be required. The quantitative goodwill impairment test requires management to estimate and compare the fair value of the reporting unit with its carrying value. If the fair value of the reporting unit exceeds the carrying value of the net assets, goodwill is not impaired. If the fair value of the reporting unit is less than the carrying value, the difference is recorded as an impairment loss.
Intangible assets with a finite useful life are recorded at cost, net of accumulated amortization and are amortized on a straight-line basis over their estimated useful lives as follows:
| | |
Customer Relationships | | |
Developed Technology | | |
Trade Name | |
Revenue Recognition
The Company recognizes revenue from sales to customers under Accounting Standards Codification 606, Revenue from Contracts with Customers, or ASC 606 by applying the following five steps: (1) identification of the contract, or contracts, with a customer, (2) identification of the performance obligations in the contract, (3) determination of the transaction price, (4) allocation of the transaction price to the performance obligations in the contract and (5) recognition of revenue when, or as, performance obligations are satisfied.
For a contract with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation on a relative standalone selling price basis using our best estimate of the standalone selling price of each distinct product or service in the contract. The primary method used to estimate standalone selling price is the price observed in standalone sales to customers; however, when prices in standalone sales are not available, the Company may use third party pricing for similar products or services or estimate the standalone selling price, which is set by management.
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Allocation of the transaction price is determined at the contract’s inception and is not updated to reflect changes between contract inception and when the performance obligations are satisfied.
The Company derives revenue primarily from the sale of devices, consumables, accessories, software and services. Revenue is recognized when control of the promised devices, consumables, accessories, software or services is transferred to our customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those devices, consumables, accessories, software or services (the transaction price). A performance obligation is a promise in a contract to transfer a distinct product or service to a customer and is the unit of accounting under ASC 606. For devices, consumables, accessories and software sold by us, control transfers to the customer at a point in time. To indicate the transfer of control, the Company must have a present right to payment, legal title must have passed to the customer, the customer must have the significant risks and rewards of ownership, and where acceptance is other than perfunctory, the customer must have accepted the product or service. The Company’s principal terms of sale are freight on board, or FOB, shipping point, or equivalent, and, as such, the Company primarily transfers control and record revenue for devices, consumables, accessories and software sales upon shipment. Sales arrangements with delivery terms that are not FOB shipping point are not recognized upon shipment and the transfer of control for revenue recognition is evaluated based on the associated shipping terms and customer obligations. If a performance obligation to the customer with respect to a sales transaction remains to be fulfilled following shipment (typically installation or acceptance by the customer), revenue recognition for that performance obligation is deferred until such commitments have been fulfilled. For extended warranty and support and software subscriptions, control transfers to the customer over the term of the arrangement. Revenue for extended warranty and support and software subscriptions is recognized based upon the period of time elapsed under the arrangement as this period represents the transfer of benefits or services under the agreement.
The Company also offers customers a subscription to our proprietary target library and companion software application, which together represent a single combined performance obligation, as the library has no substantive functionality separate from our hosted platform and the platform has no content to deliver absent the library. Because the customer simultaneously receives and consumes the benefit of continuous, updated access over the contract term, revenue for the subscription is recognized based upon the period of time elapsed under the arrangement, consistent with our recognition of extended warranty and support revenue.
From time to time, the Company generates revenue from short and long-term contracts associated with the design and development and delivery of detection devices or related design and support services.
Generally, revenue for long-term contracts is recognized based upon the cost-to-cost measure of progress, provided that the Company meets the criteria associated with transferring control of the good or service over time such as not creating an asset with an alternative use and having an enforceable right to payment for completed performance. However, the Company evaluates the proper revenue recognition on a contract by contract basis, as each contract generally contains terms specific to the underlying agreement which result in differing performance obligations and payment terms (cost plus, fixed price agreements among others). For revenue recognized under the cost-to-cost measure of progress basis, the Company continually assesses total costs expected to be incurred and if such costs require adjustment to the measure of progress, the Company records such adjustment as a change in estimate on a cumulative catch-up basis in the period of adjustment.
The Company includes the unconstrained amount of consideration in the transaction price. The amount included in the transaction price is constrained to the amount for which it is probable that a significant reversal of cumulative revenue recognized will not occur. At the end of each subsequent reporting period, as required by ASC 606, the Company re-evaluates the estimated consideration included in the transaction price and any related constraint, and if necessary, adjust its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis in the period of adjustment.
Revenue from Contracts with Customers
The Company’s customers primarily consist of federal and defense entities, state authorities and local municipalities, foreign national and provincial organizations and other institutions.
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Distribution Channels
A majority of the Company’s revenue is generated by sales in conjunction with its channel partners, such as its international channel partners and, in the United States, for end customers where a government contract is required or a customer has a pre-existing relationship. When the Company transacts with a channel partner, its contractual arrangement is with the partner and not with the end-use customer. Whether the Company transacts business with and receives the order from a channel partner or directly from an end-use customer, its revenue recognition policy and resulting pattern of revenue recognition for the order are the same.
Disaggregated Revenue
The Company’s product and service revenue consists of sales of devices and recurring revenue which includes consumables, accessories, software, software subscriptions and the sale of service and extended warranty plans. The following table presents the Company’s revenue by revenue stream (in thousands):
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | ||||
Revenue: |
| | |
| | |
| | |
| | |
Device sales revenue | | $ | | | $ | | | $ | | | $ | |
Recurring revenue | |
| | |
| | |
| | |
| |
Contract revenue | |
| | |
| | |
| | |
| |
Total revenue | | $ | | | $ | | | $ | | | $ | |
The following table presents the Company’s revenue by source (in thousands):
| | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | | ||||
Revenue: | | | | | | | | | | | | | |
Handheld product and service revenue | | $ | | | $ | | | $ | | | $ | | |
Program product and service revenue | | | | | | | | | | | | | |
OEM and funded partnership revenue | | | | | | | | | | | | | |
Total revenue | | $ | | | $ | | | $ | | | $ | | |
Revenue based on the end-user entity type for the Company’s revenue are presented below (in thousands):
| | | | | | | | | | | | |
| Three Months Ended June 30, | | Six Months Ended June 30, | | ||||||||
| 2026 | | 2025 | | 2026 | | 2025 | | ||||
United States federal and defense | $ | | | $ | | | $ | | | $ | | |
United States state authorities and local municipalities | | | | | | | | | |
| | |
Rest of world national and provincial organizations | | | |
| | | | | | | | |
Global pharmaceutical, industrial and other | | | |
| | | | | |
| | |
Total revenue | $ | | | $ | | | $ | | | $ | | |
The following table disaggregates the Company’s revenue from contracts with customers by geography, which are determined based on the customer location (in thousands):
| | | | | | | | | | | | |
| Three Months Ended June 30, | | Six Months Ended June 30, | | ||||||||
| 2026 | | 2025 | | 2026 | | 2025 | | ||||
United States | $ | | | $ | | | $ | | | $ | | |
Europe, Middle East and Africa | | | |
| | | | | |
| | |
Asia Pacific | | | | | | | | | | | | |
Americas other | | | |
| | | | | |
| | |
Total revenue | $ | | | $ | | | $ | | | $ | | |
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Customer Commitment
In June 2025, the Company entered into a Master Supply Agreement with a large analytical instrumentation customer (“OEM Customer”), who is an existing customer of the Company and a customer of KAF. For the initial three years of the total five year term, the OEM Customer committed to $
Deferred Revenue
The following is a summary of the activity of the Company’s deferred revenue (in thousands):
| | | | | | |
| | Six Months Ended June 30, | ||||
| | 2026 | | 2025 | ||
Balances at beginning of period | | $ | | | $ | |
Recognition of revenue included in balance at beginning of the period | |
| ( | |
| ( |
Deferred revenue acquired, net of revenue recognized | | | | | | — |
Revenue deferred during the period, net of revenue recognized | |
| | |
| |
Balances at end of period | | $ | | | $ | |
The amount of deferred revenue equals the transaction price allocated to unfulfilled performance obligations for the period presented. Such deferred revenue amounts related to product and service revenue are expected to be recognized in the future as follows (in thousands):
| | | | | | |
| | June 30, | | December 31, | ||
| | 2026 | | 2025 | ||
Deferred revenue expected to be recognized in: |
| | |
| | |
One year or less | | $ | | | $ | |
One to two years | |
| | |
| |
Three years and beyond | |
| | |
| |
| | $ | | | $ | |
Business Combination
Under the acquisition method of accounting, the Company generally recognizes the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values on the date of acquisition. The fair values assigned, defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between willing market participants, are based on estimates and assumptions determined by management. The excess consideration over the aggregate value of tangible and intangible assets, net of liabilities assumed, is recorded as goodwill. These valuations require significant estimates and assumptions, especially with respect to intangible assets.
The Company estimates the fair value of the contingent consideration earnouts using the Monte Carlo Simulation or probability weighted scenario depending on the nature of the contingent consideration and updates the fair value of the contingent consideration at each reporting period based on the estimated probability of achieving the earnout targets and applying a discount rate that captures the risk associated with the expected contingent payments. To the extent that these estimates change in the future regarding the likelihood of achieving these targets, the Company may need to record material adjustments to its accrued contingent consideration. Such changes in the fair value of contingent consideration are recorded as contingent consideration expense or income in the consolidated statements of operations.
The Company uses the income approach to determine the fair value of certain identifiable intangible assets including customer relationships, developed technology and trade names. This approach determines fair value by estimating after-tax cash flows attributable to these assets over their respective useful lives and then discounting these after-tax cash flows back to a present value. The Company bases its assumptions on estimates of future cash flows, expected growth rates, expected trends in
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technology, probabilities of customer renewals, etc. The Company bases the discount rates used to arrive at a present value as of the date of acquisition on the time value of money and certain industry-specific risk factors. The Company believes the estimated purchased customer relationships, developed technology and trade name amounts determined represent the fair value at the date of acquisition and do not exceed the amount a third-party would pay for the assets.
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The new standard requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact of the ASU on its consolidated financial statements.
Recently Adopted Accounting Pronouncements
In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326) to introduce a practical expedient to calculating current expected credit loss by assuming that the current conditions as of the balance sheet date will not change for the remaining life of the asset. This expedient can only be applied to current accounts receivable and current contract assets. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025, and interim periods within those annual periods, and this update is applied prospectively. The Company adopted ASU 2025-05 in the first quarter of 2026 and applied it prospectively, with no material impact on its consolidated financial statements.
3. Discontinued Operations and TSA
On March 3, 2025, upon board approval of the transaction, the Company classified its Desktop Portfolio as held for sale, and the Company then completed the sale of its Desktop Portfolio to Repligen on March 4, 2025. The Company has determined the sale of the Desktop Portfolio represents a strategic shift that will have a major effect on its business and therefore met the criteria for classification as discontinued operations as of March 3, 2025.
The related assets and liabilities of the Desktop Portfolio were classified as assets and liabilities of discontinued operations in the consolidated balance sheets and the results of operations from the Desktop Portfolio as discontinued operations in the consolidated statements of operations. Applicable amounts in prior years have been recast to conform to this discontinued operations presentation.
As of June 30, 2026 and December 31, 2025, there were
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| | | | |
Consideration received | | | | |
Payment for fair value transferred for Desktop Portfolio(1) | | $ | | |
| | | | |
Net assets transferred | | | | |
Cash | | $ | | |
Accounts receivable | | | | |
Inventory | | | | |
Prepaid expenses and other current assets | | | | |
Property and equipment, net | | | | |
Operating lease right-of-use assets | | | | |
Intangible assets and other long-term assets | | | | |
Accounts payable | | | ( | |
Accrued expenses and other current liabilities | | | ( | |
Deferred revenue | | | ( | |
Operating lease liabilities | | | ( | |
Deferred income taxes | | | ( | |
Net assets transferred | | $ | | |
| | | | |
Transaction costs | | $ | ( | |
Release of cumulative translation adjustment under 908 Devices GmbH | | | | |
Gain on sale, pre-tax | | $ | | |
Income tax | | | — | |
Gain on sale, net of tax | | $ | | |
| (1) | The Cash payment consists of $ |
For the six months ended June 30, 2026 and 2025, the Company recognized
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The following table presents the financial results of the discontinued operations prior to the sale of the Desktop Portfolio (in thousands):
| | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | |
| ||
| | 2025 | | 2025 | |
| ||
Revenue: | | | | | | | | |
Product revenue | | $ | — | | $ | | | |
Service and contract revenue | | | — | | | | | |
Total revenue | |
| — | |
| | | |
Cost of revenue: | |
| | |
| | | |
Product cost of revenue | |
| — | |
| | | |
Service and contract cost of revenue | | | — | | | | | |
Total cost of revenue | |
| — | |
| | | |
Gross profit | | | — | | | | | |
Operating expenses: | |
| | |
| | | |
Research and development | |
| — | |
| | | |
Selling, general and administrative | |
| | |
| | | |
Total operating expenses | |
| | |
| | | |
Other income (expense), net: | | | | | | | | |
Gain on divesture | | | — | | | | | |
Other expense, net: | |
| — | |
| ( | | |
Total other income, net: | | | — | | | | | |
Income (loss) from discontinued operations before income taxes | | $ | ( | | $ | | | |
Benefit for income taxes | | | — | | | | | |
Net income (loss) from discontinued operations, net of tax | | $ | ( | | $ | | | |
In accordance with ASC 205-20, only expenses specifically identifiable and related to a business to be disposed may be presented in discontinued operations. As such, the research and development and general and administrative expenses in discontinued operations only include corporate costs incurred directly to support the Desktop Portfolio.
The Company has also entered into a TSA with Repligen, through which the Company provided certain technology, financial, manufacturing and other operational transition services to Repligen for a period of time, and maintained the personnel and facilities required to provide such services for the duration specified for each such service. Income from TSA, net of directly identifiable costs, is included as income from transition services agreement, net under other income, net. The services and obligations under the TSA were completed as of June 30, 2026.
As of June 30, 2026, Repligen owes the Company $
The cash flows related to discontinued operations have not been segregated and are included in the condensed consolidated statements of cash flows. The Company received release of escrow of $
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4. Fair Value Measurements
The following tables present the Company’s fair value hierarchy for its assets and liabilities that are measured at fair value on a recurring basis (in thousands):
| | | | | | | | | | | | |
| | Fair Value Measurements at June 30, 2026 Using: | ||||||||||
| | Level 1 | | Level 2 | | Level 3 | | Total | ||||
Assets: |
| | |
| | |
| | |
| | |
Cash equivalents - Money market funds | | $ | | | $ | — | | $ | — | | $ | |
Marketable securities - U.S. Treasury securities due in 3 to 12 months | | | — | | | | | | — | | | |
Marketable securities - agency bond due in 3 to 12 months | | | — | | | | | | — | | | |
Total assets measured at fair value |
| $ | |
| $ | |
| $ | — |
| $ | |
Other current liabilities: | | | | | | | | | | | | |
Holdback shares - NIRLAB acquisition | | $ | | | $ | — | | $ | — | | $ | |
Acquisition-related contingent consideration | | | — | | | — | | | | | | |
| | $ | |
| $ | — |
| $ | |
| $ | |
Other long-term liabilities: | | | | | | | | | | | | |
Acquisition-related contingent consideration | | | — | | | — | | | | | | |
Total liabilities measured at fair value | | $ | | | $ | — | | $ | | | $ | |
| | | | | | | | | | | | |
| | Fair Value Measurements at December 31, 2025 Using: | ||||||||||
| | Level 1 | | Level 2 | | Level 3 | | Total | ||||
Assets: |
| | |
| | |
| | |
| | |
Cash equivalents - Money market funds | | $ | | | $ | — | | $ | — | | $ | |
Marketable securities - U.S. Treasury securities due in 3 to 12 months | | | — | | | | | | — | | | |
Total assets measured at fair value |
| $ | |
| $ | |
| $ | — |
| $ | |
Other current liabilities: | | | | | | | | | | | | |
Acquisition-related contingent consideration | | | — | | | — | | | | | | |
Total liabilities measured at fair value | | $ | — | | $ | — | | $ | | | $ | |
Money Market Funds
Money market funds were valued by the Company based on quoted market prices, which represent a Level 1 measurement within the fair value hierarchy. There were
Marketable Securities
U.S. Treasury securities and agency bond were valued by the Company using quoted prices in active markets for similar securities, which represent a Level 2 measurement within the fair value hierarchy.
Contingent Consideration
The Company recognizes acquisition-related contingent consideration which represents the estimated fair value of future payments or issuance of the Company’s common stock to the former owners of an acquired entity as part of certain transactions. Acquisition-related contingent consideration is measured and reported at fair value using the present value technique, the Monte Carlo simulation method or probability weighted scenario based on the unobservable inputs, which are significant to the fair value and classified with Level 3 of the fair value hierarchy.
For the acquisition of NIRLAB in May 2026, the amount of contingent consideration to be issued is based on the satisfaction of certain performance milestones and the execution of specified contracts. Under the revenue milestone, the amount of revenue the Company generates from the sale of certain NIRLAB products and services during the one-year period from January 1, 2027 through December 31, 2027 determines the amount of contingent consideration to be issued. Under the contractual milestone, the execution of specified contracts and recurring revenue from such contracts for the fiscal year 2026
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and 2027 determines the amount of contingent consideration to be issued. As of the acquisition date of NIRLAB, the fair value of the contingent consideration was estimated using a Monte Carlo simulation, utilizing the closing price of the Company’s common stock on the Nasdaq Global Market of $
As of June 30, 2026, the fair value of the contingent consideration related to the acquisition of NIRLAB was estimated utilizing the closing price of the Company’s common stock on the Nasdaq Global Market of $
For the acquisition of RedWave in April 2024, the amount of contingent consideration to be issued was based on the amount of revenue the Company generated from the sale of certain RedWave products and services during the
As of April 30, 2026, per the terms of the Equity Purchase Agreement (the “RedWave Purchase Agreement”), dated as of April 29, 2024, by and among the Company, RedWave, CAM3 HoldCo, LLC, the beneficial sellers named therein (the “Beneficial Sellers”) and the indirect beneficial seller named therein the Company was required to notify the Seller Entity (as defined in the RedWave Purchase Agreement) within ninety (90) days of its specific calculation of Earnout Revenue (as defined in the RedWave Purchase Agreement) and of the amount of the Earnout Consideration (as defined in the RedWave Purchase Agreement), if any. As of June 30, 2026, the fair value of the contingent consideration related to the acquisition of RedWave was estimated utilizing the closing price of the Company’s common stock on the Nasdaq Global Market of $
The following table provides a roll-forward of the fair value of the Company’s contingent consideration, for which fair value is determined using Level 3 inputs (in thousands):
| | | |
Balance as of December 31, 2025 | | $ | |
Contingent consideration - NIRLAB acquisition | | | |
Increase in fair value of contingent consideration earnouts - NIRLAB | | | |
Increase in fair value of contingent consideration earnouts - RedWave | | | |
Balance as of June 30, 2026 | | $ | |
The change in the fair value of contingent consideration liability is included in loss from continuing operations.
5. Marketable Securities
Marketable securities by security type consisted of the following (in thousands):
| | | | | | | | | | | | | | | | |
| | June 30, 2026 | | |||||||||||||
| | Amortized | | Gross | | Gross | | Credit Losses | | Fair Value | | |||||
Marketable securities - U.S. Treasury securities | | $ | | | $ | | | $ | ( | | $ | — | | $ | | |
Marketable securities - Agency bond | | | | | | — | | | ( | | | — | | | | |
| | $ | | | $ | — | | $ | ( | | $ | — | | $ | | |
| | | | | | | | | | | | | | | | |
| | December 31, 2025 | | |||||||||||||
| | Amortized | | Gross | | Gross | | Credit Losses | | Fair Value | | |||||
Marketable securities - U.S. Treasury securities | | $ | | | $ | | | $ | — | | $ | — | | $ | | |
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The Company purchased a total of approximately $
6. Inventory
Inventory consisted of the following (in thousands):
| | | | | | | |
| | June 30, | | December 31, | | ||
| | 2026 | | 2025 | | ||
Raw materials | | $ | | | $ | | |
Work-in-progress | | | | |
| | |
Finished goods | | | | |
| | |
| | $ | | | $ | | |
During the six months ended June 30, 2026 and 2025, the Company made noncash transfers of demonstration equipment from inventory to property and equipment of $
7. Goodwill and Intangible Assets, net
Goodwill
As of June 30, 2026, the carrying amount of goodwill was $
| | | |
| | Six Months Ended June 30, | |
| | 2026 | |
Balances at beginning of period | | $ | — |
Goodwill acquired | |
| |
Foreign currency impact | | | ( |
Balances at end of period | | $ | |
The Company evaluates goodwill at least annually on November 1, as well as whenever events or changes in circumstances suggest that the carrying amount may not be recoverable.
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Intangible Assets, net
Intangible assets, net consists of the following (in thousands):
| | | | | | | | | | | | |
| | June 30, 2026 | ||||||||||
| | Cost | | Accumulated Amortization | | Translation adjustments | | Net Book Value | ||||
Customer Relationships | | $ | | | $ | ( | | $ | ( | | $ | |
Developed Technology | | | | | | ( | | | ( | | | |
Trade Name | | | | | | ( | | | ( | | | |
| | $ | | | $ | ( | | $ | ( | | $ | |
| | | | | | | | | |
| | December 31, 2025 | |||||||
| | Cost | | Accumulated Amortization | | Net Book Value | |||
Customer Relationships | | $ | | | $ | ( | | $ | |
Developed Technology | | | | | | ( | | | |
| | $ | | | $ | ( | | $ | |
Amortization expense for intangible assets was recorded in the following expense categories of its condensed consolidated statements of operations (in thousands):
| | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | | ||||
Cost of revenue | | $ | | | $ | | | $ | | | $ | | |
Selling, general and administrative expenses | | | | | | | | | | | | | |
| | $ | | | $ | | | $ | | | $ | | |
Estimated future amortization expense for the intangible assets as of June 30, 2026 are as following (in thousands):
| | | |
Remainder of 2026 | | $ | |
2027 | | | |
2028 | | | |
2029 | | | |
2030 | | | |
Thereafter | | | |
| | $ | |
8. Accrued Expenses
Accrued expenses consisted of the following (in thousands):
| | | | | | | |
| | June 30, | | December 31, | | ||
| | 2026 | | 2025 | | ||
Accrued employee compensation and benefits | | $ | | | $ | | |
Accrued warranty | | | | |
| | |
Accrued professional fees | | | | |
| | |
Accrued other | | | | |
| | |
| | $ | | | $ | | |
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Changes in the Company’s product warranty obligations were as follows (in thousands):
| | | | | | |
| | Six Months Ended June 30, | ||||
| | 2026 | | 2025 | ||
Accrual balance at beginning of period | | $ | | | $ | |
Provision for new warranties | |
| | |
| |
Settlements and adjustments made during the period | |
| ( | |
| ( |
Accrual balance at end of period | | $ | | | $ | |
9. Restructuring
In June 2025, the Company abandoned its Boston facility in connection with transitioning manufacturing operations from Boston, Massachusetts to Danbury, Connecticut and moved its corporate headquarters to Burlington, Massachusetts. The Company had no intention to sublease or utilize the space for the remaining lease term, resulting in the right-of-use assets to be abandoned. The Company recorded a $
10. Long-Term Debt
Loan Revolver
On March 5, 2026, the Company entered into the Amended 2026 Revolver by and between the Company, as borrower, and SVB, as lender. The Amended 2026 Revolver provides for a revolving line of credit of up to $
11. Equity and Net Income (Loss) per Share
Equity
As of June 30, 2026, the Company’s certificate of incorporation authorized the Company to issue up to
Each share of common stock entitles the holder to
As of June 30, 2026, and December 31, 2025, the Company had outstanding warrants for the purchase of
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Net (Loss) Income per Share
Basic and diluted net (loss) income per share attributable to common stockholders was calculated as follows (in thousands, except share and per share data):
| | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
| ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 |
| ||||
Net income (loss) per share attributable to common stockholders: | | | | | | | | | | | | | |
Numerator: |
| | | | | | | | | | | | |
Net loss from continuing operations attributable to common stockholders | | $ | ( | | $ | ( | | $ | ( | | $ | ( | |
Net income (loss) from discontinued operations attributable to common stockholders | |
| — | |
| ( | |
| — | |
| | |
Net income (loss) attributable to common stockholders | | $ | ( | | $ | ( | | $ | ( | | $ | | |
| | | | | | | | | | | | | |
Denominator: | |
| | |
| | |
| | |
| | |
Weighted average common shares outstanding - basic and diluted | | | | | | | | | | | | | |
Net loss from continuing operations per share attributable to common stockholders, basic and diluted | | $ | ( | | $ | ( | | $ | ( | | $ | ( | |
Net income (loss) from discontinued operations per share attributable to common stockholders, basic and diluted | | $ | - | | $ | ( | | $ | - | | $ | | |
Net income (loss) per share attributable to common stockholders, basic and diluted | | $ | ( | | $ | ( | | $ | ( | | $ | | |
The Company utilizes the control number concept in the computation of diluted earnings per share to determine whether potential common stock equivalents are dilutive. The control number used is net loss from continuing operations. The control number concept requires that the same number of potentially dilutive securities applied in computing diluted earnings per share from continuing operations be applied to all other categories of income or loss, regardless of their anti-dilutive effect on such categories. Since the Company had a net loss from continuing operations for all periods presented, no dilutive effect has been recognized in the calculation of income from discontinued operations per share. Therefore, the weighted average number of common shares outstanding used to calculate both basic and diluted net loss from continuing operations and net (loss) income from discontinued operations per share attributable to common stockholders are the same.
Diluted net income (loss) per share attributable to common stockholders is computed by dividing net (loss) income by the weighted average number of shares of common stock outstanding for the period, including potential dilutive common shares assuming the dilutive effect of outstanding warrants, stock options, restricted stock units and shares to be purchased under the Company’s employee stock purchase plan.
For periods in which the Company reports a net loss from continuing operations, regardless of net (loss) income from discontinued operation, diluted net (loss) income per share attributable to common stockholders is the same as basic net (loss) income per share attributable to common stockholders since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. As the Company has reported a net loss from continuing operations during the three and six months ended June 30, 2026 and 2025, basic net (loss) income per share is the same as diluted net loss per share.
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The Company excluded the following potential shares of common stock, presented based on amounts outstanding at each period end, from the computation of diluted net (loss) income per share attributable to common stockholders for the three and six months ended June 30, 2026 and 2025 as the impact of including such common stock equivalents would have been anti-dilutive:
| | | | |
| | June 30, | ||
| | 2026 | | 2025 |
Warrants to purchase common stock | | | | |
Options to purchase common stock | | |
| |
Performance stock units | | | | |
Restricted stock units | | | | |
Shares to be issued for earnout achievement - RedWave acquisition | | | | — |
|
| |
| |
12. Stock-Based Compensation
The Company recorded stock-based compensation expense for all stock awards in the following expense categories of its condensed consolidated statements of operations (in thousands):
| | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | | ||||
Cost of revenue | | $ | | | $ | | | $ | | | $ | | |
Research and development expenses | | | | |
| | | | | |
| | |
Selling, general and administrative expenses | | | | |
| | | | | |
| | |
| | $ | | | $ | | | $ | | | $ | | |
RSUs and PSUs
As of June 30, 2026, there was $
The maximum payout percentage for all performance-based restricted stock units, including Performance Condition Based PSUs, granted by the Company is
Stock Options
As of June 30, 2026, there was $
2026 Inducement Plan
In February 2026, the Company adopted the 2026 Inducement Plan (the “Inducement Plan”). The Inducement Plan was adopted by board of directors without stockholder approval pursuant to Nasdaq Marketplace Rule 5635(c)(4). In accordance with Rule 5635(c)(4), awards made under the Inducement Plan, including stock options and RSUs, may only be granted to newly hired employees as a material inducement to accept employment with the Company. Awards granted under the Inducement Plan expire no later than
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13. Leases
The Company’s primary operating lease obligations consist of leases for office space and manufacturing facilities in Massachusetts and Connecticut.
The Company has leases for office space and certain equipment. Some of the leases include
In July 2025, the Company acquired KAF and entered into an agreement to lease the approximately
In June 2025, the Company entered into a new operating lease agreement in Burlington, Massachusetts. The new lease is for approximately
In February 2025, the Company entered into a new operating lease agreement in Massachusetts to relocate the machine shop from the Company’s headquarters to a lower cost location. The new lease is for approximately
For additional information, read Note 16, Leases, to the consolidated financial statements in the Company’s Form 10-K for the year ended December 31, 2025.
The components of lease expense under ASC 842, Leases, were as follows (in thousands):
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | ||||
Operating lease cost | | $ | | | $ | | | $ | | | $ | |
Short-term lease cost |
| | |
| | | | | |
| | |
Variable lease cost |
| | — |
| | | | | — |
| | |
| | $ | | | $ | | | $ | | | $ | |
Supplemental disclosure of cash flow information related to leases was as follows (in thousands):
| | | | | | | |
| | Six Months Ended June 30, |
| ||||
| | 2026 | | 2025 |
| ||
Cash paid for amounts included in the measurement of operating lease liabilities | | $ | | | $ | |
|
Operating lease liabilities arising from obtaining right-of-use assets | | $ | — | | $ | | |
The weighted-average remaining lease term and discount rate were as follows:
| | | | | |
| | Six Months Ended June 30, | | ||
| | 2026 | | 2025 | |
Weighted-average remaining lease term (in years) | | |
| ||
Weighted-average discount rate - operating leases |
| | % | | % |
The interest rate implicit in lease contracts is typically not readily determinable and as such, the Company uses its incremental borrowing rate based on information available at the lease commencement date, which represents an internally developed rate that would be incurred to borrow, on a collateralized basis, over a similar term, an amount equal to the lease payments in a similar economic environment.
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Future annual minimum lease payments under operating leases as of June 30, 2026 are as follows (in thousands):
| | | |
Remainder of 2026 | | $ | |
2027 | |
| |
2028 | |
| |
2029 | |
| |
2030 | | | |
Thereafter | |
| |
Total future minimum lease payments | |
| |
Less: imputed interest | | | ( |
Total operating lease liabilities | | $ | |
14. Commitments and Contingencies
Royalty Arrangements
The Company has entered into royalty arrangements whereby the Company owes low- to mid-single digit royalty percentages related to revenue that is derived pursuant to in-licensed technologies. These royalties are calculated as a percent of revenue or on a per component basis, depending on the arrangement. Royalty obligations are expensed when incurred or over the minimum royalty periods and have not been material.
As a part of Repligen Purchase Agreement, the Company entered into a sublicense agreement with Repligen under which the Company granted a sublicense to certain Company rights to in-licensed technologies under the Company’s license agreement with UNC. Under the sublicense agreement, Repligen owes the Company low- to mid-single digit royalty percentages related to revenue that is derived pursuant to such licensed technologies, which are calculated as a percent of revenue and deemed not material. See Note 1, Nature of the Business and Basis of Presentation.
401(k) Savings Plan
The Company has a defined-contribution savings plan under Section 401(k) of the Internal Revenue Code of 1986. This plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pre-tax basis. Company contributions to the plan may be made at the discretion of the board of directors. During the three and six months ended June 30, 2026, the Company made $
Contingent Consideration – Earnouts
Earnouts from acquisition of RedWave Technology
The Company was obligated to issue up to an additional
On July 8, 2026,
Earnouts from acquisition of NIRLAB
Pursuant to the terms of the Share Purchase Agreement, dated as of May 4, 2026 (the “NIRLAB Purchase Agreement”), by and among the Company and Florentin Coppey, Pierre Esseiva, Matteo Delbrück, Parkview Invest AG, Matthieu Girod and
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NIRLab SA (the “Sellers”), the Company may be obligated to issue up to $
Indemnification Agreements
In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with its executive officers and members of its board of directors that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or services as directors or officers. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. To date, the Company has not incurred any material costs as a result of such indemnifications. The Company is not currently aware of any indemnification claims and had not accrued any liabilities related to such obligations in its condensed consolidated financial statements as of June 30, 2026.
Legal Proceedings
The Company is not currently party to any material legal proceedings. At each reporting date, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. The Company expenses as incurred the costs related to such legal proceedings.
15. Acquisitions
Acquisition of NIRLAB
On May 4, 2026, the Company completed its acquisition of NIRLAB. Pursuant to the NIRLAB Purchase Agreement, the Sellers agreed to sell and transfer to the Company, on the closing date, all of the issued and outstanding NIRLAB shares in exchange for a preliminary consideration payable by the Company on the closing date with a price of $
The Cash and Stock Considerations are subject to customary adjustments. The Company withheld $
The Company may also be obligated to issue up to $
The Company has accounted for the acquisition of NIRLAB as a business combination under U.S. GAAP. Under the acquisition method of accounting, the assets and liabilities of NIRLAB have been recorded as of the acquisition date, at their respective fair values, and consolidated with those of the Company.
The Company has preliminarily allocated the purchase price to the net tangible and intangible assets and liabilities assumed based on their fair values as of May 4, 2026. The valuation of assets acquired and liabilities assumed has not yet been finalized as of June 30, 2026. Finalization of the valuation during the measurement period could result in a change in the amounts recorded for the acquired intangible assets, goodwill and among other items. The completion of the valuation will occur no later than one year from the acquisition date.
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Fair Value of Net Assets Acquired
The following table presents the preliminary allocation of the consideration paid on the acquisition date for the NIRLAB transaction (amounts in thousands):
| | | |
Consideration Transferred: | | | |
Cash paid (1) | | $ | |
Common stock shares issued and holdback (2) | | | |
Net cash and working capital adjustment (3) | | | |
Contingent consideration - earnout | | | |
Total consideration transferred | | $ | |
| | | |
Assets acquired and liabilities assumed: | | | |
Cash and cash equivalents | | $ | |
Accounts receivable | | | |
Inventory | | | |
Prepaid expenses and other current assets | | | |
Property and equipment | | | |
Identifiable Intangible assets | | | |
Trade Name | | | |
Customer Relationships | | | |
Developed Technology | | | |
Goodwill | | | |
Accounts payable, accrued expenses and other current liabilities | | | ( |
Deferred tax liabilities, net | | | ( |
Deferred revenue | | | ( |
Total | | $ | |
| (1) | The Company withheld $ |
| (2) | The |
| (3) | Net cash and working capital adjustments include preliminary look-back of net cash, debt and working capital adjustment. |
The excess of the purchase price over the fair value of the acquired business's net assets represents cost and revenue synergies specific to the Company and NIRLAB, and has been allocated to goodwill, which is not tax deductible. As the Company operates in a single reportable segment, which consists of only one reporting unit, the entire balance of the acquired goodwill has been allocated to this single reporting unit for the purpose of subsequent impairment testing.
The fair value of NIRLAB’s technology-based intangible assets were determined using the multi-period excess earnings method which measures economic benefit indirectly by calculating the income attributable to an asset after appropriate returns are paid to complementary assets used in conjunction with the subject asset to produce the earnings associated with the subject assets, commonly referred to as contributory asset charges. Under this method, the value of an asset is a function of several components, including the forecasted revenue, earnings generated by the asset, expected economic life of the asset, contributory asset charges and a discount rate.
The fair value of the customer relationships was calculated using a distributor method, a form of the income approach, which incorporates a variation of the multi-period excess earnings method that uses market-based inputs to value an asset. Under this method, the value of the asset is a function of several components, including revenue associated with the existing customers, distributor profit margin, charges for use of other assts and discount rate. The fair value of the developed technology was also calculated using the multi-period excess earnings method that uses market-based inputs to value an asset.
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The fair value of the trade name was calculated using a relief from royalty method, a form of the income approach, which incorporate fair value of a royalty to a third party for the use of that asset. The projected revenue attributable to the products or services using the asset, economic life of the asset and the royalty rate, as a percentage of revenue that would hypothetically be charged by a licensor of the asset to an unrelated licensee and a discount rate are common components of the method.
Intangible assets acquired have finite life and are amortized per our accounting policy. See Note 2, Summary of Significant Accounting Policies, for the amortization periods.
The results of NIRLAB’s operations have been included in the Company’s condensed consolidated financial statements since the date of the acquisition. NIRLAB contributed $0.6 million in revenue during the three months ended June 30, 2026. The Company has not disclosed NIRLAB’s net income or loss since the acquisition date because the NIRLAB business is fully integrated into the condensed consolidated Company’s operations and therefore it was impracticable to determine these amounts.
The unaudited pro forma results do not reflect any operating efficiencies or potential cost savings which may result from the consolidation of the operations of the Company and NIRLAB. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of the results of operations that would have been achieved had the acquisition occurred on January 1, 2025, nor are they intended to represent or be indicative of future results of operations (in thousands):
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | ||||
Revenue (unaudited) | | $ | | | $ | | | $ | | | $ | |
Pre-tax loss from continuing operation (unaudited) | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
Supplemental pro forma pre-tax loss for the three and six months ended June 30, 2025 were adjusted to exclude $
Acquisition of KAF Manufacturing Company, Inc.
On July 1, 2025, the Company entered into an asset purchase agreement with KAF. The purchase price included an initial payment of $
KAF is a precision machining company focused on providing precision components, diamond-turned optics and components for laboratory and medical instrument original equipment manufacturers and for the aerospace industry. The Company believes this acquisition will enable it to strengthen and secure its supply chain for critical FTIR components.
The purchase price allocation related to the acquisition of KAF is complete.
The Company has accounted for the acquisition of KAF as a business combination under U.S. GAAP. Under the acquisition method of accounting, the assets of KAF have been recorded as of the acquisition date, at their respective fair values, and consolidated with those of the Company. The Company has allocated the purchase price to the net tangible and intangible assets based on their estimated fair values as of July 1, 2025.
In June 2025, the Company entered into a Master Supply Agreement with an OEM Customer, who is an existing customer of the Company and a customer of KAF. On July 1, 2025, the Company also entered into a lease agreement, which includes extension options under the Company’s control through March 2028, with the KAF owners for the
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The results of KAF’s operations have been included in the Company’s consolidated financial statements since the date of the acquisition. Pro forma financial information reflecting the acquisition has not been presented because the impact, individually and collectively, on revenues and net income (loss) is not material.
Fair Value of Net Assets Acquired
Subsequent to the acquisition date, no measurement period adjustments were recognized.
| | | |
Consideration Transferred: | | | |
Cash paid | | $ | |
Contingent consideration - earnout | | | |
Total consideration transferred | | $ | |
| | | |
Assets acquired: | | | |
Standard tools and machinery | | $ | |
Identifiable Intangible assets | | | |
Customer Relationships | | | |
Total | | $ | |
The fair value of standard tools and machinery was determined using the cost approach which includes assumptions related to replacement cost, physical deterioration, economic obsolescence, and scrap value, or the market approach which includes adjustments for physical condition of comparable standard tools or machinery sold. The fair value of the customer relationships was calculated using a distributor method, a form of the income approach, which incorporates a variation of the multi-period excess earnings method that uses market-based inputs to value an asset. Under this method, the value of the asset is a function of several components, including revenue associated with the existing customers, distributor profit margin, charges for use of other assts and discount rate. Intangible assets acquired have finite life and are amortized per our accounting policy. See Note 2, Summary of Significant Accounting Policies, for the amortization periods.
16. Segment Reporting
The Company has determined that it operates and is managed as
The CODM uses total revenues and operating results, predominantly in the strategic plan, annual operating plan and quarterly forecast review processes. During these processes, the CODM considers budget-to-actual variances to evaluate both internal (e.g., changes in selling prices, strategic growth investments, productivity, business mix, newly acquired/divested businesses, etc.) and external (e.g., inflation, foreign currency, etc.) events and conditions.
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The following table includes additional information about reported segment revenue, significant segment expenses and segment measure of profitability (in thousands):
| | | | | | | | | | | | | |
| | | Six Months Ended June 30, | | |||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | | ||||
Total revenue | | $ | | | $ | | | $ | | | $ | | |
Significant segment expenses (income) | | | | | | | | | | | | | |
Cost of revenues | | | | |
| | | | | |
| | |
Research and development | | | | | | | | | | | | | |
Sales and marketing | | | | | | | | | | | | | |
General and administrative | | | | | | | | | | | | | |
Change in fair value of contingent consideration | | | | | | | | | | | | | |
Other segment items(1) | | | ( | | | ( | | | ( | | | ( | |
Net loss from continuing operations | | | ( | | | ( | | | ( | | | ( | |
Net income (loss) from discontinued operations, net of tax(2) | | | — | | | ( | | | — | | | | |
Net income (loss) attributable to common stockholders | | $ | ( | | $ | ( | | $ | ( | | $ | | |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on March 9, 2026, or the 2025 Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in “Item 1.A. Risk Factors” section of our 2025 Form 10-K, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
Overview
We have developed an innovative suite of purpose-built handheld devices for point-of-need chemical analysis. Leveraging complementary analytical technologies including our proprietary mass spectrometry (“Mass Spec”) and optical spectroscopy, analytics and machine learning technologies, we make devices that are significantly smaller and more accessible than conventional laboratory instruments. Our devices are used at the point-of-need to interrogate unknown and invisible materials and provide quick, actionable answers to directly address vital health and safety applications, including the fentanyl and illicit drug crisis, toxic carcinogen exposure, and global security threats.
We create simplified measurement devices that our customers can use as accurate tools where and when their work needs to be done, rather than overly complex and centralized analytical instrumentation. We believe the insights and answers our devices provide will accelerate workflows, reduce costs, and offer transformational opportunities for our end users.
Front-line workers rely upon our Mass Spec handheld devices to combat the opioid crisis and detect counterfeit pharmaceuticals and illicit materials in the air or on surfaces at levels 1,000 times below their lethal dose. First responders also utilize our handheld devices to detect and identify thousands of hazardous bulk materials. The term “products” as used in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” refers to the MX908, ThreatID, ProtectIR, XplorIR, VipIR, NIRLab and related devices.
On March 4, 2025, the Company completed the sale of its Desktop Portfolio to Repligen. The Company has determined the sale of the Desktop Portfolio represents a strategic shift that will have a major effect on its business and therefore met the criteria for classification as discontinued operations in the first quarter of 2025. Accordingly, the Desktop Portfolio is reported
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as discontinued operations in accordance with ASC 205-20, Discontinued Operations. The related results of operations from the Desktop Portfolio are classified within discontinued operations in the consolidated statements of operations. Applicable amounts in prior years have been recast to conform to this discontinued operations presentation. The Company recognized a gain on the sale of the Desktop Portfolio upon closing.
Since our inception, we have incurred significant operating losses. Our ability to generate revenue sufficient to achieve profitability will depend on the successful further development and commercialization of our products. We generated revenue from continuing operations of $29.5 million and $24.8 million for the six months ended June 30, 2026 and 2025, respectively, and incurred net losses from continuing operations of $23.8 million and $22.7 million for those same periods. As of June 30, 2026, we had an accumulated deficit of $247.2 million. We expect to continue to incur net losses as we focus on growing sales of our products in both the United States and international markets, scaling our manufacturing operations, continuing research and development efforts to develop new products and further enhance our existing products. As a result, we may need additional funding for expenses related to our operating activities, including selling, general and administrative expenses and research and development expenses.
Because of the numerous risks and uncertainties associated with product development and commercialization, we are unable to accurately predict the timing or amount of increased expenses or when, or if, we will be able to achieve or maintain profitability. Until such time, if ever, as we can generate substantial revenue sufficient to achieve profitability, we expect to finance our operations through a combination of available cash, equity offerings, debt financings and strategic alliances. We may be unable to raise additional funds or enter into such other agreements or arrangements when needed on favorable terms, or at all. If we are unable to raise capital or enter into such agreements as, and when needed, we may have to significantly delay, scale back or discontinue the further development and commercialization efforts of one or more of our products, or may be forced to reduce or terminate our operations.
We believe that our existing cash and cash equivalents, marketable securities and revenue from product and service will enable us to fund our operating expenses, capital expenditure requirements and debt service payments for at least the next 12 months. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. See “Liquidity and Capital Resources.”
Global Economic Conditions
We are continuing to closely monitor macroeconomic factors, including, but not limited to, continued inflationary and interest rate pressures, changes in countries’ trade policies and tariffs, challenging capital market conditions and the limited availability of financing alternatives, which may have an impact on our business, results of operations and financial results.
We are closely monitoring continued economic uncertainty in the United States and abroad, including volatility in the global markets and the rise and fluctuations in inflation and interest rates. These developments and the potential worsening of other macroeconomic conditions present risks for us, and our suppliers and customers. For example, general inflation in the United States, Europe, the Middle East and other geographies has recently been at levels not experienced in recent decades, which has led to higher prices for our raw materials and other inputs, as well as higher salaries and travel expenses, which could continue to negatively impact our business by increasing our cost of sales and operating expenses. General inflation could also negatively impact our business if it leads to spending pressure and decreased available capital for our customers to deploy to purchase our products and services.
Challenging capital market conditions and the limited availability of financing alternatives, together with inflationary and interest rates pressures, may contribute to more cautious spending by our customers. We cannot accurately predict the full impact of current macroeconomic factors on the budgets and capital expenditures of our customers, or the timing of the normalization of customer purchasing patterns.
We are closely monitoring the ongoing military conflict between Russia and Ukraine and the conflicts in the Middle East. Although we do not directly source any material products or supplies from Russia, Ukraine or the Middle East, our customers in Europe and the Middle East could be impacted by extended conflicts or an escalation of these conflicts into neighboring countries.
We are also closely monitoring increases or changes in tariffs on parts and components imported into the U.S., as well as
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reciprocal tariffs recently implemented by non-U.S. countries where we export our finished products. We do not expect these tariffs to materially impact our business or results of operations in the 2026 fiscal year. Nonetheless, we will continue to review and assess how any current or future tariffs may affect our business.
While it is difficult to predict all of the impacts these global economic events and continued inflationary, tariff and interest rate pressures will have on our business and to predict the effects of these factors on our customers’ spending in the near term, we believe the long-term opportunity that we see for our products and services remain unchanged.
For further discussion of the possible impacts of these global factors and other risks on our business, see Part I, Item 1A, “Risk Factors,” of our 2025 Form 10-K.
Factors Affecting Our Performance
We believe that our financial performance has been and in the foreseeable future will continue to be primarily driven by the following factors. While each of these factors presents significant opportunities for our business, they also pose important challenges that we must successfully address to sustain our growth and improve our results of operations. Our ability to successfully address the factors below is subject to various risks and uncertainties.
Device sales
Our financial performance has largely been driven by, and in the future will continue to be impacted by, the rate of sales of our handheld devices. Management focuses on device sales as an indicator of current business success and a leading indicator of likely future recurring revenue from consumables and services. We expect our device sales to continue to grow as we increase penetration in our existing markets and expand into, or offer new features and solutions that appeal to, new markets.
We plan to grow our device sales in the coming years through multiple strategies including expanding our sales efforts domestically and globally and continuing to enhance the underlying technology and applications for our handheld devices. We regularly solicit feedback from our customers and focus our research and development efforts on enhancing our devices and enabling our customers to use additional applications that address their needs, which we believe in turn helps to drive additional sales of our devices and consumables.
Our handheld device orders relate to our MX908, ThreatID, ProtectIR, XplorIR, VipIR and NIRLab, as well as components for the Aerosol and Vapor Chemical Agent Detectors (“AVCAD”) program. Historically, our handheld devices have been used by municipal, state, federal and foreign governments and governmental agencies. Our sales process with government customers is often long and involves multiple levels of approvals, testing and, in some cases, trials. Device orders from a government customer are typically large orders and can be impacted by the timing of their capital budgets. As a result, the revenue for our handheld devices can vary significantly from period-to-period and has been and may continue to be concentrated in a small number of customers in any given period.
Recurring revenue
We regularly assess trends relating to recurring revenue which includes consumables, accessories, software, software subscription and services based on our product offerings, our customer base and our understanding of how our customers use our products. Recurring revenue was 30% and 36% of total revenue for the six months ended June 30, 2026 and 2025, respectively. Our recurring revenue as a percentage of total revenue will vary based upon new device placements in the period. As our device installed base expands, recurring revenue on an absolute basis is expected to increase and over time should be an increasingly important contributor to our revenue.
Recurring revenue is primarily from service revenue, accessories and software subscription. Consumable revenue is mainly related to single-use swab samplers for MX908 to be used in liquid and solid materials analysis, but there are a number of other applications that the MX908 can be used for that do not require consumables. ThreatID, ProtectIR, XplorIR, VipIR and NIRLab do not have consumables.
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Revenue mix and gross margin
Our revenue is derived from sales of our devices, consumables, accessories, software and services. There will be fluctuations in the mix between devices and recurring from period-to-period. Over time, as our device installed base grows, we expect service revenue to constitute a larger percentage of total revenue, provided that our customers remain under a service contract. However, the percentage will be subject to fluctuation based upon our handheld sales in a period. In addition, our selling price and, consequently, our margins, are higher for those devices and recurring revenue that we sell directly to customers as compared to those that we sell through channel partners. While we expect the mix of direct sales as compared to sales through channel partners to remain relatively constant in the near term, we may consider increasing our direct sales capabilities in certain geographies based upon identified opportunities.
Future device and recurring selling prices and gross margins may fluctuate due to a variety of factors, including the introduction by others of competing products and solutions. We aim to mitigate downward pressure on our average selling prices by increasing the value proposition offered by our devices and consumables and accessories, primarily by expanding the applications for our devices and increasing the quantity and quality of data that can be obtained using our consumables.
Product adoption
We monitor our customers’ stages of adoption of our products to provide insight into the timing of future potential sales and to help us formulate financial projections. Typical stages of adoption include testing, trials, pilot and deployment as follows:
| ● | Testing - a customer is actively engaged with internal or external testing of our products. This may include an onsite or virtual demonstration with a salesperson, a customer submitting samples for testing in one of our facilities or testing by a third party. |
| ● | Trials - a customer has committed to a trial of one of our products, which may include a defined period to assess the functionality of the device in their operational environment (in the field or onsite within the customer’s facility). |
| ● | Pilot - a customer commits to the purchase of an initial quantity of devices to deploy in their operational environment to assess a broader opportunity that may grow to tens or hundreds of devices. |
| ● | Deployment - a customer has completed testing, a trial, and/or a pilot and intends to roll out the technology across their enterprise (either at a site or throughout the entire organization). |
Key Business Metrics
We regularly review the number of product placements and cumulative product placement as key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections, and make strategic decisions. We believe that these metrics are representative of our current business; however, we anticipate these will change or may be substituted for additional or different metrics as our business grows.
During the three and six months ended June 30, 2026 and 2025, our product placements (units recognized as revenue) were as follows:
| | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | | ||||
| | 2026 | | 2025 | | 2026 | | 2025 | |
Product Placements: | | | | | | | | | |
Handheld |
| 198 | | 164 | | 365 | | 321 | |
The number of product placements vary considerably from period-to-period due to the type and size of our customers and concentrations among larger government customers as described above. We expect continued fluctuations in our period-to-
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period number of product placements. Placements are reported for devices with a selling price of greater than $25,000 and therefore exclude NIRLab placements.
Our cumulative product placements consist of the following number of devices:
| | | | | |
| | June 30, | | ||
| | 2026 | | 2025 | |
Cumulative Product Placements: | | | | | |
Handheld |
| 4,101 |
| 3,336 |
|
Components of Our Results of Operations
Revenue
Product and Service Revenue
We generate product and service revenue from the sale of our devices and recurring revenue from the sale of consumables, accessories, software, software subscriptions and services. Device sales accounted for 69% and 63% of our total revenue for the six months ended June 30, 2026 and 2025, respectively. Recurring revenue accounted for 30% and 36% of our total revenue for the six months ended June 30, 2026 and 2025, respectively. Our current device offerings include MX908, ThreatID, ProtectIR, XplorIR, VipIR, NIRLab and AVCAD components.
We sell our devices directly to customers and through channel partners. Each of our device sales drives various streams of recurring revenue comprised of consumable, accessory, software, software subscriptions and service revenue. Our consumables consist primarily of accessories and swabs for MX908.
We also offer our customers extended warranty, service plans and software subscriptions. Our extended warranty and service plans are offered for periods beyond the standard one-year warranty that all of our customers receive. These extended warranty and service plans generally have fixed fees and terms ranging from one additional year to four additional years. We recognize revenue from the sale of extended warranty and service plans over the respective coverage period, which approximates the service effort provided by us. Our software subscription to our proprietary target library and companion software application, which together represent a single combined performance obligation, are recognized over the coverage period.
We expect consumables, accessories, software, software subscriptions and service revenue to increase in future periods as our installed base grows and we are able to generate recurring sales.
Contract revenue
Contract agreements are arrangements whereby we provide engineering services for the development of our technology platform for specific programs or new and expanding applications of our technologies for future commercial endeavors. Our contract agreements are with the U.S. government and commercial entities (who may be contracting with the government). Contracts typically include compensation for labor effort and materials incurred related to the deliverables under the contract. Our contract revenue was related to two and one customer during the six months ended June 30, 2026 and 2025, respectively.
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During the three and six months ended June 30, 2026 and 2025, our revenue was comprised of revenue from the following sources:
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | ||||
Revenue: |
| | |
| | |
| | |
| | |
Device sales revenue | | $ | 11,024 | | $ | 8,282 | | $ | 20,384 | | $ | 15,693 |
Recurring revenue | |
| 4,946 | |
| 4,733 | |
| 8,968 | |
| 9,037 |
Contract revenue | |
| 104 | |
| 20 | |
| 104 | |
| 83 |
Total revenue | | $ | 16,074 | | $ | 13,035 | | $ | 29,456 | | $ | 24,813 |
Our product and service revenue is comprised of sales of our devices and related consumables, accessories, software and service contracts to end-users in the government, pharmaceutical and industrial markets as follows:
| | | | | | | | | | | | |
| Three Months Ended June 30, | | Six Months Ended June 30, | | ||||||||
| 2026 | | 2025 | | 2026 | | 2025 | | ||||
United States federal and defense | $ | 2,560 | | $ | 2,886 | | $ | 5,819 | | $ | 4,615 | |
United States state authorities and local municipalities | | 8,912 | | | 7,561 | | | 15,688 | |
| 12,248 | |
Rest of world national and provincial organizations | | 4,139 | |
| 2,033 | | | 6,853 | | | 6,707 | |
Global pharmaceutical, industrial and other | | 463 | |
| 555 | | | 1,096 | |
| 1,243 | |
Total revenue | $ | 16,074 | | $ | 13,035 | | $ | 29,456 | | $ | 24,813 | |
We sell our products primarily in the United States; however, we will continue to expand our global sales efforts as we see traction in our products and assess global market needs. The majority of our international sales are through a distribution channel.
Cost of Revenue, Gross Profit and Gross Margin
Product cost of revenue primarily consists of costs for raw material parts and associated freight, shipping and handling costs, royalties, contract manufacturer costs, salaries and other personnel costs, overhead, amortization of intangibles and other direct costs related to those sales recognized as product revenue in the period.
Cost of revenue for services primarily consists of salaries and other personnel costs, travel related to services provided, facility costs associated with training, warranties and other costs of servicing equipment on a return-to-factory basis and at customer sites. Contract cost of revenue primarily consists of salaries and other personnel costs, materials, travel and other direct costs related to the revenue recognized in the period. The contract cost of revenue will vary based upon the type of contract, including whether it is primarily for development services or for both materials and development services.
We expect that our cost of revenue will increase or decrease to the extent that our revenue increases and decreases and depending on how many contracts we have ongoing at any given point in time and the stage of those contracts.
Gross profit is calculated as revenue less cost of revenue. Gross profit margin is gross profit expressed as a percentage of revenue. Our gross profit in future periods will depend on a variety of factors, including: market conditions that may impact our pricing, sales mix among devices, sales mix changes among consumables, excess and obsolete inventories, our cost structure for manufacturing operations relative to volume, and product warranty obligations. Our gross profit in future periods will vary based upon our channel mix and may decrease based upon our distribution channels and the potential to establish original equipment manufacturing channels for certain components of our technology platform which would have a lower gross margin.
We expect that our gross profit margin for product and service will increase over the long term as our sales and production volumes increase and our cost per unit decreases due to efficiencies of scale. We intend to use our design, engineering and manufacturing capabilities to further advance and improve the efficiency of our manufacturing, which we believe will reduce
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costs and increase our gross margin. We expect that our gross profit margin for contract will remain consistent for our contracts that are cost reimbursement contracts.
Operating Expenses
Research and development expenses
Research and development expenses consist primarily of costs incurred for our research activities, product development, hardware and software engineering and consultant services and other costs associated with our technology platform and products, which include:
| ● | employee-related expenses, including salaries, related benefits and stock-based compensation expense for employees engaged in research and hardware and software development functions; |
| ● | the cost of maintaining and improving our product designs, including third party development costs for new products and materials for prototypes; |
| ● | research materials and supplies; and |
| ● | facilities, depreciation and other expenses, which include direct and allocated expenses for rent and maintenance of facilities and insurance. |
| ● | Rent expense and passthrough costs, reimbursable by Repligen, incurred in performing duties under the TSA. |
We believe that our continued investment in research and development is essential to our long-term competitive position.
Selling, general and administrative expenses
Selling, general and administrative expenses consist primarily of salaries and other personnel costs, and stock-based compensation for our sales and marketing, finance, legal, human resources and general management, as well as professional services, such as legal, audit and accounting services, and director and officer insurance costs as well as investor and public relations expenses associated with operating as a public company.
We expect selling, general and administrative expenses, amortization of customer relationship and tradename intangibles to stabilize in future periods as we execute our strategic transformation as outlined in our restructuring plan.
Beginning in the first quarter of 2025, general and administrative expenses also include rent expense and passthrough costs, reimbursable by Repligen, incurred in performing duties under the TSA. The TSA was completed in the second quarter of 2026.
Change in fair value of contingent consideration
Change in fair value of contingent consideration represents the change in fair value of the contingent consideration obligation included in contingent consideration on the consolidated balance sheets as of the end of each period. Remeasurement of the contingent consideration obligation is done each quarter and the carrying value of the obligation is adjusted to the current fair value through our consolidated statements of comprehensive income (loss).
Other Income (Expense)
Interest income
Interest income consists of interest earned on our invested cash, cash equivalents and marketable securities balances.
Income from transition services agreement, net
Income from transition services agreement, net represents service charges provided to Repligen to facilitate the transition of the Desktop Portfolio, net of directly identifiable personnel related costs. The scope of transition services includes the provision of certain manufacturing services, research and development support and certain administrative functions related to the Desktop Portfolio. The services and obligations under the TSA were completed as of June 30, 2026.
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Other income (expense), net
Other income (expense), net consists of miscellaneous other income and expense unrelated to our core operations, interest expense associated with the amortization of deferred financing costs and debt discounts associated with our loan and security agreements.
Provision for Income Taxes
We have not recorded any U.S. federal or state income tax benefits for the net operating losses we have incurred in each year or for the research and development tax credits we generated in the United States and have recorded a full valuation allowance against our net deferred assets, as we believe, based upon the weight of available evidence, that it is more likely than not that all of our net operating loss carryforwards and tax credits will not be realized.
As of December 31, 2025, the Company had gross federal and state operating loss carryforwards of $147.0 million and $94.5 million, respectively. The federal operating loss carryforward may be available to offset future taxable income and begin to expire in 2032, of which $112.6 million of federal gross operating losses do not expire. As of December 31, 2025, the Company also had U.S. federal and state research and development tax credit carryforwards of $9.1 million and $4.9 million, respectively, which may be available to offset future tax liabilities and begin to expire in 2032 and 2030, respectively.
Utilization of the net operating loss and research and development tax credit carryforwards may be subject to a substantial annual limitation under Sections 382 and 383 of the Code due to ownership changes that have occurred previously or that could occur in the future. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50% over a three-year period. Since its formation, the Company has raised capital through the issuance of capital stock on several occasions. These financings, combined with the purchasing shareholders’ subsequent disposition of those shares, may have resulted in a change of control or could result in a change of control in the future upon subsequent disposition. The Company conducted an analysis to determine if historical changes in ownership through March, 2025 would limit or otherwise restrict its ability to utilize these net operating loss and research and development credit carryforwards. As a result of this analysis, the Company does not believe there are any significant limitations on its ability to utilize these carryforwards. However, future changes in ownership after March 2025 could affect the limitation in future years. Any limitation may result in expiration of a portion of the net operating loss or research and development credit carryforwards before utilization.
Results of Operations
Unless otherwise noted, all amounts included below relate to continuing operations. The results of operations from the Desktop Portfolio are classified as discontinued operations in the consolidated statements of operations. Applicable amounts in prior years have been recast to conform to this presentation.
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Comparison of the three months ended June 30, 2026 and 2025
The following table summarizes our results of operations for the three months ended June 30, 2026 and 2025:
| | | | | | | | | |
| | Three Months Ended June 30, | | | | ||||
| | 2026 | | 2025 | | Change | |||
| | (in thousands) | |||||||
Revenue: |
| | |
| | |
| | |
Product revenue | | $ | 12,974 | | $ | 9,577 | | $ | 3,397 |
Service and contract revenue | |
| 3,100 | |
| 3,458 | |
| (358) |
Total revenue | |
| 16,074 | |
| 13,035 | |
| 3,039 |
Cost of revenue: | |
| | |
| | |
| |
Product cost of revenue | |
| 6,412 | |
| 5,323 | |
| 1,089 |
Service and contract cost of revenue | |
| 1,319 | |
| 1,339 | |
| (20) |
Total cost of revenue | |
| 7,731 | |
| 6,662 | |
| 1,069 |
Gross profit | |
| 8,343 | |
| 6,373 | |
| 1,970 |
Operating expenses: | |
| | |
| | |
| |
Research and development | |
| 3,598 | |
| 4,405 | |
| (807) |
Selling, general and administrative | |
| 11,112 | |
| 10,337 | |
| 775 |
Change in fair value of contingent consideration | | | 6,442 | | | 6,792 | | | (350) |
Total operating expenses | |
| 21,152 | |
| 21,534 | |
| (382) |
Loss from continuing operations | |
| (12,809) | |
| (15,161) | |
| 2,352 |
Other income (expense): | |
| | |
| | |
| |
Interest income | | | 938 | | | 1,196 | | | (258) |
Income from transition services agreement, net | |
| — | |
| 1,236 | |
| (1,236) |
Other expense, net | |
| (77) | |
| (108) | |
| 31 |
Total other income, net | |
| 861 | |
| 2,324 | |
| (1,463) |
Loss from continuing operations before income taxes | | | (11,948) | | | (12,837) | | | 889 |
Income tax benefit (expense), net | | | 54 | | | (71) | | | 125 |
Net loss from continuing operations | | $ | (11,894) | | $ | (12,908) | | $ | 1,014 |
Revenue, Cost of Revenue and Gross Profit
Product
Our product revenue is comprised of revenue from sales of devices and related consumables, accessories and software as follows:
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Change | | |||||||
| | 2026 | | 2025 | | Amount | | % | | |||
| | (dollars in thousands) | | |||||||||
Product revenue | | $ | 12,974 | | $ | 9,577 | | $ | 3,397 |
| 35 | % |
Product cost of revenue | |
| 6,412 | |
| 5,323 | |
| 1,089 |
| 20 | % |
Gross profit | | $ | 6,562 | | $ | 4,254 | | $ | 2,308 |
| 54 | % |
Gross profit margin | |
| 51 | % |
| 44 | % |
| 7 | % | | |
Product revenue increased by $3.4 million, or 35%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. The increase was primarily related to a $2.6 million increase in product revenue from our FTIR products, driven by our VipIR placements, a $0.6 million increase from our mass spec products related to accessories in the quarter and a $0.2 million increase related to our recently acquired NIRLab product revenues.
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Product cost of revenue increased by $1.1 million, or 20%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. The increase in product cost of revenue was primarily related to a $1.3 million increase in shipments and related warranty costs and $0.1 million related to an increase in charges for excess and obsolete inventory. These increases were offset in part by $0.2 million in lower facility related costs and a $0.1 million reduction in all other manufacturing costs.
Product gross profit increased by $2.3 million, or 54%, and gross profit margin increased by seven percentage points for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increased product gross profit was primarily due to the higher product revenue volume, a shift in channel mix with less international product sales that are at a lower gross margin, as well as the decreased facility costs related to the shutdown of the Boston facility as of June 30, 2025 and lower operating costs for the three months ended June 30, 2026, which drove the increase in gross profit margin.
Service and contract
Our service and contract revenue is comprised of revenue from sales of extended warranty and service plans, software subscriptions and customer training as follows:
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Change | | |||||||
| | 2026 | | 2025 | | Amount | | % | | |||
| | (dollars in thousands) | | |||||||||
Service and contract revenue | | $ | 3,100 | | $ | 3,458 | | $ | (358) |
| (10) | % |
Service and contract cost of revenue | |
| 1,319 | |
| 1,339 | |
| (20) |
| (1) | % |
Gross profit | | $ | 1,781 | | $ | 2,119 | | $ | (338) |
| (16) | % |
Gross profit margin | |
| 57 | % |
| 61 | % |
| (4) | % | | |
Service and contract revenue decreased by $0.4 million, or 10%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. The decrease was primarily related to a $0.9 million decrease in mass spec service revenue, driven by a $0.7 million decrease in extended service contracts for MX908 devices mainly related to a funding-related pause in service coverage by a United States defense customer which began to impact our service revenues in the fourth quarter of 2025. The decrease was offset in part by a $0.2 million increase in service revenue related to our FTIR products and $0.3 million related to our recently acquired NIRLab service and subscription revenues. Contract revenue for the three months ended June 30, 2026 was $0.1 million compared to less than $0.1 million in the three months ended June 30, 2025.
Service and contract cost of revenue decreased less than $0.1 million, or 1%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. The decrease in service cost of revenue was primarily related to a reduction in third party contractors and materials spent on extended service contracts during the three months ended June 30, 2026, compared to the three months ended June 30, 2025.
Service and contract gross profit decreased by $0.3 million, or 16%, and gross profit margin decreased by four percentage points for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, primarily due to a decrease in service volume related to extended service contracts, resulting in reduced leverage of our investments in personnel and service infrastructure.
Operating Expenses
Research and development
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Change | | |||||||
| | 2026 | | 2025 | | Amount | | % | | |||
| | (dollars in thousands) | | |||||||||
Research and development expenses | | $ | 3,598 | | $ | 4,405 |
| $ | (807) |
| (18) | % |
Percentage of total revenue | |
| 22 | % |
| 34 | % |
| | | | |
Our research and development expenses were $3.6 million for the three months ended June 30, 2026, a decrease of $0.8 million from research and development expenses of $4.4 million for the three months ended June 30, 2025. The decrease was primarily due to a $0.3 million reduction in facility costs related to the shutdown of the Boston facility as of June 30, 2025, a
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$0.3 million reduction in personnel and related costs and a $0.2 million reduction in program spend related to materials and consulting expenses.
Selling, general and administrative expenses
| | | | | | | | | | | | |
| | Three Months Ended June 30, | | Change | | |||||||
| | 2026 | | 2025 | | Amount | | % | | |||
| | (dollars in thousands) | | |||||||||
Selling, general and administrative expenses | | $ | 11,112 | | $ | 10,337 | | $ | 775 |
| 7 | % |
Percentage of total revenue | |
| 69 | % |
| 79 | % | | | | | |
Our selling, general and administrative expenses were $11.1 million for the three months ended June 30, 2026, an increase of $0.8 million from selling, general and administrative expenses of $10.3 million for the three months ended June 30, 2025. The increase was due primarily to a $0.8 million increase in personnel and related costs and a $0.7 million charge for legal and accounting expenses related to the NIRLAB acquisition, offset in part by a $0.8 million reduction in facility costs, mainly related to facility shut down and moving costs expensed in the second quarter of 2025.
Change in fair value of contingent consideration
The change in fair value of contingent consideration was $6.4 million for the three months ended June 30, 2026, a decrease of $0.4 million, compared to the $6.8 million charge in the three months ended June 30, 2025. The change in fair value for the three months ended June 30, 2026, consisted of a $1.3 million decrease related to the RedWave acquisition valuation and a $0.9 million increase related to the NIRLAB acquisition, which was not recorded in the prior comparative period. The increase in fair value for the three months ended June 30, 2026, primarily related to the increase in the Company’s publicly quoted share price and the impact to the NIRLAB contingent consideration, offset in part by a change in the final projections and backlog for FTIR revenues, net of the higher stock price. The increase in fair value for the three months ended June 30, 2025, related to both the increase in the Company’s publicly quoted share price, and due to an increase in the projections for FTIR revenue, including the recent product launch of VipIR.
Other Income
Interest income
Interest income decreased by $0.3 million for the three months ended June 30, 2026 from $1.2 million for the three months ended June 30, 2025. The decrease was due to the lower cash, cash equivalent and marketable securities balances, primarily due to the average balance during the three months ended June 30, 2026, compared to the three months ended June 30, 2025.
Income from transition services agreement, net
Income from the transition services agreement, net was zero for the three months ended June 30, 2026 compared to $1.2 million for the three months ended June 30, 2025.
Other expense (income), net
Other expense, net for the three months ended June 30, 2026 did not change materially from the three months ended June 30, 2025.
Income tax benefit (expense), net
Income tax benefit (expense), net was a net benefit of less than $0.1 million for the three months ended June 30, 2026, compared to a net income tax expense net of less than $0.1 million for the three months ended June 30, 2025. The change of $0.1 million was primarily due to the amortization of intangible assets acquired from our NIRLAB acquisition. We have recorded a full valuation allowance against our net United States deferred tax assets, and our income tax benefit (expense), net for these periods primarily related to state and foreign income taxes.
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Comparison of the six months ended June 30, 2026 and 2025
The following table summarizes our results of operations for the six months ended June 30, 2026 and 2025:
| | | | | | | | | |
| | Six Months Ended June 30, | | | | ||||
| | 2026 | | 2025 | | Change | |||
| | (in thousands) | |||||||
Revenue: | | | | | | | | | |
Product revenue | | $ | 23,711 | | $ | 18,106 | | $ | 5,605 |
Service and contract revenue | | | 5,745 | | | 6,707 | | | (962) |
Total revenue | |
| 29,456 | |
| 24,813 | |
| 4,643 |
Cost of revenue: | |
| | |
| | |
| |
Product cost of revenue | |
| 11,573 | |
| 10,048 | |
| 1,525 |
Service and contract cost of revenue | | | 2,658 | | | 2,850 | | | (192) |
Total cost of revenue | |
| 14,231 | |
| 12,898 | |
| 1,333 |
Gross profit | |
| 15,225 | |
| 11,915 | |
| 3,310 |
Operating expenses: | |
| | |
| | |
| |
Research and development | |
| 7,069 | |
| 8,234 | |
| (1,165) |
Selling, general and administrative | |
| 21,027 | |
| 20,576 | |
| 451 |
Change in fair value of contingent consideration | |
| 12,823 | |
| 9,291 | |
| 3,532 |
Total operating expenses | |
| 40,919 | |
| 38,101 | |
| 2,818 |
Loss from continuing operations | |
| (25,694) | |
| (26,186) | |
| 492 |
Other income, net: | |
| | |
| | |
| |
Interest income | | | 1,874 | | | 2,012 | | | (138) |
Income from transition services agreement, net | |
| — | |
| 1,642 | |
| (1,642) |
Other expense, net | | | (83) | |
| (142) | |
| 59 |
Total other income, net | |
| 1,791 | |
| 3,512 | |
| (1,721) |
Loss from continuing operations before income taxes | | | (23,903) | | | (22,674) | | | (1,229) |
Income tax benefit (expense), net | | | 54 | | | (71) | | | 125 |
Net loss from continuing operations | | $ | (23,849) | | $ | (22,745) | | $ | (1,104) |
Revenue, Cost of Revenue and Gross Profit
Product
Our product revenue is comprised of revenue from sales of devices and related consumables, accessories and software as follows:
| | | | | | | | | | | | |
| | Six Months Ended June 30, | | Change | ||||||||
| | 2026 | | 2025 | | Amount | | % | ||||
| | (dollars in thousands) |
| |||||||||
Product revenue | | $ | 23,711 | | $ | 18,106 | | $ | 5,605 |
| 31 | % |
Product cost of revenue | |
| 11,573 | |
| 10,048 | |
| 1,525 |
| 15 | % |
Gross profit | | $ | 12,138 | | $ | 8,058 | | $ | 4,080 |
| 51 | % |
Gross profit margin | |
| 51 | % |
| 45 | % |
| 6 | % | | |
Product revenue increased by $5.6 million, or 31%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The increase was primarily related to a $3.4 million increase in product revenue from our FTIR products, driven by our VipIR placements, a $2.0 million increase in product revenue from our mass spec products mainly related to higher device shipments within our federal and defense and state and local customers and a $0.2 million increase related to our recently acquired NIRLAB product revenues.
Product cost of revenue increased by $1.5 million, or 15%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The increase in product cost of revenue was primarily related to a $1.9 million increase in shipments and related warranty costs and $0.2 million in personnel related costs, offset in part by $0.4 million in lower facility
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related costs, $0.2 million from reduced severance and retention costs driven by the facility move in 2025 and a $0.2 million reduction in all other manufacturing costs.
Product gross profit increased by $4.1 million, or 51%, and gross profit margin increased by six percentage points for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The increased product gross profit was primarily due to the higher product revenue volume, a shift in channel mix with less international product sales that are at a lower gross margin, as well as the decreased facility and personnel costs related to the shutdown of the Boston facility as of June 30, 2025, which drove the increase in gross profit margin.
Service and contract
Our service and contract revenue is comprised of revenue from sales of extended warranty and service plans, software subscriptions and customer training as follows:
| | | | | | | | | | | | |
| | Six Months Ended June 30, | | Change | ||||||||
| | 2026 | | 2025 | | Amount | | % | ||||
| | (dollars in thousands) |
| |||||||||
Service and contract revenue | | $ | 5,745 | | $ | 6,707 | | $ | (962) |
| (14) | % |
Service and contract cost of revenue | |
| 2,658 | |
| 2,850 | |
| (192) |
| (7) | % |
Gross profit | | $ | 3,087 | | $ | 3,857 | | $ | (770) |
| (20) | % |
Gross profit margin | |
| 54 | % |
| 58 | % |
| (4) | % | | |
Service and contract revenue decreased by $1.0 million, or 14%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The decrease was primarily related to a $1.6 million decrease in extended service contracts for MX908 devices mainly related to a funding-related pause in service coverage by a United States defense customer which began to impact our service revenues in the fourth quarter of 2025. The decrease was offset in part by a $0.3 million increase in service revenue related to our FTIR products and $0.3 million related to our recently acquired NIRLab service and subscription revenues. Contract revenue for the six months ended June 30, 2026 was $0.1 million compared to $0.1 million in the six months ended June 30, 2025.
Service and contract cost of revenue decreased by $0.2 million, or 7%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The decrease in service cost of revenue was primarily related to a reduction in third party contractors and materials spent on extended service contracts during the six months ended June 30, 2026, compared to the six months ended June 30, 2025, and to a lesser extend a decrease in costs to perform contract revenue.
Service and contract gross profit decreased by $0.8 million, or 20%, and gross profit margin decreased by four percentage points for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily due to a decrease in service volume related to extended service contracts, resulting in reduced leverage of our investments in personnel and service infrastructure.
Operating Expenses
Research and development
| | | | | | | | | | | | |
| | Six Months Ended June 30, | | Change | ||||||||
| | 2026 | | 2025 | | Amount | | % | ||||
| | (dollars in thousands) |
| |||||||||
Research and development expenses | | $ | 7,069 | | $ | 8,234 | | $ | (1,165) |
| (14) | % |
Percentage of total revenue | |
| 24 | % |
| 33 | % |
| |
| | |
Our research and development expenses were $7.1 million for the six months ended June 30, 2026, a decrease of $1.2 million from research and development expenses of $8.2 million for the six months ended June 30, 2025. The decrease was primarily due to a $0.8 million reduction in facility costs related to the shutdown of the Boston facility as of June 30, 2025, a $0.2 million reduction in personnel and related costs and a $0.2 million reduction in program spend related to materials and consulting expenses.
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Selling, general and administrative expenses
| | | | | | | | | | | | |
| | Six Months Ended June 30, | | Change | ||||||||
| | 2026 | | 2025 | | Amount | | % | ||||
| | (dollars in thousands) |
| |||||||||
Selling, general and administrative expenses | | $ | 21,027 | | $ | 20,576 | | $ | 451 |
| 2 | % |
Percentage of total revenue | |
| 71 | % |
| 83 | % |
| |
| | |
Our selling, general and administrative expenses were $21.0 million for the six months ended June 30, 2026, an increase of $0.5 million from selling, general and administrative expenses of $20.6 million for the six months ended June 30, 2025. The increase was due primarily to a $1.1 million increase for legal and accounting transaction expenses related to the NIRLAB acquisition, offset in part by a $0.6 million reduction in facility costs mainly related to the Boston facility shut down and moving costs and a net decrease in all other expenses of $0.1 million.
Change in fair value of contingent consideration
The change in fair value of contingent consideration was $12.8 million for the six months ended June 30, 2026, an increase of $3.5 million, compared to the $9.3 million charge in the six months ended June 30, 2025. The change in fair value consisted of a $2.6 million increase related to the RedWave acquisition and a $0.9 million increase related to the NIRLAB acquisition. The increase in fair value for the six months ended June 30, 2026, primarily related to the increase in the Company’s publicly quoted share price, and to a lesser extent a change in the final projections and backlog for FTIR revenues. The increase in fair value for the six months ended June 30, 2025, related to both the increase in the Company’s publicly quoted share price, and due to an increase in the projections for FTIR revenue, including the second quarter product launch of VipIR.
Other Income
Interest income
Interest income decreased by $0.1 million for the six months ended June 30, 2026 from $2.0 million for the six months ended June 30, 2025. The decrease was primarily due to the lower interest rates during the six month ended June 30, 2026, offset in part by higher cash, cash equivalent and marketable securities balances during the six months ended June 30, 2026, compared to the six months ended June 30, 2025.
Income from transition services agreement, net
Income from the transition services agreement, net was zero for the six months ended June 30, 2026 compared to $1.6 million for the six months ended June 30, 2025.
Other expense (income), net
Other expense, net for the six months ended June 30, 2026 did not change materially from the six months ended June 30, 2025 to the six months ended June 30, 2026.
Income tax benefit (expense), net
Income tax benefit (expense), net was a net benefit of less than $0.1 million for the six months ended June 30, 2026, compared to a net income tax expense of less than $0.1 million for the six months ended June 30, 2025. The change of $0.1 million was primarily due to the amortization of intangible assets acquired from our NIRLAB acquisition. We have recorded a full valuation allowance against our net United States deferred tax assets, and our income tax benefit (expense), net for these periods primarily related to state and foreign income taxes.
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Liquidity and Capital Resources
Since our inception, we have incurred significant operating losses. To date, we have funded our operations primarily with proceeds from sales of redeemable preferred stock, borrowings under loan agreements and revenue from sales of our products and services and contract revenue. As of June 30, 2026, we had cash, cash equivalents and marketable securities of $101.5 million. We believe that our existing cash, cash equivalents and marketable securities will enable us to fund our operating expenses, capital expenditure requirements and debt service payments for at least the next twelve months.
We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. Our future funding requirements will depend on many factors, including:
| ● | market uptake of our products and growth into new and existing markets; |
| ● | the cost of our research and development efforts to expand the applications of our current devices and to create enhanced products with our platform of technologies; |
| ● | the cost of expanding our commercial operations, including distribution capabilities, and accelerating planned investments, such as hiring additional support, service, and sales management in Europe, Asia Pacific and Latin America, bolstering our infrastructure in these regions; |
| ● | the cost of acquiring complementary businesses, products, services or technologies, when and if required; |
| ● | the success of our existing collaborations and our ability to enter additional collaborations in the future; |
| ● | the effect of competing technological and market developments; and |
| ● | the level of our selling, general and administrative expenses. |
On March 5, 2026, the Company entered into the Amended 2026 Revolver by and between the Company, as borrower, and SVB, as lender. The Amended 2026 Revolver provides for a revolving line of credit of up to $20.0 million. The Amended 2026 Revolver supersedes and replaces the Amended 2022 Revolver and its extension upon the execution of the Amended 2026 Revolver. The Company is permitted to make interest-only payments on the revolving line of credit through March 5, 2028, at which time all outstanding indebtedness shall be immediately due and payable. The outstanding principal amount of any advance shall accrue interest at a floating rate per annum equal to the greater of (i) six percent (6.00%) or (ii) the “prime rate” as published in The Wall Street Journal. The Company’s obligations under the Amended 2026 Revolver are secured by substantially all of the Company’s assets, excluding its intellectual property, which is subject to a negative pledge. The Company capitalized $0.1 million of the debt issuance cost upon entering into the Amended 2026 Revolver and no balance is drawn from the revolving line of credit as of June 30, 2026.
We may seek additional funding through private or public equity financings, debt financings, collaborations, strategic alliances and marketing, channel partner or licensing arrangements. We cannot assure you that we will be able to obtain additional funds on acceptable terms, or at all. If we raise additional funds by issuing equity or equity-linked securities, our stockholders may experience dilution. Future debt financing, if available, may involve covenants, in addition to our existing covenants, restricting our operations or our ability to incur additional debt or potentially limiting our ability to obtain new debt financing or the refinance of our existing debt. Any debt or equity financing that we raise may contain terms that are not favorable to us or our stockholders. If we raise additional funds through collaboration and licensing arrangements with third parties, it may be necessary to relinquish some rights to our technologies or our products, or grant licenses on terms that are not favorable to us. If we do not have or are not able to obtain sufficient funds, we may have to delay development or commercialization of our products. We also may have to reduce marketing, customer support or other resources devoted to our products or cease operations.
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Cash Flows
The following table summarizes our sources and uses of cash for each of the periods presented:
| | | | | | |
| | Six Months Ended June 30, | ||||
| | 2026 | | 2025 | ||
| | (in thousands) | ||||
Cash provided by (used in) operating activities | | $ | 4,376 | | $ | (20,803) |
Cash provided by (used in) investing activities | |
| (9,309) | |
| 38,726 |
Cash used in financing activities | |
| (1,203) | |
| (267) |
Effect of foreign exchange rate changes on cash and cash equivalents | | | (56) | | | 27 |
Net increase (decrease) in cash, cash equivalents and restricted cash | | $ | (6,192) | | $ | 17,683 |
Operating Activities
During the six months ended June 30, 2026, net cash provided by operating activities was $4.4 million, primarily resulting from noncash items of $20.4 million and inflows from our operating assets and liabilities of $7.8 million, partially offset by our net loss of $23.8 million. Noncash items consisted primarily of a $12.8 million increase from the change in fair value of contingent consideration and a $4.7 million increase from stock-based compensation expense. Inflows from our operating assets and liabilities of $7.8 million consist primarily of a $4.2 million increase from prepaid expenses and other current assets, a $3.4 million increase from accounts payable and accrued expenses and a $1.2 million increase from deferred revenue, partially offset by a $1.4 million decrease from changes in inventory.
During the six months ended June 30, 2025, net cash used in operating activities was $20.8 million, primarily resulting from noncash income of $40.0 million, partially offset by our net income of $30.3 million and net cash used in changes in our operating assets and liabilities of $11.1 million. Noncash charges consisted primarily of a $56.2 million increase from the gain on sale of Desktop Portfolio, net of transaction costs, partially offset by a $9.3 million increase from the change in fair value of contingent consideration. Net cash used in changes in our operating assets and liabilities of $11.1 million consisted primarily of a $5.6 million decrease from changes in accounts payable and accrued expenses, a $5.2 million decrease from changes in inventory and a $3.3 million decrease from changes in prepaid expenses and other current assets, partially offset by a $5.3 million increase from changes in account receivable, net.
Investing Activities
During the six months ended June 30, 2026, net cash used by investing activities was $9.3 million, due primarily to $23.4 million in purchases of marketable securities and $12.7 million in acquisition of NIRLAB, partially offset by $27.0 million of proceeds from the maturity of marketable securities.
During the six months ended June 30, 2025, net cash provided by investing activities was $38.7 million, due primarily to $69.9 million of proceeds from the sale of the Desktop Portfolio and $28.5 million of proceeds from the maturity of marketable securities, partially offset by $59.4 million in purchases of marketable securities.
Financing Activities
Cash used in financing activities during the six months ended June 30, 2026 was $1.2 million, consisting primarily of payments for withholding taxes on vested equity awards and $0.1 million of payments for debt financing costs, net of proceeds from issuances of common stock.
Cash used in financing activities during the six months ended June 30, 2025 was $0.3 million, consisting primarily of payments for withholding taxes on vested equity awards.
Critical Accounting Policies and Significant Judgments and Estimates
Our condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The preparation of our condensed consolidated financial statements and related disclosures
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requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue, costs and expenses and the disclosure of contingent assets and liabilities in our condensed consolidated financial statements. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.
For a further discussion of our critical accounting policies, please refer to Note 2 to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q and our Annual Report. There were no significant changes to our critical accounting policies for the three and six months ended June 30, 2026.
Recently Issued Accounting Pronouncements
A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q and is incorporated herein by reference.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
We are a smaller reporting company, as defined in Rule 12b-2 under the Exchange Act for this reporting period and are not required to provide the information required under this item.
Item 4. Controls and Procedures.
Our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a- 15(e) and 15d- 15(e) under the Exchange Act), as of the end of the period covered by this Quarterly Report on Form 10-Q. Our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and our management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q, our principal executive officer and principal financial officer have concluded that as of such date, our disclosure controls and procedures were effective at a reasonable assurance level.
Changes in Internal Control over Financial Reporting
On May 4, 2026, we completed the acquisition of NIRLAB. The financial results of NIRLAB are included in our unaudited consolidated financial statements as of June 30, 2026, and for the three and six months then ended. Management intends to exclude NIRLAB from its evaluation of internal control over financial reporting as of December 31, 2026.
Other than the internal controls associated with NIRLAB, there were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II—OTHER INFORMATION
Item 1. Legal Proceedings.
We are not currently party to any material legal proceedings.
Item 1A. Risk Factors.
Our business, financial condition and operating results are affected by a number of factors, whether currently known or unknown, including risks specific to us or the industry in which we operate as well as risks that affect businesses in general. In addition to the information set forth in this Quarterly Report on Form 10-Q, you should consider carefully the factors discussed in Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on March 9, 2026. The risks and uncertainties disclosed in such Annual Report could materially adversely affect our business, financial condition, cash flows or results of operations and thus our stock price. There have been no material changes to our previously disclosed risk factors.
These risk factors may be important to understanding other statements in this Quarterly Report and should be read in conjunction with the unaudited condensed consolidated financial statements and related notes in Part I, Item 1, “Financial Statements” and Part I, Item 2,“Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Quarterly Report. Because of such risk factors, as well as other factors affecting our financial condition and operating results, past financial performance should not be considered to be a reliable indicator of future performance, and investors should not use historical trends to anticipate results or trends in future periods.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
None.
Item 5. Other Information.
On
On
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Item 6. Exhibits.
| ||
Exhibit Number | | Description |
| | |
2.1# | | Share Purchase Agreement, dated as of May 4, 2026, among 908 Devices Inc., Florentin Coppey, Pierre Esseiva, Matteo Delbrück, Parkview Invest AG, Matthieu Girod and NIRLAB SA (incorporated by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K (File No. 001-39815) filed with the SEC on May 6, 2026) |
3.1 | | Sixth Amended and Restated Certificate of Incorporation of the Registrant, as currently in effect (incorporated by reference to Exhibit 3.3 to the Registrant’s Registration Statement on Form S-1 (File No. 333-250954) filed with the SEC on November 25, 2020) |
| | |
3.2 | | Amended and Restated By-laws of the Registrant, as currently in effect (incorporated by reference to Exhibit 3.5 to the Registrant’s Registration Statement on Form S-1 (File No. 333-250954) filed with the SEC on December 14, 2020) |
| | |
31.1 | | Certification of Principal Executive Officer of the Registrant Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| | |
31.2 | | Certification of Principal Financial Officer of the Registrant Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| | |
32.1† | | Certification of Principal Executive Officer of the Registrant Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
| | |
32.2† | | Certification of Principal Financial Officer of the Registrant Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
| | |
101.INS | | Inline XBRL Instance Document |
| | |
101.SCH | | Inline XBRL Taxonomy Extension Schema Document |
| | |
101.CAL | | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| | |
101.LAB | | Inline XBRL Taxonomy Extension Labels Linkbase Document |
| | |
101.PRE | | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| | |
101.DEF | | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| | |
104 | | Cover Page Data File (the cover page XBRL tags are embedded within the iXBRL document). |
# | Certain confidential portions (indicated by brackets and asterisks) have been omitted from this exhibit. The Company agrees to furnish supplementally a copy of such omitted confidential portions to the Securities and Exchange Commission upon request. |
† | The certifications attached as Exhibits 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q, are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of 908 Devices Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| | | |
| | 908 DEVICES INC. | |
| | | |
Date: August 11, 2026 | | By: | /s/ Kevin J. Knopp, Ph.D. |
| |
| Kevin J. Knopp, Ph.D. Chief Executive Officer (Principal Executive Officer) |
| | | |
Date: August 11, 2026 | | By: | /s/ Joseph H. Griffith IV |
| |
| Joseph H. Griffith IV Chief Financial Officer (Principal Financial Officer) |
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