You should read the following discussion and analysis in conjunction with our consolidated financial statements and the accompanying notes thereto included in Part II, Item 8 of this Annual Report on Form 10-K for the fiscal year ended June 30, 2026 (this “Report”). This discussion and analysis contains forward-looking statements that are based on our management’s current beliefs and assumptions, which statements are subject to substantial risks and uncertainties. Our actual results may differ materially from those expressed or implied by these forward-looking statements as a result of many factors, including those discussed in “Risk Factors” included in Part I, Item 1A of this Report. Please also see “Cautionary Note Regarding Forward-Looking Statements” at the beginning of this Report. Overview Lantronix, Inc. is a global leader in Edge AI and Industrial IoT solutions that power NDAA-compliant unmanned systems, critical infrastructure and resilient enterprise networks. We deliver intelligent computing, secure connectivity, and remote management for mission-critical applications, enabling customers to optimize operations, enhance security and accelerate digital transformation. Our comprehensive portfolio of hardware, software, and services, powers applications ranging from mission-critical autonomous platforms and edge analytics for critical infrastructure to intelligent surveillance and secure network management. By bringing intelligence to the network edge, we help organizations achieve efficiency, security, and a competitive edge in today’s AI-driven world. We conduct our business globally and manage our sales teams by three geographic regions: the Americas; EMEA; and APJ. References to “fiscal 2026” refer to the fiscal year ended June 30, 2026 and references to “fiscal 2025” refer to the fiscal year ended June 30, 2025. 25 Products and Solutions We organize our portfolio services and products into the following product lines: Embedded IoT Solutions, IoT Systems Solutions, and Software and Services. Refer to “Products and Solutions” included in Part I, Item 1 of this Report, which is incorporated herein by reference, for further discussion. Recent Developments In March 2026, the U.S. Court of International Trade issued a ruling indicating that importers that paid tariffs under the International Emergency Economic Powers Act (“IEEPA”) may be entitled to refunds. We have paid tariffs on certain imported products and materials that were subject to IEEPA-based duties. The nature, timing, and extent of any such refunds remain uncertain. As of June 30, 2026, we have not recognized any amounts related to the potential recovery of such tariff-related costs. On July 7, 2026, we entered into an asset purchase agreement to acquire the industrial IoT business of Vecima Networks Inc., including its Nero Global Tracking software-as-a-service platform, for aggregate consideration of approximately $11.7 million, excluding working capital adjustments and other customary purchase price adjustments. The acquired business provides GPS-based fleet and asset tracking solutions and serves customers across the fleet, municipal, restoration and industrial asset-tracking markets in North America. We closed the transaction on August 1, 2026. Since the transaction closed after the fiscal year ended on June 30, 2026, we have not recorded any amounts in the accompanying consolidated financial statements. We are in the process of evaluating the acquisition and, therefore, determining the preliminary allocation of the purchase price, including the identification and valuation of acquired intangible assets and any associated goodwill. Additional disclosures required by ASC 805, Business Combinations, will be provided for the quarter ending September 30, 2026 following the completion of the preliminary purchase accounting assessment. Recent Accounting Pronouncements Refer to Note 1 of Notes to Consolidated Financial Statements included in Part II, Item 8 of this Report, which is incorporated herein by reference, for a discussion of recent accounting pronouncements. Critical Accounting Policies and Estimates The preparation of financial statements and related disclosures in accordance with U.S. generally accepted accounting principles (“GAAP”) requires us to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of net revenue and expenses during the reporting period. We regularly evaluate our estimates and assumptions related to revenue recognition, sales returns and allowances, inventory valuation, valuation of deferred income taxes, valuation of goodwill and long-lived and intangible assets. We base our estimates and assumptions on historical experience and on various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. To the extent there are material differences between our estimates and the actual results, our future results of operations will be affected. We believe the following critical accounting policies require us to make significant judgments and estimates in the preparation of our consolidated financial statements: 26 Revenue Recognition Revenue is recognized upon the transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. We apply the following five-step approach in determining the amount and timing of revenue to be recognized: (i) identifying the contract with a customer, (ii) identifying the performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the performance