The following is a discussion of the financial condition and results of operations of Arcturus Therapeutics Holdings Inc. for the three and six months ended June 30, 2026. Unless otherwise specified herein, references to the “Company,” “Arcturus,” “we,” “our” and “us” mean Arcturus Therapeutics Holdings Inc. and its consolidated subsidiaries. You should read the following discussion and analysis together with the interim condensed consolidated financial statements and related notes included elsewhere herein. For additional information relating to our management’s discussion and analysis of financial conditions and results of operations, please see our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Annual Report”), which was filed with the U.S. Securities and Exchange Commission (the “Commission”) on March 3, 2026. Unless otherwise defined herein, capitalized words and expressions used herein shall have the same meanings ascribed to them in the 2025 Annual Report. This report includes forward-looking statements which, although based on assumptions that we consider reasonable, are subject to risks and uncertainties which could cause actual events or conditions to differ materially from those currently anticipated and expressed or implied by such forward-looking statements. This report also includes certain statements based solely on information, reports and studies provided by or conducted by Seqirus, Inc. and Meiji Holdings Co., Ltd or their respective affiliates. You should read this report and the documents that we reference in this report and have filed as exhibits to this report completely and with the understanding that our actual future results may be materially different from what we expect. You should also review the factors and risks we describe in the reports we will file or submit from time to time with the Commission after the date of this report. Overview We are a messenger RNA medicines company focused on the development of liver and respiratory rare disease therapeutics. We have ongoing Phase 2 clinical studies for our RNA therapeutic candidates to potentially treat ornithine transcarbamylase (OTC) deficiency and cystic fibrosis (CF). We developed the world’s first approved self-amplifying messenger RNA (sa-mRNA) vaccine, KOSTAIVE® (“KOSTAIVE”). KOSTAIVE has achieved approval in Japan, the European Union and the United Kingdom as a vaccine against COVID-19, and sales of KOSTAIVE began in Japan in October 2024. We have several key platform technologies that we leverage to develop and advance a pipeline of mRNA-based therapeutics for rare genetic disorders with significant unmet medical needs and vaccines for infectious diseases. Current mRNA medicines have two critical components: the messenger RNA (“mRNA”) constructs and the lipid nanoparticles (“LNP”) which help deliver the mRNA to disease-relevant target tissues. We have extensive expertise in the design and optimization of mRNA constructs, including with respect to a type of mRNA technology known as self-amplifying mRNA (sa-mRNA). Our proprietary self-amplifying mRNA technology platform, or STARR® (“STARR”), has been demonstrated to induce a robust, longer-lasting and broader humoral immune response at lower dose levels than conventional mRNA-based vaccines. Our proprietary LNP delivery system, LUNAR® (“LUNAR”), is intended to address the major hurdle in RNA drug development, namely the effective and safe delivery of RNA to disease-relevant target tissues. LUNAR may enable multiple nucleic acid medicines. We also have significant expertise and valuable know-how in the development and scalability of complex and robust manufacturing processes required to deliver the next generation of nucleic acid medicines. Our internal pipeline includes RNA therapeutic candidates to potentially treat ornithine transcarbamylase (OTC) deficiency and cystic fibrosis (CF), both rare diseases. In our vaccine program, following termination of the CSL Collaboration Agreement, we regained strategic control of KOSTAIVE® and our broader vaccine portfolio, subject to ongoing arrangements with Meiji in Japan for the Northern Hemisphere 2026-2027 season. Business Updates Key Updates on Arcturus-Owned mRNA Therapeutic Development Candidates 14 •LUNAR-CF/ARCT-032. LUNAR-CF (ARCT-032) is our mRNA therapeutic candidate for CF and it continues to progress in the clinic. The ongoing Phase 2 clinical trial (NCT06747858) is an open-label, multiple ascending dose study to assess safety and efficacy of ARCT-032 in CF adults who do not benefit from current CFTR modulators, including those with Class I null mutations. The study initiated dosing in the U.S. in December 2024 and enrollment and dosing have completed for the initial three cohorts. Each participant received daily inhaled treatments of ARCT-032 at doses of 5 mg, 10 mg, or 15 mg for 28 days. The treatment was generally safe and well tolerated. Bronchospasm was not reported in these participants, either with or without pretreatment with a bronchodilator. Treatment-related AEs that were identified in the single-dose Phase 1 study were also observed in some participants for the first few doses but ceased with continued dosing. Two subjects experienced SAEs after the dosing period that were unrelated to ARCT-032, and the safety review committee approved the study to proceed. After amending the protocol, a fourth cohort of up to 20 subjects began enrolling in March 2026 and continues to advance with active screening and enrollment in the United States and Israel. The fourth cohort was initiated with 10 mg administered once daily via inhalation over a 12-week period to better assess longer term safety, tolerability and early evidence of clinical efficacy. •LUNAR-OTC/ARCT-810. The LUNAR-OTC development program addresses ornithine transcarbamylase (OTC) deficiency, a rare, life-threatening, genetic disease caused by mutations in the OTC gene that lead to dysfunctional or deficient OTC. We have completed enrollment in the open-label multiple ascending dose Phase 2 study of ARCT-810 and all enrolled subjects have completed study drug dosing. The study evaluates safety and pharmacodynamics in adult and adolescent patients requiring clinical management for OTC deficiency. We continue to evaluate supplementary data to inform regulatory discussions and preparation for an End-of-Phase 2 meeting regarding the potential path forward across adult and pediatric development. Thermo Fisher Agreement On June 26, 2026, we entered into a series of agreements with Thermo Fisher Scientific Inc. (“Thermo Fisher”) and certain of Thermo Fisher’s affiliates to establish a strategic collaboration for the provision of contract development and manufacturing organization (“CDMO”) and contract research organization (“CRO”) services in connection with the development of ARCT-032, our investigational mRNA therapeutic for cystic fibrosis (“CF”). The collaboration is structured through (i) a Master Services Agreement (the “Thermo Fisher MSA”) between Thermo Fisher and Arcturus and (ii) a Project Addendum for Development Services between Patheon UK Limited, a Thermo Fisher affiliate (“Patheon”), and Arcturus (the “Project Agreement”). Master Services Agreement The Thermo Fisher MSA establishes the framework under which Thermo Fisher and its affiliates will provide CRO and CDMO services to Arcturus from time to time pursuant to the Project Agreement and any additional individual project addendums. CRO services will be provided through PPD, Inc., Thermo Fisher’s affiliated contract research organization (“PPD”), and CDMO services will be provided through Thermo Fisher’s Pharma Services division. Under the Thermo Fisher MSA, Thermo Fisher will contribute up to $40 million of clinical manufacturing services for ARCT-032, and Arcturus will engage PPD for up to $40 million in CRO services. Upon regulatory approval of ARCT-032, Thermo Fisher would receive exclusive commercial manufacturing rights for the product for a specified duration, on terms to be set forth in a definitive commercial supply agreement to be negotiated in good faith by the parties. Arcturus may engage an alternative manufacturer only if Thermo Fisher is unable to supply, limited solely to the quantities and duration necessary to address the supply shortfall. The Thermo Fisher MSA has an initial term of five years from the effective date and automatically renews for successive one-year periods unless either party provides at least 90 days’ prior written notice of non-renewal. Project Agreement Under the Project Agreement, the services to be provided include technical transfer, engineering batches, manufacture of clinical trial materials, manufacture of process performance qualification batches, open-label extension batches, drug product fill and finish, product release, and stability studies. The Project Agreement remains in effect from its effective date until the completion of all services or earlier termination under the Thermo Fisher MSA. Termination of Vaccine Collaboration with CSL Seqirus On August 3, 2026, the Company entered into the Termination Agreement with CSL Seqirus pursuant to which the Company and CSL Seqirus mutually terminated the CSL Collaboration Agreement, effective as of such date. Under the Termination Agreement, the Company received a one-time cash payment of $12.0 million from CSL Seqirus. In addition, the Company was released from a liability and from repayment of an R&D credit with an aggregate value of approximately $16.0 million. As a result of the termination, the Company regained strategic control of its vaccine portfolio, including KOSTAIVE® and its vaccine programs for seasonal influenza, pandemic influenza, respiratory syncytial virus (“RSV”) and Epstein-Barr virus (“EBV”), subject to ongoing arrangements with Meiji Seika Pharma (“Meiji”) for the Northern Hemisphere 2026-2027 season, which is 15 expected to end on or around June 30, 2027. Beginning with the Northern Hemisphere 2027–2028 season, the Company expects to work directly with Meiji for KOSTAIVE® activities in Japan. We are obligated to pay CSL Seqirus single-digit royalties and revenue-sharing payments on our future commercialization of vaccine products formerly licensed under the CSL Collaboration Agreement and successor products, where certain CSL Seqirus intellectual property is incorporated into such products, subject to agreed terms and conditions and applicable time limitations. With respect to certain of the vaccine products, we are obligated to pay a percentage of upfront payments received from future licensees up to pre-agreed amounts. As a result of the termination, we expect deferred revenue from CSL Seqirus of approximately $5.2 million associated with remaining performance obligations under the CSL Collaboration Agreement to be recognized during the third quarter of 2026. KOSTAIVE® for Japan Meiji launched in Japan the two-dose vial of KOSTAIVE updated for the JN.1 variant XEC in August 2025. In June 2026, Meiji filed a Partial Change Application for KOSTAIVE updated for the NB.1.8.1 variant in a two-dose vial with Japan’s Pharmaceuticals and Medical Devices Agency (PMDA) to support commercialization for the 2026-2027 season in Japan. Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes appearing elsewhere in this Report and our audited financial statements and related notes for the year ended December 31, 2025. Our historical results of operations and the year-to-year comparisons of our results of operations that follow are not necessarily indicative of future results. Revenue We enter into arrangements with pharmaceutical and biotechnology partners and government agencies that may contain upfront payments, license fees for research and development arrangements, research and development funding, milestone payments, option exercise and exclusivity fees and royalties on future sales. The following table summarizes our total revenues for the periods indicated: Three Months Ended June 30, Change 2026 vs 2025 (in thousands) 2026 2025 Change % Collaboration revenue $ 880 $ 24,510 $ (23,630 ) -96 % Grant revenue 2,079 3,791 (1,712 ) -45 % Total $ 2,959 $ 28,301 $ (25,342 ) -90 % Revenue decreased by $25.3 million during the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The decline was primarily driven by lower revenue recognized under the CSL collaboration, reflecting reduced supply agreement revenue and decreased amortization of deferred revenue as KOSTAIVE transitions from development to the commercial phase. Grant revenue also decreased primarily related to our agreement with BARDA, partially offset by increased grant revenue from the Gates Foundation. Six Months Ended June 30, Change 2026 vs 2025 (in thousands) 2026 2025 $ change % change Collaboration revenue $ 1,490 $ 49,987 $ (48,497 ) -97 % Grant revenue 3,530 7,696 (4,166 ) -54 % Total $ 5,020 $ 57,683 $ (52,663 ) -91 % Revenue decreased by $52.7 million during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The decline was primarily driven by lower revenue recognized under the CSL collaboration, reflecting reduced supply agreement revenue and decreased amortization of deferred revenue as KOSTAIVE transitions from development to the commercial 16 phase. Grant revenue also decreased primarily related to our agreement with BARDA, partially offset by increased grant revenue from the Gates Foundation. Operating Expenses Our operating expenses consist of research and development and general and administrative expenses. Three Months Ended June 30, Change 2026 vs 2025 Six Months Ended June 30, 2025 to 2026 (in thousands) 2026 2025 $ change % change 2026 2025 $ change % change Operating expenses: Research and development, net $ 17,515 $ 29,579 $ (12,064 ) -41 % $ 39,042 $ 64,471 $ (25,429 ) -39 % General and administrative 10,989 10,338 651 6 % 20,454 21,654 (1,200 ) -6 % Total $ 28,504 $ 39,917 $ (11,413 ) -29 % $ 59,496 $ 86,125 $ (26,629 ) -31 % Research and Development Expenses, net The following table presents our total research and development expenses by category: Three Months Ended June 30, Change 2026 vs 2025 Six Months Ended June 30, 2025 to 2026 (in thousands) 2026 2025 $ change % change 2026 2025 $ change % change LUNAR-COVID $ 391 $ 3,831 $ (3,440 ) -90 % $ 993 $ 9,640 $ (8,647 ) -90 % LUNAR-OTC 1,870 2,901 (1,031 ) -36 % 4,588 4,477 111 2 % BARDA 642 2,459 (1,817 ) -74 % 966 4,941 (3,975 ) -80 % LUNAR-CF, net 2,593 4,629 (2,036 ) -44 % 9,124 11,777 (2,653 ) -23 % Early-stage programs 92 167 (75 ) -45 % 335 164 171 104 % Discovery technologies 1,341 2,439 (1,098 ) -45 % 3,095 4,627 (1,532 ) -33 % Payroll and benefits 8,731 10,611 (1,880 ) -18 % 16,350 23,654 (7,304 ) -31 % Facilities and equipment 1,855 2,542 (687 ) -27 % 3,591 5,191 (1,600 ) -31 % Total research and development expenses, net $ 17,515 $ 29,579 $ (12,064 ) -41 % $ 39,042 $ 64,471 $ (25,429 ) -39 % Research and development expenses were $17.5 million for the three months ended June 30, 2026, compared with $29.6 million for the three months ended June 30, 2025. The decrease was primarily driven by lower clinical trial expenses associated with the BARDA, LUNAR-CF, and LUNAR-OTC programs, as well as reduced manufacturing costs related to the LUNAR-COVID and LUNAR-OTC programs. Additional decreases were attributable to lower payroll and benefits costs associated with lower share-based compensation expense and a reduction in headcount. Research and development expenses were $39.0 million for the six months ended June 30, 2026, compared with $64.5 million for the six months ended June 30, 2025. The decrease was primarily driven by lower manufacturing costs related to the LUNAR-COVID and LUNAR-CF programs, as well as reduced clinical trial expenses associated with the LUNAR-COVID, BARDA, and LUNAR-CF programs. Additional decreases were attributable to lower payroll and benefits costs associated with lower share-based compensation expense and a reduction in headcount, as well as lower facilities costs. Early-stage programs represent programs that are in the preclinical or Phase 1 clinical stage and may be partnered or unpartnered. Early-stage programs include our Phase 1 clinical stage LUNAR-FLU program which was formerly partnered with CSL Seqirus. Discovery technologies represent our efforts to expand our product pipeline and are primarily related to pre-partnered studies and new capabilities. The related expenses may be partially offset with funds that have been reimbursed or awarded to us and consist of external manufacturing costs, lab supplies, equipment, and consulting and professional fees. Expenses for both early-stage programs and discovery technologies are expected to increase slightly over the next twelve months as we continue to advance both our early- and later-stage programs. General and Administrative Expenses General and administrative expenses were $11.0 million for the three months ended June 30, 2026, compared with $10.3 million for the three months ended June 30, 2025. The slight increase was related to legal and professional fees offset by reduced share-based compensation. General and administrative expenses were $20.5 million for the six months ended June 30, 2026, compared with $21.7 million for the six months ended June 30, 2025. The decrease was primarily due to lower share-based compensation expense, reduced payroll and benefits costs resulting from lower headcount, and lower facilities costs. 17 Finance income, net Three Months Ended June 30, Change 2026 vs 2025 Six Months Ended June 30, Change 2026 vs 2025 (in thousands) 2026 2025 $ change % change 2026 2025 $ change % change Interest income $ 1,819 $ 2,567 $ (748 ) -29 % $ 3,751 $ 5,339 $ (1,588 ) -30 % Interest income is generated by the Company’s cash and cash equivalents. The decrease in interest income for the three and six months ended June 30, 2026, compared to the same period in 2025, was primarily due to lower interest rates and a reduced cash balance. Off-balance sheet arrangements Through June 30, 2026, we have not entered into and did not have any relationships with unconsolidated entities or financial collaborations, such as entities often referred to as structured finance or special purpose entities, established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. Liquidity and Capital Resources From the Company’s inception through the quarter ended June 30, 2026, the Company has funded its operations principally with the proceeds from revenues earned through collaboration agreements and government contracts, the sale of capital stock and long-term debt. Through the second quarter of 2026, we have received a total of approximately $514.3 million in upfront payments and milestones from CSL Seqirus. As of June 30, 2026, the Company’s balance of cash and cash equivalents was $191.5 million. CSL Seqirus, Inc. Collaboration and License Agreement In November 2022, we entered into the CSL Collaboration Agreement with CSL Seqirus, a part of CSL Limited, one of the world’s leading influenza vaccine providers, for global exclusive rights to research, develop, manufacture and commercialize mRNA vaccines. Following the end of the second quarter of 2026, we entered into the Termination Agreement with CSL Seqirus, pursuant to which we mutually terminated the CSL Collaboration Agreement effective as of August 3, 2026. Under the Termination Agreement, we received a one-time cash payment of $12.0 million from CSL Seqirus. In addition, we were released from a liability and from repayment of an R&D credit with an aggregate value of approximately $16.0 million. We also regained strategic control of our vaccine portfolio, including KOSTAIVE® and our vaccine programs for seasonal influenza, pandemic influenza, RSV and EBV, subject to ongoing arrangements with Meiji for the Northern Hemisphere 2026-2027 season. We are obligated to pay CSL Seqirus single-digit royalties and revenue-sharing payments on our future commercialization of vaccine products formerly licensed under the CSL Collaboration Agreement and successor products, where certain CSL Seqirus intellectual property is incorporated into such products, subject to agreed terms and conditions and applicable time limitations. With respect to certain of the vaccine products, we are obligated to pay a percentage of upfront payments received from future licensees up to pre-agreed amounts. In connection with the termination, the parties agreed to dismiss the arbitration and exchanged mutual releases of claims. As a result of the termination, we expect deferred revenue from CSL Seqirus of approximately $5.2 million associated with remaining performance obligations under the CSL Collaboration Agreement to be recognized during the third quarter of 2026. Thermo Fisher Agreement On June 26, 2026, we entered into a series of agreements with Thermo Fisher in support of the clinical development of ARCT-032. Under the agreement, Thermo Fisher has agreed to provide up to $40.0 million of qualifying clinical manufacturing services. We believe the agreement may reduce our future cash requirements associated with the clinical development of ARCT-032 by funding a portion of those development activities, subject to the terms of the agreement. See Note 8 to the condensed consolidated financial statements for additional information regarding the agreement. Grant from the Biomedical Advanced Research and Development Authority On August 31, 2022, we entered into a cost reimbursement contract (the “BARDA Contract”) with the Biomedical Advanced Research and Development Authority (“BARDA”), a division of the Office of the Assistant Secretary for Preparedness and Response (“ASPR”) within the U.S. Department of Health and Human Services (“HHS”) to support the development of a low-dose pandemic influenza candidate based on our proprietary self-amplifying messenger RNA-based vaccine platform. The BARDA Contract is to support our non-clinical and pre-clinical development, early-stage clinical development through Phase 1, and associated drug product manufacturing, regulatory and quality-assurance activities over a period of three years. It provides for reimbursement by BARDA of our permitted costs up to $63.2 million. As of June 30, 2026, the remaining available funding net of revenue earned was $24.6 million. General Financial Resources 18 A portion of our current cash balance is expected to be utilized during fiscal year 2026 to fund (i) advances to our LUNAR-CF program in clinical trials, (ii) the continued Phase 2 trial of ARCT-810, our LUNAR-OTC candidate, (iii) expenses incurred prior to customer payments under the BARDA agreement and any transition or settlement-related activities following termination of the CSL Collaboration Agreement and (iv) continued exploratory activities related to our platform and other general administrative activities. Our future capital requirements are difficult to forecast and will depend on many factors that are out of our control. If we are unable to maintain sufficient financial resources, our business, financial condition and results of operations will be materially and adversely affected. There can be no assurance that we will be able to obtain additional needed financing on acceptable terms or at all. Additionally, equity or debt financings may have a dilutive effect on the holdings of our existing shareholders. We expect to continue to incur additional losses in the long term, and we will need to raise additional debt or equity financing or enter into additional partnerships to fund development. Our ability to transition to profitability is dependent on regulatory approvals and subsequent sales of KOSTAIVE, and identifying and developing other successful mRNA drug and vaccine candidates. If we are not able to achieve planned milestones or incur costs in excess of our forecasts, we will need to reduce discretionary spending, discontinue the development of some or all of our programs, which will delay part of our development programs, all of which will have a material adverse effect on our ability to achieve our intended business objectives. Overview The following table shows a summary of our cash flows: Six Months Ended June 30, (in thousands) 2026 2025 Cash provided by (used in): Operating activities $ (39,351 ) $ (40,893 ) Investing activities 52 (137 ) Financing activities 16 469 Net decrease in cash, cash equivalents and restricted cash $ (39,283 ) $ (40,561 ) Operating Activities Net cash used in operating activities was $39.4 million for the six months ended June 30, 2026, compared to $40.9 million for the six months ended June 30, 2025. The decrease in cash outflows was primarily driven by improved collections in accounts receivable and more favorable changes in accrued liabilities and deferred revenue. These factors were partially offset by less favorable changes in accounts payable and prepaid expenses. Investing Activities Net cash provided by investing activities was $0.1 million for the six months ended June 30, 2026, compared with net cash used of $0.1 million for the six months ended June 30, 2025. The increase in cash provided by investing activities was primarily driven by the absence of property and equipment purchases during the current year period. Financing Activities Net cash provided by financing activities was nominal for the six months ended June 30, 2026, compared to $0.5 million for the six months ended June 30, 2025. The decrease in cash provided by financing activities was primarily driven by lower proceeds from employee stock option exercises. Funding Requirements We anticipate that we will continue to generate losses for the foreseeable future, and we expect the losses to increase as we continue the development of, and seek regulatory approvals for, our product candidates, and begin commercialization of our products. As a result, we will require additional capital to fund our operations in order to support our long-term plans. We believe that our current cash position will be sufficient to meet our anticipated cash requirements through at least the next twelve months, assuming, among other things, no significant unforeseen expenses and continued funding under existing agreements at anticipated levels. We intend to seek additional capital through equity and/or debt financings, collaborative or other funding arrangements with partners or through other sources of financing when and as needed. Should we seek additional financing from outside sources, we may not be able to raise such financing on terms acceptable to us or at all. If we are unable to raise additional capital when required or on acceptable terms, we may be required to scale back or discontinue the advancement of product candidates, reduce headcount, liquidate our assets, file for bankruptcy, reorganize, merge with another entity, or cease operations. 19 Our future funding requirements are difficult to forecast and will depend on many factors, including the following: •the development of our cystic fibrosis and OTC deficiency therapeutic candidates; •maintaining and/or expanding our manufacturing network and capabilities; •the terms and timing of any other strategic alliance, licensing and other arrangements that we may establish, including transition arrangements with CSL Seqirus, arrangements with Meiji and any new collaboration arrangements, and any related payments thereunder; •the initiation, progress, timing and completion of preclinical studies and clinical trials for our product candidates; •the maintenance and deployment of vaccine assets that we regained as a result of the Termination Agreement with CSL Seqirus; •the number and characteristics of product candidates that we pursue; •the outcome, timing and cost of regulatory approvals; •delays that may be caused by changing regulatory requirements; •the cost and timing of hiring new employees to support growth; •the costs involved in filing and prosecuting patent applications and enforcing and defending patent claims; •the costs and timing of procuring clinical and commercial supplies of our product candidates; •the costs and timing of establishing sales, marketing and distribution capabilities; •the costs associated with legal proceedings; •the costs associated with potential litigation related to collaboration agreements; and •the extent to which we acquire or invest in businesses, products or technologies. Critical Accounting Policies and Estimates We prepare our condensed consolidated financial statements in conformity with GAAP. As such, we make certain estimates, judgments and assumptions that we believe are reasonable, based upon information available to us. These judgments involve making estimates about the effect of matters that are inherently uncertain and may significantly impact our reported results of operations and financial condition. We describe our significant accounting policies more fully in Note 2 to our consolidated financial statements for the year ended December 31, 2025 included in the 2025 Annual Report. There have been no material changes to our critical accounting policies and estimates from the information provided in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in the 2025 Annual Report. 20