Financial Analysis

4. BUSINESS COMBINATION On July 31, 2024, the Company completed its acquisition of Incal Technology, Inc. (Incal), a company that specializes in packaged part reliability/burn-in test solutions. The acquisition date fair value of the consideration transferred for Incal was approximately $22.2 million, which consisted of the following: (In thousands) Fair Value Cash $ 10,631 Common stock under transfer restriction 9,381 Escrow payable 2,381 Working capital adjustments (1) (240 ) Total $ 22,153 (1) Included in Prepaid expenses and other current assets as of May 30, 2025 As part of the purchase consideration, the Company issued 552,355 shares of its restricted common stock. The restricted stock issued to the shareholders of Incal is subject to a six-month holding period, during which time the shares cannot be transferred or sold without registration under the Securities Act of 1933, as amended, or pursuant to an available exemption. The fair value of the restricted shares was determined based on the closing price of the Companys common stock on the acquisition date, adjusted for a discount related to the lack of marketability due to the transfer restrictions. The total fair value of the restricted shares issued as part of the consideration was $9.4 million. The escrow payable represented the present value of total escrow amount, net of certain indemnification, and was initially recorded within accrued expenses and other current liabilities and other long-term liabilities, respec …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

9. COMMITMENTS AND CONTINGENCIES Commitment Purchase obligations consist of non-cancelable significant contractual obligations. As of May 29, 2026, the Companys unconditional purchase obligations, which have a remaining term in excess of 12 months, were not material. Contingencies The Company may, from time to time, be involved in legal proceedings arising in the ordinary course of business. While there can be no assurances as to the ultimate outcome of any litigation involving the Company, management does not believe any pending legal proceedings will result in judgment or settlement that will have a material adverse effect on the Companys consolidated financial position, results of operations or cash flows. On October 16, 2024, the Company filed a complaint with the China Suzhou Intermediate Court to protect its intellectual property rights in China against Suzhou Semight Instruments Co., Ltd. (Semight) and its related entities and/or distributors, alleging infringement of the Companys two patents related to wafer burn-in systems and wafer reliability test systems. The Company is seeking injunctive relief, claiming that Semights actions have infringed upon its intellectual property rights and caused substantial harm to its business. The Company believes its claims are valid and is vigorously pursuing its legal remedies. At this stage, the outcome of the litigation is uncertain, and the Company is unable to predict the likelihood of success or estimate the potential financia …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

"12. EMPLOYEE STOCK PLANS 2023 Equity Incentive Plan On October 23, 2023, the shareholders of the Company approved the 2023 Equity Incentive Plan (the ""2023 Plan"") to replace the Companys 2016 Equity Incentive Plan (the 2016 Plan) and reserved a total of 1,500,000 shares of common stock under the 2023 Plan. The 2023 Plan permits grants to employees of share-based awards, including stock options, RSUs, PRSUs, restricted shares, performance restricted shares. Full value awards, which are equity awards other than options, stock appreciation rights or other awards that are based solely on an increase in value of the shares following the grant date, when granted or forfeited will be counted as the same number of common stock shares added or deducted to the remaining available shares for issuance under the 2023 Plan. On October 20, 2025, the Companys shareholders approved amendments to the 2023 Equity Incentive Plan to increase the share reserves by 2,500,000 shares. The additional shares became available for future issuance upon shareholder approval. 2016 Equity Incentive Plan In October 2016, the Companys 2016 Plan was approved by the Companys shareholders. The 2016 Plan replaced the 2006 Equity Incentive Plan and would continue in effect until 2026. The exercise price of each stock option equals the market value of the Company's common stock on the date of grant. Options typically vest over four years, subject to the grantees continued service with the Company through the sche …

CompensationAndEmployeeBenefitPlansTextBlock · excerpt; the full note is in the filing

Year Ended May 29, May 30, May 31, (In thousands) 2026 2025 2024 Systems $ 28,669 $ 21,978 $ 24,169 Contactors 14,887 30,848 37,560 Services 6,445 6,142 4,489 $ 50,001 $ 58,968 $ 66,218 Year Ended May 29, May 30, May 31, (In thousands) 2026 2025 2024 Asia $ 22,823 $ 37,095 $ 58,076 United States 20,643 17,673 3,532 Europe and Middle East 6,535 4,200 4,610 $ 50,001 $ 58,968 $ 66,218 Year Ended May 29, May 30, May 31, (In thousands) 2026 2025 2024 Timing of revenue recognition: Products and services transferred at a point in time $ 46,820 $ 57,745 $ 64,590 Services transferred over time 3,181 1,223 1,628 $ 50,001 $ 58,968 $ 66,218

