Financial Analysis

"Commitments and Contingencies Commitments Leases: The Company primarily enters into leases for office space that are classified as operating leases. For the three months ended June 30, 2026 and 2025, total lease cost was $0.7 million and $0.7 million, respectively. For the six months ended June 30, 2026 and 2025, total lease cost was $1.5 million and $1.4 million, respectively. Total lease cost was primarily composed of operating lease costs. Purchase Commitments: The Company enters into inventory purchase commitments with third-party manufacturers in the ordinary course of business, including a non-cancellable inventory supply agreement with a certain third-party manufacturing vendor. The provisions of the agreement allowed the Company, once it reached a certain cumulative purchase threshold in the fourth quarter of 2021, to pay for a portion of the subsequent inventory purchases using an advance previously paid to the vendor. As of June 30, 2026, the aggregate amount of minimum inventory purchase commitments is $2.0 million, and the Company has a vendor advance asset of $0.4 million, net of write-downs, and an accrued purchase commitment liability of $0.1 million related to the agreement. The portion of the balances that is expected to be utilized in the next 12 months is included in current assets and current liabilities in the accompanying condensed consolidated balance sheets. The Company applied the guidance in Accounting Standards Codification Topic 330, Inventory to …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

The following table summarizes the Companys disaggregated revenue (in thousands): Pattern of Recognition Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 By type of good or service: Product Point-in-time $ 15,720 $ 16,621 $ 30,373 $ 30,785 Software and other services Over time 16,892 6,762 28,769 13,823 Total revenue $ 32,612 $ 23,383 $ 59,142 $ 44,608 By geographical market: United States $ 27,591 $ 17,540 $ 48,954 $ 34,579 International 5,021 5,843 10,188 10,029 Total revenue $ 32,612 $ 23,383 $ 59,142 $ 44,608 By business line: Core business $ 21,851 $ 21,387 $ 42,646 $ 40,303 Embedded 10,761 1,996 16,496 4,305 Total revenue $ 32,612 $ 23,383 $ 59,142 $ 44,608 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

"Stock-Based Compensation Equity Incentive Plans For the three and six months ended June 30, 2026, there were no significant changes to the Companys 2012 Employee, Director and Consultant Equity Incentive Plan, as amended, (the ""2012 Plan"") and the Companys Amended and Restated 2020 Equity Incentive Plan (the ""2020 Plan""). On January 1, 2026, pursuant to the terms of the 2020 Plan, the number of shares reserved for issuance was increased automatically by 4% of the number of outstanding shares of common stock as of January 1, 2026. Stock Option Activity The following table summarizes the changes in the Companys outstanding stock options: Number of Options Outstanding at December 31, 2025 5,551,227 Granted Exercised (1,662,938) Forfeited (1,706,317) Outstanding at June 30, 2026 2,181,972 Generally, each award vests based on continued service per the award agreement. The grant date fair value of the award is recognized as stock-based compensation expense over the requisite service period. The grant date fair value was determined using similar methods and assumptions as those previously disclosed by the Company. Restricted Stock Unit Activity The following table summarizes the changes in the Companys outstanding restricted stock units (""RSUs""): Number of RSUs Outstanding at December 31, 2025 21,538,563 Granted 8,016,481 Vested (7,704,480) Forfeited (1,649,105) Outstanding at June 30, 2026 20,201,459 Generally, each award vests based on continued service per the award agreem …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

"Fair Value of Financial Instruments Fair value estimates of financial instruments are made at a specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair value. The Company measures fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The Company utilizes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 Valuations based on quoted prices in active markets for identical assets or liabilities that an entity has the ability to access. Level 2 Valuations based on quoted prices for similar assets or liabilities, quoted prices for identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. Level 3 Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company has no assets or liabilities valued with Level 3 inputs. The carrying values of cash and cash equivalents, accounts re …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

"Recent Accounting Pronouncements Issued but Not Yet Adopted The Company considers the applicability and impact of all Accounting Standards Updates (""ASUs"") issued by the Financial Accounting Standards Board (""FASB""). ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Companys consolidated financial statements. In November 2024, the FASB issued ASU 2024-03, Income StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses , which introduced new guidance on disclosures of specified information about certain costs and expenses included within expenses presented on the face of the income statements, such as purchases of inventory and employee compensation. This guidance is effective for the Company for annual reporting periods beginning January 1, 2027 and interim reporting periods beginning January 1, 2028. The Company is currently evaluating the impact that the adoption of this pronouncement will have on the Company's consolidated financial statements and disclosures. In September 2025, the FASB issued ASU 2025-06, IntangiblesGoodwill and OtherInternal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software , which introduced new guidance to modernize the accounting for internal-use software development costs by removing references to prescriptive and sequential software development …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Revenue Recognition Disaggregation of Revenue The Company disaggregates revenue from contracts with customers by type of good or service, geographical market, and business line. For the business line disaggregation, the Company considers revenue from its core business to be all revenue generated by activities outside of its Embedded business line. The Company believes that these categories aggregate the payor types by nature, amount, timing, and uncertainty of its revenue streams. The following table summarizes the Companys disaggregated revenue (in thousands): Pattern of Recognition Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 By type of good or service: Product Point-in-time $ 15,720 $ 16,621 $ 30,373 $ 30,785 Software and other services Over time 16,892 6,762 28,769 13,823 Total revenue $ 32,612 $ 23,383 $ 59,142 $ 44,608 By geographical market: United States $ 27,591 $ 17,540 $ 48,954 $ 34,579 International 5,021 5,843 10,188 10,029 Total revenue $ 32,612 $ 23,383 $ 59,142 $ 44,608 By business line: Core business $ 21,851 $ 21,387 $ 42,646 $ 40,303 Embedded 10,761 1,996 16,496 4,305 Total revenue $ 32,612 $ 23,383 $ 59,142 $ 44,608 Contract Balances Contract balances represent amounts presented in the condensed consolidated balance sheets when the Company has either transferred goods or services to the customer or the customer has paid consideration to the Company under the contract. These contract balances include trade accounts receivable an …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

"Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in accordance with generally accepted accounting principles in the U.S. (""U.S. GAAP"") and the accounting disclosure rules and regulations of the SEC regarding interim financial reporting. Certain information and note disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the 2025 Annual Report on Form 10-K. All intercompany balances and transactions are eliminated upon consolidation. The condensed consolidated balance sheet as of December 31, 2025, included herein, was derived from the audited consolidated financial statements as of that date but does not include all disclosures, including certain notes, required by U.S. GAAP for annual reporting. In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal and recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods. The results for the three and six months ended June 30, 2026 are …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing