Summary of Significant Accounting Policies and Estimates

9 Months Ended

Sep. 30, 2025

Accounting Policies [Abstract]

Summary of Significant Accounting Policies and Estimates

Summary of Significant Accounting Policies and Estimates

Basis of Financial Statement Presentation

The condensed consolidated financial statements include the accounts of Caris and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

The Company’s condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASUs”) of the Financial Accounting Standards Board (“FASB”).

Unaudited Interim Consolidated Financial Information

The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and reflect, in the opinion of management, all adjustments of a normal and recurring nature that are necessary for the fair statement of the Company’s financial position as of September 30, 2025, its results of operations for the three and nine months ended September 30, 2025 and 2024, and cash flows for the nine months ended September 30, 2025 and 2024. The results of operations for the nine months ended September 30, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025, or for any other future annual or interim period. The condensed consolidated balance sheet as of December 31, 2024 included herein was derived from the audited financial statements as of that date and should be read in conjunction with the audited annual consolidated financial statements. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with GAAP have been condensed or omitted from these unaudited condensed consolidated financial statements.

Pre-IPO Financing

On April 1, 2025, the Company closed a private financing in which we issued a combination of senior convertible notes (the “2025 Convertible Notes”) with warrants (the “2025 Warrants”) to acquire shares of common stock, Series E redeemable convertible preferred stock (“Series E Preferred Stock”) and Series F redeemable convertible preferred stock (“Series F Preferred Stock”), for an aggregate of $167.7 million. Investors in the private financing generally participated in each of the instruments. The 2025 Convertible Notes had an aggregate principal amount of $30.0 million. The 2025 Convertible Notes accrued interest at a rate of 8% per annum, payable quarterly in cash, and were scheduled to mature on January 1, 2026. The 2025 Warrants were not initially exercisable for any shares of common stock, but such warrants became exercisable for a specified dollar value of shares on a monthly basis commencing on June 1, 2025 if we had not completed an IPO by such date. The Series E Preferred Stock and Series F Preferred Stock both were issued at an original issue price of $8.10 per share for gross proceeds of approximately $137.7 million. Additionally, the gross proceeds of

$167.7 million, less issuance costs of $8.3 million, were allocated as follows: $27.9 million to the 2025 Convertible Notes, $10.3 million to the 2025 Warrants, $87.6 million to the Series E Preferred Stock, and $33.6 million to the Series F Preferred Stock.

Upon the closing of the IPO, the 2025 Convertible Notes (plus accrued interest), Series E Preferred Stock and Series F Preferred Stock (plus an 8% accrued dividend in connection with the preferred stock) converted into common stock at a price equal to 70% of the initial public offering price per share. Although structured and referred to as a legal-form conversion, this feature effectively functions as a share-settled redemption provision for accounting purposes.

Reverse Stock Split

Effective June 1, 2025, the Company’s Board approved a one-for-four reverse stock split of the Company’s common stock. This also resulted in an adjustment to the conversion price for each series of the Company’s convertible preferred stock, to the underlying number of shares outstanding with respect to the restricted stock units, and to the exercise prices and number of shares of common stock underlying the outstanding stock options and warrants. Accordingly, all share and per share information relating to common stock for all periods presented in the accompanying consolidated financial statements and notes thereto have been retroactively adjusted. The shares of common stock retain a par value of $0.001 per share. Accordingly, an amount equal to the excess was reclassified from common stock to additional paid-in capital or, in the absence of additional paid-in-capital, accumulated deficit.

Initial Public Offering

On June 20, 2025, the Company completed its IPO of common stock, in which the Company issued and sold 23,529,412 shares of its common stock at an IPO price of $21.00 per share, which resulted in net proceeds of $459.5 million after deducting underwriting discounts and commissions of $39.8 million and before deducting offering costs of $9.0 million. Additionally, on June 25, 2025, the underwriters exercised in full their over-allotment option and purchased from the Company an additional 3,529,411 shares of common stock at the IPO price, which resulted in net proceeds to the Company of $68.9 million after deducting discounts and commissions.

An amended and restated certificate of formation, which authorized 2,800,000,000 shares of common stock and 100,000,000 shares of preferred stock, became effective on June 20, 2025 in connection with the closing of the Company’s initial public offering (“IPO”). As of September 30, 2025, no shares of preferred stock are outstanding.