DisaggregationOfRevenueTableTextBlock

2. FAIR VALUE OF FINANCIAL INSTRUMENTS The Companys financial instruments are measured at fair value consistent with authoritative guidance. This authoritative guidance defines fair value, establishes a framework for using fair value to measure assets and liabilities, and disclosures required related to fair value measurements. The guidance establishes a fair value hierarchy based on inputs to valuation techniques that are used to measure fair value that is either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources while unobservable inputs reflect a reporting entitys pricing based upon their own market assumptions. The fair value hierarchy consists of the following three levels: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - Inputs that are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant inputs are observable in the market or can be derived from observable market data. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs including interest rate curves, foreign exchange rates, and credit ratings. Level 3 - Un …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

5. GOODWILL AND PURCHASED INTANGIBLE ASSETS Goodwill The Company's goodwill activity during the years ended May 29, 2026 and May 30, 2025 was as follows: (In thousands) Total Balance as of May 31, 2024 $ - Addition due to business combination 10,719 Balance as of May 30, 2025 10,719 Activity during the year - Balance as of May 29, 2026 $ 10,719 Goodwill was tested for impairment in the fourth quarter at the reporting unit level. There were no impairments to goodwill during the years ended May 29, 2026 and May 30, 2025. Purchased Intangible Assets The Companys purchased intangible assets, net, were as follows: May 29, 2026 May 30, 2025 (In thousands) Accumulated Accumulated Finite-lived intangible assets: Gross Amortization Net Gross Amortization Net Developed technology $ 9,130 $ (1,395 ) $ 7,735 $ 9,130 $ (634 ) $ 8,496 Trade names 1,050 (192 ) 858 1,050 (88 ) 962 Customer relationship 810 (135 ) 675 810 (61 ) 749 Non-compete agreements and others 1,010 (726 ) 284 1,010 (436 ) 574 Total $ 12,000 $ (2,448 ) $ 9,552 $ 12,000 $ (1,219 ) $ 10,781 Amortization expense related to purchased intangible assets with finite lives was $1.2 million and $1.2 million for the years ended May 29, 2026 and May 30, 2025. As of May 29, 2026, the estimated future amortization expense of purchased intangible assets with finite lives is as follows: (In thousands) Amount 2027 $ 1,183 2028 981 2029 939 2030 939 2031 939 Thereafter 4,571 Total $ 9,552 There were no impairment charges related to purch …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

"6. INCOME TAXES Domestic and foreign components of income (loss) before income tax benefit are as follows: Year Ended May 29, May 30, May 31, (In thousands) 2026 2025 2024 Domestic $ (11,825 ) $ (4,422 ) $ 12,355 Foreign 89 131 103 $ (11,736 ) $ (4,291 ) $ 12,458 The income tax benefit consists of the following: Year Ended May 29, May 30, May 31, (In thousands) 2026 2025 2024 Federal income taxes: Current $ - $ - $ 6 Deferred (4,170 ) (409 ) (14,377 ) State income taxes: Current - 7 14 Deferred (545 ) (12 ) (6,396 ) Foreign income taxes: Current 105 33 55 Deferred - - - $ (4,610 ) $ (381 ) $ (20,698 ) The Company adopted ASU 2023-09 ""Income Taxes (Topic 740): Improvements To Income Tax Disclosures"" on a prospective basis beginning with the year ended May 29, 2026. The following table presents required disclosure pursuant to ASU 2023-09 and reconciles the U.S. federal statutory tax amount and rate to the actual effective amount and rate for the year ended May 29, 2026: May 29, 2026 (In thousands) Amount Percent Income taxes benefit at U.S. federal statutory tax $ (2,465 ) 21.0 % State and local taxes, net of federal income tax effect (546 ) 4.7 % Foreign tax effects 25 (0.2 )% Effect of cross-border tax laws: Global intangible low-taxed income 1 (0.0 )% Tax credits: Change in research and development reserves 61 (0.5 )% Nontaxable or nondeductible items: Permanent Items 20 (0.2 )% Stock-based compensation (1,720 ) 14.6 % Section 162(m) compensation limitation 987 (8.4 )% Ex …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

7. LEASES The Company leases its manufacturing and office space under operating leases. The principal administrative and production facility is located in Fremont, California, in a 51,289 square foot building. The Company entered into a non-cancelable operating lease agreement for its United States manufacturing and office facility, which was amended in December 2022 to extend the lease term to September 2030. The total commitments, net of tenant incentives of up to $0.3 million, under the modified lease are $8.6 million. The modified lease contains an option to further extend the lease for five years. The lease modification resulted in an increase in the Companys operating lease right-of-use assets and operating lease liabilities of $5.9 million each in December 2022. In April 2025, it became reasonably certain that the Company would exercise the five-year lease extension option ending in September 2035 due to the remodeling of the Fremont manufacturing and administrative office. As a result, the lease modification increased the Companys operating lease right-of-use assets and operating lease liabilities by $4.6 million each. The Company leases a 492 square foot sales and support office in Utting, Germany. The lease, which began on February 1, 1992, contains an automatic twelve months renewal. The Company leases a facility in the Philippines located in a 6,458 square foot building in Clark Freeport Zone, Pampanga. The lease, amended in 2023, began on November 1, 2023 and exp …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

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, an accounting standard update to improve income statement expenses disclosures. The standard requires more detailed information related to the types of expenses, including (among other items) the amounts of purchases of inventory, employee compensation, depreciation and intangible asset amortization included within each interim and annual income statements expense caption, as applicable. This authoritative guidance can be applied prospectively or retrospectively and will be effective for fiscal years beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the effect of this pronouncement on its disclosures. 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. The new guidance allows companies to apply a practical expedient when estimating credit losses on current accounts receivable and contract assets. This ASU is effective for fiscal years beginning after December 15, 2025. Early adoption is permitted for periods in which financial statements have not yet been issued or made ready for issuance on a prospective basis. The Company is currently evaluating the impact of adopting this guidance on its consolidated financial state …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

13. RESTRUCTURING CHARGES In the fourth quarter of fiscal 2025, the Company initiated a restructuring plan to consolidate facilities and optimize cost structure in order to more effectively support the Companys long-term strategic objectives. Restructuring charges relate to impairment of long-lived assets that will no longer be used in operations, including right-of-use assets and facility-related property, contract termination costs and facility exit-related costs. During fiscal year 2026, the Company entered into a lease termination agreement with the landlord, paid a termination fee of $0.2 million and was released from its remaining lease obligation. Consequently, the Company recognized a credit to the restructuring charge of $0.2 million during the period. Separately, the Company implemented a workforce reduction to align resources with its business needs in fiscal year 2026. The Company recorded $0.2 million of restructuring charges, primarily related to employee termination benefits. The following table presents restructuring charges included in the consolidated statements of operations: May 29, May 30, (In thousands) 2026 2025 Asset impairments $ (104 ) $ 584 Contract termination (109 ) 188 Facility exit-related - 92 Employee termination benefits 219 - Total $ 6 $ 864 There were no restructuring charges for the year ended May 31, 2024. The Company recorded a restructuring liability of $0.2 million as of May 30, 2025, primarily related to contract termination costs, wh …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

11. REVENUE Disaggregation of Revenue The following tables show revenues by major product categories. Within each product category, contract terms, conditions and economic factors affecting the nature, amount, timing and uncertainty around revenue recognition and cash flow are substantially similar. The Companys revenues by product category are as follows: Year Ended May 29, May 30, May 31, (In thousands) 2026 2025 2024 Systems $ 28,669 $ 21,978 $ 24,169 Contactors 14,887 30,848 37,560 Services 6,445 6,142 4,489 $ 50,001 $ 58,968 $ 66,218 The following presents information about the Companys operations in different geographic areas. Net revenues are based on ship-to locations: Year Ended May 29, May 30, May 31, (In thousands) 2026 2025 2024 Asia $ 22,823 $ 37,095 $ 58,076 United States 20,643 17,673 3,532 Europe and Middle East 6,535 4,200 4,610 $ 50,001 $ 58,968 $ 66,218 With the exception of the amount of service contracts and extended warranties, the Companys product category revenues are recognized at point in time when control transfers to customers. The following presents revenue based on timing of recognition: Year Ended May 29, May 30, May 31, (In thousands) 2026 2025 2024 Timing of revenue recognition: Products and services transferred at a point in time $ 46,820 $ 57,745 $ 64,590 Services transferred over time 3,181 1,223 1,628 $ 50,001 $ 58,968 $ 66,218 Contract Balances Accounts receivable are recognized in the period the Company delivers goods and provides servic …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

"17. SEGMENT INFORMATION The Company's chief executive officer, who is the chief operating decision maker (""CODM""), reviews discrete financial information presented at the consolidated basis, to assess performance and allocate resources. There are no segment managers who are held accountable for operations or operating results below the consolidated unit level. Accordingly, the Company has only one operating and reportable segment. The measure of segment profit or loss that our CODM uses to allocate resources and assess performance is our consolidated net income (loss). The information for revenue category by type, geography and timing of revenue recognition, is summarized in Note 11, Revenue. The CODM reviews consolidated expense information under the categories that are reported on the consolidated statement of operations, for the purpose of allocating resources and evaluating financial performance. Property and equipment information is based on the physical location of the assets. The following table presents property and equipment information for geographic areas: May 29, May 30, (In thousands) 2026 2025 United States $ 8,913 $ 8,892 International 27 77 Total property and equipment, net $ 8,940 $ 8,969 As of May 29, 2026, the operating lease right-of-use assets of $8.7 million and $0.2 million were allocated to the United States and international locations, respectively. As of May 30, 2025, the operating lease right-of-use assets of $9.3 million and $0.3 million were al …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

10. EQUITY On October 15, 2024, the Board of Directors authorized management to execute a new $100 million shelf registration, and a Registration Statement on Form S-3 was filed with the SEC. Additionally, a Prospectus Supplement for sales of $40 million of common stock pursuant to an At the Market (ATM) offering program was subsequently filed on October 29, 2024. In November 2025, the Company sold 384,380 shares of common stock at an average selling price of $25.89 per share. The gross proceeds to the Company were approximately $10.0 million, before professional fees of $0.6 million. In February 2026, the Company sold 269,439 shares of common stock at an average selling price of $39.20 per share. The gross proceeds to the Company were approximately $10.5 million, before professional fees of $0.3 million. In March 2026, the Company sold an additional 476,649 shares of common stock at an average selling price of $40.88 per share. The gross proceeds to the Company were approximately $19.5 million, before professional fees of $0.5 million. On April 7, 2026, the Board of Directors authorized the filing of an additional Prospectus Supplement for the sale of $60 million of its common stock pursuant to a new ATM offering program under the Companys existing $100 million shelf registration statement. In April 2026, the Company sold 812,185 shares of common stock at an average selling price of $73.87 per share. The gross proceeds to the Company were approximately $60.0 million, before …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

6. COMMITMENTS AND CONTINGENCIES Purchase Obligations The Company has purchase obligations to certain suppliers. In some cases, the products the Company purchases are unique and have provisions against cancellation of the order. Contingencies The Company may, from time to time, be involved in legal proceedings arising in the ordinary course of business. While there can be no assurances as to the ultimate outcome of any litigation involving the Company, management does not believe any pending legal proceedings will result in judgment or settlement that will have a material adverse effect on the Companys consolidated financial position, results of operations or cash flows. On December 3, 2024, a putative shareholder class action lawsuit captioned Lucid Alternative Fund, LP v. Aehr Test Systems, Inc. was filed in the United States District Court for the Northern District of California against the Company. The lawsuit alleged, in part, that the Company and certain of its executives made materially false and misleading statements regarding the Companys earnings guidance and other financial projections for 2024. The lawsuit sought unspecified monetary damages and purported to represent purchasers of the Companys securities between January 9, 2024 and March 24, 2024. On February 3, 2025, Lucid and individual investor Yue Guo each filed motions requesting appointment as lead plaintiff. On March 19, 2025, the court appointed Yue Guo, who was represented by Rosen Law, as lead plaintiff …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Three Months Ended Nine Months Ended February 27, February 28, February 27, February 28, (In thousands) 2026 2025 2026 2025 Asia $ 5,552 $ 5,472 $ 15,645 $ 27,875 United States 2,733 10,560 9,487 14,544 Europe and Middle East 2,028 2,275 6,034 2,460 $ 10,313 $ 18,307 $ 31,166 $ 44,879 Three Months Ended Nine Months Ended February 27, February 28, February 27, February 28, (In thousands) 2026 2025 2026 2025 Systems $ 5,782 $ 10,744 $ 17,521 $ 14,214 Contactors 3,003 5,937 9,060 26,606 Services 1,528 1,626 4,585 4,059 $ 10,313 $ 18,307 $ 31,166 $ 44,879 Three Months Ended Nine Months Ended February 27, February 28, February 27, February 28, (In thousands) 2026 2025 2026 2025 Timing of revenue recognition: Products and services transferred at a point in time $ 9,475 $ 18,067 $ 28,848 $ 44,215 Services transferred over time 838 240 2,318 664 $ 10,313 $ 18,307 $ 31,166 $ 44,879

