BOF — what changed in the latest 10-Q

Text added vs the prior filing · source: 10-Q · 2026-08-13

• Despite improvements in production volumes, throughput and manufacturing efficiencies, including gains in uptime, yields and production flow, gross margins have decreased in both the first and second quarters of 2026, due to (i) increased downtime at the plant, and lower production levels during Jan…

• As the Company scales production to support new customer programs, initial production runs are often completed on a compressed procurement timeline to meet customer delivery requirements. As a result, raw materials may be purchased at prevailing market prices rather than through advance procurement,…

• Management intentionally prioritizes establishing new customer relationships and securing product placements with large retailers, recognizing that the economics of initial production runs may differ from those of recurring production. As customer demand becomes recurring, the Company expects to pro…

• Operating expenses primarily reflect costs associated with supporting our Peru Facility, growth initiatives to establish new customer relationships, distribution expansion and public company requirements. We continue to operate at a net loss and with negative working capital. Future operating perfor…

• In addition to gross margin calculated in accordance with U.S. generally accepted accounting principles (“GAAP”), we use adjusted gross margin, a non-GAAP supplemental measure to evaluate underlying manufacturing performance. Non-GAAP adjusted gross margin excludes depreciation included in cost of g…

Text removed vs the prior filing · source: 10-Q · 2026-05-14

• Gross margin performance continues to reflect underlying improvements in production volumes, throughput and manufacturing efficiencies, including gains in uptime, yields and production flow. However, on a quarter-over-quarter basis, gross margin declined due to increased downtime at the plant, lower…

• Our operating results for the current period continue to reflect the ongoing scale-up of internal manufacturing operations. Production levels have remained below normalized capacity during the scale-up phase. As a result, a portion of fixed manufacturing costs has not been fully absorbed into invent…

• Operating expenses primarily reflect costs associated with supporting our Peru Facility, growth initiatives, distribution expansion and public company requirements. We continue to operate at a net loss and with negative working capital. Future operating performance will depend on revenue growth, pro…

• In addition to gross margin calculated in accordance with U.S. generally accepted accounting principles (“GAAP”), we use adjusted gross margin, a non-GAAP supplemental measure to evaluate underlying manufacturing performance. Non-GAAP adjusted gross margin excludes depreciation included in cost of g…

• We believe adjusted gross margin provides additional visibility into the underlying unit economics of our manufacturing model during this scale-up phase. As the plant gains operating experience and throughput increases, we expect reported gross margin to improve as additional products achieve manufa…

Text added vs the prior filing · source: 10-Q · 2026-08-13

• As previously disclosed in Item 9A, “Controls and Procedures,” of our Annual Report on Form 10-K for the year ended December 31, 2025, management identified material weaknesses in our internal control over financial reporting. As a result of these material weaknesses, our Chief Executive Officer and…

• During the three months ended June 30, 2026, there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities…

Text removed vs the prior filing · source: 10-Q · 2026-05-14

• During the three months ended March 31, 2026, there were no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-…

Text added vs the prior filing · source: 10-Q · 2026-08-13

• We are party to a lawsuit filed by our former Chief Financial Officer alleging wrongful termination. The complaint was filed on June 25, 2025, in the Superior Court of the State of Washington in and for King County, and seeks damages and other relief. The parties have entered into a settlement agree…

Text removed vs the prior filing · source: 10-Q · 2026-05-14

• We are party to a lawsuit filed by our former Chief Financial Officer alleging wrongful termination. The complaint was filed on June 25, 2025, in the Superior Court of the State of Washington in and for King County, and seeks damages and other relief. We believe the claims are without merit and inte…