NovoCure (NASDAQ: NVCR) grows Q1 2026 revenue while investing in new cancer indications
Filing Impact
Filing Sentiment
Form Type
10-Q
Rhea-AI Filing Summary
NovoCure Limited reported higher revenue but a wider loss for the quarter ended March 31, 2026. Net revenues rose 12% to $174.1 million, driven mainly by international growth in Germany, France and other markets, plus increased U.S. usage of Optune Gio and Optune Lua.
Gross margin improved to 78% as cost per active patient fell, but operating expenses climbed on new indication launches and higher share-based compensation. The company recorded a net loss of $71.1 million, or $0.62 per share, compared with a $34.3 million loss a year earlier.
Adjusted EBITDA narrowed to a small loss of $0.3 million. Active patients on therapy increased to 4,791, supported by the U.S. launch of Optune Pax for locally advanced pancreatic cancer and ongoing expansion of Optune Lua for NSCLC. Cash, cash equivalents and short-term investments totaled $432.0 million, and 115,820,940 ordinary shares were outstanding as of April 24, 2026.
Positive
- Strong top-line and margin performance: Net revenues grew 12% year over year to $174.1 million, led by international markets, while gross margin improved to 78% as per-patient costs declined.
- Major clinical and regulatory milestones: FDA approval of Optune Pax, final positive phase 3 METIS results in brain metastases from NSCLC, and positive phase 2 PANOVA-4 data in metastatic pancreatic cancer expand the therapy platform’s potential indications.
Negative
- Widening net loss driven by higher expenses: Net loss more than doubled to $71.1 million, or $0.62 per share, largely due to higher operating expenses and substantial non-cash share-based compensation.
- Continuing cash burn despite balance-sheet strength: Operating activities used $13.5 million of cash in the quarter, and the company still carries $200.0 million of senior secured debt.
Insights
Revenue grew and pipelines advanced, but losses widened on one-time equity compensation.
NovoCure delivered $174.1 million in Q1 2026 revenue, up 12% year over year, with strength in Germany, France and other international markets plus higher U.S. adoption of Optune Gio and Optune Lua. Gross margin reached 78% as array costs declined.
Operating expenses rose to $202.5 million, including $63.0 million of share-based compensation. A key driver was about $43.4 million of non-cash expense from PSUs tied to FDA approval of Optune Pax for locally advanced pancreatic cancer, which contributed to the larger net loss of $71.1 million.
On the pipeline side, the quarter highlighted final METIS data in brain metastases from NSCLC, submission of the Optune Mya PMA, and positive PANOVA-4 phase 2 results in metastatic pancreatic cancer. With $432.0 million in cash and investments and Adjusted EBITDA essentially breakeven, the company emphasizes funding additional indications while planning for future profitability.
Key Figures
Net revenues: $174.1M
Net income (loss): ($71.1M)
Gross margin: 78%
+5 more
8 metrics
Net revenues
$174.1M
Three months ended March 31, 2026; up 12% year over year
Net income (loss)
($71.1M)
Three months ended March 31, 2026; vs. ($34.3M) in 2025
Gross margin
78%
Three months ended March 31, 2026; improvement from 75% in 2025
Share-based compensation
$63.0M
Expense in Q1 2026 across all functions
Adjusted EBITDA
($0.3M)
Three months ended March 31, 2026; improved from ($5.0M)
Cash, cash equivalents and short-term investments
$432.0M
Balance as of March 31, 2026
Active patients
4,791 patients
Total active patients on therapy at March 31, 2026
Senior secured credit facility balance
$200.0M principal
Tranche A and B loans outstanding as of March 31, 2026
Key Terms
Tumor Treating Fields, Premarket Approval, Humanitarian Device Exemption, Adjusted EBITDA, +2 more
6 terms
Tumor Treating Fields medical
"a proprietary platform technology called Tumor Treating Fields ("TTFields"), which are electric fields that exert physical forces"
Tumor treating fields are a medical therapy that uses low‑intensity, alternating electric fields applied through pads on the skin to interfere with cancer cells as they try to divide, slowing or stopping tumor growth. Investors pay attention because the therapy’s clinical results, regulatory approvals, reimbursement and device sales directly influence a company’s revenue outlook; think of it like a new tool in a toolbox whose market adoption and proof it works determine its commercial value.
Premarket Approval regulatory
"Optune Gio is approved by the U.S. Food and Drug Administration ("FDA") under the Premarket Approval ("PMA") pathway"
Premarket approval is the formal regulatory clearance required before certain medical devices can be sold, based on detailed evidence that the product is safe and effective. For investors, it’s a major milestone because receiving approval typically clears the way for commercial sales and reduces regulatory uncertainty, while failure or delays can block revenue and raise the risk profile; think of it like a safety certificate needed before a new car model can be sold.
Humanitarian Device Exemption regulatory
"Optune Lua is also approved by the FDA under the Humanitarian Device Exemption ("HDE") pathway for the treatment of adult patients with malignant pleural mesothelioma"
A humanitarian device exemption is a regulatory pathway that lets a medical device be approved for use in treating or diagnosing very small patient groups without the usual proof that it works as well as larger treatments; think of it as a special permit for products that serve rare conditions. It matters to investors because it can speed market access and reduce development cost, but the patient pool and sales potential are small and reimbursement or wider adoption may be uncertain.
Adjusted EBITDA financial
"We also measure our performance using a non-GAAP measurement of earnings before interest, taxes, depreciation, amortization and shared-based compensation ("Adjusted EBITDA")"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
senior secured credit facility financial
"entered into a five-year senior secured credit facility of up to $400,000 (the "Facility") with BPCR Limited Partnership"
A senior secured credit facility is a loan or revolving line of credit where lenders have first legal claim on specific company assets (collateral) and the debt ranks above other obligations for repayment. For investors it signals where a lender sits in the repayment pecking order and how much protection creditors have if the company struggles, affecting credit costs, the company’s ability to borrow more, and potential recoveries in a default — like a mortgage taking priority over other claims on a house.
Earnings Snapshot
Net revenues: $174.1M
Q1 2026
Net revenues
$174.1M
+12% YoY
Net income (loss)
($71.1M)
loss widened from ($34.3M)
Gross margin
78%
up from 75% in prior-year quarter
Adjusted EBITDA
($0.3M)
improved from ($5.0M) loss
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________________________________
FORM 10-Q
(Mark One)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended March 31, 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 001-37565
(Exact Name of Registrant as Specified in Its Charter)
| (State or Other Jurisdiction of | (I.R.S. Employer | |||||||
| Incorporation or Organization) | Identification No.) | |||||||
(Address of principal executive offices, including zip code)
+44 (0) 15 3475 6700
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report)
_______________________________________________________
Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. 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.
| ☒ | 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 ☒ .
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
| Class | Outstanding as of Outstanding as of April 24, 2026 | |||||||
| Ordinary shares, no par value | ||||||||
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
In addition to historical facts or statements of current condition, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements contained in this report are based on our current plans, expectations, hopes, beliefs, intentions or strategies concerning future developments and their impact on us. Forward-looking statements contained in this report constitute our expectations or forecasts of future events as of the date this report was filed with the Securities and Exchange Commission and are not statements of historical fact. You can identify these statements by the fact that they do not relate strictly to historical or current facts. Such statements may include words such as "anticipate," "will," "estimate," "expect," "project," "intend," "should," "plan," "believe," "hope," and other words and terms of similar meaning in connection with any discussion of, among other things, future operating or financial performance, strategic initiatives and business strategies, regulatory or competitive environments, our intellectual property and research and development related to our Tumor Treating Fields ("TTFields") devices marketed under various brand names, including "Optune Gio," "Optune Lua," "Optune Pax," and software, tools and other items to support and optimize the delivery of TTFields therapy (collectively, the "Products"). In particular, these forward-looking statements include, among others, statements about:
•our research and development, clinical study and commercialization activities and projected expenditures;
•the further commercialization of our Products for current and future indications;
•our business strategies and the expansion of our sales and marketing efforts in the United States ("U.S.") and in other countries;
•the market acceptance of our Products for current and future indications by patients, physicians, third-party payers and others in the healthcare and scientific community;
•our plans to pursue the use of our Products for the treatment of indications other than glioblastoma ("GBM"), pancreatic cancer, non-small cell lung cancer ("NSCLC"), brain metastases from NSCLC, and malignant pleural mesothelioma ("MPM");
•our estimates regarding revenues, expenses, capital requirements and needs for additional financing;
•our ability to obtain regulatory approvals for the use of our Products in indications other than GBM, NSCLC, MPM and pancreatic cancer;
•our ability to acquire from third-party suppliers the supplies needed to manufacture our Products;
•our ability to manufacture adequate supply of our Products;
•our ability to secure and maintain adequate coverage from third-party payers to reimburse us for our Products for current and future indications;
•our ability to receive payment from third-party payers for use of our Products for current and future indications;
•our ability to maintain, develop, protect, defend or enforce our intellectual property position;
•our ability to manage the risks associated with business disruptions caused by natural disasters, extreme weather events, pandemics such as COVID-19 (coronavirus), international conflict, a prolonged failure of U.S. lawmakers to agree on a budget or appropriation legislation to fund the federal government’s operations (also known as a government shutdown), which could have an adverse effect on regulatory agencies, such as the U.S. Food and Drug Administration (e.g. PMA processing) and Centers for Medicare & Medicaid Services (e.g. payment processing), to perform their duties the impact our operations and the financial markets’ and other businesses’ reactions to any such failure, or other disruptions outside of our control;
•our cash needs; and
i
•our prospects, financial condition and results of operations.
These forward-looking statements involve a number of risks and uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Factors which may cause such differences to occur include those risks and uncertainties set forth under Part I, Item 1A., “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed on February 26, 2026, as well as other risks and uncertainties set forth from time to time in the reports we file with the Securities and Exchange Commission (the "SEC"). We do not intend to update publicly any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.
TRADEMARKS
This Quarterly Report on Form 10-Q includes trademarks of NovoCure Limited and other persons. All trademarks or trade names referred to herein are the property of their respective owners.
ii
Table of Contents
Quarterly Report on Form 10-Q
TABLE OF CONTENTS
| Page | ||||||||
Cautionary Note Regarding Forward Looking Statements | i | |||||||
Trademarks | ii | |||||||
PART I—FINANCIAL INFORMATION | ||||||||
Item 1. | Financial Statements | 2 | ||||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 18 | ||||||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 27 | ||||||
Item 4. | Controls and Procedures | 27 | ||||||
PART II—OTHER INFORMATION | ||||||||
Item 1. | Legal Proceedings | 28 | ||||||
Item 1A. | Risk Factors | 28 | ||||||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 28 | ||||||
Item 3. | Defaults Upon Senior Securities | 28 | ||||||
Item 4. | Mine Safety Disclosures | 28 | ||||||
Item 5. | Other Information | 28 | ||||||
Item 6. | Exhibits | 29 | ||||||
Signatures | 30 | |||||||
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PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
| NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS | |||||||||||
| U.S. dollars in thousands (except share data) | |||||||||||
| March 31, 2026 | December 31, 2025 | ||||||||||
| Unaudited | Audited | ||||||||||
| ASSETS | |||||||||||
| CURRENT ASSETS: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Short-term investments | |||||||||||
| Restricted cash | |||||||||||
| Trade receivables, net | |||||||||||
| Receivables and prepaid expenses | |||||||||||
| Inventories | |||||||||||
| Total current assets | |||||||||||
| LONG-TERM ASSETS: | |||||||||||
| Property and equipment, net | |||||||||||
| Field equipment, net | |||||||||||
| Right-of-use assets | |||||||||||
| Other long-term assets | |||||||||||
| Total long-term assets | |||||||||||
| TOTAL ASSETS | $ | $ | |||||||||
| The accompanying notes are an integral part of these unaudited consolidated financial statements. | |||||||||||
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| NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS | |||||||||||
| U.S. dollars in thousands (except share data) | |||||||||||
| March 31, 2026 | December 31, 2025 | ||||||||||
| Unaudited | Audited | ||||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||
| CURRENT LIABILITIES: | |||||||||||
| Trade payables | |||||||||||
| Other payables, lease liabilities and accrued expenses | |||||||||||
| Total current liabilities | |||||||||||
| LONG-TERM LIABILITIES: | |||||||||||
Senior secured credit facility, net | |||||||||||
| Long-term leases | |||||||||||
| Employee benefit liabilities | |||||||||||
| Total long-term liabilities | |||||||||||
| TOTAL LIABILITIES | |||||||||||
| COMMITMENTS AND CONTINGENCIES | |||||||||||
| SHAREHOLDERS' EQUITY: | |||||||||||
| Share capital - | |||||||||||
Ordinary shares no par value, | |||||||||||
| Additional paid-in capital | |||||||||||
| Accumulated other comprehensive income (loss) | ( | ( | |||||||||
| Retained earnings (accumulated deficit) | ( | ( | |||||||||
| TOTAL SHAREHOLDERS' EQUITY | |||||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | $ | |||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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| NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
| U.S. dollars in thousands (except share and per share data) | ||||||||||||||||||||
| Three months ended March 31, | Year ended December 31, | |||||||||||||||||||
| 2026 | 2025 | 2025 | ||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| Net revenues | $ | $ | $ | |||||||||||||||||
| Cost of revenues | ||||||||||||||||||||
| Gross profit | ||||||||||||||||||||
| Operating costs and expenses: | ||||||||||||||||||||
| Research, development and clinical studies | ||||||||||||||||||||
| Sales and marketing | ||||||||||||||||||||
| General and administrative | ||||||||||||||||||||
| Total operating costs and expenses | ||||||||||||||||||||
| Operating income (loss) | ( | ( | ( | |||||||||||||||||
| Financial income (expenses), net | ( | |||||||||||||||||||
| Income (loss) before income tax | ( | ( | ( | |||||||||||||||||
| Income tax | ( | |||||||||||||||||||
| Net income (loss) | $ | ( | $ | ( | $ | ( | ||||||||||||||
| Basic and diluted net income (loss) per ordinary share | $ | ( | $ | ( | $ | ( | ||||||||||||||
| Weighted average number of ordinary shares used in computing basic and diluted net income (loss) per share | ||||||||||||||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||||||
| U.S. dollars in thousands | ||||||||||||||||||||
| Three months ended March 31, | Year ended December 31, | |||||||||||||||||||
| 2026 | 2025 | 2025 | ||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| Net income (loss) | $ | ( | $ | ( | $ | ( | ||||||||||||||
| Other comprehensive income (loss), net of tax: | ||||||||||||||||||||
| Change in foreign currency translation adjustments | ( | |||||||||||||||||||
| Pension benefit plan | ( | |||||||||||||||||||
| Total comprehensive income (loss) | $ | ( | $ | ( | $ | ( | ||||||||||||||
| NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||||||
| U.S. dollars in thousands (except share data) | |||||||||||||||||||||||||||||
| Ordinary shares | Additional paid-in capital | Accumulated other comprehensive income (loss) | Retained earnings (accumulated deficit) | Total shareholders' equity | |||||||||||||||||||||||||
| Balance as of December 31, 2025 (audited) | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||
| Share-based compensation to employees | — | — | — | ||||||||||||||||||||||||||
| Exercise of options and vested RSUs | — | — | |||||||||||||||||||||||||||
| Tax payment related to net share settlement on equity awards | ( | ( | |||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax benefit of $ | — | — | ( | — | ( | ||||||||||||||||||||||||
| Net income (loss) | — | — | — | ( | ( | ||||||||||||||||||||||||
| Balance as of March 31, 2026 (Unaudited) | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||
| Ordinary shares | Additional paid-in capital | Accumulated other comprehensive loss | Retained earnings (accumulated deficit) | Total shareholders' equity | |||||||||||||||||||||||||
| Balance as of December 31, 2024 (audited) | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||
| Share-based compensation to employees | — | — | — | ||||||||||||||||||||||||||
| Exercise of options and vested RSUs | — | — | |||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax benefit of $ | — | — | — | ||||||||||||||||||||||||||
| Net income (loss) | — | — | — | ( | ( | ||||||||||||||||||||||||
| Balance as of March 31, 2025 (Unaudited) | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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| NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||||||||
| U.S. dollars in thousands | ||||||||||||||||||||
| Three months ended March 31, | Year ended December 31, | |||||||||||||||||||
| 2026 | 2025 | 2025 | ||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| Cash flows from operating activities: | ||||||||||||||||||||
| Net income (loss) | $ | ( | $ | ( | $ | ( | ||||||||||||||
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||
| Accrued Interest | ( | ( | ||||||||||||||||||
| Asset write-downs and impairment of field equipment | ||||||||||||||||||||
| Share-based compensation | ||||||||||||||||||||
| Foreign currency remeasurement loss (gain) | ( | |||||||||||||||||||
Decrease (increase) in accounts receivables and prepaid expenses | ( | ( | ||||||||||||||||||
| Amortization of discount (premium) | ( | ( | ( | |||||||||||||||||
| Decrease (increase) in inventories | ( | ( | ( | |||||||||||||||||
| Decrease (increase) in other long-term assets | ||||||||||||||||||||
| Increase (decrease) in accounts payables and accrued expenses | ( | ( | ||||||||||||||||||
| Increase (decrease) in other long-term liabilities | ( | ( | ( | |||||||||||||||||
| Net cash provided by (used in) operating activities | ( | ( | ( | |||||||||||||||||
| Cash flows from investing activities: | ||||||||||||||||||||
| Purchase of property, equipment and field equipment | ( | ( | ( | |||||||||||||||||
| Proceeds from maturity of short-term investments | ||||||||||||||||||||
| Purchase of short-term investments | ( | ( | ( | |||||||||||||||||
| Net cash provided by (used in) investing activities | ( | |||||||||||||||||||
| Cash flows from financing activities: | ||||||||||||||||||||
| Proceeds from issuance of shares, net | ||||||||||||||||||||
Proceeds from senior secured credit facility, net | ||||||||||||||||||||
Repayment and redemption of long-term debt | ( | |||||||||||||||||||
| Tax payments related to net settlements on equity awards | ( | ( | ||||||||||||||||||
| Exercise of options | ||||||||||||||||||||
| Net cash provided by (used in) financing activities | ( | ( | ||||||||||||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | ( | |||||||||||||||||||
| Increase (decrease) in cash, cash equivalents and restricted cash | ( | ( | ( | |||||||||||||||||
| Cash, cash equivalents and restricted cash at the beginning of the period | ||||||||||||||||||||
| Cash, cash equivalents and restricted cash at the end of the period | $ | $ | $ | |||||||||||||||||
| Supplemental cash flow activities: | ||||||||||||||||||||
| Cash paid during the period for: | ||||||||||||||||||||
| Income taxes paid (refunded), net | $ | ( | $ | $ | ||||||||||||||||
| Interest paid | $ | $ | $ | |||||||||||||||||
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| NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||||||||
| U.S. dollars in thousands | ||||||||||||||||||||
| Reconciliation of cash, cash equivalents and restricted cash: | ||||||||||||||||||||
| Cash and cash equivalents | $ | $ | $ | |||||||||||||||||
| Restricted cash | ||||||||||||||||||||
| Total cash, cash equivalents and restricted cash | $ | $ | $ | |||||||||||||||||
| Non-cash activities: | ||||||||||||||||||||
Right-of-use assets obtained (disposed) in exchange for lease liabilities | $ | $ | $ | |||||||||||||||||
| Purchase of property incurred but unpaid at period end | $ | $ | $ | |||||||||||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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NOVOCURE LIMITED AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
U.S. dollars in thousands (except share data)
NOTE 1: ORGANIZATION AND BASIS OF PRESENTATION
Organization. NovoCure Limited (including its consolidated subsidiaries, the "Company") was incorporated in the Bailiwick of Jersey and is principally engaged in the development, manufacture and commercialization of Tumor Treating Fields ("TTFields") devices, including Optune Gio and Optune Lua (collectively, our "Products"), for the treatment of solid tumor cancers. The Company markets Optune Gio and Optune Lua in multiple countries around the globe with the majority of revenues coming from the use of Optune Gio in the U.S., Germany, France and Japan. The Company also has a License and Collaboration Agreement (the "Zai Agreement") with Zai Lab (Shanghai) Co., Ltd. ("Zai") to market Optune in China, Hong Kong, Macau and Taiwan ("Greater China").
Financial statement preparation. The accompanying unaudited consolidated financial statements include the accounts of the Company and intercompany accounts and transactions have been eliminated. In the opinion of the Company’s management, the unaudited consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation for the periods presented. The preparation of these unaudited consolidated financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in these unaudited consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. These unaudited consolidated financial statements and accompanying notes should be read in conjunction with the Company’s annual consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the "2025 10-K") filed with the Securities and Exchange Commission on February 26, 2026.
The significant accounting policies applied in the audited annual consolidated financial statements of the Company as disclosed in the 2025 10-K are applied consistently in these unaudited interim consolidated financial statements except for the adoption of ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): "Measurement of Credit Losses for Accounts Receivable and Contract Assets”, see below.
Concentration Risks. The Company's cash, cash equivalents, short-term investments and trade receivables are potentially subject to a concentration of risk. Cash, cash equivalents and short-term investments are invested at top tier financial institutions globally and the total value invested at any one institution is limited pursuant to the Company's investment policy. These investments may be in excess of insured limitations or not insured in certain jurisdictions. Generally, these investments may be redeemed upon demand according to the terms of the securities.
The Company's trade receivables are due from numerous governments and federal and state agencies that are paid from their respective budgets, and from hundreds of health insurance companies. The Company does not believe that there are significant default risks associated with these governments, agencies and health insurance companies based upon the Company's historical experience.
The Company has no off-balance sheet concentrations of credit risk such as foreign exchange contracts, option contracts or other foreign hedging arrangements.
Recently adopted accounting pronouncements
In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.
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. This amendment introduces a practical expedient for the application of the current expected credit loss (“CECL”) model to current accounts receivable and contract assets. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted. The Company adopted ASU 2025-05 on January 1, 2026, on a prospective basis, and elected the practical expedient provided by ASU 2025-05. Under this expedient, the Company assumes that economic conditions as of the balance sheet date remain unchanged for the
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remaining life of all current accounts receivable and current contract assets arising from transactions under ASC 606. The Company continues to estimate expected credit losses for non-current receivables and contract assets in accordance with ASC 326. The adoption of ASU 2025-05 did not have any material impact on the consolidated financial statements.
In September 2025, the FASB issued ASU 2025-06, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) - Targeted Improvements to the Accounting for Internal-Use Software. The ASU was updated to consider different methods of software development and requires internal use software costs to be capitalized when management has authorized and committed to funding the software project and when significant uncertainty associated with the development of the software has been resolved. The amendments in this ASU are required to be adopted for annual and interim reporting periods beginning after December 15, 2027 (the year ending December 31, 2028, for the Company), with early adoption permitted, and may be applied either through a prospective, retrospective or a modified transition approach. The Company is currently evaluating the effect of adopting the ASU on its consolidated financial statements.
NOTE 2: CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS
Cash equivalents include items almost as liquid as cash, with maturity periods of three months or less when purchased, and short-term investments include items with maturity dates between three months and one year when purchased. As of March 31, 2026 and December 31, 2025, the Company’s cash and cash equivalents and short-term investments were composed of:
| March 31, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||
| Unaudited | |||||||||||||||||||||||||||||||||||||||||||||||
| Fair value level | Adjusted cost basis | Unrealized gains | Unrealized losses | Fair market value | Recorded basis | Cash and cash equivalents | Short-term investments | ||||||||||||||||||||||||||||||||||||||||
| Cash | $ | $ | — | $ | — | $ | $ | $ | $ | — | |||||||||||||||||||||||||||||||||||||
| Money market funds | Level 1 | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Certificate of deposits and term deposits | Level 2 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
| HTM securities (1) | |||||||||||||||||||||||||||||||||||||||||||||||
| U.S. Treasury bills | Level 1 | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Corporate debt securities | Level 2 | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| $ | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | ( | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
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| December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||
| Audited | |||||||||||||||||||||||||||||||||||||||||||||||
| Fair value level | Adjusted cost basis | Unrealized gains | Unrealized losses | Fair market value | Recorded basis | Cash and cash equivalents | Short-term investments | ||||||||||||||||||||||||||||||||||||||||
| Cash | $ | $ | — | $ | — | $ | $ | $ | $ | — | |||||||||||||||||||||||||||||||||||||
| Money market funds | Level 1 | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Certificate of deposits and term deposits | Level 2 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
| HTM securities (1) | |||||||||||||||||||||||||||||||||||||||||||||||
| U.S. Treasury bills | Level 1 | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
| Corporate debt securities | Level 2 | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| $ | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | ( | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
(1) Changes in fair value of held-to-maturity ("HTM") securities are presented for disclosure purposes as required by ASC 320 "Investments — Debt Securities" and are recorded as finance expenses only if the unrealized loss is identified as a credit loss.
In accordance with ASC 820, "Fair Value Measurements and Disclosures," the Company measures its money market funds at fair value. The fair value of the money market funds and HTM securities, which is presented for disclosure purposes, is classified within Level 1 or Level 2. This is because these assets are valued using quoted market prices or alternative pricing sources and models utilizing market observable inputs.
As of March 31, 2026 and December 31, 2025, all investments mature in one year or less.
Unrealized losses from debt securities are primarily attributable to changes in interest rates. The Company does not believe any remaining unrealized losses represent impairments based on the evaluation of available evidence.
NOTE 3: INVENTORIES
Inventories are stated at the lower of cost or net realizable value. The weighted average methodology is applied to determine cost. As of March 31, 2026 and December 31, 2025, the Company’s inventories were composed of:
| March 31, 2026 | December 31, 2025 | ||||||||||
| Unaudited | Audited | ||||||||||
| Raw materials | $ | $ | |||||||||
| Work in progress | |||||||||||
| Finished products | |||||||||||
| Total | $ | $ | |||||||||
NOTE 4: COMMITMENTS AND CONTINGENT LIABILITIES
Operating Leases. The facilities of the Company are leased under various operating lease agreements for periods, including options for extensions, ending no later than 2044. The Company also leases motor vehicles under various operating leases, which expire on various dates, the latest of which is in 2030.
Pledged deposits and bank guarantees. As of March 31, 2026 and December 31, 2025, the Company pledged bank deposits of $5,791 and $5,114 , respectively, to cover bank guarantees in respect of its leases of operating facilities
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and obtained bank guarantees for the fulfillment of the Company’s lease and other contractual commitments of $6,233 and $5,554 , respectively.
NOTE 5: LONG-TERM DEBT, NET
a.Senior secured credit facility, net
On May 1, 2024 Novocure Luxembourg S.a.r.l. ("Borrower"), a wholly-owned subsidiary of the Company, entered into a five-year senior secured credit facility of up to $400,000 (the "Facility") with BPCR Limited Partnership and BioPharma Credit Investments V (Master) LP (collectively, the "Lenders"), BioPharma Credit PLC, as collateral agent for the Lenders, and the guarantors party to such agreement (the "Loan Agreement"). The Facility could be drawn in up to four drawings. The Loan Agreement provides for an initial term loan in the principal amount of $100,000 (the "Tranche A Loan"), which was funded to the Borrower on May 1, 2024 (the "Tranche A Funding Date"). Under the Loan Agreement, the Borrower was required to draw $100,000 on the Facility on or before September 30, 2025 (the "Tranche B Loan"), which was drawn down on that date. Not later than December 31, 2025, the Borrower had the option to draw an additional $100,000 of the Facility (the "Tranche C Loan"). In addition, not later than March 31, 2026, the Borrower had the option to draw an additional $100,000 of the Facility (the "Tranche D Loan"). As of March 31, 2026, the Company has borrowed the Tranche A Loan and the Tranche B Loan in the aggregate principal amount of $200,000 . The Company did not did not give notice of its intent to borrow the Tranche C Loan. As a result, the Company no longer has the ability to borrow the Tranche C or Tranche D Loans. The obligations under the Loan Agreement are guaranteed by certain of the Company's subsidiaries and secured by a first lien on the Borrower's and certain of the Company's other subsidiaries’ assets. Outstanding term loans under the Loan Agreement will bear interest at an annual rate equal to 6.25 % plus the three-months SOFR (subject to a 3.25 % floor), payable quarterly in arrears and calculated on the basis of actual days elapsed in a 360-day year. The Borrower paid 2.5 % of additional consideration on each principal draw, with payment for the Tranche A Loan and the Tranche B Loan paid on the Tranche A Funding Date. Principal under the Facility will be repaid in eight equal quarterly repayments commencing with the third quarter of 2027 and continuing each quarter thereafter, with the final payment of outstanding principal due on the fifth anniversary of the Tranche A Funding Date. Voluntary prepayment of all, but not less than all, of the term loans outstanding is permitted at any time, subject to make-whole and prepayment premiums as set forth in the Loan Agreement. Prepayment of all term loans outstanding, subject to make-whole and prepayment premiums, is due and payable upon a change-in-control as defined in the Loan Agreement. Make-whole and prepayment premiums are due and payable for the Tranche B Loans for any voluntary prepayment of the term loans outstanding, upon a change-in-control (as defined in the Loan Agreement), and upon any acceleration of the maturity date, in each case regardless of whether the Tranche B Loan is drawn.
| March 31, 2026 | December 31, 2025 | ||||||||||
| Unaudited | Audited | ||||||||||
| Liability component, net: | |||||||||||
| Principal amount | $ | $ | |||||||||
| Unamortized issuance costs | ( | ( | |||||||||
| Net carrying amount of liability component (1) | $ | $ | |||||||||
(1) An effective interest rate determines the fair value of the Notes, therefore they are categorized as Level 3 in accordance with ASC 820. The estimated fair value of the net carrying amount of liability component of the Notes as of March 31, 2026 and December 31, 2025 were $209,613 and $215,538 , respectively.
The net carrying amount of the liability is represented by the principal amount of the Notes, less total issuance costs plus any amortization of issuance costs. The total issuance costs upon issuance of the Notes were $6,177 and are amortized to interest expense using the effective interest rate method over the contractual term of the Notes. For
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purposes of calculating the net carrying amount, the annual effective interest rate is assumed to be 11.6 % over the remaining contractual term of the Notes.
Finance expense related to the Facility was as follows:
| Three months ended March 31, | Year ended December 31, 2025 | |||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
Interest | ||||||||||||||||||||
Amortization of debt issuance costs | ||||||||||||||||||||
Total finance expense recognized | $ | $ | $ | |||||||||||||||||
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NOTE 6: REVENUE RECOGNITION
a. Net revenues
The Company’s net revenues by geographic region, based on the patient’s location are summarized as follows:
| Three months ended March 31, | Year ended December 31, | |||||||||||||||||||
| 2026 | 2025 | 2025 | ||||||||||||||||||
| United States | $ | $ | $ | |||||||||||||||||
| International markets: | ||||||||||||||||||||
| Germany | ||||||||||||||||||||
| France | ||||||||||||||||||||
| Japan | ||||||||||||||||||||
| Other international markets | ||||||||||||||||||||
| International markets - Total | ||||||||||||||||||||
Greater China (1) | ||||||||||||||||||||
| Total net revenues | $ | $ | $ | |||||||||||||||||
(1) For additional information, see Notes 12 and 13 to the Consolidated Financial Statements in the 2025 10-K.
The Company's net revenues by performance period are as follows:
| Three months ended March 31, | Year ended December 31, | |||||||||||||||||||
| 2026 | 2025 | 2025 | ||||||||||||||||||
| Net revenues recognized in the reporting period from performance obligations satisfied in: | ||||||||||||||||||||
| Reporting period | $ | $ | $ | |||||||||||||||||
| Previous periods | ||||||||||||||||||||
| Total net revenues | $ | $ | $ | |||||||||||||||||
b. Contract balances
The following table provides information about trade receivables, unbilled receivables and contract liabilities from contracts with customers:
| March 31, 2026 | December 31, 2025 | ||||||||||
| Unaudited | Audited | ||||||||||
| Trade receivables | $ | $ | |||||||||
| Unbilled receivables | $ | $ | |||||||||
| Deferred revenues (short-term contract liabilities) | $ | ( | $ | ( | |||||||
During the three months ended March 31, 2026 and 2025 and the year ended December 31, 2025 the Company recognized $15,948 , $14,225 and $14,225 , respectively, which were included in the deferred revenues (short-term contract liability) balance at January 1, 2026 and 2025.
NOTE 7: SHARE OPTION PLANS AND ESPP
In April 2024, the Company adopted the 2024 Omnibus Incentive Plan (the "2024 Plan"), which replaced the 2015 Omnibus Incentive Plan (the "2015 Plan"), effective June 5, 2024 (the "Effective Date") following approval from the Company's shareholders. Under the 2024 Plan, the Company can issue various types of equity compensation
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awards such as share options, restricted shares, performance shares, restricted share units (“RSUs”), performance-based share units (“PSUs”), long-term cash awards and other share-based awards. The total number of shares of the Company’s ordinary shares that may be granted under the 2024 Plan consists of (i) 8,566,982 ordinary shares plus (ii) the number of undelivered shares subject to outstanding awards under the 2015 Plan that become available for future awards under the 2024 Plan as provided for in the 2024 Plan.
Options granted under the 2024 Plan generally will have a two-year or four-year vesting period and expire ten years after the date of grant. Options granted under the 2015 Plan and 2024 Plan that are canceled or forfeited before expiration become available for future grants under the 2024 Plan. RSUs granted under the 2024 Plan generally will vest over a three-year period. PSUs granted under the 2024 Plan generally will vest between a - and six-year period as performance targets are attained. RSUs and PSUs granted under the 2015 Plan and 2024 Plan that are canceled before expiration become available for future grants under the 2024 Plan.
As of March 31, 2026, 2,879,680 ordinary shares were available for grant under the 2024 Plan.
A summary of the status of the Company’s option plans as of March 31, 2026 and changes during the period then ended is presented below:
| Three months ended March 31, 2026 | |||||||||||
| Unaudited | |||||||||||
| Number of options | Weighted average exercise price | ||||||||||
| Outstanding at beginning of year | $ | ||||||||||
| Granted | |||||||||||
| Exercised | ( | ||||||||||
| Forfeited and canceled | ( | ||||||||||
| Outstanding as of March 31, 2026 | $ | ||||||||||
| Exercisable options | $ | ||||||||||
A summary of the status of the Company’s RSUs and PSUs as of March 31, 2026 and changes during the period then ended is presented below.
| Three months ended March 31, 2026 | |||||||||||
| Unaudited | |||||||||||
| Number of RSU/PSUs | Weighted average grant date fair value | ||||||||||
| Unvested at beginning of year | $ | ||||||||||
| Granted | |||||||||||
| Vested | ( | ||||||||||
RSUs withheld for tax liabilities | ( | ||||||||||
| Forfeited and cancelled | ( | ||||||||||
| Unvested as of March 31, 2026 (1) | |||||||||||
(1) Includes PSUs that have a mix of service, market and other milestone performance vesting conditions which are vested upon achievements of performance milestones that are not probable as of March 31, 2026, in accordance with ASC 718 "Compensation - Stock Compensation" as follows:
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March 31, 2026 | |||||||||||||||||
| Number of PSUs | Fair value at grant date per PSU | Total fair value at grant date | |||||||||||||||
| $ | $ | ||||||||||||||||
| $ | |||||||||||||||||
These PSUs will be expensed over the performance period when the vesting conditions become probable in accordance with ASC 718.
In February 2025, the Company adopted the 2025 Novocure Employee Share Purchase Plan ("ESPP"), effective June 4, 2025 (the "ESPP Effective Date"), following approval from the Company's shareholders. The ESPP replaced the Company's expiring prior employee share purchase plan, which was adopted in 2015 (the "Prior ESPP"). The purpose of the ESPP is to encourage and enable eligible employees to acquire ownership of the Company’s ordinary shares purchased through accumulated payroll deductions on an after-tax basis. The total number of shares of the Company’s ordinary shares that may be issued under the ESPP is 6,366,651 shares. In the United States, the ESPP is intended to be an “employee stock purchase plan” within the meaning of Section 423 of the Internal Revenue Code and the provisions of the ESPP are construed in a manner consistent with the requirements of such section. As of March 31, 2026, 6,228,393 ordinary shares were available to be purchased by eligible employees under the ESPP.
The fair value of share-based awards was estimated using the Black-Scholes model for all equity grants. For market condition awards, the Company also applied the Monte-Carlo simulation model. The Company assessed fair value using the following underlying assumptions:
| Three months ended March 31, | Year ended December 31, 2025 | ||||||||||||||||
| 2026 | 2025 | ||||||||||||||||
| Unaudited | Audited | ||||||||||||||||
| Stock Option Plans | |||||||||||||||||
| Expected term (years) | |||||||||||||||||
| Expected volatility | % | % | |||||||||||||||
| Risk-free interest rate | % | % | |||||||||||||||
| Dividend yield | % | % | % | ||||||||||||||
| ESPP | |||||||||||||||||
| Expected term (years) | |||||||||||||||||
| Expected volatility | % | % | |||||||||||||||
| Risk-free interest rate | % | % | |||||||||||||||
| Dividend yield | % | % | % | ||||||||||||||
The total non-cash share-based compensation expense related to all of the Company’s equity-based awards recognized for the three months ended March 31, 2026 and 2025, and the year ended December 31, 2025 was:
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| Three months ended March 31, | Year ended December 31, 2025 | |||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| Cost of revenues | $ | $ | $ | |||||||||||||||||
| Research, development and clinical studies | ||||||||||||||||||||
| Sales and marketing | ||||||||||||||||||||
General and administrative (1) | ||||||||||||||||||||
| Total share-based compensation expense | $ | $ | $ | |||||||||||||||||
NOTE 8: Basic and diluted net income (loss) per ordinary share
Basic net income (loss) per share is computed based on the weighted average number of ordinary shares outstanding during each period. Diluted net income per share is computed based on the weighted average number of ordinary shares outstanding during the period, plus potential dilutive shares (deriving from options, RSUs, PSUs, Notes and the ESPP) considered outstanding during the period, in accordance with ASC 260-10 "Earnings Per Share", as determined under the treasury stock or if-converted method, as applicable.
The following table sets forth the computation of the Company’s basic and diluted net income (loss) per ordinary share:
| Three months ended March 31, | Year ended December 31, 2025 | |||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| Net income (loss) attributable to ordinary shares as reported used in computing basic and diluted net income (loss) per share | $ | ( | $ | ( | $ | ( | ||||||||||||||
| Weighted average number of ordinary shares used in computing diluted net income (loss) per share | ||||||||||||||||||||
Potentially anti-dilutive shares that were excluded from the computation of basic net income (loss) per share: | ||||||||||||||||||||
| Options | ||||||||||||||||||||
RSUs and PSUs | ||||||||||||||||||||
| ESPP | ||||||||||||||||||||
| Weighted anti-dilutive shares outstanding which were not included in the diluted calculation | ||||||||||||||||||||
| Basic and diluted net income (loss) per ordinary share | $ | ( | $ | ( | $ | ( | ||||||||||||||
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NOTE 9: SUPPLEMENTAL INFORMATION
The Company operates in a single reportable segment.
The following table presents long-lived assets by location:
| March 31, 2026 | December 31, 2025 | ||||||||||
| Unaudited | Audited | ||||||||||
| United States | $ | $ | |||||||||
| Switzerland | |||||||||||
| Israel | |||||||||||
| Others | |||||||||||
| Total long lived assets | $ | $ | |||||||||
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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 (“MD&A”) is intended to provide information to assist you in better understanding and evaluating our financial condition and results of operations. We encourage you to read this MD&A in conjunction with our unaudited consolidated financial statements and the notes thereto for the period ended March 31, 2026 included in Part I, Item 1 of this Quarterly Report on Form 10-Q. This discussion contains forward-looking statements that involve risks and uncertainties. Please refer to the information under the heading “Cautionary Note Regarding Forward-Looking Statements” elsewhere in this report. References to the words “we,” “our,” “us,” and the “Company” in this report refer to NovoCure Limited, including its consolidated subsidiaries.
Critical Accounting Policies and Estimates
In accordance with U.S. generally accepted accounting principles (“GAAP”), in preparing our financial statements, we must make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of net revenues and expenses during the reporting period. We develop and periodically change these estimates and assumptions based on historical experience and on various other factors that we believe are reasonable under the circumstances. Actual results may differ from these estimates.
The critical accounting policies requiring estimates, assumptions and judgments that we believe have the most significant impact on our consolidated financial statements can be found in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the "2025 10-K"). For additional information, see Note 1 to our unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report. There were no other material changes to our critical accounting policies and estimates as compared to the critical accounting policies and estimates described in our 2025 10-K.
Overview
We are a global oncology company with a proprietary platform technology called Tumor Treating Fields ("TTFields"), which are electric fields that exert physical forces to kill cancer cells. Our therapy is delivered through a medical device. Our key priorities are to drive commercial adoption of Optune Gio®, Optune Lua®, and Optune Pax®, our commercial TTFields therapy devices, obtain regulatory approval to market TTFields therapy devices in new indications, such as brain metastases from non-small cell lung cancer ("NSCLC"), and to advance clinical and product development programs intended to extend overall survival in some of the most aggressive forms of cancer.
Optune Gio is approved by the U.S. Food and Drug Administration ("FDA") under the Premarket Approval ("PMA") pathway for the treatment of adult patients with newly diagnosed glioblastoma ("GBM") together with temozolomide, a chemotherapy drug, and for adult patients with GBM following confirmed recurrence after chemotherapy as monotherapy treatment. We also have a CE certificate to market Optune Gio for the treatment of GBM in the European Union ("EU"), as well as approval or local registration in the United Kingdom ("UK"), Japan, Canada and certain other countries.
Optune Lua is approved by the FDA under the PMA pathway for the treatment of adult patients with metastatic NSCLC concurrent with PD-1/PD-L1 inhibitors or docetaxel following progression on or after a platinum-based regimen. We also have a CE certificate to market Optune Lua concurrent with PD-1/PD-L1 inhibitors or docetaxel following progression on or after a platinum-based regimen for the treatment of metastatic NSCLC in the EU. In addition, we received regulatory approval in Japan for the use of Optune Lua for the treatment of adult patients with unresectable advanced/recurrent NSCLC concurrent with PD-1/PD-L1 inhibitors following progression on or after a platinum-based regimen.
Optune Lua is also approved by the FDA under the Humanitarian Device Exemption ("HDE") pathway for the treatment of adult patients with malignant pleural mesothelioma or pleural mesothelioma (together, "MPM") together with standard chemotherapies. We have also have a CE certificate in the EU and approval or local registration to market Optune Lua for the treatment of MPM in certain other countries.
Optune Pax is approved by the FDA under the PMA pathway for the treatment of adult patients with locally advanced pancreatic cancer concurrent with gemcitabine and nab-paclitaxel. We have submitted regulatory applications required to market Optune Pax in the EU and Japan.
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We market our Products in multiple countries around the globe with the majority of our revenues coming from the use of Optune Gio in the U.S., Germany, France and Japan. We are actively evaluating opportunities to expand access to Optune Gio, Optune Lua and Optune Pax in additional international markets.
We have established coverage policies with both public and private payers for the use of Optune Gio in our active markets. In March, we announced the approval of a national reimbursement coverage policy in Japan for the use of Optune Lua for the treatment of NSCLC. We are actively pursuing coverage policies with payers to expand access to Optune Lua and Optune Pax and in the meantime we will bill and seek reimbursement from payers on an individual case basis, as applicable.
In September 2025, we presented final data from the Phase 3 METIS clinical trial evaluating the use of TTFields therapy and best supportive care for the treatment of adult patients (n=298) with 1-10 brain metastases from NSCLC following stereotactic radiosurgery ("METIS") at the 2025 American Society for Radiation Oncology Annual Meeting. The METIS trial met its primary endpoint, demonstrating a statistically significant improvement in time to intracranial progression for patients treated with TTFields therapy and supportive care compared to patients treated with supportive care alone. In December 2025, we submitted the final module of our PMA application with the FDA seeking approval for the use of TTFields therapy for the treatment of brain metastases from NSCLC under the brand name Optune Mya®.
In March, we announced topline results from the Phase 2 PANOVA-4 clinical trial ("PANOVA-4") evaluating the use of TTFields therapy together with atezolizumab, gemcitabine and nab-paclitaxel (collectively, "systemic therapies") for the treatment of metastatic pancreatic cancer. PANOVA-4 met its pre-specified primary endpoint, achieving a statistically significant improvement in disease control rate (DCR) compared to the DCR reported in the Phase 3 MPACT study used as the historical control. Patients in PANOVA-4 achieved a DCR of 74% compared 48% in patients receiving gemcitabine and nab-paclitaxel alone (N=431) in the MPACT trial (difference = 26.4%, 1-sided p-value < 0.001). Secondary endpoint analyses for overall survival (OS) and objective response rate (ORR) were also completed, with PANOVA-4 patients exhibiting a median OS of 9.7 months and ORR of 34.6% (95% CI, 24.2% - 46.2%). Median duration of treatment with TTFields therapy was 25.6 weeks and six cycles of systemic therapies. TTFields therapy was well-tolerated and device related safety was consistent with prior clinical studies.
We believe the physical mechanisms of action behind TTFields therapy may be broadly applicable to solid tumor cancers. We have several ongoing clinical trials which further explore the use of TTFields therapy in these solid tumor cancers, including the Phase 3 TRIDENT and KEYNOTE D58 trials in GBM and the Phase 3 LUNAR-2 trial in NSCLC. We anticipate expanding our clinical pipeline over time to study the safety and efficacy of TTFields therapy for our existing and additional solid tumor indications and for use together with other cancer treatment modalities.
The table below presents the current status of the ongoing clinical trials in our pipeline and anticipated timing of data.
We are exploring options to modify our LUNAR-2 trial design with the goals of compressing the timeline to completion and significantly reducing costs. We anticipate engaging with regulators regarding potential protocol revisions in the coming months.
We have several product development programs underway that are designed to optimize the delivery of TTFields to the target tumor and enhance patient ease of use. Our intellectual property portfolio contains hundreds of issued patents and numerous patent applications pending worldwide. We believe we possess global commercialization rights to our Products in oncology and are well-positioned to extend those rights into the future as we continue to find innovative ways to improve our Products.
In 2018, we granted Zai Lab (Shanghai) Co., Ltd. ("Zai") a license to commercialize our Products in China, Hong Kong, Macau and Taiwan ("Greater China") under a License and Collaboration Agreement (the "Zai Agreement"). The Zai Agreement also establishes a development partnership intended to accelerate the development of TTFields
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therapy in multiple solid tumor cancer indications. For additional information, see Note 13 to the Annual Consolidated Financial Statements.
We view our operations and manage our business in one operating segment. For the three months ended March 31, 2026, our net revenues were $174.1 million. Our net loss for the three months ended March 31, 2026 was $71.1 million. As of March 31, 2026, we had an accumulated deficit of $1,361.5 million.
Impact of Current Events
Conflict in Israel
Since October 2023, the State of Israel has been in a state of war. As of the date of this filing, we believe that there is no immediate risk to our business facilities or operations. Our supply chain teams have increased stock levels to mitigate distribution and service risks from our suppliers in Israel, some of whom are single-source suppliers. Pursuant to our policy to seek and maintain second-source suppliers wherever possible, we are in the process of obtaining second-source suppliers outside of Israel when feasible; however we can provide no assurance that we will secure or maintain such suppliers on a timely basis. Where second-sources suppliers are not reasonably available, we maintain increased inventories to reduce risk. We do not believe the current escalation of hostilities with Iran will have an incremental impact.
Recent Changes to U.S. Tariff Rates
Throughout 2025 and 2026, the U.S. has increased or threatened to increase tariff rates on imported goods from numerous countries. The manufacturing of our Products and associated accessories is fully outsourced to third parties across multiple countries. In recent years, in anticipation of active patient growth and new indication launches, we began onboarding additional suppliers and/or supply nodes to increase the resilience of our network. As an example, we are in the final steps of adding production capacity in Mexico and Ireland. This also helps us provide optionality around supply routes to optimize our cost structure, including the emerging tariff landscape. Our current analysis of the global tariff environment leads us to believe there should not be a material impact to gross margins in the short-term and we are actively working to mitigate any potential impacts in the medium to long-term. We are also actively pursuing refunds of tariffs we paid under the International Emergency Economic Powers Act ("IEEPA") following the February 2026 U.S. Supreme Court ruling that IEEPA does not authorize tariffs. We believe that we are entitled to recovery of amounts paid; however we cannot be assured that we will be able to collect the full amount or when any recoveries will occur.
We anticipate continued volatility in the global tariff environment through 2026 and we cannot be assured that we will not ultimately be negatively impacted further by these changes.
Commentary on Results of Operations
Net revenues. Our revenues are primarily derived from patients using our Products in our active markets. We charge for treatment with our Products on a monthly basis. Our potential net revenues per patient are determined by our ability to secure payment, the monthly fee we collect and the number of months that the patient remains on therapy. In the case of a new indication launch such as Optune Lua, it can take time for us to generate the claims history needed for a reasonable estimate of collections that will enable us to recognize revenues upon billing without waiting for a final collection of the claim. Until that time, our revenue from NSCLC claims will be recognized in the period of cash collection.
We also recognize revenues pursuant to the Zai Agreement. For additional information regarding the Zai Agreement, see Note 13 to the annual Consolidated Financial Statements in our 2025 10-K.
Cost of revenues. We contract with third parties to manufacture our Products. Our cost of revenues is primarily comprised of the following:
•disposable arrays;
•depreciation expense for the field equipment, including the electric field generator used by patients;
•patient support and other personnel costs; and
•overhead costs, such as facilities, freight and depreciation of property, plant and equipment associated with managing our inventory, warehousing and order fulfillment functions.
Operating expenses. Our operating expenses consist of research, development and clinical studies, sales and marketing and general and administrative expenses. Personnel costs are a significant component for each category
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of operating expenses and consist of wages, benefits and bonuses. Personnel costs also include share-based compensation.
Financial income (expenses), net. Financial income (expenses), net primarily consists of interest income from cash balances and short-term investments, credit facility interest expense and related debt issuance costs, and gains (losses) from foreign currency transactions. Our reporting currency is the U.S. dollar. We have historically held substantially all of our cash balances in U.S. dollar denominated accounts to minimize the risk of translational currency exposure.
Results of Operations
The following discussion provides an analysis of our results of operations and reasons for material changes therein for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025. The tables contained in this section report U.S. dollars in thousands (except share, patient, and prescription data). The following table sets forth our consolidated statements of operations data:
| Three months ended March 31, | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| Unaudited | ||||||||||||||
| Net revenues | $ | 174,055 | $ | 154,994 | ||||||||||
| Cost of revenues | 38,929 | 38,521 | ||||||||||||
| Gross profit | 135,126 | 116,473 | ||||||||||||
| Operating costs and expenses: | ||||||||||||||
| Research, development and clinical studies | 58,336 | 53,777 | ||||||||||||
| Sales and marketing | 58,357 | 55,792 | ||||||||||||
| General and administrative | 85,853 | 44,769 | ||||||||||||
| Total operating costs and expenses | 202,546 | 154,338 | ||||||||||||
| Operating income (loss) | (67,420) | (37,865) | ||||||||||||
| Financial income (expenses), net | (1,838) | 7,570 | ||||||||||||
| Income (loss) before income taxes | (69,258) | (30,295) | ||||||||||||
| Income taxes | 1,880 | 4,024 | ||||||||||||
| Net income (loss) | $ | (71,138) | $ | (34,319) | ||||||||||
| Basic and diluted net income (loss) per ordinary share | $ | (0.62) | $ | (0.31) | ||||||||||
| Weighted average number of ordinary shares used in computing basic and diluted net income (loss) per share | 114,149,838 | 110,281,832 | ||||||||||||
As a result of FDA approval of Optune Pax during the quarter, we incurred a non-cash general and administrative expense of approximately $43,406 related to 901,284 PSUs granted in March 2020 to an executive officer that were
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expensed for U.S. GAAP purposes, but not actually converted to Ordinary Shares and distributed to the executive officer. These PSUs are now cancelled.
The following table details the share-based compensation expense included in costs and expenses:
| Three months ended March 31, | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| Unaudited | ||||||||||||||
| Cost of revenues | $ | 599 | $ | 1,102 | ||||||||||
| Research, development and clinical studies | 4,026 | 6,201 | ||||||||||||
| Sales and marketing | 4,297 | 8,517 | ||||||||||||
| General and administrative | 54,087 | 13,732 | ||||||||||||
| Total share-based compensation expense | $ | 63,009 | $ | 29,552 | ||||||||||
Key performance indicators
We believe certain commercial operating statistics are useful to investors in evaluating our commercial business as they help our management team and investors evaluate and compare the adoption of our Products from period to period. The number of active patients on therapy is our principal revenue driver. An "active patient" is a patient who is receiving treatment under a commercial prescription order as of the measurement date, including patients who may be on a temporary break from treatment and who plan to resume treatment in less than 60 days.
The following table includes certain commercial operating statistics for and as of the end of the periods presented.
| March 31, | |||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||||||||||||||||||||||||||
| Optune Gio | Optune Lua | Optune Pax | Total | Optune Gio | Optune Lua | Optune Pax | Total | ||||||||||||||||||||||||||||||||||||||||
| Active patients at period end | |||||||||||||||||||||||||||||||||||||||||||||||
| United States | 2,250 | 106 | 83 | 2,439 | 2,157 | 74 | — | 2,231 | |||||||||||||||||||||||||||||||||||||||
| International markets: | |||||||||||||||||||||||||||||||||||||||||||||||
| Germany | 641 | 47 | — | 688 | 573 | 21 | — | 594 | |||||||||||||||||||||||||||||||||||||||
| France | 503 | 2 | — | 505 | 463 | — | — | 463 | |||||||||||||||||||||||||||||||||||||||
| Japan | 535 | 6 | — | 541 | 445 | — | — | 445 | |||||||||||||||||||||||||||||||||||||||
| Other international | 614 | 4 | — | 618 | 524 | 11 | — | 535 | |||||||||||||||||||||||||||||||||||||||
| International markets - Total | 2,293 | 59 | — | 2,352 | 2,005 | 32 | — | 2,037 | |||||||||||||||||||||||||||||||||||||||
| 4,543 | 165 | 83 | 4,791 | 4,162 | 106 | — | 4,268 | ||||||||||||||||||||||||||||||||||||||||
Prescriptions are an indicator of new indication adoption during the first year of product launch. As such, we are no longer reporting new prescriptions received in indications which have been commercially available for more than
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one year (GBM, NSCLC, MPM). Prescriptions received for the treatment of pancreatic cancer will be provided for a one-year period following launch.
| Three months ended March 31, | |||||
| 2026 | |||||
| Optune Pax | |||||
| Prescriptions received in period (1) | |||||
| United States | 168 | ||||
| International markets: | |||||
| Germany | 1 | ||||
| France | — | ||||
| Japan | — | ||||
| Other international | — | ||||
| International markets - Total | 1 | ||||
| 169 | |||||
(1) A "prescription received" is a commercial order for Optune Pax that is received from a physician certified to treat patients with our Products for a patient not previously on Optune Pax. Orders to renew or extend treatment are not included in this total.
Three months ended March 31, 2026 compared to three months ended March 31, 2025
| Three months ended March 31, | ||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||
| Net revenues | $ | 174,055 | $ | 154,994 | 12 | % | ||||||||||||||
Net revenues. Net revenues increased 12% to $174.1 million for the three months ending March 31, 2026 from $155.0 million for the same period in 2025. For the three months ended March 31, 2026 the net revenue increase primarily resulted from $16.3 million in growth from international markets, driven by a $5.8 million increase in Germany from active patient growth and reimbursement improvements, a $5.0 million increase from continued growth in France, and a $3.7 million increase in other international markets due to active patient growth and the Optune Gio launch in Spain. In the quarter, there were $3.5 million in one-time revenue benefits included in the aforementioned international market increase consisting of $2.5 million from Germany related to approval rate increases and aged collections and $1.0 million in France related to performance improvements. The overall increase includes $5.6 million of exchange rate benefits. In addition, net revenue in the United States grew by $2.8 million due to active patient growth in both Optune Gio and Optune Lua. Recognized revenue from Optune Lua in the quarter was $3.0 million versus $1.5 million in the same period last year.
| Three months ended March 31, | ||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||
| Cost of revenues | $ | 38,929 | $ | 38,521 | 1 | % | ||||||||||||||
Cost of revenues. For the three months ended March 31, 2026, the increase in cost of revenues was primarily due to 12% growth in active patients mostly offset by $4.2 million lower costs of arrays mainly resulting from improved array utilization and lower supplier prices.
Excluding sales to Zai, cost of revenues per active patient per month was $2,530 for the three months ended March 31, 2026, a decrease of 9% from $2,794 for the same period in 2025, primarily due to the lower cost of arrays. Cost of revenues per active patient is calculated by dividing the cost of revenues for the quarter less equipment sales to Zai for the quarter by the average of the active patients at the end of the prior quarter and the ending active patients in the current quarter. This quarterly figure is then divided by three to estimate the monthly
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cost of revenues per active patient. Sales to Zai are deducted because they are sold at cost and in anticipation of future royalties from Zai, and Zai patient counts are not included in our active patient population. Cost of products sold to Zai totaled $3.2 million for the three months ended March 31, 2026 compared to $3.3 million for the three months ended March 31, 2025.
Gross margin was 78% for the three months ended March 31, 2026 compared to 75% for the three months ended March 31, 2025. The improvement in gross margin is primarily due to 12% active patient growth while limiting the increase in cost of revenues to only 1%. We expect that our gross margins will continue to be impacted by our launches in NSCLC and pancreatic cancer, as well as by the changing tariff landscape. We continue to focus on opportunities to increase efficiencies and scale within our supply chain. This includes evaluating new materials, manufacturers, and processes that could lead to lower costs.
Operating Expenses.
| Three months ended March 31, | ||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||
| Research, development and clinical studies | $ | 58,336 | $ | 53,777 | 8 | % | ||||||||||||||
| Sales and marketing | 58,357 | 55,792 | 5 | % | ||||||||||||||||
| General and administrative | 85,853 | 44,769 | 92 | % | ||||||||||||||||
| Total operating expenses | $ | 202,546 | $ | 154,338 | 31 | % | ||||||||||||||
Research, development and clinical study expenses. Research, development and clinical study expenses increased 8% to $58.3 million for the three months ended March 31, 2026 from $53.8 million for the same period in 2025. For the three months ended March 31, 2026, the change was primarily due to a $2.0 million increase in engineering costs mostly related to payroll increases, a $1.3 million increase in direct clinical expenses mostly related to the ramp up of our KEYNOTE D58 trial partially offset by the completion of other clinical trials, and a $0.8 million increase in regulatory affairs expenses. The increase was partially offset by a $2.2 million decrease in share based compensation expenses. Total research and development expenses can fluctuate quarter-to-quarter dependent upon the amount of clinical research organization services delivered, clinical materials procured and the number of trials actively underway within a given quarter.
Sales and marketing expenses. Sales and marketing expenses increased 5% to $58.4 million for the three months ended March 31, 2026 from $55.8 million for the same period in 2025. For the three months ended March 31, 2026, the change was mainly driven by $5.4 million in sale and marketing efforts related to the Optune Pax launch in the United States and Optune Lua launch in Japan, partially offset by $4.2 million in lower share-based compensation expenses.
General and administrative expenses. General and administrative expenses increased 92% to $85.9 million for the three-month period ended March 31, 2026 from $44.8 million for the same period in 2025. For the three months ended March 31, 2026, these changes were primarily due to $40.4 million higher share-based compensation expenses, resulting primarily from approximately $43.4 million related to PSUs granted in March 2020 to an executive officer that were expensed according to U.S. GAAP as a result of the FDA approval of Optune Pax, but not distributed. Additionally, excluding share based compensation expenses, there was a $0.7 million increase in general and administrative expenses resulting from a $3.0 million increase in personnel expenses to support multiple launches partly offset by a one-time expense of $2.3 million recognized in the same period last year for the retirement of a production line.
| Three months ended March 31, | ||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||
| Financial income (expenses), net | $ | (1,838) | $ | 7,570 | (124) | % | ||||||||||||||
Financial income (expenses), net. Financial income decreased by $ 9.4 million or 124% from $7.6 million in income for the three months ended March 31, 2025 to an expense of $1.8 million for the same period in 2026, primarily due to a $7.1 million decrease in interest income on our investments driven by the repayment upon maturity in November 2025 of our 0% coupon convertible notes, $2.3 million of higher interest expenses related to
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our senior secured credit facility driven by our borrowing of Tranche B in September 2025 and $0.5 million of higher foreign currency exchange expenses, offset by $0.5 million of lower amortization expenses on our senior secured credit facility.
| Three months ended March 31, | ||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||
| Income taxes | $ | 1,880 | $ | 4,024 | (53) | % | ||||||||||||||
Income taxes. Income taxes decreased 53% to $1.9 million for the three months ended March 31, 2026 from $4.0 million for the same period in 2025. The change is driven primarily by a $1.2 million reduction due to intercompany interest income in Switzerland and Luxembourg and a $1.6 million increase in tax benefits from share-based compensation deductions in the period.
Non-GAAP financial measures
We also measure our performance using a non-GAAP measurement of earnings before interest, taxes, depreciation, amortization and shared-based compensation (“Adjusted EBITDA”). We believe Adjusted EBITDA is useful to investors in evaluating our operating performance because it helps investors evaluate and compare the results of our operations from period to period by removing the impact of earnings attributable to our capital structure, tax rate and material non-cash items, specifically share-based compensation.
We calculate Adjusted EBITDA as operating income before financial expenses and income taxes, net of depreciation, amortization and share-based compensation. The following table reconciles net income (loss), which is the most directly comparable GAAP operating performance measure, to Adjusted EBITDA.
| Three months ended March 31, | ||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||
| Net income (loss) | $ | (71,138) | $ | (34,319) | 107 | % | ||||||||||||||
| Add: Income tax | 1,880 | 4,024 | (53) | % | ||||||||||||||||
| Add: Financial expenses (income), net | 1,838 | (7,570) | (124) | % | ||||||||||||||||
| Add: Depreciation and amortization | 4,124 | 3,325 | 24 | % | ||||||||||||||||
| EBITDA | $ | (63,296) | $ | (34,540) | 83 | % | ||||||||||||||
| Add: Share-based compensation | 63,009 | 29,552 | 113 | % | ||||||||||||||||
| Adjusted EBITDA | $ | (287) | $ | (4,988) | (94) | % | ||||||||||||||
Adjusted EBITDA increased to a loss of $0.3 million for the three months ended March 31, 2026 from a loss of $5.0 million for the same period in 2025. For three months ended March 31, 2026, the change in adjusted EBITDA was primarily driven by revenue growth partially offset by increasing costs for new indications. The revenue increase drove a $18.7 million increase in gross profit. The gross profit increase was partially offset by increased operating expenses, primarily due to our launches in pancreatic cancer and NSCLC. We intend to take actions that prioritize growth and maintain financial health and flexibility as we position our company for future profitability.
Liquidity and Capital Resources
We have incurred significant losses and cumulative negative cash flows from operations since our founding in 2000. As of March 31, 2026, we had an accumulated deficit of $1,361.5 million. To date, we have primarily financed our operations through the exercise of options, issuance and sale of equity and the proceeds from long-term loans.
At March 31, 2026, we had $432.0 million in cash, cash equivalents and short-term investments, a decrease of $15.7 million compared to $447.7 million at December 31, 2025, primarily attributable to net cash used in operations. We believe our cash, cash equivalents and short-term investments as of March 31, 2026 are sufficient for our operations for at least the next 12 months based on our existing business plan and our ability to control the timing of significant expense commitments. We expect that our operating expenses will continue to increase over the next several years and may outpace our gross profit as we prepare to expand into additional indications beyond CNS and Lung. As a result, we may need to raise additional capital to fund our operations.
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The following summary of our cash flows for the periods indicated has been derived from our unaudited consolidated financial statements, which are included elsewhere in this Quarterly Report:
| Three months ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | Change | % Change | ||||||||||||||||||||
Net cash provided by (used in) operating activities | $ | (13,517) | $ | (35,665) | $ | 22,148 | (62) | % | |||||||||||||||
| Net cash provided by (used in) investing activities | 7,747 | (6,472) | 14,219 | (220) | % | ||||||||||||||||||
Net cash provided by (used in) financing activities | (166) | 5,247 | (5,413) | (103) | % | ||||||||||||||||||
| Effect of exchange rate changes on cash and cash equivalents | (130) | 227 | (357) | (157) | % | ||||||||||||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | $ | (6,066) | $ | (36,663) | $ | 30,597 | (83) | % | |||||||||||||||
Operating activities. Net cash used in or provided by operating activities represents our net income (loss) for the periods presented. Adjustments to net income (loss) for non-cash items include share-based compensation and depreciation, amortization and asset write-downs. Operating cash flows are also impacted by changes in working capital as a result of collections from trade receivables and payments of accounts payables and by changes in other long term assets and liabilities.
Net cash used in operating activities decreased by $22.1 million from $35.7 million net cash used in operating activities for the three months ended March 31, 2025 to $13.5 million net cash used in operating activities for the three months ended March 31, 2026. This was primarily the result of an $11.3 million increase in accounts payable and accrued expenses, and a decrease of $9.4 million in accounts receivable and prepaid expenses.
Investing activities. Our investing activities consist primarily of investments in and redemptions of our short-term investments as well as investments in property and equipment.
Net cash provided by investing activities was $7.7 million for the three months ended March 31, 2026, compared to $6.5 million used in investing activities for the three months ended March 31, 2025. The $7.7 million net cash provided by investing activities for the three months ended March 31, 2026 was primarily attributable to $12.9 million of net proceeds of short term investments offset by the purchase of $5.2 million of property and equipment. The $6.5 million net cash used in investing activities for the three months ended March 31, 2025 was primarily attributable to $4.1 million of net proceeds of short-term investments offset by the purchase of $10.6 million of property and equipment.