DisaggregationOfRevenueTableTextBlock

9. STOCK-BASED COMPENSATION Stock-based compensation expense consists of expenses for stock options, restricted stock units (RSUs), performance RSUs (PRSUs), restricted shares, performance restricted shares and employee stock purchase plan (ESPP) purchase rights. Stock-based compensation expense for stock options and ESPP purchase rights is measured at each grant date, based on the fair value of the award using the Black-Scholes option valuation model, and is recognized as expense over the employees requisite service period. This model was developed for use in estimating the value of publicly traded options that have no vesting restrictions and are fully transferable. The Companys employee stock options have characteristics significantly different from those of publicly traded options. For RSUs, PRSUs, restricted shares and performance restricted shares, stock-based compensation expense is based on the fair value of the Companys common stock at the grant date and is recognized as expense over the employees requisite service period. All of the Companys stock-based compensation is accounted for as equity instruments. See Note 12 in the Companys Annual Report on Form 10-K for fiscal 2025 filed on July 28, 2025 for further information regarding the equity incentive plans and the ESPP. The following table summarizes the stock-based compensation expense for the three and nine months ended February 27, 2026 and February 28, 2025: Three Months Ended Nine Months Ended February 27, Feb …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

2. FAIR VALUE OF FINANCIAL INSTRUMENTS The Company measures its cash equivalents and money market funds at fair value on a recurring basis. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or a liability. Assets and liabilities recorded at fair value are measured and classified in accordance with a three-tier fair value hierarchy based on the observability of the inputs available in the market used to measure fair value: Level 1 Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 Inputs that are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant inputs are observable in the market or can be derived from observable market data. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs including interest rate curves, foreign exchange rates, and credit ratings. Level 3 Unobservable inputs that are supported by little or no market activities. The following table represents the Companys assets mea …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

4. GOODWILL AND PURCHASED INTANGIBLE ASSETS Goodwill There were no impairments to goodwill during the three and nine months ended February 27, 2026 and the three and nine months ended February 28, 2025. Purchased Intangible Assets The Companys purchased intangible assets, net, were as follows: February 27, 2026 May 30, 2025 (In thousands) Accumulated Accumulated Finite-lived intangible assets: Gross Amortization Net Gross Amortization Net Developed technology $ 9,130 $ (1,205 ) $ 7,925 $ 9,130 $ (634 ) $ 8,496 Trade names 1,050 (166 ) 884 1,050 (88 ) 962 Customer relationships 810 (117 ) 693 810 (61 ) 749 Non-compete agreements and others 1,010 (665 ) 345 1,010 (436 ) 574 Total $ 12,000 $ (2,153 ) $ 9,847 $ 12,000 $ (1,219 ) $ 10,781 Amortization expense related to purchased intangible assets with finite lives was $0.3 million and $0.9 million for the three and nine months ended February 27, 2026, respectively. Amortization expense was $0.4 million and $0.9 million for the three and nine months ended February 28, 2025, respectively. There were no impairments to purchased intangible assets during the three and nine months ended February 27, 2026 and the three and nine months ended February 28, 2025. As of February 27, 2026, the estimated future amortization expense of purchased intangible assets with finite lives is as follows: (In thousands) Amount Remainder of 2026 $ 295 2027 1,183 2028 981 2029 939 2030 939 2031 939 Thereafter 4,571 Total $ 9,847 …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

5. INCOME TAXES The following table provides details of income taxes: Three Months Ended Nine Months Ended February 27, February 28, February 27, February 28, (In thousands) 2026 2025 2026 2025 Loss before income tax benefit $ (4,001 ) $ (874 ) $ (11,281 ) $ (1,305 ) Income tax benefit $ (798 ) $ (231 ) $ (2,764 ) $ (294 ) Effective tax rate 19.9 % 26.4 % 24.5 % 22.5 % The Companys effective tax rate varies from the U.S. federal statutory rate of 21% primarily due to the tax deduction from stock-based compensation. During interim periods, tax expenses are recorded for jurisdictions that are anticipated to be profitable for fiscal 2026. The provision for income taxes for interim periods is based on the Companys estimated annual effective tax rate. For the three and nine months ended February 27, 2026 and the three and nine months ended February 28, 2025, the Company recognized income tax benefits primarily related to quarter-to-date and year-to-date losses in the United States. The Company accounts for uncertain tax positions consistent with authoritative guidance. The guidance prescribes a more likely than not recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company recognizes interest and penalties related to unrecognized tax benefits as a component of income taxes. …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

"In December 2023, the Financial Accounting Standards Board (""FASB"") issued Accounting Standards Update (""ASU"") 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands the disclosures in an entitys income tax rate reconciliation table and disclosures regarding cash taxes paid both in the United States and foreign jurisdictions. This ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendment should be applied on a prospective basis while retrospective application is permitted. The Company is currently evaluating the effect of this pronouncement on its disclosures. 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, an accounting standard update to improve income statement expenses disclosures. The standard requires more detailed information related to the types of expenses, including (among other items) the amounts of purchases of inventory, employee compensation, depreciation and intangible asset amortization included within each interim and annual income statements expense caption, as applicable. This authoritative guidance can be applied prospectively or retrospectively and will be effective for fiscal years beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the effect of this pronouncement …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

8. REVENUE Revenue recognition The Company recognizes revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services by following a five-step process: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price, and (5) recognize revenue when or as the Company satisfies a performance obligation, as further described below. Performance obligations include sales of systems, contactors, spare parts, as well as installation and training services included in customer contracts. A contracts transaction price is allocated to each distinct performance obligation. In determining the transaction price, the Company evaluates whether the price is subject to refund or adjustment to determine the net consideration to which the Company expects to be entitled. The Company generally does not grant return privileges, except for defective products during the warranty period. For contracts that contain multiple performance obligations, the Company allocates the transaction price to the performance obligations on a relative standalone selling price basis. Standalone selling prices are based on multiple factors including, but not limited to historical discounting trends for products and services and pricing practices in different geographies. Revenue for …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

13. SEGMENT AND CONCENTRATION INFORMATION Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or group, in deciding how to allocate resources and in assessing performance. The Companys chief operating decision maker, the chief executive officer, reviews discrete financial information presented on a consolidated basis for purposes of regularly making operating decisions and assessing financial performance. Accordingly, the Company considers itself to be in one operating segment. Property and equipment, net by geographic area are as follows: February 27, May 30, (In thousands) 2026 2025 United States $ 9,238 $ 8,892 International 39 77 Total property and equipment, net $ 9,277 $ 8,969 …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

7. SHAREHOLDERS EQUITY On October 15, 2024, the Board of Directors authorized management to execute a $100 million shelf registration, and a Registration Statement on Form S-3 was filed with the SEC. Additionally, a Prospectus Supplement for sales of $40 million of common stock pursuant to an ATM offering program was subsequently filed on October 29, 2024. In November 2025, the Company sold 384,380 shares of common stock at an average selling price of $25.89 per share. The gross proceeds to the Company were approximately $10.0 million, before commission fees of $0.3 million and offering expenses of $0.3 million. In February 2026, the Company sold 269,439 shares of common stock at an average selling price of $39.20 per share. The gross proceeds to the Company were approximately $10.5 million, before commission fees of $0.3 million and offering expenses of $49,000. As of February 27, 2026, the remaining amount of the ATM offering program was approximately $19.5 million. Subsequent to February 27, 2026, the Company sold an additional 476,649 shares of common stock at an average selling price of $40.88 per share. The gross proceeds to the Company were approximately $19.5 million, before commission fees of $0.5 million. The March 2026 sales fully utilized the remaining capacity under the current ATM offering program. …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing