Financial Analysis

NOTE 16 - COMMITMENTS AND CONTINGENCIES We are subject to various claims that arise in the ordinary course of business. The Company believes that the Companys potential liability under such claims, individually and in the aggregate, will not have a material effect on the Companys consolidated financial statements. As of October 31, 2025, and October 31, 2024, the Company was not involved in environmental litigation to which a government was a party. …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

NOTE 8 - DEBT As of October 31, 2025 and October 31, 2024, the Current portion of long-term debt and the Long-term debt balances were comprised of finance leases as described below: October 31, 2025 October 31, 2024 Principal due: Next 12 months $ 11 17,972 Months 13 24 $ 12 12 Months 25 36 1 12 Months 37 48 - 1 Months 49 60 - - Long-term debt 13 25 Total debt $ 24 17,997 Interest rate at balance sheet date N/A N/A Basis spread on interest rates N/A N/A Interest rate reset N/A N/A Maturity date N/A N/A Periodic payment amount Varies as Lease matures Varies as Lease matures Periodic payment frequency Monthly Monthly Loan collateral (carrying amount) $ 1 (1) 32,293 (1) (1) Represents the carrying amount at the balance sheet date of the related ROU assets, in which the lessors have secured interests. Finance Leases In February 2021, the Company entered into a five-year $7.2 million finance lease for a high-end inspection tool. Monthly payments on the lease, which commenced in February 2021, were $0.1 million per month. Upon the fiftieth monthly payment and prior to payment of the fifty-first monthly payment, the Company could exercise an early buyout option to purchase the tool for $2.4 million. After the original term or any renewal periods, the Company could return the tool, elect to extend the lease, or purchase the tool at its fair market value. The Company exercised the early buyout option to purchase the tool for $2.4 million during the fiscal year 2025. In December 2020, …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following tables present the Companys revenue for the years ended October 31, 2025, October 31, 2024, and October 31, 2023, disaggregated by product type, geographic origin, and timing of recognition. Year Ended October 31, October 31, October 31, Revenue by Product Type 2025 2024 2023 IC High-end $ 238,865 $ 228,469 $ 194,939 Mainstream 376,239 409,682 456,340 Total IC $ 615,104 $ 638,151 $ 651,279 FPD High-end $ 195,520 $ 195,365 $ 200,842 Mainstream 38,670 33,430 39,955 Total FPD $ 234,190 $ 228,795 $ 240,797 $ 849,294 $ 866,946 $ 892,076 Year Ended Revenue by Geographic Origin* October 31, October 31, October 31, 2025 2024 2023 Taiwan $ 283,844 $ 288,275 $ 316,889 China 221,005 232,941 245,378 South Korea 158,524 158,017 162,235 United States 148,915 146,652 128,879 Europe 34,075 39,244 36,579 Other 2,931 1,817 2,116 $ 849,294 $ 866,946 $ 892,076 * This table disaggregates revenue by the location in which it was earned. Year Ended Revenue by Timing of Recognition October 31, October 31, October 31, 2025 2024 2023 Over time $ 818,404 $ 831,500 $ 838,628 At a point in time 30,890 35,446 53,448 $ 849,294 $ 866,946 $ 892,076 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

NOTE 12 - SHARE-BASED COMPENSATION On April 2, 2025, at its annual meeting of shareholders, the shareholders of Photronics, Inc., approved the Companys 2025 Equity Incentive Compensation Plan (the 2025 Plan) under which incentive stock options, non-qualified stock options, stock grants, stock-based awards, restricted stock, restricted stock units, stock appreciation rights, performance units, performance stock, and other stock or cash awards may be granted. The maximum number of shares of common stock that may be issued under the 2025 Plan is five million shares. At the time of approval of the 2025 Plan, the Companys 2016 Equity Incentive Compensation Plan (which was largely replicated by the 2025 Plan) was due to expire in early 2026 and had a limited quantity of shares remaining available for issuance. Awards may be granted to officers, employees, directors, consultants, advisors, and independent contractors of Photronics or its subsidiaries. In the event of a change in control (as defined in the 2025 Plan), the vesting of awards may be accelerated. The 2025 Plan prohibits further awards from being issued under prior plans. The table below presents information on the Companys share-based compensation expenses for the three most recent fiscal years. Year Ended October 31, October 31, October 31, 2025 2024 2023 Expense reported in: Cost of goods sold $ 3,233 $ 2,704 $ 1,259 Selling, general, and administrative 8,954 10,124 5,962 Research and development 1,201 1,062 780 Total …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

NOTE 21 - FAIR VALUE MEASUREMENTS The accounting framework for determining fair value includes a hierarchy for ranking the quality and reliability of the information used to measure fair value, which enables the reader of the financial statements to assess the inputs used to develop those measurements. The fair value hierarchy consists of three tiers as follows: Level 1- These are investments where values are based on unadjusted quoted prices for identical assets in an active market the Company has the ability to access. Level 2- These are investments where values are based on quoted market prices that are not active or model derived valuations in which all significant inputs are observable in active markets. Level 3- These are investments where values are derived from techniques in which one or more significant inputs are unobservable. The following are the major categories of assets measured at fair value on a recurring basis using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2) and significant unobservable inputs (Level 3): October 31, 2025 October 31, 2024 Cash and cash equivalents Short-term investments Total Fair Value Cash and cash equivalents Short-term investments Total Fair Value Cash $ 222,166 $ - $ 222,166 $ 414,074 $ - $ 414,074 Level 1 U.S. Government Securities 3,789 25,157 28,946 - - - Money market funds 11,159 - 11,159 36,322 - 36,322 Level 2 Commercial paper 30,747 2,259 33,006 - - - Time deposits …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

NOTE 14 INCOME TAXES On December 15, 2022, the European Union (EU) Member States formally adopted the EUs Pillar Two Directive, which generally provides for a minimum effective tax rate of 15%, as established by the Organization for Economic Co-operation and Development (OECD) Pillar Two Framework. The EU effective dates are January 1, 2024, and January 1, 2025, for different aspects of the directive. A significant number of other countries are expected to continue to implement similar legislation with varying effective dates. The Company is currently subject to Pillar Two, but we estimate that the financial impact is immaterial. We will continue to monitor further developments to determine any potential impact in the countries in which we operate. Income before the income tax provisions consists of the following: Year Ended October 31, 2025 October 31, 2024 October 31, 2023 United States $ 10,225 $ 20,145 $ (1,737 ) Foreign 211,559 227,270 271,683 $ 221,784 $ 247,415 $ 269,946 Income Tax Provision The components of our income tax provisions are presented below. Year Ended October 31, 2025 October 31, 2024 October 31, 2023 Current: Federal $ - $ - $ - State 60 95 14 Foreign 48,658 64,861 71,225 48,718 64,956 71,239 Deferred: Federal (14,320 ) - - State (731 ) 13 12 Foreign (2,117 ) (1,402 ) (939 ) (17,168 ) (1,389 ) (927 ) Total $ 31,550 $ 63,567 $ 70,312 The table below presents a reconciliation of income taxes calculated by applying the statutory U.S. federal income tax rat …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

NOTE 11 - LEASES The following table provides information on operating and finance leases included in the Companys consolidated balance sheets. Classification October 31, 2025 October 31, 2024 ROU Assets Operating Leases Other assets $ 5,976 $ 5,010 ROU Assets Finance Leases Property, plant and equipment, net $ 1 $ 32,293 Lease Liabilities Operating Leases Accrued liabilities $ 1,975 $ 1,925 Other liabilities 3,960 3,037 $ 5,935 $ 4,962 Lease Liabilities Finance Leases Current portion of long-term debt $ 11 $ 17,972 Long-term debt 13 25 $ 24 $ 17,997 The following table presents future lease payments under noncancelable operating and finance leases as of October 31, 2025. Imputed interest represents the difference between undiscounted cash flows and discounted cash flows. Fiscal Year Operating Leases Finance Leases 2026 $ 2,109 12 2027 1,686 12 2028 532 1 2029 216 - 2030 and thereafter 2,088 - Total lease payments $ 6,631 25 Imputed interest (696 ) (1 ) Lease liabilities $ 5,935 24 The following table presents lease costs for 2025, 2024, and 2023. Year Ended October 31, October 31, October 31, 2025 2024 2023 Operating lease costs $ 2,348 $ 2,255 $ 2,278 Short-term lease costs $ 1,280 $ 1,273 $ 462 Variable lease costs $ 599 $ 595 $ 656 Interest on finance lease $ 2 $ 330 $ 426 Amortization of ROU assets $ 19 $ 2,950 $ 2,870 The following table presents statistical information related to the Companys operating and finance leases. The information presented is as of the balance …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

Recent Accounting Pronouncements In November 2024, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update (ASU) No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03) and in January 2025, the FASB issued ASU No. 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date, which clarified the effective date of ASU 2024-03. ASU 2024-03 will require the Company to disclose the amounts of purchases of inventory, employee compensation, depreciation and intangible asset amortization, as applicable, as well as qualitatively describe remaining amounts included in those captions. The guidance in this ASU will be effective for Photronics in its fiscal year 2028 Form 10-K, with early application of the amendments allowed. The Company is currently evaluating the impact the adoption of this ASU may have on the Companys consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, to enhance the transparency and decision usefulness of income tax disclosures. The amendments in this ASU related to the rate reconciliation and income taxes paid disclosures to improve the transparency of income tax disclosures by requiring (1) consistent categories and …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

NOTE 13 - EMPLOYEE RETIREMENT PLANS The Company maintains a 401(k) Savings and Profit-Sharing Plan (401(k) Plan) which covers all full and certain part-time U.S. employees who have completed three months of service and are 18 years of age or older. Under the terms of the 401(k) Plan, employees may contribute up to 50% of their salary, subject to certain maximum amounts, which will be matched by the Company at 100% of the employee's contributions that are up to 4% of the employee's compensation. Employee and employer contributions vest immediately upon contribution. Contribution expense for the 401(k) plan was $1.2 million, $1.2 million, and $0.8 million in fiscal year 2025, 2024, and 2023, respectively. …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

NOTE 20 - RELATED PARTY TRANSACTIONS One of our executive officers is related to an individual in a position of authority at one of the Companys largest customers. The Company recorded revenue from this customer of $137.3 million, $127.0 million, and $126.5 million, in 2025, 2024, and 2023, respectively. As of October 31, 2025, and October 31, 2024, the Company had accounts receivable of $38.3 million and $38.8 million, respectively, from this customer. The Company believes the terms of the transactions described above were negotiated at arms length and were no less favorable to the Company than terms the Company could have obtained from unrelated third parties. …

RelatedPartyTransactionsDisclosureTextBlock · excerpt; the full note is in the filing

NOTE 10 - REVENUE The following tables present the Companys revenue for the years ended October 31, 2025, October 31, 2024, and October 31, 2023, disaggregated by product type, geographic origin, and timing of recognition. Year Ended October 31, October 31, October 31, Revenue by Product Type 2025 2024 2023 IC High-end $ 238,865 $ 228,469 $ 194,939 Mainstream 376,239 409,682 456,340 Total IC $ 615,104 $ 638,151 $ 651,279 FPD High-end $ 195,520 $ 195,365 $ 200,842 Mainstream 38,670 33,430 39,955 Total FPD $ 234,190 $ 228,795 $ 240,797 $ 849,294 $ 866,946 $ 892,076 Year Ended Revenue by Geographic Origin* October 31, October 31, October 31, 2025 2024 2023 Taiwan $ 283,844 $ 288,275 $ 316,889 China 221,005 232,941 245,378 South Korea 158,524 158,017 162,235 United States 148,915 146,652 128,879 Europe 34,075 39,244 36,579 Other 2,931 1,817 2,116 $ 849,294 $ 866,946 $ 892,076 * This table disaggregates revenue by the location in which it was earned. Year Ended Revenue by Timing of Recognition October 31, October 31, October 31, 2025 2024 2023 Over time $ 818,404 $ 831,500 $ 838,628 At a point in time 30,890 35,446 53,448 $ 849,294 $ 866,946 $ 892,076 Contract Assets and Contract Liabilities The following table provides information about the Companys contract balances at the balance sheet dates. October 31, October 31, Classification 2025 2024 Contract Assets Other current assets $ 12,670 $ 11,532 Contract Liabilities Accrued liabilities $ 9,491 $ 12,375 Other liabilities 5,041 8, …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

NOTE 18 - SEGMENT REPORTING The Company operates and manages its business as one operating and reportable segment based on the organizational structure of the Company and information reviewed by the Companys Chief Executive Officer, who is also the chief operating decision maker (CODM). The CODM allocates capital resources across the Companys entire asset base to maximize profitability without regard to geography, legal entity, or end market basis and evaluates the performance based on consolidated net income attributable to Photronics, Inc. shareholders . The following table presents selected financial information with respect to the Companys single operating segment for the years ended October 31, 2025, 2024, and 2023: Year Ended October 31, 2025 2024 2023 Revenues $ 849,294 $ 866,946 $ 892,076 Cost of goods sold (549,464 ) (551,000 ) (555,914 ) Gross Profit 299,830 315,946 336,162 Selling, general and administrative expense (75,625 ) (77,760 ) (69,458 ) Research and development expense (15,804 ) (16,576 ) (13,654 ) Other operating expense (240 ) (92 ) - Operating Income 208,161 221,518 253,050 Non-operating income, net 13,623 25,897 16,896 Income tax provision (31,550 ) (63,567 ) (70,312 ) Net income attributable to noncontrolling interests (53,829 ) (53,160 ) (74,149 ) Net income attributable to Photronics, Inc. shareholders 136,405 130,688 125,485 …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Business and Basis of Presentation Description of Business Photronics, Inc. (Photronics, the Company, we, our, or us) is one of the worlds leading manufacturers of photomasks, which are high-precision photographic quartz or glass plates containing microscopic images of electronic circuits. Photomasks are a key element in the manufacture of ICs and FPDs, and are used as masters to transfer circuit patterns onto semiconductor wafers and FPD substrates during the fabrication of integrated circuits, a variety of FPDs and, to a lesser extent, other types of electrical and optical components. The Company currently has eleven manufacturing facilities, located in Taiwan (3), China (2), South Korea (1), the United States (3), and Europe (2). Basis of Presentation The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). The accounting policies used to prepare these financial statements are the same as those used to prepare the consolidated financial statements in prior years, except as described in these notes or for the adoption of new standards as outlined below. Principles of Consolidation The accompanying consolidated financial statements include the accounts of Photronics, Inc., its wholly owned subsidiaries, in which Photronics is considered the primary beneficiary, and the majority-owned subsidiaries which it controls. A …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

NOTE 12 - COMMITMENTS AND CONTINGENCIES On July 6, 2026, a purported shareholder filed a class action complaint in the United States District Court for the District of Connecticut (Cooper v. Photronics, Inc., et al.: Case No. 3:26-cv-01069) against the Company and certain of its directors and officers alleging violations of Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated under Section 10(b). Plaintiff alleges that defendants made materially false and misleading statements related to the Companys business to deceive the market in violation of the Exchange Act. Plaintiff seeks unspecified damages, interest, attorneys fees, expert fees and other costs. The Company disputes these allegations and intends to vigorously defend the action. There are no accrued contingent liabilities recognized based on our belief that any liabilities, while reasonably possible, are not probable, and any possible loss or range of losses in these matters cannot be reasonably estimated at this time given the early stage of the matter. The Company is subject to various other claims that arise in the ordinary course of business. The Company believes that the potential liability under such other claims, individually and in the aggregate, will not have a material effect on the Companys condensed consolidated financial statements. …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

NOTE 7 - DEBT The balance of long-term debt and its current portion was comprised of the following finance leases as described below: August 2, 2026 October 31, 2025 Principal due: Next 12 months $ 3,889 $ 11 Months 13 24 $ 4 $ 12 Months 25 36 - 1 Months 37 48 - - Months 49 60 - - Long-term debt 4 13 Total debt $ 3,893 $ 24 Interest rate at balance sheet date N/A N/A Basis spread on interest rates N/A N/A Interest rate reset N/A N/A Maturity date N/A N/A Periodic payment amount Varies as Lease matures Varies as Lease matures Periodic payment frequency Varies Monthly Finance lease ROU assets (carrying amount) $ 3,882 (1) $ 1 (1) (1) Represents the carrying amount at the balance sheet date of the related ROU assets, in which the lessors have secured interests. Please refer to Note 5. Finance Lease During the second quarter of fiscal year 2026, the Company received a tool component associated with the purchase of an FPD lithography tool. Under the arrangement, the Company may either return or purchase the tool component from the vendor after a 12-month period. The Company has determined that the arrangement contains an embedded finance lease under ASC 842, as it contains an identified asset, has the right to direct the use of the asset and obtains substantially all the economic benefits from its use. …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following tables present the Companys revenue for the three months and nine months ended August 2, 2026, and August 3, 2025, disaggregated by product type, geographic origin, and timing of recognition. Three Months Ended Nine Months Ended Revenue by Product Type August 2, 2026 August 3, 2025 August 2, 2026 August 3, 2025 IC High-end $ 68,506 $ 53,648 $ 196,442 $ 173,053 Mainstream 86,165 94,176 271,027 284,605 Total IC $ 154,671 $ 147,824 $ 467,469 $ 457,658 FPD High-end $ 52,311 $ 53,486 $ 152,088 $ 146,778 Mainstream 9,065 9,084 31,497 29,088 Total FPD $ 61,376 $ 62,570 $ 183,585 $ 175,866 $ 216,047 $ 210,394 $ 651,054 $ 633,524 Three Months Ended Nine Months Ended Revenue by Geographic Origin * August 2, 2026 August 3, 2025 August 2, 2026 August 3, 2025 Taiwan $ 68,516 $ 68,429 $ 207,882 $ 216,524 China 53,013 50,618 176,330 162,919 South Korea 43,271 43,716 124,384 121,547 United States 40,127 37,754 111,686 105,379 Europe 10,215 9,050 28,045 25,143 Other 905 827 2,727 2,012 $ 216,047 $ 210,394 $ 651,054 $ 633,524 * This table disaggregates revenue by the location in which it was earned. Three Months Ended Nine Months Ended Revenue by Timing of Recognition August 2, 2026 August 3, 2025 August 2, 2026 August 3, 2025 Over time $ 205,855 $ 201,986 $ 627,718 $ 607,249 At a point in time 10,192 8,408 23,336 26,275 $ 216,047 $ 210,394 $ 651,054 $ 633,524 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

NOTE 9 - SHARE-BASED COMPENSATION On April 2, 2025, at its annual meeting of shareholders, the shareholders of Photronics, Inc., approved the Companys 2025 Equity Incentive Compensation Plan (the 2025 Plan) under which incentive stock options, non-qualified stock options, stock grants, stock-based awards, restricted stock, restricted stock units, stock appreciation rights, performance units, performance stock, and other stock or cash awards may be granted. The maximum number of shares of common stock that may be issued under the 2025 Plan is five million shares. Awards may be granted to officers, employees, directors, consultants, advisors, and independent contractors of Photronics or its subsidiaries. In the event of a change in control (as defined in the 2025 Plan), the vesting of awards may be accelerated. The 2025 Plan prohibits further awards from being issued under prior plans. The table below presents information on the Companys share-based compensation expenses. Three Months Ended Nine Months Ended August 2, 2026 August 3, 2025 August 2, 2026 August 3, 2025 Expense reported in: Cost of goods sold $ 977 $ 816 $ 2,801 $ 2,378 Selling, general, and administrative 2,729 2,174 7,869 6,729 Research and development 155 304 (233 ) 896 Total expense incurred $ 3,861 $ 3,294 $ 10,437 $ 10,003 Expense by award type: Restricted stock awards $ 2,275 $ 2,943 $ 6,516 $ 9,029 Restricted stock units 1,547 294 3,806 803 Employee stock purchase plan 39 57 115 171 Total expense incurred …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

NOTE 10 - INCOME TAXES The Company calculates its provision for income taxes at the end of each interim reporting period on the basis of an estimated annual effective tax rate adjusted for tax items that are discrete to each period. The table below sets forth the primary reasons that the Companys effective income tax rates differed from the U.S. statutory tax rates in effect during the periods ended August 2, 2026, and August 3, 2025. Reporting Period U.S. Statutory Tax Rates Photronics Effective Tax Rates Primary Reasons for Differences Three months ended August 2, 2026 21.0% 20.0% Tax credits in a non-U.S. jurisdiction more than offset the impact of higher statutory tax rates and changes in uncertain tax positions in non-U.S. jurisdictions. Three months ended August 3, 2025 21.0% 24.8% Non-recognition of the tax benefit of losses that, in certain jurisdictions, have been offset by valuation allowances, non-U.S. pre-tax income being taxed at higher statutory rates in the non-U.S. jurisdictions, and changes in uncertain tax positions in non-U.S. jurisdictions. Nine months ended August 2, 2026 21.0% 19.6% Tax credits in a non-U.S. jurisdiction more than offset the impact of higher statutory tax rates and changes in uncertain tax positions in non-U.S. jurisdictions. Nine months ended August 3, 2025 21.0% 23.5% Non-recognition of the tax benefit of losses that, in certain jurisdictions, have been offset by valuation allowances, non-U.S. pre-tax income being taxed at higher statu …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Recent Accounting Pronouncements In December 2025, the Financial Accounting Standards Board (the FASB) issued Accounting Standards Update (ASU) No. 2025-11, Interim Reporting (Topic 270): Narrow Scope Improvements, which improves the navigability of the required interim disclosures and clarifies when that guidance is applicable. The guidance in this ASU will be effective for Photronics for interim reporting periods in its first quarter of fiscal year 2028 Form 10-Q. The amendments can be applied either (1) prospectively or (2) retrospectively to any or all prior periods presented in the financial statements. The Company does not expect adoption of this ASU to have a material effect on the Companys consolidated financial statements and related disclosures. In December 2025, the FASB issued ASU No. 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. This update establishes authoritative guidance on the accounting for government grants received by business entities. The guidance in this ASU will be effective for Photronics in its fiscal year 2030 Form 10-K, with early application of the amendments allowed. The standard may be applied using a modified prospective, modified retrospective or full retrospective transition approach. The Company is currently evaluating the timing and impact of this ASU on the Companys consolidated financial statements and related disclosures. In November 2024, the FASB issued ASU No. 2024-03, Income …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

NOTE 8 - REVENUE The Company recognizes revenue when, or as, control of a good or service transfers to a customer, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring those goods or services. The Company accounts for an arrangement as a revenue contract when each party has approved and is committed to perform under the contract, the rights of the contracting parties regarding the goods or services to be transferred and the payment terms are identifiable, the arrangement has commercial substance, and collection of consideration is probable. Substantially all of the Companys revenue comes from the sales of photomasks. The Company typically contracts with its customers to sell sets of photomasks, which are comprised of multiple layers, the predominance of which the Company invoices as they ship to customers. As the photomasks are manufactured to customer specifications, they have no alternative use to the Company and, as the Companys contracts generally provide it with the right to payment for work completed to date, the Company recognizes revenue as it performs, or over time, on most of its contracts. The Company measures its performance to date using an input method, which is based on the Companys estimated costs to complete the various manufacturing phases of a photomask. At the end of a reporting period, there are a number of uncompleted revenue contracts on which the Company has performed; for any such contra …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

NOTE 15 - SEGMENT REPORTING The Company operates and manages its business as one operating and reportable segment based on the organizational structure of the Company and information reviewed by the Companys Chief Executive Officer, who is also the chief operating decision maker (CODM). The CODM allocates capital resources across the Companys entire asset base to maximize profitability without regard to geography, legal entity, or end market basis and evaluates the performance based on consolidated net income attributable to Photronics, Inc. shareholders. The following table presents selected financial information with respect to the Companys single operating segment for the periods ended August 2, 2026 and August 3, 2025: Three Months Ended Nine Months Ended August 2, 2026 August 3, 2025 August 2, 2026 August 3, 2025 Revenue $ 216,047 $ 210,394 $ 651,054 $ 633,524 Cost of goods sold (144,313 ) (139,539 ) (434,862 ) (409,228 ) Gross Profit 71,734 70,855 216,192 224,296 Selling, general and administrative expense (22,543 ) (18,423 ) (64,610 ) (55,624 ) Research and development expense (3,707 ) (4,271 ) (9,116 ) (12,618 ) Other operating income 20 - 76 - Operating Income 45,504 48,161 142,542 156,054 Other income (expense), net 9,368 (9,428 ) 40,718 (10,232 ) Income tax provision (10,989 ) (9,594 ) (35,950 ) (34,209 ) Net income attributable to noncontrolling interests (14,967 ) (6,248 ) (44,026 ) (37,009 ) Net income attributable to Photronics, Inc. shareholders $ 28,916 $ 22, …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing