Financial Analysis

Acquisitions 4RF Limited On July 2, 2024, the Company acquired 4RF Limited (4RF), a New Zealand company, Aviat purchased all of the issued and outstanding shares of 4RF in an all-cash transaction for $18.2 million, net of $1.2 million cash acquired. 4RF is a leading provider of industrial wireless access solutions, including narrowband point-to-point/multi-point radios and Private LTE and 5G routers. The acquisition of 4RF allows Aviat to expand its product offering for the global industrial wireless access markets including Private LTE/5G. The 4RF acquisition was accounted for as a business combination using the acquisition method of accounting. During the fourth quarter of fiscal 2025, the Company finalized purchase accounting adjustments for the valuation of intangible and tangible assets acquired. The fair value of the acquired intangible assets are based on estimates and assumptions that are considered reasonable to the Company. A summary of the finalized purchase price allocation is as follows: Fair Value Useful Life in Years (In thousands) Cash and cash equivalents $ 1,215 Accounts receivable, net 2,575 Inventories 5,123 Property, plant and equipment, net 235 Identifiable finite-lived intangible assets: Customer relationships 7,100 10 Technology 1,800 7 Trade names 300 3 Other assets 4,647 Accounts payable (5,104) Advance payments and unearned revenue (323) Other liabilities (2,202) Goodwill 3,999 Net assets acquired $ 19,365 The final purchase price allocation was upd …

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Commitments and Contingencies Purchase Orders and Other Commitments From time to time in the normal course of business, the Company may enter into purchasing agreements with its suppliers that require the Company to accept delivery of and remit full payment for (i) finished products that it has ordered, (ii) finished products that it requested be held as safety stock, and (iii) work in process started on its behalf, in the event it cancels or terminates the purchasing agreement. Because these agreements do not specify fixed or minimum quantities, do not specify minimum or variable price provisions, and do not specify the approximate timing of the transaction, and the Company has no present intention to cancel or terminate any of these agreements, the Company currently does not believe that it has any future liability under these agreements. As of June 27, 2025, the Company had outstanding purchase obligations with its suppliers or contract manufacturers of approximately $48.1 million. In addition, the Company had purchase obligations of approximately $4.9 million associated with software as a service and software maintenance support. Financial Guarantees and Commercial Commitments Guarantees issued by banks, insurance companies, or other financial institutions are contingent commitments issued to guarantee performance under borrowing arrangements, such as bank overdraft facilities, tax and customs obligations, and similar transactions, or to ensure performance under customer …

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Credit Facility and Debt The Company entered into a Secured Credit Facility Agreement (the Credit Facility), dated May 9, 2023, amended as of November 22, 2023 and October 18, 2024, with Wells Fargo Bank, National Association, as administrative agent, swingline lender and issuing lender and Wells Fargo Securities LLC, Citigroup Global Markets Inc., and Regions Capital Markets as lenders. The Credit Facility provides for a $75.0 million revolving credit facility (the Revolver) and a $75.0 million Term Loan Facility (the Term Loan) with a maturity date of October 18, 2029. The $75.0 million Revolver can be borrowed with a $10.0 million sub-limit for letters of credit, and a $10.0 million swingline loan sub-limit. On August 28, 2025, the Company entered into an amendment under the Credit Facility to increase the Term Loan and Revolver commitments by $20 million for each instrument. Refer to Note 16. Subsequent Events for further information. In November 2023, the Company borrowed $50.0 million against the Term Loan to primarily settle the cash portion of the consideration associated with the NEC Transaction. Refer to Note 12. Acquisitions for further information. As of June 27, 2025, the available credit under the Revolver was $51.3 million, reflecting the available limit of $60.0 million less outstanding letters of credit of $8.7 million. The Company borrowed $95.0 million and repaid $80.0 million against the Revolver in fiscal 2025. The Company borrowed $75.0 million and repai …

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Fair Value Measurements of Assets and Liabilities Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal market (or most advantageous market in the absence of a principal market) for the asset or liability in an orderly transaction between market participants as of the measurement date. The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs in measuring fair value and established a three-level fair value hierarchy that prioritizes the observable inputs used to measure fair value. The three levels of inputs used to measure fair value are as follows: Level 1 Observable inputs such as quoted prices in active markets for identical assets or liabilities; Level 2 Observable market-based inputs or observable inputs that are corroborated by market data; and Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The estimated fair values and valuation input levels of financial assets and liabilities that are measured at fair value on a recurring basis as of June 27, 2025, and June 28, 2024, were as follows: Fair Value (In thousands) June 27, 2025 June 28, 2024 Valuation Inputs Assets: Cash and cash equivalents: Money market funds $ 2,782 $ 6,602 Level 1 Bank certificates of deposit 3,660 3,706 Level 2 Items are classified within Level 1 if quoted prices are available in active mark …

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Goodwill and Intangible Assets The following presents details of goodwill and intangible assets: (In thousands) June 27, 2025 June 28, 2024 Goodwill $ 19,655 $ 8,217 The $11.4 million increase in goodwill during fiscal 2025 is associated with the purchase price allocations for the 4RF acquisition and the NEC Transaction as described in Note 12. Acquisitions. The Company performs its annual goodwill impairment test on the first day of its fourth fiscal quarter. The fiscal 2025 annual goodwill impairment test did not result in an impairment. Useful life in Years June 27, 2025 June 28, 2024 Intangible assets: (in thousands) Technology 7 $4,998 $1,800 Patents 10 690 690 Customer relationships 10 - 15 24,022 11,530 Trade names 3 - 16 1,630 1,330 Total gross intangible assets 31,340 15,350 Accumulated amortization (4,443) (1,706) Total net intangible assets $26,897 $13,644 The $16.0 million increase in finite-lived intangible assets during fiscal 2025 is associated with the purchase price allocations for the 4RF acquisition and the NEC Transaction as described in Note 12. Acquisitions. Amortization of finite-lived intangibles for fiscal 2025, 2024 and 2023 was $2.7 million, $1.0 million and $0.7 million, respectively, and is included in selling and administrative expenses. There were no impairment charges recorded for fiscal 2025, 2024 and 2023. As of June 27, 2025, the estimated future amortization expense of finite-lived intangible assets is as follows (in thousands): (In thousan …

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Income Taxes Income before provision for income taxes during fiscal 2025, 2024 and 2023 consisted of the following: Fiscal Year (In thousands) 2025 2024 2023 United States $ 1,981 $ 16,741 $ 19,113 Foreign 1,595 165 2,201 Total income before income taxes $ 3,576 $ 16,906 $ 21,314 Provision for (benefit from) income taxes for fiscal 2025, 2024 and 2023 were summarized as follows: Fiscal Year (In thousands) 2025 2024 2023 Current: Federal $ 150 $ 54 $ Foreign 1,712 2,128 1,493 State and local 716 339 637 2,578 2,521 2,130 Deferred: Federal 1,143 4,613 8,450 Foreign (1,261) (2,035) (522) State and local (225) 1,047 1,087 (343) 3,625 9,015 Total provision for income taxes $ 2,235 $ 6,146 $ 11,145 The provision for income taxes differed from the amount computed by applying the federal statutory rate of 21% to the Companys income before provision for income taxes as follows: Fiscal Year (In thousands) 2025 2024 2023 Tax provision at statutory rate $ 751 $ 3,550 $ 4,476 Valuation allowances (1,949) (2,354) 302 Permanent differences 66 (20) 19 Foreign income inclusions 63 654 319 Effect of flow-through entities 157 (29) 409 Transaction costs 1,092 746 State and local taxes, net of U.S. federal tax benefit 341 877 980 Foreign income taxed at rates different than the U.S. statutory rate 805 411 233 Executive compensation limitation 343 729 663 Share-based compensation 583 (339) (728) Tax credit - generated and expired (88) (125) (140) Foreign withholding taxes 698 698 88 Change in unce …

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Leases The Company leases office space, assembly facilities, repair and service centers, and warehouses globally. Operating lease right-of-use assets and lease liabilities are recognized with initial lease terms greater than one year. Leases with an initial term of 12 months or less are not recognized on the consolidated balance sheets. Lease expense is recognized on a straight-line basis over the lease term. Supplemental lease information is as follows: Fiscal (In thousands) 2025 2024 Operating lease cost $ 1,790 $ 1,114 Short-term lease cost 5,801 3,065 Variable lease cost 83 249 Total lease cost $ 7,674 $ 4,428 Fiscal (In thousands, except for weighted-average) 2025 2024 Weighted-average remaining lease term 4.8 years 5.7 years Weighted-average discount rate 5.0 % 5.2 % Right-of-use assets obtained in exchange for operating lease liabilities $ 726 $ 2,105 Cash paid for operating lease liabilities $ 1,731 $ 1,044 As of June 27, 2025, future minimum lease payments under all non-cancelable operating leases with an initial term greater than one year are as follows (in thousands): 2026 $ 1,385 2027 646 2028 543 2029 308 2030 190 Thereafter 838 Total lease payments 3,910 Less: interest (579) Present value of lease liabilities $ 3,331

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Recently Adopted Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly presented to the chief operating decision maker. The disclosures required under ASU 2023-07 are also required for public entities with a single reportable segment. ASU 2023-07 is effective for the Companys annual reporting beginning in fiscal 2025 and for interim periods beginning in fiscal 2026. The Company adopted ASU 2023-07 for the year ended June 27, 2025. The adoption of this standard does not have a material impact on the Companys consolidated financial statements. Accounting Standards Not Yet Adopted In December 2023, the FASB issued Accounting Standards Update (ASU) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU enhances the transparency and usefulness of income tax information through improvements to disclosures primarily related to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for the Companys annual reporting beginning in fiscal 2026. The Company is currently evaluating the impact of this ASU on its consolidated financial statements. The Company considers the applicability and impact of all ASUs issued by the FASB. The Company determined at this time that all other ASUs issue …

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Related Party Transactions NEC Corporation On November 30, 2023 (the Closing Date), the Company completed the NEC Transaction. Refer to Note 12. Acquisitions for further information. A portion of the total consideration in the NEC Transaction included the issuance of 736,750 shares in Company common stock to NEC. The Company and NEC entered into a Registration Rights and Lock-Up Agreement, restricting NECs ability to transfer shares (the Lock-Up), except for certain limited exceptions as provided in the Registration Rights and Lock-Up Agreement, until one day after the one-year anniversary of the Closing Date (the Initial Lock-Up Expiration Date). Starting one day after the Initial Lock-Up Expiration Date, one-twelfth of the issued shares shall be released from the Lock-Up each month, such that all issued shares shall be released from Lock-Up by the two-year anniversary of the Closing Date. Pursuant to the Purchase Agreement, NEC will have the right to nominate a director to the Companys Board of Directors from the Closing Date and for a period of two years thereafter. As of June 27, 2025, NEC held approximately 5.8% of the Companys outstanding common stock. In connection with the closing of the NEC Transaction and as of the Closing Date, the Company and NEC entered into agreements covering the performance of certain post-closing services and licensing arrangements. The agreements include arrangements covering manufacturing services and product supply, transition services, di …

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Restructuring Activities The following table summarizes restructuring related activities during fiscal 2025, 2024 and 2023: (In thousands) Employee Severance and Benefits Balance as of July 1, 2022 $ 1,381 Charges, net 2,947 Cash payments (3,728) Balance as of June 30, 2023 600 Charges, net 3,901 Cash payments (2,783) Balance as of June 28, 2024 1,718 Charges, net 3,611 Cash payments (3,572) Balance as of June 27, 2025 $ 1,757 As of June 27, 2025, the accrued restructuring balance of $1.8 million was included in other current liabilities on the consolidated balance sheets. Included in the above were positions identified for termination that have not been executed from a restructuring perspective. The other activities primarily represent the impact of foreign currency movement. Fiscal 2025 Plans During fiscal 2025, the Companys Board of Directors approved restructuring plans, primarily associated with reductions in workforce in certain of the Companys operations to optimize skill sets and align cost structure and reductions associated with the NEC Transaction and 4RF acquisition. The fiscal 2025 plans are expected to be completed through the end of fiscal 2026. Prior Fiscal Years Plans Activities under the prior fiscal years plans primarily included reductions in workforce across the Company associated with the NEC Transaction and reductions in workforce in certain of the Companys operations to optimize skill sets and align cost structure. Payments related to the accrued restr …

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Revenue Recognition We recognize revenue by applying the following five-step approach: (1) identification of the contract with a customer; (2) identification of the performance obligations in the contract; (3) determination of the transaction price; (4) allocation of the transaction price to the performance obligations in the contract; and (5) recognition of revenue when, or as, we satisfy a performance obligation. Contracts and customer purchase orders are used to determine the existence of an arrangement. Many of the Companys arrangements with customers contain multiple performance obligations and therefore promises to provide multiple goods and services. The Company evaluates each promised good and service in a contract to determine whether it represents a distinct performance obligation or should be accounted for as a combined performance obligation. For goods and services determined to be distinct we have concluded that they provide a benefit to the customer either on their own or together with other resources that are readily available to the customer, without having the need for significant integration or customization. Revenue from product sales, recognized at a point-in-time, is generated predominately from the sales of products manufactured by third-party manufacturers to whom we have outsourced our manufacturing processes. Printed circuit assemblies, mechanical housings, and packaged modules are manufactured by contract manufacturing partners, with periodic busines …

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Segment and Geographic Information Aviat operates in one reportable business segment: the design, manufacturing and sale of a range of wireless networking and access networking products, solutions and services. Aviat conducts business globally and its sales and support activities are managed on a geographic basis. The Companys Chief Executive Officer (CEO) is the Chief Operating Decision Maker (the CODM). The CODM manages the business primarily by function globally and reviews financial information on a consolidated basis, accompanied by disaggregated information about revenues by geographic region, for purposes of allocating resources and evaluating financial performance. The profitability of geographic regions is not a determining factor in allocating resources and the CODM does not evaluate profitability below the level of the consolidated company. Significant segment expenses are presented in Aviats consolidated statement of operations. The Company reports revenue by region and country based on the location where customers accept delivery of products and services. Revenue by region for fiscal 2025, 2024 and 2023 were as follows: Fiscal Year (In thousands) 2025 2024 2023 North America $ 207,606 $ 206,073 $ 200,678 Africa and Middle East 49,428 48,884 59,674 Europe 31,713 24,608 18,772 Latin America and Asia Pacific 145,859 128,518 65,309 Total Revenue $ 434,606 $ 408,083 $ 344,433 Revenue by country comprising more than 10% of total revenue for fiscal 2025, 2024 and 2023 w …

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Stockholders Equity Stock Repurchase Program In November 2021, the Companys Board of Directors authorized a stock repurchase program to purchase up to $10.0 million of the Companys common stock. As of June 27, 2025, $6.3 million remained available for repurchase under the November 2021 stock repurchase program. Repurchased shares are recorded as treasury stock and are not formally retired. The following table summarizes the Companys repurchases of its common stock in fiscal 2025, 2024 and 2023: Shares Purchased Average Price Paid Per Share Aggregate Purchase Amount (In thousands) Fiscal 2025 39,800 $ 15.46 $ 598 Fiscal 2024 11,208 $ 29.59 $ 332 Fiscal 2023 $ $ Stock Incentive Programs In March 2018, the Companys stockholders approved the 2018 Incentive Plan (the 2018 Plan). The 2018 Plan permits the Company to grant share-based awards in the form of options, stock appreciation rights, restricted stock awards and units (restricted stock) and performance share awards and units (performance shares) to the Companys employees and non-employee directors. The 2018 Plan replaced the 2007 Plan as the Companys primary long-term incentive program. The 2007 Plan was discontinued following stockholder approval of the 2018 Plan, but the outstanding awards under the 2007 Plan will continue to remain in effect in accordance with their terms; provided that, as shares are returned under the 2007 Plan upon cancellation, termination or otherwise of awards outstanding under the 2007 Plan, such sh …

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Subsequent Events On August 13, 2025, NEC issued a letter of arbitration to the Company demanding $19 million of additional component purchases, which the Company believes is unfounded and not required under the Manufacturing Supply Agreement (MSA). The NEC arbitration also included a demand for payment of the outstanding accounts payable balances which are reflected in Accounts payable of the Companys consolidated balance sheets and disclosed in Note. 15 Related Party Transactions. As of June 27, 2025, the Company cannot predict the outcome of these matters. As such, no loss accrual is deemed necessary as of June 27, 2025. The Company will continue to evaluate the proceedings and the expected outcome of this matter. On August 28, 2025, the Company entered into an amendment for the Credit Facility. The amendment provided for changes and modifications to the Credit Facility, which include an increase in the Term Loan commitments by $20 million in the aggregate and an increase in the Revolver commitment by $20 million in the aggregate. …

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