In connection with the IPO, all outstanding shares of the Company’s then-outstanding redeemable convertible preferred stock, inclusive of accrued dividends, automatically converted into 211,378,638 shares of common stock. Refer to Note 6 for additional information. Additionally, all of the Company’s then-outstanding 2025 Convertible Notes converted into an aggregate of 2,076,596 shares of common stock upon the IPO. As the IPO was not completed by June 1, 2025, 784,231 shares of common stock were issued on June 20, 2025 at an exercise price of $0.04 per share in connection with the automatic net exercise of the warrants issued in connection with the 2025 Convertible Notes. Lastly, the 2018 and 2020 warrants were net exercised into 4,174,907 shares of common stock as outlined in the terms of the applicable warrant agreements.

In connection with the IPO, the Company recognized $19.5 million of stock-based compensation expense due to vesting of previously-granted restricted stock units. The vesting of such restricted stock units was contingent upon the Company completing either an IPO of its common stock or through a change of control. The vested restricted stock units were settled in August 2025. Refer to Note 7 for additional information.

Prior to the IPO, deferred offering costs, which consisted of accounting, legal and other fees directly related to the IPO, were capitalized as prepaid expenses and other current assets on the condensed consolidated balance sheets. In connection with the IPO, $9.0 million of deferred offering costs were reclassified to additional paid-in capital as a reduction of the net proceeds received from the IPO.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP in the United States requires the use of estimates and assumptions about future events that affect the amounts reported in the Company's condensed consolidated financial statements and related notes, including the amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenues and expenses during the periods reported.

Significant estimates and assumptions are used for, but not limited to:

•revenue recognition

•fair value of stock-based awards and common stock

•fair value of financial assets and liabilities

Future events and their effects cannot be predicted with certainty. Accordingly, the accounting estimates require the exercise of judgment. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. The accounting estimates used in the preparation of the Company’s condensed consolidated financial statements may change as new events occur, additional information is obtained, and the operating environment changes. The Company will evaluate and update the assumptions and estimates on an ongoing basis and may employ outside experts to assist in its evaluation, as considered necessary. Actual results could materially differ from those estimates.

Cash, Cash Equivalents, and Restricted Cash

The Company considers all highly liquid investments with original maturities of three months or less from date of acquisition to be cash equivalents. Refer to Note 4 for information on the Company's restricted cash.

Revenue Recognition

The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). Revenue is recognized when control of goods and services are transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services.

ASC 606 provides for a five-step model that includes:

Step 1: Identify the contract(s) with a customer.

Step 2: Identify performance obligations in the contract.

Step 3: Determine the transaction price.

Step 4: Allocate the transaction price to the performance obligations in the contract.

Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

The Company derives revenue from two distinct channels:

•Molecular profiling services involving the provision of precision oncology solutions utilizing MI Profile and Caris Assure

•Pharma research and development services involving delivery of laboratory, strategic data, and research services to biopharmaceutical customers

Molecular Profiling Services

For the majority of its molecular profiling services, the Company recognizes revenue from the sale of its precision oncology solutions, provided to customers, including certain hospitals, institutions and patients, at the point in time when the results of the profiling services are delivered to ordering physicians. Most cases requested on behalf of customers are provided without a written agreement; however, the Company determines that an implied contract exists with its customers for whom a physician orders the case. Results from molecular profiling services are delivered via fax, electronically, or in hard copy. Shipping and handling activities are considered fulfillment activities and as such, amounts incurred are recorded within Cost of Services - Molecular profiling services on the condensed consolidated statements of operations and comprehensive loss. The Company identifies each sale of the Company's profiling service as a distinct performance obligation. Payment terms are a function of a patient’s existing insurance benefits and applicable reimbursement contracts established between the Company and payers. Collection of consideration the Company expects to receive typically occurs within 90 to 120 days of billing. Occasionally, payers may recoup or we may refund consideration, mainly as a result of claim processing.

The total consideration to which the Company expects to be entitled in exchange for the Company’s services may be fixed or variable. Consideration includes reimbursement from patients, hospitals, and third-party commercial and governmental payers, such as insurance companies, adjusted for variable consideration related to implicit price concessions that the Company may grant. The Company estimates the variable consideration under a portfolio approach

for third-party payers, hospitals and patients with similar reimbursement characteristics. This includes analysis of an average reimbursement per case per portfolio and a percentage of cases reimbursed by considering the historical reimbursement data (including any refunds and recoupments) from such third-party payers, hospitals and patients. Specifically, the Company calculates the historical average reimbursement rates for each portfolio and applies an estimated reimbursement rate, based on historical trends, to the number of cases delivered each period. The period for which historical data is drawn upon is determined on a by- portfolio basis for each payer group, taking into consideration the average collection period. Additionally, the estimate also considers current contractual and statutory requirements, patient insurance eligibility and payer reimbursement contracts, and any known current or anticipated reimbursement trends not reflected in the historical data and only recognizes revenue for variable consideration that the Company determines is probable will not result in a significant reversal in the future. The Company monitors the estimated amount to be collected at each reporting period based on actual cash collections in order to assess whether a revision to the estimate is required. Subsequent changes to the estimate of the transaction price are recorded as adjustments to molecular profiling services revenue in the period where such changes occur. Both the estimate and any subsequent revision are uncertain and require the use of management’s judgment in the estimation of the variable consideration and application of the constraint for such variable consideration.

Pharma Research and Development Services

The Company collaborates with biopharmaceutical companies to provide commercial services and prospective and retrospective testing, along with data and bioinformatics collaborations and novel target identification and discovery solutions.

Contracts with biopharmaceutical customers may include multiple distinct performance obligations, such as molecular profiling services, pharma research and development services, and strategic data services. The Company evaluates the terms and conditions included within its contracts with biopharmaceutical customers for proper revenue recognition, including whether services are capable of being distinct and considered distinct within the context of the contract. The performance obligations for biopharmaceutical customers vary by contract. Such contracts may include a performance obligation to provide molecular profiling services, to facilitate the development and regulatory approval of drugs, or to provide target discovery services. Under those contracts, the Company receives payments upon the achievement of milestones, as well as provision of on-going support. The transaction price of the development services contracts may include variable consideration, due to the uncertainty associated with the achievement of the milestones. In making the assessment of whether variable consideration should be included in the transaction price, the Company considers its historical experience with similar milestones, the degree of complexity and uncertainty associated with each milestone, and whether achievement of the milestone is dependent on parties other than the Company. The Company recognizes pharma research and development services revenue over the period in which biopharmaceutical research and development services are provided. Depending on the nature of the service, the Company recognizes revenue using either the output or input method to measure progress, whichever provides a more faithful depiction of the transfer of goods or services. Use of an output method or input method to depict the transfer of services generally does not result in a material difference with respect to the timing of revenue recognition because most services commence and end within the same reporting period. A constraint for variable consideration is applied such that it is probable a significant reversal of revenue will not occur when the uncertainty associated with the contingency is resolved. Application of the constraint for variable consideration is updated at each reporting period as a revision to the estimated transaction price.

Standalone Selling Price

The Company determines standalone selling prices by considering the historical selling prices of its performance obligations in similar transactions, where applicable, as well as other factors, including, but not limited to, the price that customers in the market would be willing to pay, competitive pricing from other vendors, industry publications, current pricing practices and management estimates.

Contract Balances

The timing of revenue recognition may differ from the timing of invoicing to customers. Accounts receivable are recorded at the invoiced amount, net of an allowance for credit losses. A receivable is recognized in the period the Company delivers goods or provides services, or when the right to consideration is unconditional. In situations where revenue recognition occurs before invoicing, an unbilled receivable is created, which represents a contract asset. As of September 30, 2025 and December 31, 2024, the unbilled receivable balance was $9.9 million and $4.6 million, respectively, which is included in accounts receivable on the condensed consolidated balance sheets.

The Company recognizes contract liabilities primarily related to payments received in advance of satisfaction of performance obligations from contracts with customers. Contract liabilities are relieved as the Company fulfills its obligations under the contract and revenue is recognized. As of September 30, 2025 and December 31, 2024, the contract liability balance was $2.8 million and $7.5 million, respectively, which is included in accrued expenses and other current liabilities on the condensed consolidated balance sheets.

The following table shows the changes in the contract liabilities during the period:

	(amounts in thousands)
Balance at December 31, 2024	$	7,470
Increase in contract liabilities	7,903
Revenue recognized during the period that was included in deferred revenues at the beginning of the period	(7,093)
Revenue recognized from performance obligations satisfied within the same period	(5,489)
Balance at September 30, 2025	$	2,791

The amount of revenue recognized during the nine months ended September 30, 2024 pertaining to amounts deferred as of December 31, 2023 was $5.2 million.

Transaction Price Allocated to Remaining Performance Obligations

The transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes contract liabilities and non-cancelable amounts that will be invoiced and recognized as revenue in future periods and excludes performance obligations that are subject to cancellation terms. The Company has elected not to disclose information regarding the transaction price allocated to the remaining performance obligations for which the original expected duration of the contract is one year or less. The amount of transaction price allocated to the remaining performance obligations for contracts with original expected duration over one year as of September 30, 2025 was $9.1 million. The Company expects to recognize the amount within twelve months from the respective balance sheet dates.

Additionally, for the three months ended September 30, 2025 and 2024, the Company recorded $38.3 million and $6.8 million, respectively, of adjustments to revenue related to services delivered in prior periods, which is based on variability that was subsequently resolved. For the nine months ended September 30, 2025 and 2024, the Company recorded $23.4 million and $2.9 million, respectively, of adjustments to revenue related to services delivered in prior periods, which is based on variability that was subsequently resolved.

Practical Expedients and Contract Costs

Payment terms and conditions vary by contract and customer. In instances where the timing of the Company’s revenue recognition differs from the timing of its invoicing, the Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the customer and the transfer of the promised services to the customer will be one year or less.

As a practical expedient, the Company recognizes the incremental costs of obtaining contracts, such as sales commissions, as expenses when incurred, if the amortization period of the asset that the Company otherwise would have recognized for the capitalized costs is one year or less. Sales commissions are recorded within selling and marketing expense on the condensed consolidated statements of operations and comprehensive loss. The Company did not capitalize any sales commissions or contract fulfillment costs as of September 30, 2025 and December 31, 2024.

Collaboration Agreements

The Company is party to various collaboration and licensing agreements under which the Company out-licenses certain know-how and molecular data. The collaboration arrangements are intended to solidify the Company’s third-party partnerships to align oncology capabilities and create industry-leading molecular oncology research platforms to accelerate drug development and novel research. Under these collaboration arrangements, the Company generally receives a split of fees from its collaborative partners that are earned pursuant to statements of work (“SOWs”) executed with end users of the Company’s licensed molecular data.

The Company’s collaboration and licensing agreements are within the scope of ASC Topic 808, Collaborative Arrangements (“ASC 808”) and ASC 606 because the counterparty to these agreements meets the definition of a customer. As such, the Company recognizes revenue earned from the licenses of molecular data granted to the Company’s collaborative partners in accordance with ASC 606. Each license of molecular data granted by the Company to a collaborative partner represents a distinct performance obligation in the contract. The transaction price for a given arrangement is entirely variable and depends on the SOWs executed by the counterparty with end users. The amount of revenue allocated to each license is equal to the amount of revenue to which the Company expects to be entitled. The Company recognizes revenue at the point in time that it delivers the molecular data to the third-party collaborative partner. For the three months ended September 30, 2025 and 2024, the Company recognized collaboration revenue of $— million and $2.5 million, respectively, and $6.9 million and $9.1 million for the nine months ended September 30, 2025 and 2024, respectively, which is included in revenue from pharma research and development services on the condensed consolidated statements of operations and comprehensive loss.

Cost of Services - Molecular profiling services

Cost of services for molecular profiling services generally consists of cost of materials, direct labor including bonus and stock-based compensation, and equipment maintenance and depreciation expenses associated with processing cases (including accessioning, sequencing, quality control analyses and shipping charges to transport tissue samples), freight and profile results for ordering physicians. Costs associated with completing the molecular profiling services are recorded as the service is performed, regardless of when revenue is recognized with respect to the service.

Cost of Services - Pharma research and development services

Cost of services for pharma research and development services generally consists of cost incurred for the performance of the services requested by the Company's biopharmaceutical customers related to the delivery of laboratory, strategic data and research services, and will vary depending on the nature, timing, and scope of customer projects. Costs associated with delivering pharma research and development services are recorded as incurred.

Concentration of Credit Risk

Financial instruments that potentially expose the Company to concentration of credit risk consist primarily of cash, cash equivalents, marketable securities, and accounts receivable. The Company maintains its cash primarily with domestic financial institutions of high credit quality, with balances that exceed amounts insured by the Federal Deposit Insurance Corporation as of September 30, 2025 and December 31, 2024, respectively.

The Company invests in treasury bills issued by the U.S. Government. U.S. treasury bills with original maturities of three months or less are classified within cash equivalents. Short-term marketable securities are comprised of U.S. treasury bills with original maturities between three and twelve months. The Company believes it is not exposed to any significant credit risk on cash, cash equivalents, and marketable securities and performs periodic evaluations of the credit standing of such institutions. The goal of the Company’s investment policy is to ensure safety and preservation of the principal balance, and diversification of risk over cash balances held on deposit.

The Company is subject to credit risk from its accounts receivable. The Company’s accounts receivable arise from the provision of molecular profiling services and pharma research and development services, primarily with biopharmaceutical companies, all of which have high credit ratings. The Company has not experienced any material losses related to receivables from individual customers, or groups of customers. The Company does not require collateral. Accounts receivable are recorded net of allowance for credit losses, if any. Concentrations of credit risk are limited due to the number of payers and their dispersion across multiple geographic regions.

For the three and nine months ended September 30, 2025 and 2024, the Company's revenues were primarily derived from the sale of Caris molecular profiling services. As discussed above, payment terms of the services are a function of a patient’s existing insurance benefits and applicable reimbursement contracts established between the Company and payers. Revenue associated with each payer, including its affiliated entities, as a percentage of the Company’s total revenue for the respective period, and accounts receivable balance attributable to each payer, including its affiliated entities, as a percentage of the Company’s total accounts receivable balance at the respective condensed consolidated balance sheet date, are as follows:

	% Revenue for the three months ended September 30,		% Revenue for the nine months ended September 30,		% Accounts receivable as of
Major Payer	2025	2024	2025	2024	September 30, 2025	December 31, 2024
Payer 1	37.7%	35.6%	43.3%	35.8%	50.8%	16.1%
Payer 2	21.2%	17.3%	17.2%	14.9%	*	19.3%
Payer 3	12.9%	*	10.9%	*	*	*

*Represents major payers below 10.0%.

Accounts Receivable

Accounts receivable includes billed and unbilled receivables, net of an allowance for expected credit losses. Accounts receivable primarily represent receivables from biopharmaceutical customers and third-party payers. Accounts receivable for pharmaceutical services are established based on the amounts outstanding per the contractual arrangements with biopharmaceutical customers. The Company applies the current expected credit loss standard in ASC Subtopic 326-20, Financial Instruments—Credit Losses (“ASC 326-20”) and reserves a portion of the accounts receivable based on assessment of the collectability of customer accounts at the time of revenue recognition. The Company regularly reviews the reserve by considering factors such as historical experience, credit quality, the age of the accounts receivable balances, and current economic conditions that may affect a customer’s ability to pay.

Receivables deemed to be uncollectible are written-off against the allowance for credit losses at the time such receivables are deemed to be uncollectible under a specific identification or estimated method. Recoveries of accounts receivable previously written off are recorded when received. As of September 30, 2025 and December 31, 2024, the Company had an immaterial allowance for credit losses related to its accounts receivable.

Supplies

Supplies consist primarily of laboratory items and reagents used by the Company in providing services. All supplies are raw materials and are stated at the lower of cost or net realizable value on a first-in, first-out basis. The Company periodically reviews its supplies for excess or obsolescence and writes down obsolete or otherwise unmarketable supplies to their estimated net realizable value. As of September 30, 2025 and December 31, 2024, the amount of write downs associated with the Company’s supplies was immaterial.

Deferred Offering Costs

Deferred offering costs consist primarily of accounting, legal, and other fees related to the Company’s proposed IPO. The Company had $4.5 million of deferred offering costs as of December 31, 2024. Prior to the IPO, deferred offering costs were capitalized on the consolidated balance sheet. Upon the consummation of the IPO, $9.0 million of deferred offering costs were reclassified into additional paid-in capital as an offset against IPO proceeds.

Property and Equipment, Net

The Company reports property and equipment at cost, net of accumulated depreciation, amortization, and any asset impairments. The cost of properties held under finance leases is equal to the present value of lease payments not yet paid, adjusted for initial direct costs, prepaid lease payments and lease incentives received. Major improvements which add to productive capacity or extend the life of an asset are capitalized. Normal repairs and maintenance are expensed as incurred. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts, and any resulting gain or loss is reflected in the accompanying condensed consolidated statements of operations and comprehensive loss for the period.

Depreciation and amortization expenses are calculated on a straight-line basis and applied to asset classes based upon the Company’s estimate of the asset class’s useful life, as summarized below:

	Estimated Useful Life
Laboratory equipment	3 years
Computer equipment and software	3 years
Furniture and fixtures	5 years
Aircraft	15 years
Leasehold improvements/leased buildings	Lesser of remaining lease term or useful life
Leased equipment	Lesser of initial lease term or 5 years

Computer equipment and software includes the purchases of hardware, software and capitalized labor costs associated with internally developed software.

The Company capitalizes purchased software which is ready-for-service and capitalizes qualifying internal software development costs incurred on significant projects. Capitalization of costs begins when two criteria are met: (1) the preliminary project stage is completed, management with relevant authority authorizes and commits to funding the software project, and (2) it is probable that the software will be completed and used for its intended function. Capitalization ceases when the software is substantially complete and ready for its intended use, including the completion of all significant testing. Costs related to preliminary project activities and post-implementation operating activities are expensed as incurred.

Research and development costs and other computer software maintenance costs related to software development are expensed as incurred.

Capitalized software costs are included in property and equipment, net. These costs are amortized using the straight-line method over the estimated useful life of the underlying software, which is three years.

Fair Value Measurements

Fair value is defined as the 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 should be determined based on assumptions market participants would use in pricing an asset or liability.

The basis for these assumptions establishes a three-level fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

•Level 1 - Observable inputs such as quoted prices in active markets for identical assets and liabilities;

•Level 2 - Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and

•Level 3 - Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

Assets and liabilities measured at fair value are based on one or more of three valuation techniques. The three valuation techniques are as follows:

•Market approach – Prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities;

•Cost approach – Amount that would be required to replace the service capacity of an asset (i.e., replacement cost); and

•Income approach – Techniques to convert future amounts to a single present amount based on market expectations (including present value techniques, option-pricing models, and lattice models).

Financial instruments consist of cash, cash equivalents, restricted cash, short-term marketable securities, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses and other current liabilities, debt, warrants, and derivative instruments.

As of September 30, 2025 and December 31, 2024, the carrying amounts of the Company’s cash equivalents, restricted cash, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses and

other current liabilities approximate their fair value based on the short-term nature of these items. There were no transfers between Levels 1, 2 or 3 for the periods ended September 30, 2025 and December 31, 2024.

The Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used in such measurements were as follows:

	As of September 30, 2025
	Fair Value		Level 1		Level 2		Level 3
Financial assets	(amounts in thousands)
Short-term marketable securities	$	2,272	$	2,272	$	—	$	—

	As of December 31, 2024
	Fair Value		Level 1		Level 2		Level 3
Financial assets	(amounts in thousands)
Short-term marketable securities	$	2,201	$	2,201	$	—	$	—
Financial liabilities
Warrant liability	$	91,642	$	—	$	—	$	91,642
Derivative liability	$	6,058	$	—	$	—	$	6,058

2018 and 2020 Warrant Liability

The Company utilized a probability-weighted scenario approach factoring in various exit strategies and the related timing of such to estimate the fair value of its warrant liability. For each scenario, the Company utilized a Black-Scholes option pricing model with the following assumptions:

•Fair value per share of the underlying stock—The fair value of the underlying stock represents the fair value of the Company's Series C preferred stock that the warrants are convertible into.

•Volatility—The volatility is derived from historical volatilities of several unrelated publicly-listed peer companies, since the Company has no trading history. When making the selections of industry peer companies to be used in the volatility calculation, the Company considers the size, operational and economic similarities to the Company’s principal business operations.

•Risk-free interest rate—The risk-free interest rate is based on U.S. treasury yield as of the measurement dates interpolated to match the maturity equal to the respective term to exit.

•Dividend yield—The expected dividend assumption is based on the Company’s current expectations about the Company’s anticipated dividend policy.

•Expected term (years)—Based on expected term under various exit strategies.

The below table summarizes the significant unobservable inputs used in the fair value measurement of the 2018 and 2020 warrant liabilities as of December 31, 2024. The warrants were reclassified from liability to equity upon the IPO as they were exercised into Series C preferred stock, which was converted to common stock. The difference between the fair value of the warrants immediately prior to the reclassification and its prior fair value was recorded in the condensed consolidated statement of operations and comprehensive loss as changes in fair value of financial instruments. The fair

value immediately prior to the reclassification is based on the total number of common stock issued upon exercise and conversion, multiplied by the public offering price of $21.00 per share.

	As of December 31, 2024
	2018 Warrants	2020 Warrants
Fair value per share of the underlying stock	$3.66 - $5.65	$3.66 - $5.65
Expected volatility	47.6% - 63.0%	61.2% - 63.0%
Risk-free interest rate	4.2% - 4.3%	4.3%
Expected dividend yield	—%	—%
Expected term (years)	0.29 - 0.75	0.29 - 2.25

2025 Warrant Liability - Pre-IPO Financing

The Company utilized a probability-weighted scenario approach factoring in various exit scenarios and the related timing of such to estimate the fair value of its warrants that were issued in conjunction with the 2025 Convertible Notes. Upon issuance as of April 1, 2025, the fair value of these warrants was $10.3 million. Immediately prior to the IPO, the fair value of these warrants was $16.5 million.

Derivative Liability - 2023 Term Loan

On January 18, 2023, the Company entered into a credit agreement (the “New Term Loan Agreement”) under which the Company issued senior, secured promissory notes (the “2023 Term Loan”) by which the New Term Loan lenders agreed to lend the Company up to an aggregate principal amount of $400.0 million, $200.0 million of which was received by the Company upon issuance, and $200.0 million of which was drawn down in March 2024. The Company identified certain embedded features in the 2023 Term Loan, including various contingent prepayment, compensatory payment, and default interest rate features, that are required to be bifurcated from the 2023 Term Loan and separately accounted for in the condensed consolidated financial statements as a compound derivative liability.

Fair value of the derivative liability as of December 31, 2024 was estimated using the discounted cash flow method under the income approach. This approach involves significant Level 3 inputs and assumptions including an estimated probability and timing of certain contingent events, such as events of default, change of control, sale of assets, etc. The analysis also required the selection of a discount rate representative of the Company's credit risk. The discount rate used for the initial fair value was calibrated to the transaction. The value of the derivative liability in connection with the 2023 Term Loan reduced to zero upon the IPO, as the contingent prepayment is no longer required.

Refer to Note 8 for additional information about the compound embedded derivative liability.

Derivative Liability - Pre-IPO Financing

In estimating the fair value of the bifurcated derivatives related to the Series E Preferred Stock, Series F Preferred Stock and the 2025 Convertible Notes, the Company applied the with-and-without methodology as of April 1, 2025. This approach calculates the value of the bifurcated embedded derivative as the difference between the value of each instrument including the derivative and the value of each instrument excluding the derivative. Upon issuance on April 1, 2025, the fair values of the bifurcated embedded derivatives relating to the Series E Preferred Stock, Series F Preferred Stock, and 2025 Convertible Notes were $30.1 million, $11.9 million, and $21.2 million, respectively. Immediately prior to the IPO, the fair values of these bifurcated derivatives were $43.6 million, $16.5 million, and $13.1 million, respectively, determined as the excess of each instrument’s fair value immediately prior to the IPO over the sum of its original proceeds and any accrued interest or dividends. Upon the IPO, the derivative liabilities were derecognized in conjunction with the conversion of the 2025 Convertible Notes, Series E Preferred Stock, and Series F Preferred Stock, and the issuance of the associated shares was recorded in common stock and additional paid-in capital.

Debt - 2023 Term Loan

As of September 30, 2025, the estimated fair value of the 2023 Term Loan, was $380.7 million, compared to a carrying value of $375.9 million. As of December 31, 2024, the estimated fair value of the 2023 Term Loan, excluding the bifurcated embedded derivative, was $380.9 million, compared to a carrying value of $373.1 million. The Company

estimated the fair value of the 2023 Term Loan as of September 30, 2025 based on a discounted cash flow analysis, and an income approach, which represented the use of Level 3 inputs in the fair value hierarchy.

2025 Convertible Notes, Series E Preferred Stock, and Series F Preferred Stock - Pre-IPO Financing

The Company calculated the fair value of the 2025 Convertible Notes, as well as the Series E Preferred Stock, Series F Preferred Stock, and warrants as of April 1, 2025 using a calibrated approach that aligned the total fair value of the instruments with the cash proceeds received. Upon issuance as of April 1, 2025, the fair value of the 2025 Convertible Notes, the Series E Preferred Stock and the Series F Preferred Stock were $29.4 million, $92.5 million, and $35.5 million respectively. Immediately prior to the IPO, the fair value of the 2025 Convertible Notes was $43.6 million, based on the total number of common stock issued upon conversion, multiplied by the initial public offering price of $21.00 per share.

Goodwill

Goodwill represents the excess of the purchase price over the fair value of net identifiable assets and liabilities acquired through a business combination. The Company evaluates goodwill for impairment in accordance with ASC Topic 350, Intangibles – Goodwill and Other on an annual basis on October 1, or more frequently if events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. The Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, or the Company may determine to proceed directly to the quantitative impairment test.

If the Company assesses qualitative factors and concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying amount or if the Company determines not to use the qualitative assessment, then a quantitative impairment test is performed. The factors utilized in the qualitative assessment include macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, and Company-specific events. The quantitative impairment test requires comparing the fair value of the reporting unit to its carrying value, including goodwill. The fair value of the reporting unit is determined based on the present value of estimated cash flows using available information regarding expected cash flows of each reporting unit, discount rates, and the expected long-term cash flow growth rates.

