Note 8 – Acquisitions and Divestitures

Fiscal 2025 Activity

Acquisition and Divestiture of Desktop Metal, Inc. (“Desktop Metal” or “Desktop”)

On April 2, 2025, the Company acquired 100% of the shares and voting interests in Desktop Metal, a U.S. based publicly traded company (NYSE: DM). Desktop Metal designs and manufactures industrial-grade 3D printers, materials, and software. The acquisition of Desktop Metal was expected to generate operational synergies, while expanding the Company’s customer base and global market presence across key industries. After signing the Merger Agreement on July 2, 2024 (the “Merger Agreement”), the Company and Desktop worked diligently to close the transactions. By late 2024, the sole remaining condition to closing the transactions was approval by the Committee for Foreign Investment in the United States (“CIFIUS”). Desktop instituted a series of legal proceedings against the Company to compel the closing of the transactions. In the months that followed, Desktop incurred significant legal expenses that placed financial strain on its financial resources. After several months, Desktop prevailed in the litigation while reaching insolvency. Immediately following the merger with Desktop (the “Merger”), the Company provided a $12.0 million bridge loan to Desktop but notified Desktop that no further capital would be infused from the Company. On July 28, 2025, Desktop Metal filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code and was immediately deconsolidated by the Company. The results of Desktop Metal from April 2, 2025 through June 30, 2025 as well as impairment charges related to the Desktop Metal assets and the costs associated with the bankruptcy and deconsolidation are included in Net loss from discontinued operations on the condensed consolidated statements of operations and comprehensive loss.

Information related to the historical results of Desktop is not relevant to the Company’s future results as well as any pro forma presentation giving effect to the Merger since the Desktop assets have already been disposed of and were not reflected in the Company’s results for the period between the date of acquisition and the date of approval of the Insolvency Proceeding, in its condensed consolidated statements of operations and comprehensive loss as discontinued operations and in related disclosures.

The Company determined that the Desktop assets would be disposed of through a sale or other process on the acquisition date and pursued a plan to sell or otherwise dispose of the Desktop business throughout the fiscal quarter following the closing of the Merger. The Company also recorded impairment charges related to the Desktop assets and the costs associated with the bankruptcy and deconsolidation of Desktop in discontinued operations on the Company’s condensed consolidated statements of operations and comprehensive loss following the closing of the Merger. The condensed consolidated statements of operations and comprehensive loss include impairment of the Desktop Metal asset group of $139.4 million and loss from operations for the period of acquisition through June 30, 2025 of $30.4 million, which are both included within net loss from discontinued operations of $169.8 million.

The acquisition was funded through available cash. The portion of the fair-value-based measure of the replacement awards attributable to Desktop Metal employee service rendered prior to the acquisition date was $1.0 million and is recorded in additional paid in capital on the condensed consolidated balance sheet. The fair value of consideration transferred is as follows:

The Company incurred acquisition-related costs of $11.9 million, of which $8.1 million was incurred in 2025 and $3.8 million in 2024. These costs consist primarily of legal and accounting fees and have been included in general and administrative costs within the condensed consolidated statements of operations and comprehensive loss.

Acquisition of Markforged Holding Corporation (“Markforged”)

On April 25, 2025, the Company acquired 100% of the shares and voting interests in Markforged, a U.S. based publicly traded company (NYSE: MKFG). Markforged designs, produces and markets cloud-based software products (including its software enabled platform the Digital Forge) and hardware products, including precise and reliable 3D printers, proprietary metal and composite materials to bring industrial production to the point of need on the factory floor. The acquisition of Markforged would enable the Company to access Markforged’s additive manufacturing technology, facilitating a broader, more integrated product portfolio. On May 27, 2026, the Company announced that it has entered into a definitive agreement to sell MarkForged to Stratasys Ltd. The transaction is expected to close in the second half of 2026, subject to regulatory approvals and customary closing conditions.

The acquisition was funded through available cash. The portion of the fair-value-based measure of the replacement awards attributable to Markforged employee service rendered prior to the acquisition date was $1.1 million and is recorded in additional paid in capital on the condensed consolidated balance sheet. The fair value of consideration transferred is as follows:

The goodwill resulting from this transaction is primarily attributable to the potential growth and expected synergies from combining operations and is not deductible for tax purposes.

The Company incurred acquisition-related costs of $3.8 million, of which $2.2 million was incurred in 2025 and $1.6 million in 2024. These costs consist primarily of legal and accounting fees and have been included in general and administrative costs within the condensed consolidated statements of operations and comprehensive loss.

These unaudited pro forma results of operations have been prepared for comparative purposes only, and they do not purport to be indicative of the results of operations that actually would have resulted had the acquisition occurred on the date indicated or that may result in the future. No effect has been given for synergies, if any, that may be realized through the acquisition.

Divestitures

On April 6, 2026, the AME product line and previously discontinued Fabrica product line were divested. The total consideration payable to the Company in connection with the transaction is up to $12.5 million, consisting of a $2.0 million cash payment, and up to $10.5 million of deferred payments tied to the future performance of the product lines over the next twelve months. The deferred consideration consists of up to $4.0 million (AME, 50% of net cash proceeds) and up to $6.5 million (Fabrica, 50% of net cash proceeds), each measured over a 12-month Earn-Out period. The deferred consideration (the “Earn-Out”) is contingent on the purchaser selling the transferred assets over a 12-month period following closing. The Company receives 50% of net cash proceeds actually collected or invoiced and collected within six months thereafter from the transferred AME inventory, capped at $4.0 million. The Company also receives 50% of net cash proceeds from Fabrica inventory, capped at $6.5 million. The final amount, in each case, is net of returns, credits, shipping, duties, and third-party commissions. The Earn-Out was recognized at its estimated fair value at the disposal date of $2.1 million for AME and $0.8 million for Fabrica, or $2.9 million in total, within Other current assets. There was no change in fair value as of June 30, 2026. The loss on sale of AME assets of $1.3 million was recorded to Restructuring and other during the three and six months ended June 30, 2026.

During 2025, we discontinued a number of product lines, including, Fabrica, Admatec, Formatec, Formatec Holdings, DeepCube, and the AME online community platform (J.A.M.E.S.). The Company implemented a complete cost reduction program for the DeepCube and Nano Fabrica product lines. In April 2025, Admatec, Formatec, and Formatec Holdings were declared bankrupt. Additionally, in April 2025, J.A.M.E.S. ceased operations.

Loss on deconsolidation of subsidiaries represents the difference between proceeds received upon disposition and the book value of a subsidiary which has been divested and was excluded from treatment as a discontinued operation. Also included in loss on disposal of subsidiaries is recognition of the cumulative translation adjustment out of accumulated other comprehensive loss. The loss on deconsolidation of subsidiaries was $1.8 million related to Admatec and Formatec and a gain of $0.1 million related to J.A.M.E.S. recorded to Restructuring and other during the three and six months ended June 30, 2025.