obligations in the contract and (v) recognizing revenue when the performance obligation is satisfied. A significant portion of our products are sold to distributors under agreements which contain (i) limited rights to return unsold products and (ii) price adjustment provisions, both of which are accounted for as variable consideration when estimating the amount of revenue to recognize. Establishing accruals for product returns and pricing adjustments requires the use of judgment and estimates that impact the amount and timing of revenue recognition. When product revenue is recognized, we establish an estimated allowance for future product returns based primarily on historical returns experience and other known or anticipated returns. We also record reductions of revenue for pricing adjustments, such as competitive pricing programs and rebates, in the same period that the related revenue is recognized, based primarily on approved pricing adjustments and our historical experience. Actual product returns or pricing adjustments that differ from our estimates could result in increases or decreases to our net revenue. A portion of our revenues are derived from engineering and related consulting service contracts with customers. These contracts generally include performance obligations in which control is transferred over time because the customer either simultaneously receives and consumes the benefits provided or our performance on the contract creates or enhances an asset that the customer controls. These contracts typically provide services on the following basis: · Time & Materials (“T&M”) – services consist of revenues from software modification, consulting implementation, training and integration services. These services are set forth separately in the contractual arrangements such that the total price of the customer arrangement is expected to vary depending on the actual time and materials incurred based on the customer’s needs. · Fixed Price – arrangements to render specific consulting and software modification services which tend to be more complex. Performance obligations for T&M contracts qualify for the “Right to Invoice” practical expedient within the revenue guidance. Under this practical expedient, we may recognize revenue, over time, in the amount to which we have a right to invoice. In addition, we are not required to estimate variable consideration upon inception of the contract and reassess the estimate each reporting period. We determined that this method best represents the transfer of services as, upon billing, we have a right to consideration from a customer in an amount that directly corresponds with the value to the customer of our performance completed to date. We recognize revenue on fixed price contracts, over time, using an input method based on the proportion of our actual costs incurred (generally labor hours expended) to the total costs expected to complete the contract performance obligation. We determined that this method best represents the transfer of services as the proportion closely depicts the efforts or inputs completed towards the satisfaction of a fixed price contract performance obligation. From time to time, we may enter into contracts with customers that include promises to transfer multiple performance obligations that may include sales of products, professional engineering services and other product qualification or certification services. Determining whether the promises in these arrangements are considered distinct performance obligations, that should be accounted for separately versus together, often requires judgment. We consider performance obligations to be distinct when the customer can benefit from the promised good or service on its own or by combining it with other resources readily available and when the promised good or service is separately identifiable from other promised goods or services in the contract. In these arrangements, we allocate revenue on a relative standalone selling price basis by maximizing the use of observable inputs to determine the standalone selling price for each performance obligation. Additionally, estimating standalone selling prices for separate performance obligations within a contract may require significant judgment and consideration of various factors including market conditions, items contemplated during negotiation of customer arrangements and internally developed pricing models. Changes to performance obligations that we identify, or the estimated selling prices pertaining to a contract, could materially impact the amounts of earned and unearned revenue that we record. 27 Inventory Valuation We value inventories at the lower of cost (on a first-in, first-out basis) or net realizable value, whereby we make estimates regarding the market value of our inventories, including an assessment of excess and obsolete inventories. We determine excess and obsolete inventories based on an estimate of the future sales demand for our products within a specified time horizon, which is generally 12 to 24 months. In addition, specific reserve estimates are recorded to cover risks for end-of-life products, inventory located at our contract manufacturers and warranty replacement stock. The estimates we use for demand are also used for near-term capacity planning and inventory purchasing. Demand for our products can fluctuate significantly from period to period. A significant decrease in demand could