The Company has identified that its business operates as a single operating segment which is also a single reporting unit for purposes of testing goodwill for impairment. An impairment exists if the fair value of the reporting unit is lower than its carrying value. If the fair value of the reporting unit is lower than its carrying value, the Company would record an impairment loss equal to the excess of the reporting unit's carrying value over its fair value.

There were no impairment losses for the three and nine months ended September 30, 2025 and 2024.

Research and Development Costs

Research and development costs are expensed as incurred. Research and development expenses consist of costs incurred in performing research and development activities. The costs include direct costs for salaries and benefits, materials, contract services and other outside costs, and costs to acquire in-process research and development projects and technologies that have no alternative future use.

Advertising

The Company expenses advertising costs as incurred. The Company incurred advertising costs of $0.3 million and $0.4 million for the three months ended September 30, 2025 and 2024, respectively, and $0.5 million and $0.9 million for the nine months ended September 30, 2025 and 2024, respectively.

Self-Insurance

The Company offers medical insurance coverage to eligible employees under a self-insured program managed by a third-party administrator, leveraging stop-loss insurance policies to mitigate risk. The Company records an estimate of its liability for medical claims, which includes the incurred claims amount plus an estimate of incurred, but not reported claims. Self-insurance liability of $2.2 million and $1.9 million as of September 30, 2025 and December 31, 2024, respectively, is included within accrued expenses and other current liabilities on the condensed consolidated balance sheets.

Net Income (Loss) per Share Attributable to Common Shareholders

The Company calculates its basic and diluted net income (loss) per share attributable to common shareholders in conformity with the two-class method required for companies with participating securities. Each series of the Company’s redeemable convertible preferred stock is considered to be a participating security because the preferred shareholders have a right to receive dividends on a pari passu basis with the Company’s common shareholders. The two-class method determines net income (loss) per share for each class of common stock and participating security according to dividends declared or accumulated and participating rights in undistributed earnings. The two-class method requires income (loss) available to common shareholders for the period to be allocated between common and participating securities based upon the respective rights of each to share in earnings as if all income (loss) for the period had been distributed. The participating securities are not required to participate in the losses of the Company, and therefore during periods of loss there is no allocation required under the two-class method between common and participating securities.

Income Taxes

The Company accounts for income taxes under the asset and liability method as set forth in ASC 740 “Income Taxes” (“ASC 740”). Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in a multitude of jurisdictions across its global operations. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related taxing authority. For tax positions not meeting the more-likely-than-not test, no tax benefit is recorded.

At September 30, 2025 and December 31, 2024, the Company has accumulated net operating loss carryforwards in both the U.S. and foreign jurisdictions, and no provision for income taxes is required. The Company's deferred tax assets are subject to a full valuation allowance.

Recently Issued Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures which requires presentation of specific categories of reconciling items, as well as reconciling items that meet a quantitative threshold, in the reconciliation between the income tax provision and the income tax provision using statutory tax rates. The standard also requires disclosure of income taxes paid disaggregated by jurisdiction with separate disclosure of income taxes paid to individual jurisdictions that meet a quantitative threshold. For public business entities, the ASU is effective for annual periods beginning after December 15, 2024, with early adoption permitted. For entities other than public business entities, the ASU is effective for annual periods beginning after December 15, 2025. The amendments of the ASU should be applied on a prospective basis; however, entities have the option to apply retrospectively for each period presented. The Company does not expect the adoption of this new standard in 2025 to have an impact on its condensed consolidated financial position, results of operations, or cash flow.

In November 2024, the FASB issued ASU No. 2024-03, Income Statement- Reporting Comprehensive Income-Expense disaggregation disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses. This ASU requires disclosure of specified information about certain costs and expenses in the notes to financial statements. This ASU is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Adoption of this ASU should be applied on a prospective basis. Early adoption is permitted. We are currently evaluating the impact that this guidance will have on the disclosures within our financial statements, and expect to adopt this ASU for the fiscal year beginning January 1, 2027.

In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software. This ASU removes all references to prescriptive and sequential software development stages throughout Subtopic 350-40. This will require an entity to change how it starts capitalizing software costs, along with updating how entities evaluate the probable-to-complete recognition threshold. For all entities, the ASU is effective for annual reporting periods beginning after December 15, 2027, with early adoption permitted. The amendments of this ASU can be applied using any of the following three approaches: prospective transition approach; modified transition approach that is based

on the status of the project and whether software costs were capitalized before the date of adoption; and retrospective transition approach. We are currently evaluating the impact that this guidance will have, and expect to adopt this ASU for the year ending December 31, 2028.