NN Inc. Q3 sales rise 26.2%; operating loss hits $3.3M
Operating cash flow was $16.9 million for the first nine months, while available liquidity was $46.979 million at quarter-end.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
10-Q
Rhea-AI Filing Summary
NN, Inc. reported third-quarter 2026 net sales of $131.1 million, up 26.2% from $103.9 million a year earlier. Sales growth primarily reflected higher selling prices that passed through raw-material costs, higher volumes and favorable foreign exchange. Operating loss widened to $3.3 million from $2.2 million, while net loss narrowed to $4.6 million from $6.7 million. Power Solutions earned $9.2 million from operations, compared with $5.4 million; Mobile Solutions’ operating loss increased to $6.3 million from $2.9 million.
For the nine months ended September 30, 2026, operating cash flow was $16.9 million, versus $7.1 million, including a $12.7 million IRS refund received in May. Total debt was $168.8 million and available liquidity was $46.979 million as of September 30, 2026. NN, Inc. reported compliance with all covenants on that date; its term loans bore interest at 13.75%.
In July, NN, Inc. issued common stock for $70.4 million in net proceeds and redeemed $70.0 million of Series D preferred stock. After quarter-end, it closed another private placement for approximately $49.8 million in net proceeds and redeemed the remaining preferred stock for approximately $30.7 million on October 7. No Series D preferred shares remained outstanding after that redemption.
3 points · 0 major0 major · 1 point
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointQuarterly net sales rose 26.2% to $131.1 million.
- Moderate pointQuarterly net loss narrowed to $4.6 million from $6.7 million.
- Moderate pointNine-month operating cash flow was $16.9 million, versus $7.1 million.
Negative
- Moderate pointQuarterly operating loss widened to $3.3 million from $2.2 million.
Filing Explained
The October 5, 2026 placement closed with 11,275,605 common shares issued and pre-funded warrants for up to 4,824,395 more at a
Key Figures
Third-quarter net sales: $131.1 million
Third-quarter operating loss: $3.3 million
Third-quarter net loss: $4.6 million
+5 more
8 metrics
Third-quarter net sales
$131.1 million
Three months ended September 30, 2026; up 26.2% from the prior-year period
Third-quarter operating loss
$3.3 million
Three months ended September 30, 2026; compared with $2.2 million in 2025
Third-quarter net loss
$4.6 million
Three months ended September 30, 2026; compared with $6.7 million in 2025
Operating cash flow
$16.9 million
Nine months ended September 30, 2026; compared with $7.1 million in 2025
Total debt
$168.8 million
As of September 30, 2026
Available liquidity
$46.979 million
As of September 30, 2026
October private placement net proceeds
Approximately $49.8 million
Placement closed October 5, 2026
Final Series D preferred stock redemption
Approximately $30.7 million
Completed October 7, 2026
Key Terms
PIK Election, mezzanine equity, non-recourse basis, cashless basis, +1 more
5 terms
PIK Election financial
"pay a portion of interest in-kind (“PIK Election”)"
mezzanine equity financial
"classified as mezzanine equity"
Mezzanine equity is a layer of financing that sits between bank loans and full ownership, combining elements of borrowed money and equity. It often gives lenders higher potential returns in exchange for taking more risk, sometimes with the option to convert into ownership or receive extra payments; think of it as a middle seat that pays more because it’s less secure than front-row debt. Investors watch it because it affects a company’s debt risk, potential dilution of ownership, and expected returns.
non-recourse basis financial
"sell certain receivables from customers on a non-recourse basis"
cashless basis financial
"2023 Warrants have been exercised on a cashless basis"
An agreement executed on a cashless basis lets a holder convert or exercise a security (like options, warrants, or conversion rights) without paying money upfront; instead the holder receives a smaller number of shares equal in value to what the cash would have purchased. Think of trading a coupon for fewer slices of a cake rather than handing over cash for the full slice. For investors, it affects how much ownership and dilution occur and avoids immediate cash outlays.
weighted average effective interest rate financial
"based on a weighted average effective interest rate of 9.17%"
The weighted average effective interest rate is the single interest rate that represents the true cost of a group of loans or debt instruments after accounting for each loan’s size and the way interest is calculated (including compounding and fees). Investors use it to see the overall borrowing cost for an organization—like averaging the prices in a shopping cart weighted by quantity—so they can judge interest expense, cash-flow pressure, and refinancing risk more accurately.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What were NNBR’s third-quarter 2026 sales?
NN, Inc. reported third-quarter 2026 net sales of $131.1 million, compared with $103.9 million in third-quarter 2025, a 26.2% increase. The company attributed the increase primarily to higher selling prices reflecting raw-material cost pass-through, higher volumes and favorable foreign-exchange effects.
How much operating cash flow did NNBR generate in the first nine months of 2026?
NN, Inc. reported $16.9 million of operating cash flow for the nine months ended September 30, 2026, compared with $7.1 million for the same period in 2025. The company said the favorable change primarily reflected a $12.7 million collection of a tax refund claim and other favorable operating impacts.
What were the terms of NNBR’s October 2026 private placement?
NN, Inc. issued 11,275,605 common shares at $3.30 per share and pre-funded warrants to purchase up to 4,824,395 shares at $3.29 per warrant. The placement generated approximately $53.1 million in gross proceeds and approximately $49.8 million in net proceeds after placement agent fees and estimated offering expenses.
What happened to NNBR’s Series D preferred stock?
On August 5, 2026, NN, Inc. redeemed 36,750 shares for $70.0 million and exchanged 9,850 shares for 5,500,000 common shares. The dividend and preference accrual rates were reduced to 10.0% through August 5, 2027. The company redeemed the remaining 18,400 shares for approximately $30.7 million on October 7, 2026, after which none remained outstanding.
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended September 30, 2026
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 001-39268
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
(Address of principal executive offices, including zip code)
(980 ) 264-4300
(Registrant’s telephone number, including area code)
| Securities registered pursuant to Section 12(b) of the Act: | ||||||||||||||
| Title of each class | Trading symbol | 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. Yes ☒ No ☐
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). Yes ☒ No ☐
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 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 | ☐ | |||||||||||||||||
| Non-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 ☐ No ☒
As of October 21, 2026, there were 93,744,244 shares of the registrant’s common stock, par value $0.01 per share, outstanding.
Table of Contents
NN, Inc.
INDEX
| Page | ||||||||
PART I. FINANCIAL INFORMATION | 3 | |||||||
| Item 1. | Financial Statements | 3 | ||||||
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 27 | ||||||
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 33 | ||||||
| Item 4. | Controls and Procedures | 34 | ||||||
PART II. OTHER INFORMATION | 35 | |||||||
| Item 1. | Legal Proceedings | 35 | ||||||
| Item 1A. | Risk Factors | 35 | ||||||
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 35 | ||||||
| Item 3. | Defaults Upon Senior Securities | 35 | ||||||
| Item 4. | Mine Safety Disclosures | 35 | ||||||
| Item 5. | Other Information | 35 | ||||||
| Item 6. | Exhibits | 36 | ||||||
SIGNATURES | 37 | |||||||
2
Table of Contents
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
NN, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| (in thousands, except per share data) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of sales (exclusive of depreciation and amortization shown separately below) | |||||||||||||||||||||||
| Selling, general, and administrative expense | |||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||
| Other operating income, net | ( | ( | ( | ( | |||||||||||||||||||
| Loss from operations | ( | ( | ( | ( | |||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Loss on extinguishment of debt | |||||||||||||||||||||||
| Other income, net | ( | ( | ( | ( | |||||||||||||||||||
| Loss before provision for income taxes and share of net income from joint venture | ( | ( | ( | ( | |||||||||||||||||||
| Provision for income taxes | ( | ( | ( | ( | |||||||||||||||||||
| Share of net income from joint venture | |||||||||||||||||||||||
| Net loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Other comprehensive income: | |||||||||||||||||||||||
| Foreign currency translation gain | |||||||||||||||||||||||
| Total other comprehensive income | |||||||||||||||||||||||
| Comprehensive loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Basic and diluted net loss per common share | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Shares used to calculate basic and diluted net loss per common share | |||||||||||||||||||||||
See notes to condensed consolidated financial statements (unaudited).
3
Table of Contents
NN, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
| (in thousands, except per share data) | September 30, 2026 | December 31, 2025 | |||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of allowances of $ | |||||||||||
| Inventories | |||||||||||
| Income tax receivable | |||||||||||
| Prepaid assets | |||||||||||
| Other current assets | |||||||||||
| Total current assets | |||||||||||
Property, plant and equipment, net of accumulated depreciation of $ | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Intangible assets, net | |||||||||||
| Investment in joint venture | |||||||||||
| Deferred tax assets | |||||||||||
| Other non-current assets | |||||||||||
| Total assets | $ | $ | |||||||||
| Liabilities, Preferred Stock, and Stockholders’ Equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued salaries, wages and benefits | |||||||||||
| Income tax payable | |||||||||||
| Current maturities of long-term debt | |||||||||||
| Current portion of operating lease liabilities | |||||||||||
| Other current liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Deferred tax liabilities | |||||||||||
| Long-term debt, net of current maturities | |||||||||||
| Operating lease liabilities, net of current portion | |||||||||||
| Other non-current liabilities | |||||||||||
| Total liabilities | |||||||||||
Commitments and contingencies (Note 11) | |||||||||||
Series D perpetual preferred stock - $ | |||||||||||
| Stockholders’ equity: | |||||||||||
Common stock - $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Accumulated deficit | ( | ( | |||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||
| Total stockholders’ equity | |||||||||||
| Total liabilities, preferred stock, and stockholders’ equity | $ | $ | |||||||||
See notes to condensed consolidated financial statements (unaudited).
4
Table of Contents
NN, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
| Nine Months Ended September 30, | |||||||||||
| (in thousands) | 2026 | 2025 | |||||||||
| Cash flows from operating activities | |||||||||||
| Net loss | $ | ( | $ | ( | |||||||
| Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Amortization of debt issuance costs and discount | |||||||||||
| Paid-in-kind interest | |||||||||||
| Loss on extinguishment of debt | |||||||||||
| Total derivative loss (gain) | ( | ||||||||||
| Share of net income from joint venture, net of cash dividends received | ( | ( | |||||||||
| Share-based compensation expense | |||||||||||
| Deferred income taxes | ( | ( | |||||||||
| Other | ( | ( | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable | ( | ||||||||||
| Inventories | ( | ||||||||||
| Other operating assets | ( | ( | |||||||||
| Income taxes receivable and payable, net | ( | ||||||||||
| Accounts payable | |||||||||||
| Other operating liabilities | ( | ||||||||||
| Net cash provided by operating activities | |||||||||||
| Cash flows from investing activities | |||||||||||
| Acquisition of property, plant, and equipment | ( | ( | |||||||||
| Proceeds from sale of property, plant, and equipment | |||||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities | |||||||||||
| Proceeds from asset backed credit facilities | |||||||||||
| Repayments of asset backed credit facilities | ( | ( | |||||||||
| Proceeds from long-term debt | |||||||||||
| Repayments of long-term debt | ( | ( | |||||||||
| Payments for debt issuance costs | ( | ( | |||||||||
| Proceeds from issuance of common stock, net of issuance costs | |||||||||||
| Redemption of preferred stock | ( | ||||||||||
| Proceeds from sale-leaseback of equipment | |||||||||||
| Proceeds from sale-leaseback of land and buildings | |||||||||||
| Repayments of financing obligations | ( | ( | |||||||||
| Other | ( | ( | |||||||||
| Net cash used in financing activities | ( | ( | |||||||||
| Effect of exchange rate changes on cash flows | |||||||||||
| Net change in cash and cash equivalents | ( | ||||||||||
| Cash and cash equivalents at beginning of period | |||||||||||
| Cash and cash equivalents at end of period | $ | $ | |||||||||
See notes to condensed consolidated financial statements (unaudited).
NN, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
| Nine Months Ended September 30, | |||||||||||
| (in thousands) | 2026 | 2025 | |||||||||
| Supplemental schedule of non-cash activities: | |||||||||||
| Non-cash additions to property, plant and equipment | $ | $ | |||||||||
| Non-cash additions to financing obligations | |||||||||||
| Non-cash Series D perpetual preferred stock exchanged for common stock | |||||||||||
See notes to condensed consolidated financial statements (unaudited).
5
Table of Contents
NN, Inc.
Condensed Consolidated Statements of Changes in Stockholders’ Equity
Three Months Ended September 30, 2026 and 2025
(Unaudited)
| Common Stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive loss | Total | |||||||||||||||||||||||||||||||
| (in thousands) | Number of shares | Par value | |||||||||||||||||||||||||||||||||
| Balance as of June 30, 2026 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
| Dividends accrued for preferred stock | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Shares issued under stock incentive plans, net of forfeitures | ( | ( | — | — | |||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Restricted shares surrendered for tax withholdings under stock incentive plans | ( | ( | ( | — | — | ( | |||||||||||||||||||||||||||||
| Issuance of common stock, net of issuance costs (1) | — | — | |||||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | |||||||||||||||||||||||||||||||
| Balance as of September 30, 2026 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Common Stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive loss | Total | |||||||||||||||||||||||||||||||
| (in thousands) | Number of shares | Par value | |||||||||||||||||||||||||||||||||
| Balance as of June 30, 2025 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
| Dividends accrued for preferred stock | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Shares issued under stock incentive plans, net of forfeitures | ( | ( | — | — | |||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Restricted shares surrendered for tax withholdings under stock incentive plans | ( | ( | — | — | ( | ||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | |||||||||||||||||||||||||||||||
| Balance as of September 30, 2025 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
See notes to condensed consolidated financial statements (unaudited).
6
Table of Contents
NN, Inc.
Condensed Consolidated Statements of Changes in Stockholders’ Equity
Nine Months Ended September 30, 2026 and 2025
(Unaudited)
| Common Stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive loss | Total | |||||||||||||||||||||||||||||||
| (in thousands) | Number of shares | Par value | |||||||||||||||||||||||||||||||||
| Balance as of December 31, 2025 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
| Dividends accrued for preferred stock | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Shares issued for warrants exercised | — | — | |||||||||||||||||||||||||||||||||
| Shares issued under stock incentive plans, net of forfeitures | ( | — | — | ||||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Restricted shares surrendered for tax withholdings under stock incentive plans | ( | ( | ( | — | — | ( | |||||||||||||||||||||||||||||
| Issuance of common stock, net of issuance costs (1) | — | — | |||||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | |||||||||||||||||||||||||||||||
| Balance as of September 30, 2026 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Common Stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive loss | Total | |||||||||||||||||||||||||||||||
| (in thousands) | Number of shares | Par value | |||||||||||||||||||||||||||||||||
| Balance as of December 31, 2024 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
| Dividends accrued for preferred stock | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Shares issued under stock incentive plans, net of forfeitures and tax withholdings | ( | — | — | ( | |||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Restricted shares surrendered for tax withholdings under stock incentive plans | ( | ( | ( | — | — | ( | |||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | |||||||||||||||||||||||||||||||
| Balance as of September 30, 2025 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
(1) Additional paid-in capital impact consists of $96.1 million for shares issued, less $4.8 million of fees and $3.4 million of deemed dividends (see Note 9).
See notes to condensed consolidated financial statements (unaudited).
7
Table of Contents
NN, Inc.
Notes to Condensed Consolidated Financial Statements
September 30, 2026
(Unaudited)
Note 1. Interim Financial Statements
Nature of Business
NN, Inc., a Delaware corporation, is a diversified industrial company that combines advanced engineering and production capabilities with in-depth materials science expertise to design and manufacture high-precision components and assemblies for a variety of end markets on a global basis. As of September 30, 2026, we had 27 facilities in North America, South America, Europe and China. As used in this Quarterly Report on Form 10-Q (this “Quarterly Report”), the terms “NN,” the “Company,” “we,” “our,” or “us” refer to NN, Inc. and its subsidiaries.
Basis of Presentation
The accompanying condensed consolidated financial statements have not been audited. The Condensed Consolidated Balance Sheet as of December 31, 2025, was derived from the audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Annual Report”), which we filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 4, 2026. In management’s opinion, the accompanying unaudited condensed consolidated financial statements reflect all adjustments necessary to fairly state our results of operations for the three and nine months ended September 30, 2026 and 2025; financial position as of September 30, 2026 and December 31, 2025; and cash flows for the nine months ended September 30, 2026 and 2025, on a basis consistent with our audited consolidated financial statements. These adjustments are of a normal recurring nature and are, in the opinion of management, necessary to state fairly our financial position and operating results for the interim periods. Certain prior period amounts have been reclassified to conform to the current year’s presentation.
Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been condensed or omitted from the unaudited condensed consolidated financial statements presented in this Quarterly Report. These unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and accompanying notes included in the 2025 Annual Report. The results for the three and nine months ended September 30, 2026, are not necessarily indicative of results for the year ending December 31, 2026, or any other future periods.
Except for per share data or as otherwise indicated, all U.S. dollar amounts and share counts presented in the tables in these Notes to Condensed Consolidated Financial Statements are in thousands.
Accounting Standards Recently Adopted
In July 2025, the FASB issued ASU 2025-05, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets” (“ASU 2025-05”). We have adopted the practical expedient effective for the current fiscal year noting that it does not have a material impact on the Company’s financial statements.
Accounting Standards Not Yet Adopted
In November 2024, the FASB issued ASU 2024-03, “Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”), which requires disaggregated disclosures of certain categories of expenses that are included in income statement line items. ASU 2024-03 is effective for fiscal years beginning on or after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Companies may early adopt and can apply the guidance prospectively or retrospectively. We have not yet determined the potential impact of adopting this standard.
Assets Held for Sale
Note 2. Segment Information
8
Table of Contents
Our business is organized into two reportable segments, Mobile Solutions and Power Solutions, based on the nature of the products manufactured. There have been no changes in the composition of our reportable segments from those described in our Annual Report on Form 10-K for the year ended 2025.
These reportable segments are considered our two operating segments as each has engaged in business activities for which it earns revenues and incurs expenses, discrete financial information is available for each, and this is the level at which the chief operating decision maker (“CODM”) reviews discrete financial information for purposes of allocating resources and assessing performance. The CODM, who is our President and Chief Executive Officer, uses segment operating income (loss) to evaluate the performance of our segments each quarter and for annual forecasting purposes. Segment operating income (loss) is used to make key operating decisions, such as the amount and timing of capital expenditures, plant optimization actions, and allocation of management resources. In addition to amounts allocated to our two reportable segments, certain corporate costs and unallocated expenses that are not allocated to the reportable segments and are included in reconciliations to consolidated results. Transactions between segments are recorded at cost.
The following tables reconcile segment net sales to consolidated loss before provision for income taxes and share of net income from joint venture.
| Three Months Ended September 30, 2026 | Mobile Solutions | Power Solutions | Total | ||||||||||||||
| Net sales to external customers | $ | $ | $ | ||||||||||||||
| Intersegment net sales | 255 | ||||||||||||||||
| Total net sales | |||||||||||||||||
| Reconciliation of net sales: | |||||||||||||||||
| Elimination of intersegment net sales | ( | ||||||||||||||||
| Total consolidated net sales | $ | ||||||||||||||||
| Less: | |||||||||||||||||
| Cost of sales | |||||||||||||||||
| Selling, general, and administrative expense | |||||||||||||||||
| Depreciation expense | |||||||||||||||||
| Other segment items (1) | |||||||||||||||||
| Segment operating (loss) income | ( | ||||||||||||||||
| Reconciliation of segment operating (loss) income: | |||||||||||||||||
| Elimination of intersegment profits | ( | ||||||||||||||||
| Unallocated expenses (2) | |||||||||||||||||
| Interest expense | |||||||||||||||||
| Other income, net | ( | ||||||||||||||||
| Loss before provision for income taxes and share of net income from joint venture | $ | ( | |||||||||||||||
_______________________________
(1) Other segment items include amortization expense and other operating expenses and income.
(2) Unallocated expenses consist of selling, general, and administrative expense of $6.1 million, depreciation expense of $0.4 million, and other operating income of $0.2 million from our corporate headquarters that are not allocated to segments.
9
Table of Contents
| Three Months Ended September 30, 2025 | Mobile Solutions | Power Solutions | Total | ||||||||||||||
| Net sales to external customers | $ | $ | $ | ||||||||||||||
| Intersegment net sales | 183 | ||||||||||||||||
| Total net sales | |||||||||||||||||
| Reconciliation of net sales: | |||||||||||||||||
| Elimination of intersegment net sales | ( | ||||||||||||||||
| Total consolidated net sales | $ | ||||||||||||||||
| Less: | |||||||||||||||||
| Cost of sales | |||||||||||||||||
| Selling, general, and administrative expense | |||||||||||||||||
| Depreciation expense | |||||||||||||||||
| Other segment items (1) | |||||||||||||||||
| Segment operating (loss) income | ( | ||||||||||||||||
| Reconciliation of segment operating (loss) income: | |||||||||||||||||
| Elimination of intersegment profits | ( | ||||||||||||||||
| Unallocated expenses (2) | |||||||||||||||||
| Interest expense | |||||||||||||||||
| Other income, net | ( | ||||||||||||||||
| Loss before provision for income taxes and share of net income from joint venture | $ | ( | |||||||||||||||
(1) Other segment items include amortization expense and other operating expenses and income.
(2) Unallocated expenses consist of selling, general, and administrative expense of $4.6 million, depreciation expense of $0.4 million, and other operating income of $0.2 million from our corporate headquarters that are not allocated to segments.
10
Table of Contents
| Nine Months Ended September 30, 2026 | Mobile Solutions | Power Solutions | Total | ||||||||||||||
| Net sales to external customers | $ | $ | $ | ||||||||||||||
| Intersegment net sales | 458 | ||||||||||||||||
| Total net sales | |||||||||||||||||
| Reconciliation of net sales: | |||||||||||||||||
| Elimination of intersegment net sales | ( | ||||||||||||||||
| Total consolidated net sales | $ | ||||||||||||||||
| Less: | |||||||||||||||||
| Cost of sales | |||||||||||||||||
| Selling, general, and administrative expense | |||||||||||||||||
| Depreciation expense | |||||||||||||||||
| Other segment items (1) | |||||||||||||||||
| Segment operating (loss) income | ( | ||||||||||||||||
| Reconciliation of segment operating (loss) income: | |||||||||||||||||
| Elimination of intersegment profits | ( | ||||||||||||||||
| Unallocated expenses (2) | |||||||||||||||||
| Interest expense | |||||||||||||||||
| Other income, net | ( | ||||||||||||||||
| Loss before provision for income taxes and share of net income from joint venture | $ | ( | |||||||||||||||
(1) Other segment items include amortization expense and other operating expenses and income.
(2) Unallocated expenses consist of selling, general, and administrative expense of $18.1 million, depreciation expense of $1.1 million, and other operating income of $0.6 million from our corporate headquarters that are not allocated to segments.
11
Table of Contents
| Nine Months Ended September 30, 2025 | Mobile Solutions | Power Solutions | Total | ||||||||||||||
| Net sales to external customers | $ | $ | $ | ||||||||||||||
| Intersegment net sales | 356 | ||||||||||||||||
| Total net sales | |||||||||||||||||
| Reconciliation of net sales: | |||||||||||||||||
| Elimination of intersegment net sales | ( | ||||||||||||||||
| Total consolidated net sales | $ | ||||||||||||||||
| Less: | |||||||||||||||||
| Cost of sales | |||||||||||||||||
| Selling, general, and administrative expense | |||||||||||||||||
| Depreciation expense | |||||||||||||||||
| Other segment items (1) | |||||||||||||||||
| Segment operating (loss) income | ( | ||||||||||||||||
| Reconciliation of segment operating (loss) income: | |||||||||||||||||
| Elimination of intersegment profits | ( | ||||||||||||||||
| Unallocated expenses (2) | |||||||||||||||||
| Interest expense | |||||||||||||||||
| Loss on extinguishment of debt | |||||||||||||||||
| Other income, net | ( | ||||||||||||||||
| Loss before provision for income taxes and share of net income from joint venture | $ | ( | |||||||||||||||
_______________________________
(1) Other segment items include amortization expense and other operating expenses and income.
(2) Unallocated expenses consist of selling, general, and administrative expense of $15.5 million, depreciation expense of $1.2 million, and other operating income of $0.6 million from our corporate headquarters that are not allocated to segments.
12
Table of Contents
The following table presents capital expenditures and depreciation and amortization by reportable segment.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Capital expenditures: | |||||||||||||||||||||||
| Mobile Solutions | $ | $ | $ | $ | |||||||||||||||||||
| Power Solutions | |||||||||||||||||||||||
| Total reportable segments | $ | $ | $ | $ | |||||||||||||||||||
| Reconciliation to consolidated totals: | |||||||||||||||||||||||
| Other unallocated amounts (1) | |||||||||||||||||||||||
| Total capital expenditures | $ | $ | $ | $ | |||||||||||||||||||
| Depreciation and amortization: | |||||||||||||||||||||||
| Mobile Solutions | $ | $ | $ | $ | |||||||||||||||||||
| Power Solutions | |||||||||||||||||||||||
| Total reportable segments | $ | $ | $ | $ | |||||||||||||||||||
| Reconciliation to consolidated totals: | |||||||||||||||||||||||
| Other unallocated amounts (2) | |||||||||||||||||||||||
| Total depreciation and amortization | $ | $ | $ | $ | |||||||||||||||||||
_______________________________
(1) Total unallocated amounts consist of capital expenditures from our corporate headquarters that are not allocated to segments.
(2) Total unallocated amounts consist of depreciation expense from our corporate headquarters that are not allocated to segments.
The following table summarizes total assets by reportable segment.
| September 30, 2026 | December 31, 2025 | ||||||||||
| Mobile Solutions (1) | $ | $ | |||||||||
| Power Solutions | |||||||||||
| Total reportable segments | $ | $ | |||||||||
| Reconciliation to consolidated totals: | |||||||||||
| Other unallocated amounts (2) | |||||||||||
| Total assets | $ | $ | |||||||||
_______________________________
(1) Total assets in Mobile Solutions includes $48.0 million and $42.5 million as of September 30, 2026 and December 31, 2025, respectively, related to our investment in a joint venture (see Note 7).
(2) As of September 30, 2026, amounts consisted of $7.9 million current assets, $6.5 million of property, plant and equipment, $3.6 million of operating leases, and $2.4 million of other non-current assets that are not allocated to segments from our corporate headquarters. As of December 31, 2025, amounts consisted of $15.8 million current assets, $6.6 million of property, plant and equipment, $4.0 million of operating leases, and $2.6 million of other non-current assets that are not allocated to segments from our corporate headquarters.
13
Table of Contents
Note 3. Revenue from Contracts with Customers
Revenue is recognized when control of the good or service is transferred to the customer either at a point in time or, in limited circumstances, as our services are rendered over time. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or services.
Beginning in the second quarter of fiscal 2026, we revised our revenue disaggregation categories to provide more detailed disclosure of the markets we serve. Prior period amounts have been recast to conform to the current presentation. The following tables summarize revenue by customer industry. Our products in the Global Automotive end market include high-precision components and assemblies for electric power steering systems, electric braking, electric motors, sensors, electrical contacts, fuel systems, emissions control, and transmissions. Our products in the Data Center & Electric Grid end market include components used in smart meters, electric circuits, electric panels, and liquid cooling connectors for thermal management systems in data centers. Our products in the Industrial end market include high-precision metal components for a variety of industrial applications, including motors, heating and cooling systems, pumps, valves, and power tools. Our products in the Commercial Vehicle end market include high-precision components for diesel fuel systems, emissions control, power steering, braking, and transmissions. Our products in the Defense & Electronics end market include plating of critical electronics contained within advanced weapons systems, metal fabrications within guidance and weapon systems, and machined parts for firearms and accessories. Our products in the Medical end market include high-precision components used in surgical instruments, robotic-assisted surgery equipment, orthopedic tools, orthopedic components, electrosurgical products, suture-related products, and other precision medical devices.
| Three Months Ended September 30, 2026 | Mobile Solutions | Power Solutions | Intersegment Sales Eliminations | Total | |||||||||||||||||||
| Global Automotive | $ | $ | $ | — | $ | ||||||||||||||||||
| Data Center & Electric Grid | — | ||||||||||||||||||||||
| Industrial | — | ||||||||||||||||||||||
| Commercial Vehicle | — | ||||||||||||||||||||||
| Defense & Electronics | — | ||||||||||||||||||||||
| Medical | — | ||||||||||||||||||||||
| Eliminations | ( | ( | |||||||||||||||||||||
| Total net sales | $ | $ | $ | ( | $ | ||||||||||||||||||
| Three Months Ended September 30, 2025 | Mobile Solutions | Power Solutions | Intersegment Sales Eliminations | Total | |||||||||||||||||||
| Global Automotive | $ | $ | $ | — | $ | ||||||||||||||||||
| Data Center & Electric Grid | — | ||||||||||||||||||||||
| Industrial | — | ||||||||||||||||||||||
| Commercial Vehicle | — | ||||||||||||||||||||||
| Defense & Electronics | — | ||||||||||||||||||||||
| Medical | — | ||||||||||||||||||||||
| Eliminations | ( | ( | |||||||||||||||||||||
| Total net sales | $ | $ | $ | ( | $ | ||||||||||||||||||
| Nine Months Ended September 30, 2026 | Mobile Solutions | Power Solutions | Intersegment Sales Eliminations | Total | |||||||||||||||||||
| Global Automotive | $ | $ | $ | — | $ | ||||||||||||||||||
| Data Center & Electric Grid | — | ||||||||||||||||||||||
| Industrial | — | ||||||||||||||||||||||
| Commercial Vehicle | — | ||||||||||||||||||||||
| Defense & Electronics | — | ||||||||||||||||||||||
| Medical | — | ||||||||||||||||||||||
| Eliminations | ( | ( | |||||||||||||||||||||
| Total net sales | $ | $ | $ | ( | $ | ||||||||||||||||||
14
Table of Contents
| Nine Months Ended September 30, 2025 | Mobile Solutions | Power Solutions | Intersegment Sales Eliminations | Total | |||||||||||||||||||
| Global Automotive | $ | $ | $ | — | $ | ||||||||||||||||||
| Data Center & Electric Grid | — | ||||||||||||||||||||||
| Industrial | — | ||||||||||||||||||||||
| Commercial Vehicle | — | ||||||||||||||||||||||
| Defense & Electronics | — | ||||||||||||||||||||||
| Medical | — | ||||||||||||||||||||||
| Eliminations | ( | ( | |||||||||||||||||||||
| Total net sales | $ | $ | $ | ( | $ | ||||||||||||||||||
Sales Concentration
During the nine months ended September 30, 2026 and 2025, a customer in our Mobile Solutions segment represented 10 % and 11 % of consolidated revenue, respectively.
Deferred Revenue
Deferred revenue relates to payments received in advance of performance under the contract and recognized as revenue as (or when) we perform under the contract. The balance of deferred revenue was $0.7 million and $0.3 million as of September 30, 2026 and December 31, 2025, respectively. Revenue recognized for performance obligations satisfied or partially satisfied during the nine months ended September 30, 2026 included $0.3 million that was included in deferred revenue as of December 31, 2025. The balance of deferred revenue was $0.2 million as of September 30, 2025 and December 31, 2024. Revenue recognized for performance obligations satisfied or partially satisfied during the nine months ended September 30, 2025 included $0.2 million that was included in deferred revenue as of December 31, 2024.
Transaction Price Allocated to Future Performance Obligations
We are required to disclose the aggregate amount of transaction price that is allocated to performance obligations that have not yet been satisfied as of September 30, 2026, unless our contracts meet one of the practical expedients. Our contracts met the practical expedient for a performance obligation that is part of a contract that has an original expected duration of one year or less.
Note 4. Accounts Receivable
The balance of trade accounts receivable was $63.0 million and $61.5 million as of September 30, 2025 and December 31, 2024, respectively. The following table presents changes in the allowance for credit losses.
| Nine Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Balance at beginning of period | $ | $ | |||||||||
| Additions | |||||||||||
| Write-offs and other | ( | ( | |||||||||
| Currency impact | ( | ||||||||||
| Balance at end of period | $ | $ | |||||||||
We participate in programs that allow us to sell certain receivables from customers on a non-recourse basis to third-party financial institutions. During the nine months ended September 30, 2026 and 2025, we incurred fees of $0.5 million and $0.4 million, respectively, related to the sale of receivables, which is recorded in the Other income, net line item on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).
15
Table of Contents
Note 5. Inventories
Inventories are comprised of the following amounts:
| September 30, 2026 | December 31, 2025 | ||||||||||
| Raw materials | $ | $ | |||||||||
| Work in process | |||||||||||
| Finished goods | |||||||||||
| Total inventories | $ | $ | |||||||||
Note 6. Intangible Assets
The following table shows changes in the carrying amount of intangible assets, net, by reportable segment.
| Mobile Solutions | Power Solutions | Total | |||||||||||||||
| Balance as of December 31, 2025 | $ | $ | $ | ||||||||||||||
| Amortization | ( | ( | ( | ||||||||||||||
| Balance as of September 30, 2026 | $ | $ | $ | ||||||||||||||
Intangible assets are reviewed for impairment when changes in circumstances indicate the carrying value of those assets may not be recoverable. There were no impairment charges for the nine months ended September 30, 2026 and 2025.
Note 7. Investment in Joint Venture
We own a 49 % investment in Wuxi Weifu Autocam Precision Machinery Company, Ltd. (the “JV”), a joint venture located in Wuxi, China. The JV is jointly controlled and managed, and we account for it under the equity method, with the share of net income from the joint venture recorded in the Mobile Solutions segment.
The following table shows changes in our investment in the JV.
| Balance as of December 31, 2025 | $ | ||||
| Share of earnings | |||||
| Dividends paid by joint venture | ( | ||||
| Foreign currency translation gain | |||||
| Balance as of September 30, 2026 | $ | ||||
Note 8. Debt
The following table presents amounts outstanding on our debt facilities.
| September 30, 2026 | December 31, 2025 | ||||||||||
| Term loan facilities | $ | $ | |||||||||
| ABL Facility | |||||||||||
| Financing obligations from sale-leaseback transactions | |||||||||||
| International loans | |||||||||||
| Other financing obligations | 1,461 | — | |||||||||
| Unamortized debt issuance costs and discount (1) | ( | ( | |||||||||
| Total debt | $ | $ | |||||||||
_______________________________
(1) In addition to this amount, costs of $0.7 million and $0.9 million related to the ABL Facility (as defined below) were recorded in Other non-current assets as of September 30, 2026 and December 31, 2025, respectively.
We capitalized interest costs of $1.0 million and $0.6 million in the nine months ended September 30, 2026 and 2025, respectively, related to construction in progress.
Term Loan Facility
On April 16, 2025 (the “Closing Date”), we entered into a Term Loan Credit Agreement by and among the Company, the lenders from time to time party thereto (collectively, the “Lenders”) and Alter Domus (US) LLC, as administrative agent (the “Term Loan Agent”) for the Lenders (the “Term Loan Credit Agreement”). The Term Loan Credit Agreement establishes a new $128.0 million senior secured Term Loan Facility (the “Term Loan Facility”) consisting of (i) a $118.0 million term loan funded in full on the Closing Date (the “Closing Date Term Loans”) and (ii) $10.0 million of delayed draw term loan
16
Table of Contents
commitments (any delayed draw term loans funded thereunder, the “Delayed Draw Term Loans”, and together, with the Closing Date Term Loans, the “Term Loans”). The Term Loans mature on April 16, 2030 . We used the proceeds from the Closing Date Term Loans to repay all of our outstanding obligations under our outstanding term loan facility (see “2021 Term Loan” below).
Under the Term Loan Credit Agreement, interest rates on the Term Loans are determined based on the type of Term Loan, the length of the interest period, and our Consolidated Net Leverage Ratio (as defined in the Term Loan Credit Agreement). The Term Loans currently bear interest at either: 1) one-month, three-month, or six-month term secured overnight finance rate (“SOFR”) with a credit spread adjustment, subject to a 2.00 % floor, plus an applicable margin ranging from 8.75 % to 9.75 % based on our Consolidated Net Leverage Ratio (as defined herein) (“Adjusted Term SOFR Rate Loans”); or 2) the greater of various benchmark rates, with certain adjustments, plus an applicable margin ranging from 7.75 % to 8.75 % based on our Consolidated Net Leverage Ratio (“Base Rate Loans”). For interest payments due before April 16, 2027, we may elect to pay a portion of interest in-kind (“PIK Election”), subject to a minimum cash interest of 5.25 % for Adjusted Term SOFR Rate Loans and 4.25 % for Base Rate Loans. The applicable margin increases by 0.50 % on borrowings to which the PIK Election is made. At September 30, 2026, the Term Loans bore interest, including amounts we have elected to pay as PIK interest, based on one-month Adjusted Term SOFR, at 13.75 %.
On January 29, 2026, we borrowed $10.0 million on the Delayed Draw Term Loans. As a result of borrowing the Delayed Draw Term Loans, the applicable margin for all Term Loans increased by 0.50 %. Through January 29, 2026, we incurred a 1.00 % commitment fee on undrawn amounts under the Delayed Draw, payable quarterly in arrears.
Subject to certain exceptions, we are required to make principal payments (i) annually that are calculated as a percentage, based on our Consolidated Net Leverage Ratio, of our Excess Cash Flow (as defined in the Term Loan Credit Agreement), (ii) Net Cash Proceeds (as defined in the Term Loan Credit Agreement) of certain non-ordinary course Dispositions (as defined in the Term Loan Credit Agreement) within 10 business days of receipt thereof, and (iii) Net Cash Proceeds from certain insurance events. We may voluntarily prepay the Term Loans, in whole or part without premium or penalty following April 16, 2027. If we would have voluntarily prepaid borrowings prior to April 16, 2026, we would have been subject to a prepayment premium equal to the present value at the prepayment date of (i) 2.00% of the outstanding principal amount of the Term Loans to be prepaid, plus (ii) all remaining scheduled interest payments due on such Term Loans through April 16, 2026 (excluding accrued but unpaid interest to, but not including, the prepayment date), computed using a discount rate equal to the Treasury Rate (determined as of the Business Day prior to such date of prepayment) plus 50 basis points. If we voluntarily prepay borrowings following April 16, 2026 and prior to April 16, 2027, we are subject to a prepayment premium equal to 2.00 % of the principal amount prepaid.
The Term Loan Credit Agreement includes customary representations, warranties and covenants, including, but not limited to, certain financial covenants, such as maximum Consolidated Net Leverage Ratio and minimum Domestic Liquidity (as defined in the Term Loan Credit Agreement), subject, in the case of the Consolidated Net Leverage Ratio covenant, to certain equity cure rights. We were in compliance with the financial covenants of the Term Loan Facility as of September 30, 2026.
Our obligations under the Term Loan Credit Agreement are guaranteed by certain of our subsidiaries and are required to be guaranteed by certain of our later formed or acquired subsidiaries (collectively, the “Guarantors”). Our obligations under the Term Loan Credit Agreement are collateralized by substantially all of our and the Guarantors’ assets. The Term Loan Agent, for itself and on behalf of the Lenders, has a first lien on all domestic assets, other than accounts receivable and inventory, and certain foreign assets and has a second lien on domestic accounts receivable and inventory.
The Term Loan Credit Agreement contains customary events of default relating to, among other things, payment defaults, breach of covenants, cross acceleration to material indebtedness, bankruptcy-related defaults, judgment defaults, and the occurrence of certain change of control events. If an event of default occurs, the lenders under the Term Loan Credit Agreement will be entitled to take various actions, including the termination of any undrawn commitments and the acceleration of amounts due under the Term Loan Credit Agreement.
The Term Loan Facility was issued at a $2.5 million discount and we capitalized an additional $0.7 million in debt issuance costs in 2025. In January 2026, we capitalized an additional $0.1 million in debt issuance costs as part of the borrowings under the Delayed Draw Term Loan. These costs are recorded as a direct reduction to the carrying amount of the associated long-term debt and amortized over the term of the debt.
2021 Term Loan
On March 22, 2021, we entered into a $150.0 million term loan facility (as amended from time to time, the “2021 Term Loan Facility”) which required principal payments of $0.4 million with the remaining unpaid principal amount due at the original loan maturity date of September 22, 2026 . On April 16, 2025, we repaid all of our outstanding obligations under the 2021 Term Loan Facility with the proceeds from the Closing Date Term Loans. The 2021 Term Loan Facility was collateralized by all of
17
Table of Contents
our assets and had a first lien on all domestic assets, other than accounts receivable and inventory and had a second lien on domestic accounts receivable and inventory.
Outstanding borrowings on the 2021 Term Loan bore interest at either: 1) one-month, three-month, or six-month term secured overnight finance rate (“SOFR”) with a duration adjustment (“Adjusted Term SOFR”), subject to a 1.000 % floor, plus an applicable margin of 6.875 %, or 2) the greater of various benchmark rates plus an applicable margin of 5.875 %. Beginning in the second quarter of 2023, interest was increased on a paid-in-kind basis at a rate between 1.00 % and 2.00 % (“PIK interest”), dependent on our net leverage ratio for the most recently reported fiscal quarter and subject to reduction upon the occurrence of certain conditions as set forth in the credit agreement governing the 2021 Term Loan Facility. At April 16, 2025, the 2021 Term Loan Facility bore interest, including PIK interest, based on one-month Adjusted Term SOFR, at 12.30 %.
The 2021 Term Loan Facility was issued at a $3.8 million discount and we capitalized an additional $5.5 million in debt issuance costs which were amortized over the term of the debt.
During the year ended December 31, 2025, we recognized a $3.0 million loss on extinguishment in connection with the termination of the 2021 Term Loan Facility.
ABL Facility
On December 30, 2024, we entered into a Revolving Credit and Security Agreement by and among the Company and PNC Bank National Association as lender and administrative agent (in such capacity, the “ABL Agent”) (as amended from time to time, including by the First Amendment to Revolving Credit and Security Agreement, dated as of April 16, 2025, the “ABL Credit Agreement”). The ABL Credit Agreement established a new $50.0 million senior secured asset backed credit facility (the “ABL Facility”) which provides for senior secured revolving loans (“Revolving Loan”) in the amount of $50.0 million, and permits the issuance of letters of credit thereunder subject to a $15.0 million sublimit. The availability under the ABL Facility is limited by a borrowing base calculation derived from accounts receivable and inventory held in the United States, less customary reserves and other items. The final maturity date of the ABL Facility is the earlier of: 1) December 30, 2029; or 2) 91 days prior to the loan maturity date of the Term Loan Facility.
Under the ABL Facility, Revolving Loans bear interest as either: 1) one, three or six month SOFR plus 1.50 %, plus an adjustment of 0.10% (“Term SOFR Rate”); or 2) the highest of the base commercial lending rate of the lender or various benchmark rates plus an applicable margin of 0.50 % or 1.00 %, depending on the benchmark (“Alternative Base Rate”). At September 30, 2026, based on an Alternative Base Rate, the interest rate on outstanding borrowings under the ABL Facility was 7.50 %. We incur a commitment fee of 0.25 % for unused capacity under the ABL Facility and a 1.85 % fee on the amount of letters of credit outstanding. We capitalized a total of $1.2 million in new debt issuance costs related to the ABL Facility.
As of September 30, 2026, there were no outstanding borrowings under the ABL Facility, $12.4 million of outstanding letters of credit, and $34.7 million available for future borrowings under the ABL Facility.
The ABL Credit Agreement includes customary representations, warranties and covenants, including, but not limited to, a financial covenant as to a minimum Fixed Charge Coverage Ratio (as defined in the ABL Credit Agreement). We were in compliance with the financial covenants of the ABL Facility as of September 30, 2026.
Our obligations under the ABL Credit Agreement are guaranteed by certain of our subsidiaries and are required to be guaranteed by certain of our later formed or acquired subsidiaries. Our obligations under the ABL Credit Agreement are collateralized by substantially all of our and such guarantors’ assets. The ABL Agent, for itself and on behalf of the Lenders, has a first lien on accounts receivable and inventory.
The ABL Credit Agreement contains customary events of default relating to, among other things, payment defaults, breach of covenants, cross acceleration to material indebtedness, bankruptcy-related defaults, judgment defaults, and the occurrence of certain change of control events. If an event of default occurs, the lenders under the ABL Credit Agreement will be entitled to take various actions, including the termination of any undrawn commitments and the acceleration of amounts due under the ABL Credit Agreement.
Sale-Leaseback Transactions
In May 2025, we sold property for a sales price of $4.3 million and concurrent with the sale, entered into a 19-year lease agreement with the purchaser for the property. In March 2024, we sold three of our properties for an aggregate sales price of $16.9 million and concurrent with the sale, we entered into a 20-year lease agreement with the purchaser for these properties.
Since these lease agreements allow for us to exercise renewal options that extend for substantially all of the remaining economic life, we have the ability to maintain the risks and rewards of ownership. Because the transactions did not transfer control of the assets, they cannot be accounted for as sales under ASC 606. As a result, the properties remain on our Condensed Consolidated Balance Sheets and the non-land assets will continue to be depreciated over their remaining useful lives. The $21.2 million of total gross proceeds from these transactions were recognized as financing obligations as a component of long-
18
Table of Contents
term debt. The monthly lease payments, which increase 3.00% each year, are being amortized as principal payments and interest expense through 2044 based on a weighted average effective interest rate of 9.17 %. We incurred $0.9 million in debt issuance costs related to these transactions, which is being amortized over the term of the debt.
In June and July 2025, we sold pieces of manufacturing equipment for an aggregate sales price of $2.7 million and entered into 3 and 5-year lease agreements with the purchaser for the equipment. In March 2024, we sold multiple pieces of manufacturing equipment for an aggregate sales price of $4.9 million. Concurrent with the sale, we entered into a 5-year lease agreement with the purchaser that includes a repurchase option for this equipment. In May 2024, we sold additional pieces of manufacturing equipment for an aggregate sales price of $3.4 million and entered into 5-year and 6-year lease agreements with the purchaser for the equipment. Since these lease agreements allow for us to exercise a purchase option, we have the ability to maintain the risks and rewards of ownership. Since the transactions did not transfer control of the assets, they cannot be accounted for as sales under ASC 606. As a result, the assets remain on our Condensed Consolidated Balance Sheets and will continue to be depreciated over their remaining useful lives. The $11.0 million of total gross proceeds from these transactions were recognized as a financing obligation as a component of long-term debt. The monthly lease payments are being amortized as principal payments and interest expense on a weighted average effective interest rate of 8.90 %.
International Loans & Other Financing Obligations
We have fixed rate debt with various financial institutions in France, Poland and China, with maturity dates between 2026 and 2033. These loans, which were obtained to fund working capital and equipment purchases, had a weighted average interest rate of 2.22 % at September 30, 2026. The increase in our financing obligation reflects $1.5 million paid to vendors on our behalf for an equipment lease arrangement that had not commenced as of September 30, 2026.
Note 9. Common Stock and Preferred Stock
Common Stock
On June 30, 2026, the Company entered into a Securities Purchase Agreement (the “July Purchase Agreement”) with certain institutional investors (the “July Purchasers”), pursuant to which the Company agreed to sell and issue shares to the July Purchasers in a private placement transaction (the “ July Private Placement”). On July 2, 2026, the Company closed the July Private Placement, which resulted in the Company issuing 24,509,804 shares of the Company’s common stock.
On September 30, 2026, at a special meeting of stockholders (the “Special Meeting”), our stockholders approved the amendment and restatement of the Company’s Certificate of Incorporation to increase the authorized number of shares to 185,000,000 shares, consisting of 180,000,000 shares of common stock, par value $0.01 per share, and 5,000,000 shares of preferred stock, par value $0.01 per share.
Preferred Stock
On March 22, 2021, the Company completed a private placement of 65,000 shares of newly designated Series D Perpetual Preferred Stock, with a par value of $0.01 per share (the “Series D Preferred Stock”), at a price of $1,000 per share. The Series D Preferred Stock has an initial liquidation preference of $1,000 per share and is redeemable at our option in cash at a redemption price equal to the liquidation preference then in effect. Series D Preferred Stock shares earn cash dividends at a rate of 10.0 % per year, payable quarterly in arrears, accruing whether or not earned or declared. If no cash dividend is paid, then the liquidation preference per share effective on the dividend date increases to 12.0 % per year. On March 22, 2026, the cash dividend rate and in-kind dividend rate increased by 2.5 %, and will increase by 2.5% each year thereafter. Cash dividends are required beginning on September 30, 2027 and are limited based on terms and conditions of the Company’s outstanding credit agreements.
The Series D Preferred Stock is classified as mezzanine equity, between liabilities and stockholders’ equity, because certain features of the Series D Preferred Stock could require redemption of the Series D Preferred Stock upon a change of control event that is considered not solely within our control. For initial recognition, the Series D Preferred Stock was recognized at a discounted value, net of issuance costs and allocation to warrants and a bifurcated embedded derivative. The aggregate discount was amortized as a deemed dividend through March 22, 2026, which is the date the dividend rate increased to 14.5% per year. Deemed dividends adjust additional paid-in capital due to the absence of retained earnings.
Redemption, Exchange, and Modification.
On August 5, 2026, we entered into an exchange agreement (the “Exchange Agreement”) with the sole holder of the Series D Preferred Stock (the “Holder”), and concurrently completed the following transactions: (i) we redeemed 36,750 shares for $70.0 million in cash, equal to the accreted liquidation preference of the redeemed shares, pursuant to our optional redemption right under the certificate of designation (the “Redemption”); (ii) we issued 5,500,000 shares of our common stock in exchange for 9,850 shares of Series D Preferred Stock (the “Exchange”) for a total value representing $18.8 million; and (iii) the Holder consented to a reduction of the cash dividend rate and the preference accrual rate to 10.0% per annum for the one-year period
19
Table of Contents
ending August 5, 2027, after which the rates revert to the certificate of designation schedule, and agreed that if we redeem all remaining shares in full for cash with payment on or before December 31, 2026 (the “Final Redemption”), the aggregate redemption price will be reduced by $5.0 million.
The excess of the total consideration transferred, totaling $3.4 million, was recorded as a deemed dividend within additional paid-in capital and increases net loss attributable to common stockholders for the three and nine months ended September 30, 2026. Total consideration transferred includes fees associated with the transaction and the difference between the closing share price and the reference share price negotiated as part of the Exchange.
The changes to the terms of the remaining 18,400 shares were evaluated as a modification; because the changes were not substantive and conveyed no value to the Holder, no adjustment was recorded, and the remaining shares continue to be carried at their accreted liquidation preference, with accretion recognized at the reduced 10.0% rate during the rate adjustment period.
Direct costs of $0.2 million attributable to the modification were expensed as incurred.
Subsequent Event — Final Redemption.
On October 7, 2026, we completed the Final Redemption, redeeming all 18,400 remaining outstanding shares of Series D Preferred Stock for aggregate cash consideration of approximately $30.7 million, reflecting the $5.0 million reduction to the aggregate redemption price provided under the Exchange Agreement. Following the Final Redemption, no shares of Series D Preferred Stock remain outstanding, all rights of the Holder with respect to the Series D Preferred Stock terminated, and the Series D Preferred Stock balance within mezzanine equity will be reduced to zero.
As of September 30, 2026, the carrying value of the Series D Preferred Stock shares was $35.6 million, which included $17.2 million of accumulated unpaid and deemed dividends. The following table presents the change in the Series D Preferred Stock carrying value during the nine months ended September 30, 2026.
| Balance as of December 31, 2025 | $ | ||||
| Accrual of in-kind dividends | |||||
| Amortization | |||||
| Redemption | ( | ||||
| Exchange of preferred shares for common stock | ( | ||||
| Balance as of September 30, 2026 | $ | ||||
Note 10. Leases
The following table contains supplemental cash flow information related to leases.
| Nine Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||
| Operating cash flows used in operating leases | $ | $ | |||||||||
| Operating cash flows used in finance leases | |||||||||||
| Financing cash flows used in finance leases | |||||||||||
| Right-of-use assets obtained in exchange for new finance lease liabilities | |||||||||||
We recognized sublease income of $2.9 million in each of the nine months ended September 30, 2026 and 2025, which is recognized in the Other operating income, net line in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).
The following table presents finance lease-related assets and liabilities recorded on the Condensed Consolidated Balance Sheets.
| Financial Statement Line Item | September 30, 2026 | December 31, 2025 | ||||||||||||||||||
| Finance lease assets | ||||||||||||||||||||
| Finance lease current liabilities | ||||||||||||||||||||
| Finance lease non-current liabilities | ||||||||||||||||||||
| Total finance lease liabilities | $ | $ | ||||||||||||||||||
20
Table of Contents
Note 11. Commitments and Contingencies
Brazil ICMS Tax Matter
Prior to the acquisition of Autocam Corporation (“Autocam”) in 2014, Autocam’s Brazilian subsidiary (“Autocam Brazil”) received notification from the Brazilian tax authority regarding ICMS (state value added tax) tax credits claimed on intermediary materials (e.g., tooling and perishable items) used in the manufacturing process. The Brazilian tax authority notification disallowed state ICMS tax credits claimed on intermediary materials based on the argument that these items are not intrinsically related to the manufacturing processes. Autocam Brazil filed an administrative defense with the Brazilian tax authority arguing, among other matters, that it should qualify for an ICMS tax credit, contending that the intermediary materials are directly related to the manufacturing process.
We believe that we have substantial legal and factual defenses, and we continue to defend our interests in this matter vigorously. The matter encompasses several lawsuits filed with the Brazilian courts requesting declaratory actions that no tax is due or seeking a stay of execution on the collection of the tax. We have obtained multiple favorable decisions and one unfavorable decision. Although we anticipate a favorable resolution to the remaining matters, we can provide no assurances that we will be successful in achieving dismissal of all pending cases. The U.S. dollar amount that would be owed in the event of an unfavorable decision is subject to interest, penalties, and currency impacts and therefore is dependent on the timing of the decision. For the remaining open lawsuits, we currently believe the cumulative potential liability in the event of unfavorable decisions on all matters will be less than $2.0 million, inclusive of interest and penalties.
We are entitled to indemnification from the former shareholders of Autocam, subject to the limitations and procedures set forth in the agreement and plan of merger relating to the Autocam acquisition. Accordingly, we do not expect such losses, if any, to have a material impact on our business, operations or financial results.
Other Legal Matters
All other legal proceedings are of an ordinary and routine nature and are incidental to our operations. Management believes that such proceedings should not, individually or in the aggregate, have a material adverse effect on our business, financial condition, results of operations, or cash flows. In making that determination, we analyze the facts and circumstances of each case at least quarterly in consultation with our attorneys and determine a range of reasonably possible outcomes.
Note 12. Income Taxes
Our effective tax rate was (31.9 )% and (14.9 )% for the three and nine months ended September 30, 2026, respectively, and (10.4 )% and (11.5 )% for the three and nine months ended September 30, 2025, respectively. The effective tax rate for the three and nine months ended September 30, 2026 differs from the U.S. federal statutory tax rate of 21 % primarily due to the accrual of tax on non-permanently reinvested unremitted earnings of foreign subsidiaries and by limitation of the amount of tax benefit recorded for losses in certain jurisdictions where we believe it is more likely than not that a future tax benefit may not be realized.
21
Table of Contents
Note 13. Net Loss Per Common Share
The following table summarizes the computation of basic and diluted net loss per common share.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||
| Net loss | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Adjustment for preferred stock cumulative dividends and deemed dividends (1) | ( | ( | ( | ( | |||||||||||||||||||
| Numerator for basic and diluted net loss per common share | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Denominator: | |||||||||||||||||||||||
| Weighted average common shares outstanding | |||||||||||||||||||||||
| Adjustment for participating securities | ( | ( | ( | ( | |||||||||||||||||||
| Adjustment for warrants outstanding (2) | |||||||||||||||||||||||
| Shares used to calculate basic and diluted net loss per common share | |||||||||||||||||||||||
| Basic and diluted net loss per common share | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
_______________________________
(1) Includes deemed dividend of $3.4 million as described in Note 9.
(2) Outstanding warrants that are exercisable at an exercise price of $0.01 per share are included in shares outstanding for calculation of basic earnings per share (see Note 16).
The following table presents securities that could be potentially dilutive in the future that were excluded from the calculation of diluted net loss per common share because they had an anti-dilutive effect.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Stock options | |||||||||||||||||||||||
| Warrants | |||||||||||||||||||||||
| Performance share units | |||||||||||||||||||||||
| Total antidilutive securities | |||||||||||||||||||||||
Note 14. Share-Based Compensation
The following table lists the components of share-based compensation expense by type of award, which is recognized in the Selling, general, and administrative expense line in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Restricted stock | $ | $ | $ | $ | |||||||||||||||||||
| Performance share units | |||||||||||||||||||||||
| Share-based compensation expense | $ | $ | $ | $ | |||||||||||||||||||
22
Table of Contents
Restricted Stock
The following table presents the status of unvested restricted stock awards as of September 30, 2026, and activity during the nine months then ended.
| Nonvested Restricted Shares | Weighted Average Grant-Date Fair Value | ||||||||||
| Unvested at January 1, 2026 | $ | ||||||||||
| Granted | |||||||||||
| Vested | ( | ||||||||||
| Forfeited | ( | ||||||||||
| Unvested at September 30, 2026 | $ | ||||||||||
During the nine months ended September 30, 2026, we granted 1,095,000 shares of restricted stock to non-executive directors, officers and certain other employees. The shares of these restricted stock awards vest pro-rata generally over three years for employees and over one year for non-executive directors. Total grant date fair value of restricted stock that vested in the nine months ended September 30, 2026, was $2.1 million.
Performance Share Units
Performance Share Units (“PSUs”) are a form of long-term incentive compensation awarded to executive officers and certain other key employees designed to directly align the interests of employees to the interests of our stockholders, and to create long-term stockholder value. The following table presents the status of unvested PSUs as of September 30, 2026, and activity during the nine months then ended.
| Nonvested PSU Awards | Weighted Average Grant-Date Fair Value | ||||||||||
| Nonvested at January 1, 2026 | $ | ||||||||||
| Granted | |||||||||||
| Vested | ( | ||||||||||
| Forfeited | ( | ||||||||||
| Nonvested at September 30, 2026 | $ | ||||||||||
During the nine months ended September 30, 2026, we granted 1,124,000 PSUs to certain executive officers.
Of the shares granted, 558,000 shares granted will vest, if at all, upon achievement of a specified relative total shareholder return (“TSR”), which will be measured against the TSR of a specified index during the three-year performance period that ends December 31, 2028.
The remaining 566,000 shares granted will vest, if at all, upon achievement of performance goals based on four equally weighted metrics: (i) the Company’s cumulative adjusted EBITDA, (ii) free cash flow, and (iii) net sales, in each case, during the period beginning January 1, 2026 and ending December 31, 2028, and (iv) the Company’s TSR as compared to the TSR of a specified group of peer companies during the three-year period that ends December 31, 2028.
The grant date fair value of the portion of the PSU awards subject to performance conditions is based on the closing price of our common stock on the grant date, and the related compensation cost is recognized based on the number of shares expected to vest under the probable outcome of those conditions.
23
Table of Contents
Note 15. Accumulated Other Comprehensive Income (Loss)
The following tables present the components of accumulated other comprehensive income (loss).
| Foreign Currency Translation | |||||
| Balance as of June 30, 2026 | $ | ( | |||
| Other comprehensive income | |||||
| Balance as of September 30, 2026 | $ | ( | |||
| Balance as of June 30, 2025 | $ | ( | |||
| Other comprehensive income | |||||
| Balance as of September 30, 2025 | $ | ( | |||
| Foreign Currency Translation | |||||
| Balance as of December 31, 2025 | $ | ( | |||
| Other comprehensive income | |||||
| Balance as of September 30, 2026 | $ | ( | |||
| Balance as of December 31, 2024 | $ | ( | |||
| Other comprehensive income | |||||
| Balance as of September 30, 2025 | $ | ( | |||
Note 16. Fair Value Measurements
Fair value is an exit price representing the expected amount that an entity would receive to sell an asset or pay to transfer a liability in an orderly transaction with market participants at the measurement date. We followed consistent methods and assumptions to estimate fair values as more fully described in the 2025 Annual Report.
Embedded Derivatives
In accordance with ASC 815-15, Derivatives and Hedging - Embedded Derivatives, certain features of our preferred stock and long-term debt were bifurcated and accounted for as derivatives separately.
In conjunction with an amendment to our 2021 Term Loan in 2023, we issued warrants to purchase up to 2.0 million shares of our common stock at an exercise price of $0.01 per share (the “2023 Warrants”). The 2023 Warrants were exercisable, in full or in part, at any time prior to June 30, 2033. The 2023 Warrants included anti-dilution adjustments in the event of certain future equity issuances, stock splits, stock dividends, combinations or similar events. During the nine months ended September 30, 2026, 1,455,000 of the 2023 Warrants have been exercised on a cashless basis. As of September 30, 2026, none of the 2023 Warrants remain outstanding.
In conjunction with our placement of the Series B Preferred Stock in 2019, we issued warrants to purchase up to 1.5 million shares of our common stock (the “2019 Warrants”). The 2019 Warrants, are exercisable, in full or in part, at any time prior to December 11, 2026, at an exercise price of $11.03 per share, and are subject to anti-dilution adjustments in the event of future below market issuances, stock splits, stock dividends, combinations or similar events. During the nine months ended September 30, 2026, a portion of the 2019 Warrants were cancelled resulting in a decrease of 285,000 exercisable shares.
The following table presents the change in the liability balance of the embedded derivatives during the nine months ended September 30, 2026.
| Balance as of December 31, 2025 | $ | ||||
| Change in fair value (1) | |||||
| Settlements | ( | ||||
| Balance as of September 30, 2026 | $ | ||||
_______________________________
(1) Changes in the fair value are recognized in the Other income, net line in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).
24
Table of Contents
The following tables show the fair values of the embedded derivatives within the fair value hierarchy.
| September 30, 2026 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||
| Derivative liability - other current liabilities | $ | $ | $ | ||||||||||||||
| December 31, 2025 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||
| Derivative liability - other non-current liabilities | $ | $ | $ | ||||||||||||||
The fair value of the 2023 Warrants were determined using the observable market price of a share of our common stock, less the $0.01 per share exercise price (Level 1).
The fair value of the 2019 Warrants is determined using a valuation model that utilizes unobservable inputs to determine the probability that the 2019 Warrants will remain outstanding for future periods (Level 3). The probabilities resulted in a weighted average term of 0.2 years and 1.3 years as of September 30, 2026 and December 31, 2025, respectively.
Fair Value Disclosures
Note 17. Plant Optimization Activities
During the second half of 2024, we took specific steps to consolidate our footprint by identifying two manufacturing facilities to close due to volume rationalization which have reduced costs and improved operational efficiency. We ceased production activities at our Mobile Solutions plants in Juarez, Mexico, and Dowagiac, Michigan in January 2025 and March 2025, respectively. In addition, we implemented operational and cost optimization actions to reduce indirect and overhead costs. Based on recent developments, we anticipate reopening of our Juarez facility in 2027.
In 2025, we completed the facility closures and organizational changes previously announced. In connection therewith, as stated in our 2025 Annual Report, we recognized $13.4 million in charges. All costs incurred have been recognized in the Mobile Solutions segment. We expect to recognize annual benefits of approximately $5.4 million.
The following is a summary of plant optimization reserve activity for the nine months ended September 30, 2026.
| Severance and employee related | |||||
| Balance as of December 31, 2025 | $ | ||||
| Amounts paid | ( | ||||
| Balance as of September 30, 2026 | $ | ||||
Voluntary Early Retirement Program
During the nine months ended September 30, 2026, we recognized $0.2 million related to an early retirement incentive program (“ERIP”) that was open to certain U.S. employees that met specified age and service requirements, and who terminated employment in 2026. The estimated total cost of the ERIP, including costs recognized in 2025, is $0.6 million with all benefit payments expected to be made in 2026.
Note 18. Subsequent Events
Securities Purchase Agreement
On October 1, 2026, the Company entered into a Securities Purchase Agreement (the “October Purchase Agreement”) with certain institutional investors (the “ October Purchasers”), pursuant to which the Company agreed to sell and issue to the Purchasers 11,275,605 shares (the “Shares”) of the Company’s common stock (“Common Stock”) and pre-funded warrants (the “Pre-Funded Warrants”) to purchase up to 4,824,395 shares of Common Stock (the “Pre-Funded Warrant Shares”), in a private
25
Table of Contents
placement transaction (the “October Private Placement”). The purchase price per share of Common Stock is $3.30 per share (the “Per Share Purchase Price”) and the purchase price per Pre-Funded Warrant is $3.29 (the “Per Pre-Funded Warrant Purchase Price”), for total gross proceeds of approximately $53.1 million. Each Pre-Funded Warrant has an exercise price of $0.01 per share of Common Stock, is immediately exercisable, subject to certain conditions set forth in the Pre-Funded Warrants, and will not expire. On October 5, 2026, the Company closed the October Private Placement, resulting in approximately $49.8 million of net proceeds to the Company after deducting placement agent fees and estimated offering expenses. Immediately following the issuance of the Shares, the Company had 93,744,244 shares of Common Stock outstanding.
Subsequent Event — Final Redemption.
On October 7, 2026, we completed the Final Redemption (as defined in Note 9 - Common Stock and Preferred Stock), redeeming all 18,400 remaining outstanding shares of Series D Preferred Stock for aggregate cash consideration of approximately $30.7 million, reflecting the $5.0 million reduction to the aggregate redemption price provided under the Exchange Agreement (as defined in Note 9 - Common Stock and Preferred Stock). Following the Final Redemption, no shares of Series D Preferred Stock remain outstanding, all rights of the Holder with respect to the Series D Preferred Stock terminated, and the Series D Preferred Stock balance within mezzanine equity will be reduced to zero.
26
Table of Contents
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to help the reader understand the results of operations and financial condition of NN, Inc. and its consolidated subsidiaries for the three and nine months ended September 30, 2026. The financial information as of September 30, 2026, should be read in conjunction with the consolidated financial statements for the year ended December 31, 2025, contained in our Form 10-K for the year ended December 31, 2025 (“2025 Annual Report”), and the Condensed Consolidated Financial Statements included in this Quarterly Report.
Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally can be identified by words such as, but not limited to, “anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “predicts,” “projects,” “will,” and similar expressions. These include, among other things, statements relating to the future growth of NN’s business and revenues, competitive position, expected new business wins, capital expenditures, and other aspects of the Company’s business operations, financial condition, and strategies. Forward-looking statements may appear throughout this report and other documents we file with the Securities and Exchange Commission (SEC), including without limitation, the following sections: Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report on Form 10-Q and Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, as updated in our subsequent Quarterly Reports on Form 10-Q. These forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties, which could cause our actual results to differ materially from those reflected in the forward-looking statements. The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s filings made with the SEC, which are available on the SEC website at www.sec.gov. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.
Overview
NN, Inc., a Delaware corporation, is a diversified industrial company that combines advanced engineering and production capabilities with in-depth materials science expertise to design and manufacture high-precision components and assemblies for a variety of end markets on a global basis. As used in this Quarterly Report, the terms “NN,” the “Company,” “we,” “our,” or “us” refer to NN, Inc. and its subsidiaries. Except for per share data, percentages, or as otherwise indicated, all dollar amounts and share counts presented in the tables in this Management's Discussion and Analysis of Financial Condition and Results of Operations are in thousands.
Third Quarter Results
Net sales for the three months ended September 30, 2026 were $131.1 million, an increase of 26.2% compared to the same period in 2025. Loss from operations was $3.3 million, compared to $2.2 million in the prior year period. Net loss was $4.6 million, compared to $6.7 million in the prior year period.
Redemption of Series D Preferred Stock
During the third quarter and through the date of this report, we completed a series of transactions that retired all of our outstanding Series D Preferred Stock and simplified our capital structure:
•On July 2, 2026, we closed a private placement of 24,509,804 shares of common stock at $3.06 per share, resulting in net proceeds of $70.4 million (the “July Private Placement”).
•On August 5, 2026, we entered into an Exchange Agreement with the sole holder of our Series D Preferred Stock, under which we (i) redeemed 36,750 shares for $70.0 million in cash, equal to the accreted liquidation preference; (ii) issued 5,500,000 shares of common stock in exchange for 9,850 shares, representing $18.8 million; and (iii) obtained a reduction in the cash dividend and preference accrual rate to 10.0% per annum through August 5, 2027, together with a $5.0 million reduction in the aggregate redemption price if we redeemed the remaining shares for cash on or before December 31, 2026.
•On October 5, 2026, subsequent to quarter-end, we closed a second private placement of 11,275,605 shares of common stock at $3.30 per share and pre-funded warrants to purchase 4,824,395 shares of common stock at $3.29 per warrant, resulting in total gross proceeds of approximately $53.1 million (the “October Private Placement”).
•On October 7, 2026, we redeemed the remaining 18,400 shares of Series D Preferred Stock for approximately $30.7 million in cash, reflecting the $5.0 million reduction. No shares of Series D Preferred Stock remain outstanding after October 7, 2026.
27
Table of Contents
As a result of these transactions, we have eliminated the Series D Preferred Stock balance in mezzanine equity. Our common shares outstanding increased to 93,744,244 as of October 5, 2026, excluding shares issuable upon exercise of the pre-funded warrants.
Factors That May Influence Results of Operations
We believe there are several important factors that have influenced, and we expect will continue to influence, our results of operations.
Macroeconomic Conditions
We continue to monitor the ongoing impacts of current macroeconomic and geopolitical events, including changing conditions from global trade negotiations and tariffs, inflationary cost pressures on metal, raw materials, and other manufacturing inputs, elevated interest rates, supply chain disruptions, and ongoing military conflicts.
Global trade negotiations continue to create volatility in the marketplace. New trade restrictions and/or increases in tariffs could have a material impact on our business, financial condition, or results of operations by increasing our input costs and decreasing demand, although the nature of those trade restrictions and tariffs remains unclear. Additionally, tariffs may increase the risk for elevated inflation more generally, which may drive an increase in other input costs and have made it more difficult to procure precious metals and other raw materials. In particular, prices for commodities and certain metals, including, but not limited to, steel, copper, and precious metals, have recently shown increased volatility. Significant price increases for these commodities and precious metals have, and could continue to have, an adverse effect on our liquidity and operating profits if we cannot timely mitigate the price increases by successfully sourcing lower cost commodities or precious metals or by passing the increased costs on to customers.
We cannot predict the future impact on our end markets or input costs, including tariffs and their potential implications and ramifications, nor our ability to recover all cost increases, including the cost of raw materials, through pricing or the timing of such recoveries.
Footprint Optimization
During the second half of 2024, we identified two manufacturing facilities to close due to volume rationalization which have reduced costs and improved operational efficiency. During the first quarter of 2025, we ceased production activities at our Mobile Solutions plants in Juarez, Mexico and Dowagiac, Michigan. In addition, we implemented operational and cost optimization actions to reduce indirect and overhead costs. Based on recent developments, we anticipate reopening of our Juarez facility in 2027. We continue to evaluate our global footprint, which may result in further consolidation actions to further improve our overall cost structure.
28
Table of Contents
Results of Operations
Three Months Ended September 30, 2026 compared to the Three Months Ended September 30, 2025
Consolidated Results
| Three Months Ended September 30, | |||||||||||||||||
| 2026 | 2025 | $ Change | |||||||||||||||
| Net sales | $ | 131,100 | $ | 103,882 | $ | 27,218 | |||||||||||
| Cost of sales (exclusive of depreciation and amortization shown separately below) | 112,830 | 86,410 | 26,420 | ||||||||||||||
| Selling, general, and administrative expense | 13,287 | 11,059 | 2,228 | ||||||||||||||
| Depreciation and amortization | 9,260 | 9,064 | 196 | ||||||||||||||
| Other operating income, net | (957) | (404) | (553) | ||||||||||||||
| Loss from operations | (3,320) | (2,247) | (1,073) | ||||||||||||||
| Interest expense | 5,467 | 5,666 | (199) | ||||||||||||||
| Other income, net | (2,919) | (70) | (2,849) | ||||||||||||||
| Loss before provision for income taxes and share of net income from joint venture | (5,868) | (7,843) | 1,975 | ||||||||||||||
| Provision for income taxes | (1,872) | (815) | (1,057) | ||||||||||||||
| Share of net income from joint venture | 3,153 | 1,979 | 1,174 | ||||||||||||||
| Net loss | $ | (4,587) | $ | (6,679) | $ | 2,092 | |||||||||||
Net Sales. Net sales increased by $27.2 million, or 26.2%, during the three months ended September 30, 2026, compared to the three months ended September 30, 2025, primarily due to higher selling prices, reflecting the pass-through of increased raw material costs to customers, higher volumes, and favorable foreign exchange effects.
Cost of Sales. Cost of sales increased by $26.4 million, or 30.6%, during the three months ended September 30, 2026, compared to the three months ended September 30, 2025, primarily due to higher volumes and higher labor costs associated with increasing headcount to support new business.
Selling, General, and Administrative Expense. Selling, general, and administrative expense increased by $2.2 million during the three months ended September 30, 2026, compared to the three months ended September 30, 2025, primarily due to higher professional fees driven by the various strategic initiatives during the quarter.
Depreciation and amortization. Depreciation and amortization increased by $0.2 million during the three months ended September 30, 2026, compared to the three months ended September 30, 2025, primarily due to the impact of capital expenditures placed in service in the current and prior year.
Interest Expense. Interest expense decreased by $0.2 million during the three months ended September 30, 2026, compared to the three months ended September 30, 2025, primarily due to higher capitalized interest and lower interest on our ABL facility.
| Three Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Interest on debt | $ | 5,419 | $ | 5,724 | |||||||
| Amortization of debt issuance costs and discount | 251 | 191 | |||||||||
| Capitalized interest | (465) | (207) | |||||||||
| Other | 262 | (42) | |||||||||
| Total interest expense | $ | 5,467 | $ | 5,666 | |||||||
Other Income, Net. Other income, net increased by $2.8 million during the three months ended September 30, 2026, compared to the three months ended September 30, 2025, primarily due to a gain from a favorable value added tax (“VAT”) ruling in Brazil.
Provision for Income Taxes. Our effective tax rate was (31.9)% for the three months ended September 30, 2026, compared to (10.4)% for the three months ended September 30, 2025. The rate for the three months ended September 30, 2026 was unfavorably impacted due to the accrual of tax on non-permanently reinvested unremitted earnings of foreign subsidiaries and by the limitation of the amount of tax benefit recorded for losses in certain jurisdictions where we believe it is more likely than not that a future tax benefit may not be realized.
29
Table of Contents
Share of Net Income from Joint Venture. Share of net income from the Wuxi Weifu Autocam Precision Machinery Company, Ltd. joint venture (the “JV”) increased by $1.2 million during the three months ended September 30, 2026, compared to the three months ended September 30, 2025. The JV, in which we own a 49% investment, recognized net sales of $37.8 million and $33.3 million for the three months ended September 30, 2026 and 2025, respectively.
Results by Segment
MOBILE SOLUTIONS
| Three Months Ended September 30, | |||||||||||||||||
| 2026 | 2025 | $ Change | |||||||||||||||
| Net sales | $ | 68,177 | $ | 59,117 | $ | 9,060 | |||||||||||
| Loss from operations | $ | (6,288) | $ | (2,854) | $ | (3,434) | |||||||||||
Net sales increased by $9.1 million, or 15.3%, during the three months ended September 30, 2026, compared to the three months ended September 30, 2025, primarily due to higher volumes and favorable foreign exchange effects.
Loss from operations increased by $3.4 million or 120.3% during the three months ended September 30, 2026, compared to the same period in the prior year. The increase was primarily due to higher costs from volume increases, increased labor costs due to the start-up of new programs, material cost increases, depreciation expense, and repairs and maintenance increases.
POWER SOLUTIONS
| Three Months Ended September 30, | |||||||||||||||||
| 2026 | 2025 | $ Change | |||||||||||||||
| Net sales | $ | 63,178 | $ | 44,948 | $ | 18,230 | |||||||||||
| Income from operations | $ | 9,200 | $ | 5,432 | $ | 3,768 | |||||||||||
Net sales increased by $18.2 million, or 40.6%, during the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to higher selling prices, reflecting the pass-through of increased raw material costs to customers, increased volumes, and favorable foreign exchange impacts.
Income from operations increased by $3.8 million during the three months ended September 30, 2026 compared to the same period in the prior year, primarily due to higher selling prices and increased volumes. This increase was partially offset by higher material costs and labor costs.
Nine Months Ended September 30, 2026 compared to the Nine Months Ended September 30, 2025
Consolidated Results
| Nine Months Ended September 30, | |||||||||||||||||
| 2026 | 2025 | $ Change | |||||||||||||||
| Net sales | $ | 378,293 | $ | 317,492 | $ | 60,801 | |||||||||||
| Cost of sales (exclusive of depreciation and amortization shown separately below) | 318,724 | 267,755 | 50,969 | ||||||||||||||
| Selling, general, and administrative expense | 39,151 | 34,325 | 4,826 | ||||||||||||||
| Depreciation and amortization | 27,844 | 26,756 | 1,088 | ||||||||||||||
| Other operating income, net | (3,053) | (2,843) | (210) | ||||||||||||||
| Loss from operations | (4,373) | (8,501) | 4,128 | ||||||||||||||
| Interest expense | 16,956 | 16,517 | 439 | ||||||||||||||
| Loss on extinguishment of debt | — | 3,007 | (3,007) | ||||||||||||||
| Other income, net | (2,634) | (2,858) | 224 | ||||||||||||||
| Loss before provision for income taxes and share of net income from joint venture | (18,695) | (25,167) | 6,472 | ||||||||||||||
| Provision for income taxes | (2,778) | (2,898) | 120 | ||||||||||||||
| Share of net income from joint venture | 7,791 | 6,599 | 1,192 | ||||||||||||||
| Net loss | $ | (13,682) | $ | (21,466) | $ | 7,784 | |||||||||||
30
Table of Contents
Net Sales. Net sales increased by $60.8 million, or 19.2%, during the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025, primarily due to higher selling prices, reflecting the pass-through of increased raw material costs to customers, higher volumes, and favorable foreign exchange effects.
Cost of Sales. Cost of sales increased by $51.0 million, or 19.0%, during the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025, primarily due to raw material price increases, higher volumes, and higher labor costs due to headcount.
Selling, General, and Administrative Expense. Selling, general, and administrative expense increased by $4.8 million during the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025, primarily due to higher compensation costs and professional fees.
Depreciation and amortization. Depreciation and amortization increased by $1.1 million during the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025, primarily due to the impact of capital expenditures placed in service in the current and prior year.
Interest Expense. Interest expense increased by $0.4 million during the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025, primarily due to higher average debt balances offset by lower amortization of debt issuance costs and higher capitalized interest.
| Nine Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Interest on debt | $ | 16,483 | $ | 15,506 | |||||||
| Amortization of debt issuance costs and discount | 750 | 1,215 | |||||||||
| Capitalized interest | (1,018) | (614) | |||||||||
| Other | 741 | 410 | |||||||||
| Total interest expense | $ | 16,956 | $ | 16,517 | |||||||
Loss on Extinguishment of Debt. Loss on extinguishment of debt was $3.0 million during the nine months ended September 30, 2025 due to the termination of the 2021 Term Loan Facility. No debt extinguishment has occurred during the nine months ended September 30, 2026.
Other Income, Net. Other income, net changed unfavorably by $0.2 million during the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025, primarily due to noncash derivative mark-to-market loss recognized during the first nine months of 2026 compared to noncash derivative mark-to-market gain in the first nine months of 2025. The derivative mark-to-market loss is offset by a gain from a favorable VAT tax ruling in Brazil.
Provision for Income Taxes. Our effective tax rate was (14.9)% for the nine months ended September 30, 2026, compared to (11.5)% for the nine months ended September 30, 2025. The rate for the nine months ended September 30, 2026 was unfavorably impacted due to the accrual of tax on non-permanently reinvested unremitted earnings of foreign subsidiaries and by the limitation of the amount of tax benefit recorded for losses in certain jurisdictions where we believe it is more likely than not that a future tax benefit may not be realized.
Share of Net Income from Joint Venture. Share of net income from the JV increased by $1.2 million during the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025. The JV, in which we own a 49% investment, recognized net sales of $108.8 million and $97.7 million for the nine months ended September 30, 2026 and 2025, respectively.
Results by Segment
MOBILE SOLUTIONS
| Nine Months Ended September 30, | |||||||||||||||||
| 2026 | 2025 | $ Change | |||||||||||||||
| Net sales | $ | 197,880 | $ | 184,752 | $ | 13,128 | |||||||||||
| Loss from operations | $ | (10,310) | $ | (6,651) | $ | (3,659) | |||||||||||
Net sales increased by $13.1 million, or 7.1%, during the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025, primarily due to higher sales volume, favorable foreign currency effects, which was partially offset by the impact of rationalization actions taken in 2025 to improve profitability.
Loss from operations increased by $3.7 million or 55.0% during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily related to raw material cost increases and higher labor costs associated with
31
Table of Contents
increased headcount. These were partially offset by lower costs due to plant rationalization benefits and favorable foreign exchange effects.
POWER SOLUTIONS
| Nine Months Ended September 30, | |||||||||||||||||
| 2026 | 2025 | $ Change | |||||||||||||||
| Net sales | $ | 180,871 | $ | 133,096 | $ | 47,775 | |||||||||||
| Income from operations | $ | 24,546 | $ | 14,237 | $ | 10,309 | |||||||||||
Net sales increased by $47.8 million, or 35.9%, during the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025, primarily due to higher selling prices, reflecting the pass-through of increased raw material costs to customers, higher volumes, and favorable foreign exchange impacts.
Income from operations increased by $10.3 million during the nine months ended September 30, 2026 compared to the same period in the prior year, primarily due to higher selling prices and higher volumes. These were partially offset by increased employee-related costs.
Sources and Uses of Cash December 31, 2025 to September 30, 2026
Cash Flows
Cash provided by operations was $16.9 million for the nine months ended September 30, 2026, compared to cash provided by operations of $7.1 million for the nine months ended September 30, 2025. The favorable change is primarily due to a $12.7 million collection of a tax refund claim and other favorable operating impacts.
Cash used in investing activities was $14.8 million for the nine months ended September 30, 2026, compared with $9.2 million for the nine months ended September 30, 2025. The higher use of cash is primarily due to additional purchases of equipment.
Cash used in financing activities decreased by $3.0 million during the nine months ended September 30, 2026, compared with the same period in 2025. During the nine months ended September 30, 2026, we received $69.4 million of net proceeds from the issuance of common stock in the July Private Placement, which funded the $70.0 million redemption of Series D Preferred Stock in August 2026. The improvement in cash used is primarily due to $10.0 million of proceeds from the Delayed Draw Term Loan, partially offset by net repayments under our ABL Facility
Liquidity and Capital Resources
Overview
As of September 30, 2026, our primary sources of liquidity were cash and cash equivalents, availability under our ABL Facility, and cash flows from operating activities. On October 5, 2026, we received net proceeds of approximately $49.8 million from the closing of the October Private Placement. On October 7, 2026, we redeemed the remaining 18,400 shares of Series D Preferred Stock for an aggregate cash consideration of approximately $30.7 million. We believe that the execution of these transactions will help support our long-term liquidity.
Based on our current cash position, anticipated cash flows from operating activities, and anticipated borrowing capacity under the ABL Facility, we believe we will have sufficient liquidity to fund our operations, capital expenditures, and debt service requirements for the next 12 months. Our ability to meet these requirements is subject to the factors described in Item 1A, "Risk Factors," in our 2025 Annual Report, including the level and timing of future cash flows, prevailing economic conditions, and restrictions under our credit agreements.
As of September 30, 2026, we had total available liquidity of:
| September 30, 2026 | |||||
| Cash & Cash Equivalents | $ | ||||
| Undrawn Commitments | 34,689 | ||||
| Total Availability | $ | 46,979 | |||
Credit Facilities
The debt and credit facilities descriptions in Note 8 are incorporated in this section by reference.
We were in compliance with all covenants as of September 30, 2026.
32
Table of Contents
Working Capital Management
We manage our liquidity and working capital to fund our operations, meet debt service obligations, finance capital expenditures and fund other business initiatives. The cost of raw materials, primarily for steel, copper and precious metals is subject to price volatility due to tariffs, supply chain constraints and market supply and demand. A significant increase in the prices we pay for raw materials may cause our working capital needs to increase, which could reduce our liquidity and borrowing availability.
Accounts Receivable Sales Programs
We participate in programs established by our customers and financial institutions which allow us to sell certain receivables from customers on a non-recourse basis to a third-party financial institution. In exchange, we receive payment on the receivables, less a discount, sooner than under the customary credit terms we have extended to customers. These programs allow us to improve working capital and cash flows at the same or lower interest rates as available on our ABL Facility. Our participation in these programs is based on our specific cash needs throughout the year, the discount charged to receive payment earlier, the length of the payment terms with our customers, as well being subject to limits in our ABL Facility and Term Loan Facility agreements.
Other Receivables
In 2021, we filed a refund claim with the IRS as a result of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). In May 2026, we received a refund check of $12.7 million in full payment of our claim, including interest.
Seasonality and Fluctuation in Quarterly Results
General economic conditions impact our business and financial results, and certain businesses experience seasonal and other trends related to the industries and end markets that they serve. For example, European sales are often weaker in the summer months as customers slow production, and sales to original equipment manufacturers are often stronger immediately preceding and following the launch of new products. In addition, our consolidated net sales in the fourth quarter are typically lower than in other quarters. As such, our results for any particular quarter are not necessarily indicative of results to be expected for the full year.
Critical Accounting Estimates
Our significant accounting policies, including the assumptions and judgments underlying them, are disclosed in Note 1 of the Notes to Consolidated Financial Statements included in the 2025 Annual Report. Our most critical accounting estimates are discussed in the Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the 2025 Annual Report. There have been no material changes to our significant accounting policies or critical accounting estimates during the nine months ended September 30, 2026.
Item 3.Quantitative and Qualitative Disclosures About Market Risk
We are exposed to changes in financial market conditions in the normal course of business due to use of certain financial instruments as well as transacting business in various foreign currencies. To mitigate the exposure to these market risks, we have established policies, procedures, and internal processes governing the management of financial market risks. We are exposed to changes in interest rates primarily as a result of borrowing activities.
Interest Rate Risk
We are subject to interest rate risk due to our variable rate debt, which comprises a majority of our outstanding indebtedness. The nature and amount of borrowings may vary as a result of future business requirements, market conditions, and other factors. To manage interest rate risk, we have used, and may in the future use, interest rate swap agreements.
At September 30, 2026, we had $135.3 million of principal outstanding under the Term Loan Facility without regard to capitalized debt issuance costs. A one-percent increase in one-month SOFR would have resulted in a net increase in interest expense of $1.4 million on an annualized basis.
During the nine months ended September 30, 2026, based on the Alternative Base Rate, the average interest rate on outstanding borrowings under the ABL Facility was 7.50%.
Foreign Currency Risk
Translation of our operating cash flows denominated in foreign currencies is impacted by changes in foreign exchange rates. We invoice and receive payment from many of our customers in various other currencies. Additionally, we are party to third party and intercompany loans, payables, and receivables denominated in currencies other than the U.S. dollar. Various strategies to manage this risk are available to management, including producing and selling in local currencies and hedging programs. We did not hold a position in any foreign currency derivatives as of September 30, 2026.
33
Table of Contents
Item 4. Controls and Procedures
Disclosure Controls and Procedures
Under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2026, to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting (as defined in the Exchange Act Rules 13a-15(f) and 15d-15(f)) that occurred during the fiscal quarter ended September 30, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
34
Table of Contents
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
As disclosed in Note 11 in the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report, we are engaged in certain legal proceedings, and the disclosure set forth in Note 11 relating to legal proceedings is incorporated herein by reference.
Item 1A. Risk Factors
There have been no material changes to the risk factors disclosed in the 2025 Annual Report under Item 1A, “Risk Factors.”
The risk factors under "Risks Related to Our Capital Structure" and "The price of our common stock may be volatile" in Item 1A, "Risk Factors" in our 2025 Annual Report, including those relating to our indebtedness and potential future equity issuances, should be read in conjunction with “Item 2 Unregistered Sales of Equity Securities and Use of Proceeds” below and Note 18, "Subsequent Events," to the Condensed Consolidated Financial Statements in this Quarterly Report, which describes the recent private placement described in Item 2 below.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Except for the issuances of unregistered securities previously disclosed in (i) our Current Report on Form 8-K filed with the SEC on July 1, 2026 and (ii) Part II Item 2 in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026 filed with the SEC on August 5, 2026, during the three months ended September 30, 2026, there were no unregistered sales of securities.
As previously disclosed in our Current Report on Form 8-K filed with the SEC on October 5, 2026, we issued 11,275,605 shares of our common stock and pre-funded warrants to purchase up to 4,824,395 shares of Common Stock in a private placement transaction with certain institutional investors in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended and Rule 506 of Regulation D promulgated thereunder.
Issuer Purchases of Equity Securities
The following table provides information about purchases we made during the quarter ended September 30, 2026.
| Period | Total Number of Shares Purchased (1) | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) | Maximum Number (or Approximate Dollar Value) of Shares That May Yet Be Purchased Under the Plan or Programs (1) | ||||||||||||||||||||||
| July 1, 2026 to July 31, 2026 | 2,807 | $ | 3.45 | — | — | |||||||||||||||||||||
| August 1, 2026 to August 31, 2026 | 418 | 3.53 | — | — | ||||||||||||||||||||||
| September 1, 2026 to September 30, 2026 | — | — | — | — | ||||||||||||||||||||||
| Total | 3,225 | $ | 3.46 | — | — | |||||||||||||||||||||
_______________________________
(1)Shares were withheld to pay for tax obligations due upon the vesting of share-based awards held by employees granted under the NN, Inc. Amended and Restated 2022 Omnibus Incentive Plan and prior plans (collectively the “Incentive Plans”). The Incentive Plans provide for the withholding of shares or units to satisfy income tax obligations. It does not specify a maximum number of shares or units that can be withheld for this purpose. These shares may be deemed to be “issuer purchases” of shares that are required to be disclosed pursuant to this Item.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
Adoption or Termination of Trading Arrangements
During the quarter ended September 30, 2026, none of the Company’s directors or executive officers adopted or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement, as defined in Item 408 of Regulation S-K.
35
Table of Contents
Item 6. Exhibits
| Exhibit Number | Description of Exhibit | |||||||
| 31.1 | Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended. | |||||||
| 31.2 | Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended. | |||||||
| 32.1* | Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||||
| 32.2* | Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||||
| 101.INS | XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) | |||||||
| 101.SCH | XBRL Taxonomy Extension Schema Document | |||||||
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
| 101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |||||||
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
* This certification is being furnished solely to accompany this quarterly report on Form 10-Q pursuant to 18 U.S.C. Section 1350, and is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
36
Table of Contents
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. | ||
| NN, Inc. | |||||
| (Registrant) | |||||
Date: October 28, 2026 | /s/ Harold C. Bevis | ||||
| Harold C. Bevis | |||||
| President, Chief Executive Officer and Director | |||||
| (Principal Executive Officer) | |||||
| (Duly Authorized Officer) | |||||
| Date: October 28, 2026 | /s/ Christopher H. Bohnert | ||||
| Christopher H. Bohnert | |||||
| Senior Vice President and Chief Financial Officer | |||||
| (Principal Financial and Accounting Officer) | |||||
| (Duly Authorized Officer) | |||||
37