Financing activities. Net cash used in financing activities was $0.2 million for the three months ended March 31, 2026, as compared to $5.2 million provided by financing activities for the three months ended March 31, 2025. The $0.2 million net cash used in financing activities for the three months ended March 31, 2026 was primarily attributable to $0.6 million of tax payments related to net settlements on equity awards offset by exercise of options. The $5.2 million provided by financing activities for the three months ended March 31, 2025 was attributable to the the exercise of options under the Company's share option plan.
Senior Secured Term Loan Credit Facility
On May 1, 2024 Novocure Luxembourg S.a.r.l. ("Borrower"), our wholly-owned subsidiary, entered into a five-year senior secured credit facility of up to $400.0 million (the "Facility") with BPCR Limited Partnership and BioPharma Credit Investments V (Master) LP (collectively, the "Lenders"), BioPharma Credit PLC, as collateral agent for the Lenders, and the guarantors party to such agreement (the "Loan Agreement"). The Facility could be drawn in up to four drawings. The Loan Agreement provides for an initial term loan in the principal amount of $100.0 million (the "Tranche A Loan"), which was funded to the Borrower on May 1, 2024 (the "Tranche A Funding Date"). Under the Loan Agreement, the Borrower was required to draw $100.0 million on the Facility on or before September 30, 2025 (the "Tranche B Loan"). Not later than December 31, 2025, the Borrower had the option to give notice of its intent to draw an additional $100.0 million of the Facility (the "Tranche C Loan"). In addition, not later than March 31, 2026, the Borrower had the option to to draw an additional $100.0 million of the Facility (the "Tranche D Loan"). As of March 31, 2026, we have borrowed the Tranche A Loan and the Tranche B Loan in the aggregate principal amount
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of $200.0 million. We did not give notice of our intent to borrow the Tranche C Loan. As a result, we no longer have the ability to borrow the Tranche C or Tranche D Loans.
The obligations under the Loan Agreement are guaranteed by certain of our subsidiaries and secured by a first lien on the Borrower's and certain of our other subsidiaries’ assets. Outstanding term loans under the Loan Agreement will bear interest at an annual rate equal to 6.25% plus the three-months SOFR (subject to a 3.25% floor), payable quarterly in arrears and calculated on the basis of actual days elapsed in a 360-day year. The Borrower paid 2.5% of additional consideration on each principal draw, with payment for the Tranche A Loan and the Tranche B Loan paid on the Tranche A Funding Date. Principal under the Facility will be repaid in eight equal quarterly repayments commencing with the third quarter of 2027 and continuing each quarter thereafter, with the final payment of outstanding principal due on the fifth anniversary of the Tranche A Funding Date. Voluntary prepayment of all, but not less than all, of the term loans outstanding is permitted at any time, subject to make-whole and prepayment premiums as set forth in the Loan Agreement. Prepayment of all term loans outstanding, subject to make-whole and prepayment premiums, is due and payable upon a change-in-control as defined in the Loan Agreement. Make-whole and prepayment premiums are due and payable for the Tranche B Loans for any voluntary prepayment of the term loans outstanding, upon a change-in-control (as defined in the Loan Agreement), and upon any acceleration of the maturity date, in each case regardless of whether the Tranche B Loan is drawn.
Contractual Obligations and Commitments
There have been no material changes from the information disclosed in our 2025 10-K.
Off-Balance Sheet Arrangements
We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements as defined under U.S. Securities and Exchange Commission (“SEC”) rules.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes from the information disclosed in our 2025 10-K.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
As required by Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as of March 31, 2026. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of March 31, 2026, our Chief Executive Officer and Chief Financial Officer have concluded that, as of March 31, 2026, our disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control over Financial Reporting
There has been no change in our internal control over financial reporting during the quarter ended March 31, 2026 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II—OTHER INFORMATION
Item 1. Legal Proceedings
From time to time, we are involved in various legal proceedings, claims, investigations and litigation that arise in the ordinary course of our business. Litigation is inherently uncertain. Accordingly, we cannot predict with certainty the outcome of these matters. After considering a number of factors, including (but not limited to) the views of legal counsel, the nature of contingencies to which the Company is subject and prior experience, management believes that the ultimate disposition of these legal actions will not materially affect its consolidated financial position or results of operations.
Item 1A. Risk Factors
There have been no material changes to our risk factors disclosed in Part I, Item 1A “Risk Factors” in the 2025 10-K.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
Securities Trading Plans of Executive Officers and Directors
Rule 10b5-1 under the Exchange Act provides an affirmative defense that enables prearranged transactions in securities in a manner that avoids concerns about initiating transactions at a future date while possibly in possession of material nonpublic information. Our Insider Trading Policy permits our executive officers and directors to enter into trading plans designed to comply with Rule 10b5-1.
The following table describes contracts, instructions or written plans for the purchase or sale of our securities that are intended to satisfy the affirmative defense conditions of Rule 10b5–1(c) promulgated under the Securities Exchange Act of 1934, as amended (each a "Rule 10b5-1 Plan") adopted by our executive officers and directors during the three month period ending March 31, 2026:
| Name and Title | Title | Date of Adoption | Duration of Rule 10b5-1 Plan | Aggregate Number of Securities to be Purchased Pursuant to the Rule 10b5-1 Plan | Aggregate Number of Securities to be Sold Pursuant to the Rule 10b5-1 Plan | ||||||||||||
6/3/2026-12/31/2028 | 202,758 | ||||||||||||||||
During the three-month period ending March 31, 2026, none of our other executive officers or directors terminated a Rule 10b5-1 trading plan or adopted or terminated a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K).
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Item 6. Exhibits
EXHIBIT INDEX
| Exhibit Number | Incorporated by Reference | Filed Herewith | ||||||||||||||||||||||||||||||
| Exhibit Description | Form | Date | Number | |||||||||||||||||||||||||||||
10.1 | Letter Agreement by and between Novocure GmbH and Uri Weinberg dated as of April 7, 2026# | 8-K | April 9, 2026 | 10.1 | ||||||||||||||||||||||||||||
10.2 | Termination Agreement by and between Novocure GmbH and Nicolas Leupin dated February 23, 2026# | X | ||||||||||||||||||||||||||||||
10.3 | Employment Agreement between Frank Leonard and Novocure GmbH effective as of January 1, 2026# | 8-K/A | April 24, 2026 | 10.1 | ||||||||||||||||||||||||||||
| 31.1 | Certification of Principal Executive Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended | X | ||||||||||||||||||||||||||||||
| 31.2 | Certification of Principal Financial Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended | X | ||||||||||||||||||||||||||||||
| 32.1* | Certification of Principal Executive Officer Required Under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. §1350 | X | ||||||||||||||||||||||||||||||
| 32.2* | Certification of Principal Financial Officer Required Under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. §1350 | X | ||||||||||||||||||||||||||||||
| 101.INS | Inline XBRL Instance Document | X | ||||||||||||||||||||||||||||||
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | X | ||||||||||||||||||||||||||||||
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | X | ||||||||||||||||||||||||||||||
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | X | ||||||||||||||||||||||||||||||
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | X | ||||||||||||||||||||||||||||||
| 101.PRE | Inline XBRL Extension Presentation Linkbase Document | X | ||||||||||||||||||||||||||||||
| 104 | Cover Page Interactive Date File (formatted as Inline XBRL and contained in Exhibit 101) | X | ||||||||||||||||||||||||||||||
____________________________________________
# Compensation plans and arrangements for executive officers and others.
* The certifications attached as Exhibits 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of NovoCure Limited under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Form 10-Q, irrespective of any general incorporation language contained in such filing.
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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.
| NovoCure Limited | ||||||||
| Date: April 30, 2026 | /s/ Christoph Brackmann | |||||||
Christoph Brackmann Chief Financial Officer (principal financial and accounting officer and duly authorized officer) | ||||||||
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FAQ
How did NovoCure (NVCR) perform financially in Q1 2026?
NovoCure reported net revenues of $174.1 million, up 12% year over year, with gross margin improving to 78%. Higher operating expenses, including significant share-based compensation, led to a net loss of $71.1 million, or $0.62 per share.
What were NovoCure (NVCR)’s key operating metrics this quarter?
Active patients on therapy reached 4,791 at March 31, 2026, up from 4,268 a year earlier. This includes growth in Optune Gio, Optune Lua and initial Optune Pax usage. Cost of revenues per active patient per month fell to $2,530, supporting a 78% gross margin.
What is driving NovoCure (NVCR)’s higher operating expenses?
Operating expenses rose to $202.5 million, mainly from launches in pancreatic cancer and NSCLC and sharply higher share-based compensation. General and administrative expense included about $43.4 million of non-cash PSU expense triggered by FDA approval of Optune Pax.
What recent clinical and regulatory milestones did NovoCure (NVCR) achieve?
The FDA approved Optune Pax for locally advanced pancreatic cancer. NovoCure reported final positive phase 3 METIS results in brain metastases from NSCLC and positive phase 2 PANOVA-4 data in metastatic pancreatic cancer, and submitted a PMA for Optune Mya.
What is NovoCure (NVCR)’s liquidity position as of March 31, 2026?
NovoCure held $432.0 million in cash, cash equivalents and short-term investments and had $200.0 million outstanding under its senior secured credit facility. Management believes this provides sufficient funding for at least the next 12 months under its current business plan.
How is NovoCure (NVCR) using Adjusted EBITDA to assess performance?
Adjusted EBITDA excludes interest, taxes, depreciation, amortization and share-based compensation. For Q1 2026, Adjusted EBITDA was a loss of only $0.3 million, improving from a $5.0 million loss a year earlier, reflecting better gross profit despite higher launch spending.