result in an increase in the amount of excess inventory on hand. In addition, our industry is characterized by rapid technological change, frequent new product development and product obsolescence that could result in an increase in the amount of obsolete inventory quantities on hand. Our estimates of future product demand and judgement to determine excess inventory may prove to be inaccurate, in which case we may have understated or overstated the reduction to the total carrying value of our inventory for excess and obsolete inventory. In the future, if our inventory is determined to be overvalued, we would be required to recognize such costs in our cost of goods sold, resulting in a reduction in our gross margins, at the time of such determination. Although we make every effort to ensure the accuracy of our forecasts of future product demand, any significant unanticipated changes in demand or technological developments could have a significant impact on the value of our inventory and our results of operations. Valuation of Deferred Income Taxes We have recorded a valuation allowance to reduce our net deferred tax assets to zero, primarily due to historical net operating losses (“NOLs”) and uncertainty of generating future taxable income. We consider estimated future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for a valuation allowance. If we determine that it is more likely than not that we will realize a deferred tax asset that currently has a valuation allowance, we would be required to reverse the valuation allowance, which would be reflected as an income tax benefit in our consolidated statements of operations at that time. Goodwill Impairment Testing We evaluate goodwill for impairment on an annual basis on May 31, or more frequently if we believe indicators of impairment exist that would more likely than not reduce the fair value of our single reporting unit below its carrying amount. We begin our evaluation of goodwill for impairment by assessing qualitative factors to determine whether it is more likely than not that the fair value of our single reporting unit is less than its carrying value. Some factors that we consider important in the qualitative assessment which could trigger a goodwill impairment review include: · significant underperformance relative to historical or projected future operating results; · significant changes in the manner of our use of the acquired assets or the strategy for our overall business; · significant negative industry or economic trends; · a significant decline in our stock price for a sustained period; and · a significant change in our market capitalization relative to our book value. Based on our qualitative assessment, if we conclude that it is more likely than not that the fair value of our single reporting unit is less than its carrying value, we conduct a quantitative goodwill impairment test, which involves comparing the estimated fair value of our single reporting unit with its carrying value, including goodwill. We estimate the fair value of our single reporting unit using a combination of the income and market approach. If the carrying value of the reporting unit exceeds its estimated fair value, we recognize an impairment loss for the difference. During the fourth quarter of fiscal 2026, we made a qualitative assessment of whether goodwill impairment existed. Since our assessment of the qualitative factors did not result in a determination that it was more likely than not that the fair value of our single reporting unit is less than its carrying value, we were not required to perform the quantitative goodwill impairment test. 28 Long-Lived Assets and Intangible Assets We assess the impairment of long-lived assets and intangible assets whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Circumstances that could trigger a review include, but are not limited to the following: · significant decreases in the market price of the asset; · significant adverse changes in the business climate or legal factors; · accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; · current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; or · current expectation that the asset will more likely than not be sold or disposed of significantly before the end of its estimated useful life. Whenever events or changes in circumstances suggest that the carrying amount of long-lived assets and intangible assets may not be recoverable, we estimate the future cash flows expected to be generated by the asset from its use or eventual disposition. If the sum of the expected future cash flows is less than the carrying amount of those assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. Significant management judgment is required in the forecasts of future operating results that are used in the discounted cash flow method of valuation. These significant judgments may include future expected revenue, expenses, capital expenditures and other costs, discount rates and whether or not alternative uses are available for impacted long-lived assets. Results of Operations - Fiscal Years Ended June 30, 2026 and 2025 Summary For fiscal 2026, our net revenue decreased by $2,024,000, or 1.6%, compared to fiscal 2025. The decrease in net revenue was driven by a 15.2% decrease in net revenue in our IoT System Solutions product line partially offset by a 15.6% increase in net revenue in our Embedded IoT Solutions product line and a 15.5% increase in our Software and Services product line. We had a net loss of $4,181,000 for fiscal 2026 compared to a net loss of $11,373,000 for fiscal 2025. The decrease in net loss was primarily driven by the reduction in operating expenses of $5,656,000 combined with the increase in gross profit for fiscal 2026 compared to fiscal 2025. Net Revenue The following tables present our net revenue by product lines and by geographic region: Years Ended June 30, % of Net % of Net Change 2026 Revenue 2025 Revenue $ % (In thousands, except percentages) Embedded IoT Solutions $ 53,607 44.3% $ 46,380 37.7% $ 7,227 15.6% IoT System Solutions 58,270 48.2% 68,735 55.9% (10,465 ) (15.2% ) Software & Services 9,022 7.5% 7,808 6.4% 1,214 15.5% $ 120,899 100.0% $ 122,923 100.0% $ (2,024 ) (1.6% ) Years Ended June 30, % of Net % of Net Change 2026 Revenue 2025 Revenue $ % (In thousands, except percentages) Americas $ 84,296 69.7% $ 70,126 57.0% $ 14,170 20.2% EMEA 21,555 17.8% 30,898 25.1% (9,343 ) (30.2% ) APJ 15,048 12.5% 21,899 17.9% (6,851 ) (31.3% ) $ 120,899 100.0% $ 122,923 100.0% $ (2,024 ) (1.6% ) 29 Embedded IoT Solutions Net revenue increased primarily due to (i) higher unit sales of our embedded compute products, which includes our drone and aerospace and defense products, in the Americas and EMEA regions, and (ii) higher unit sales of our embedded wired connectivity products across all regions, reflecting continued customer demand for embedded ethernet and compute solutions. These increases were partially offset by lower unit sales of certain legacy products, including our network interface cards and optics, primarily in the Americas and EMEA regions. IoT System Solutions Net revenue decreased primarily due to reduced sales to Gridspertise. We did not recognize any revenue from this customer during fiscal 2026, as compared to just over $11 million of revenue in the prior year. The year-over-year decrease in net revenue from this customer was partially offset by (i) increased unit sales of our network switches in the Americas and APJ regions and (ii) higher unit sales of our gateways in the Americas and EMEA regions. Software & Services Net revenue increased primarily due to higher SaaS solutions in the Americas and EMEA regions, as well as higher design services revenue in the EMEA region. This increase was partially offset by a decrease in our extended warranty services in the Americas region. Gross Profit Gross profit represents net revenue less cost of revenue. Cost of revenue consists primarily of the cost of raw material components, subcontract labor assembly from contract manufacturers, direct and indirect personnel expenses related to professional services, manufacturing overhead, inventory reserves for excess and obsolete products or raw materials, warranty costs, royalties and share-based compensation. The following table presents our gross profit: Years Ended June 30, % of Net % of Net Change 2026 Revenue 2025 Revenue $ % (In thousands, except percentages) Gross profit $ 52,923 43.8% $ 51,699 42.1% $ 1,224 2.4% Gross profit as a percentage of revenue (referred to as “gross margin”) increased primarily because of our product sales mix. This was primarily driven by the absence of lower-margin revenue from Gridspertise in fiscal 2026, and also a slightly higher percentage of our current year revenue derived from software and services. We currently expect that gross margin will fluctuate in the future, from period-to-period, based on changes in our product mix, average selling prices, and average manufacturing costs. 30 Selling, General and Administrative Selling, general and administrative expenses consist of personnel-related expenses including salaries and commissions, share-based compensation, facility expenses, information technology, advertising and marketing expenses and professional legal and accounting fees. The following table presents our selling, general and administrative expenses: Years Ended June 30, % of Net % of Net Change 2026 Revenue 2025 Revenue $ % (In thousands, except percentages) Personnel-related expenses $ 22,084 $ 20,387 $ 1,697 8.3% Professional fees and outside services 3,720 4,878 (1,158 ) (23.7% ) Advertising and marketing 2,234 2,239 (5 ) (0.2% ) Facilities and insurance 1,938 1,794 144 8.0% Share-based compensation 5,233 4,424 809 18.3% Depreciation 999 1,360 (361 ) (26.5% ) Other 840 1,164 (324 ) (27.8% ) Selling, general and administrative $ 37,048 30.6% $ 36,246 29.5% $ 802 2.2% Selling, general and administrative expenses increased primarily due to (i) higher personnel-related expenses, mostly variable compensation costs, and (ii) increased share-based compensation costs driven by new stock awards granted during the current fiscal year. These increases were partially offset by a decrease in professional fees, particularly legal expenditures, as well as the recovery of certain previously written-off receivables, the benefit of which is included in the “other” category in the table above. Research and Development Research and development expenses consist of personnel-related expenses, share-based compensation, and expenditures to third-party vendors for research and development activities and product certification costs. Our costs from period-to-period related to outside services and product certifications vary depending on our level and timing of development activities. The following table presents our research and development expenses: Years Ended June 30, % of Net % of Net Change 2026 Revenue 2025 Revenue $ % (In thousands, except percentages) Personnel-related expenses $ 11,944 $ 12,164 $ (220 ) (1.8% ) Facilities 2,248 2,597 (349 ) (13.4% ) Outside services 1,183 636 547 86.0% Product certifications 535 499 36 7.2% Share-based compensation 896 1,522 (626 ) (41.1% ) Other 748 1,179 (431 ) (36.6% ) Research and development $ 17,554 14.5% $ 18,597 15.1% $ (1,043 ) (5.6% ) 31 Research and development expenses decreased primarily due to (i) lower personnel-related expenses in our engineering team resulting from restructuring activities during the current and prior fiscal years, (ii) reduced share-based compensation costs based on the value of new and outstanding awards, and (iii) lower facilities-related equipment and software costs. These decreases were partially offset by higher spending on outside services, primarily related to outsourced product development and contractor costs. Restructuring, Severance and Related Charges During fiscal 2026 and 2025, we incurred restructuring, severance and related charges of $566,000 and $3,535,000, respectively, due to various headcount reduction efforts during these years. The most significant of these actions occurred in January 2025, in which we reduced our headcount by approximately 12% worldwide, primarily in the U.S. and India. The severance and related charges resulting from this action totaled approximately $1,400,000. We may incur additional restructuring, severance and related charges in future periods as we continue to identify cost savings and efficiencies related to our business. Acquisition-Related Costs During fiscal 2026 we incurred approximately $315,000 of acquisition costs. These costs were mainly comprised of legal and other professional fees. During fiscal 2025 we incurred approximately $371,000 of costs primarily in connection with the acquisition of Netcomm. These costs were mainly comprised of banking, legal and other professional fees. Amortization of Intangible Assets We acquired certain intangible assets through our prior acquisitions, which we recorded at fair value as of the acquisition dates. These assets are generally amortized on a straight-line basis over their estimated useful lives and resulted in charges of $1,561,000 and $3,951,000 during fiscal 2026 and 2025, respectively. Interest Income (expense), Net For fiscal 2026 and 2025, we earned interest income on our domestic cash balances and incurred interest expense on borrowings on our credit facilities. Other Income (expense), Net Other income (expense), net, is comprised primarily of foreign currency remeasurement and transaction adjustments related to our foreign subsidiaries whose functional currency is the U.S. dollar. Provision for Income Taxes The following table presents our provision for income taxes: Years Ended June 30, % of Net % of Net Change 2026 Revenue 2025 Revenue $ % (In thousands, except percentages) Provision for (benefit from) income taxes $ 279 0.2% $ (239 ) (0.2% ) $ 518 (216.7% ) 32 The following table presents our effective tax rate based upon our provision for income taxes: Years Ended June 30, 2026 2025 Effective tax rate (7.2% ) 2.1% We utilize the liability method of accounting for income taxes. The differences between our effective tax rate and the federal statutory rate in fiscal 2026 and 2025 were also impacted by the effect of our domestic losses recorded without a tax benefit, as well as the effect of certain state and foreign earnings taxed at rates differing from the federal statutory rate. Additionally, in fiscal 2025, we reversed a portion of our liability for uncertain tax positions as a result of the dissolution of one of our foreign subsidiaries. We record net deferred tax assets to the extent we believe these assets are more likely than not to be realized. Aside from a net deferred tax liability of $219,000 and $172,000 that we recorded as of June 30, 2026 and 2025, respectively, based on our cumulative losses and uncertainty of generating future taxable income, we provided a full valuation allowance against our net deferred tax assets at June 30, 2026 and 2025. Refer to Note 7 of Notes to Consolidated Financial Statements, included in Part II, Item 8 of this Report, for additional information. Liquidity and Capital Resources Liquidity The following table presents our working capital and cash and cash equivalents: June 30, 2026 2025 Change (In thousands) Working capital $ 85,359 $ 46,971 $ 38,388 Cash and cash equivalents $ 60,466 $ 20,098 $ 40,368 On May 29, 2026, in an underwritten public offering, we sold approximately 4,800,000 shares of common stock. We received net cash proceeds from the offering of approximately $31,750,000. Refer to Note 5 of Notes to Consolidated Financial Statements, included in Part II, Item 8 of this Report for additional information. On May 8, 2026, we entered into a sales agreement with sales agents, with respect to an at-the-market offering program under which we may offer and sell, from time to time at our sole discretion, shares of our common stock, with an aggregate offering price of up to $30,000,000. During the year ended June 30, 2026, we sold approximately 1.8 million shares of our common stock under the sales agreement generating approximately $12,340,000 in net proceeds. As of June 30, 2026, we have approximately $17,000,000 remaining of the aggregate offering capacity and the sales agreement remains in effect. Our principal sources of cash and liquidity include our existing cash and cash equivalents, borrowings and amounts available under our existing bank borrowing agreement, and cash generated from operations. We are subject to a variable amount of interest on the principal balance of our borrowings and could be adversely impacted by rising interest rates in the future. We believe that our current cash holdings, net cash provided by operating activities, and expected availability under our bank borrowing agreement will be sufficient to fund our material requirements for working capital, capital expenditures and other financial commitments for at least the next 12 months and beyond. 33 We continue to monitor our existing banking relationships and the availability of potential alternate sources of credit based on market conditions and our ongoing capital requirements. There can be no guarantee that we would be able to obtain any needed alternate financing on acceptable terms, or at all, or that such a financing would not result in a default under the current borrowing agreement. Refer to Note 4 of Notes to Consolidated Financial Statements, including in Part II, Item 8 of this Report, for additional information. We anticipate that the primary factors affecting our cash and liquidity are net revenue, working capital requirements and capital expenditures. We define cash and cash equivalents as highly liquid deposits with original maturities of 90 days or less when purchased. We maintain cash and cash equivalents balances at certain financial institutions in excess of amounts insured by the Federal Deposit Insurance Corporation (“FDIC”). There can be no assurance that our deposits in excess of the FDIC limits will be backstopped by the U.S., or that any bank or financial institution with which we do business will be able to obtain needed liquidity from other banks, government institutions or by acquisition in the event of a failure or liquidity crisis. Our future working capital requirements will depend on many factors, including the following: timing and amount of our net revenue; our product mix and the resulting gross margins; research and development expenses; selling, general and administrative expenses; and expenses associated with any strategic partnerships, acquisitions or infrastructure investments. From time to time, we may seek additional capital from public or private offerings of our capital stock, borrowings under our existing or future credit lines or other sources in order to (i) develop or enhance our products, (ii) take advantage of strategic opportunities, (iii) respond to competition or (iv) continue to operate our business. We currently have a Form S-3 shelf registration statement on file with the SEC. If we issue equity securities to raise additional funds, our existing stockholders may experience dilution, and the new equity securities may have rights, preferences and privileges senior to those of our existing stockholders. If we issue debt securities to raise additional funds, we may incur debt service obligations, become subject to additional restrictions that limit or restrict our ability to operate our business, or be required to further encumber our assets. There can be no assurance that we will be able to raise any such capital on terms acceptable to us, if at all. Cash Flows The following table presents the major components of the consolidated statements of cash flows: Years Ended June 30, 2026 2025 Change (In thousands) Net cash provided by operating activities $ 9,877 $ 7,285 $ 2,592 Net cash used in investing activities (612 ) (6,963 ) 6,351 Net cash provided by (used in) financing activities 31,103 (6,461 ) 37,564 Operating Activities Cash provided by operating activities during fiscal 2026 increased compared to fiscal 2025 primarily as a result of a reduction in our net loss in the current period. For fiscal 2026, our net loss included $9,535,000 of non-cash charges, while the changes in operating assets and liabilities provided net cash of $4,523,000. Accounts payable increased by $3,712,000, or 28.0%, from June 30, 2025 to June 30, 2026 primarily due to the timing of inventory receipts and payments made to our vendors. Accrued payroll and related expenses increased by $1,349,000 or 38.9% from June 30, 2025 to June 30, 2026. The increase was primarily due to the accrual of variable compensation in the current fiscal year. 34 Investing Activities Net cash used in investing activities for fiscal 2026 and fiscal 2025 consisted of purchases of equipment totaling $612,000 and $505,000, respectively, primarily for computer hardware and tooling at our contract manufacturers, business analysis tools, and certain research and development equipment. Net cash used in investing activities for fiscal 2025 also includes the acquisition of Netcomm, which used cash of $6,458,000. Financing Activities Net cash provided by financing activities during fiscal 2026 resulted primarily from the net proceeds from our equity offerings of $44,090,000 partially offset by net principal payments and borrowings on our Loan Agreement, as well as from tax withholdings paid on behalf of employees for restricted shares. Net cash used in financing activities during fiscal 2025 resulted primarily from tax withholdings paid on behalf of employees for restricted shares as well as principal payments on our previous term loan borrowings.