Immersion invests surplus funds in excess of operational requirements in a diversified portfolio of marketable securities, with the objectives of delivering competitive returns, maintaining a high degree of liquidity, and seeking to avoid the permanent impairment of principal. The following summarizes our investments in marketable-equity securities as of July 31, 2026 and April 30, 2026 (in thousands):

Marketable securities as of July 31, 2026 and April 30, 2026 consisted of the following (in thousands):


	July 31, 2026
	Cost or Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Marketable equity securities
Equity securities	$	36,121	$	6,838	$	(8,261	)	$	34,698
Total marketable securities	$	36,121	$	6,838	$	(8,261	)	$	34,698


	April 30, 2026
	Cost or Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Marketable equity securities
Equity securities	$	47,087	$	5,365	$	(10,284	)	$	42,168
Total marketable securities	$	47,087	$	5,365	$	(10,284	)	$	42,168

Immersion’s derivative instruments consisted of call and put options sold at their fair value as of the balance sheet date. These derivative instruments are reported as Other current liabilities on the Company’s Condensed Consolidated Balance Sheets as of July 31, 2026 and April 30, 2026 (in thousands):


	July 31, 2026
	Cost		Unrealized Losses		Fair Value
Derivative instruments	$	21,365	$	1,309	$	22,674
	$	21,365	$	1,309	$	22,674


	April 30, 2026
	Cost		Unrealized Losses		Fair Value
Derivative instruments	$	10,690	$	1,185	$	11,875
	$	10,690	$	1,185	$	11,875

The following summarizes the realized and unrealized gains and losses from Immersion’s equity securities and derivative instruments and realized gains and losses from our marketable-debt securities for the following periods (in thousands):


	Three Months Ended July 31,
	2026			2025
Net unrealized gains recognized on marketable equity securities	$	3,496		$	1,243
Net realized gains recognized on marketable equity securities		3,623			960
Net unrealized gains (losses) recognized on derivative instruments		(124	)		2,577
Net realized gains recognized on derivative instruments		6,768			1,205
Total net gains recognized in interest income and other income (expense), net	$	13,763		$	5,985

The fair value of certain financial instruments including Cash and cash equivalents; Accounts receivable, net; Accounts payable; and Accrued liabilities approximate their carrying value due to their short-term nature and are classified within Level 1. The fair value of our Long-term borrowings approximates its carrying value and is classified as Level 2, as it is estimated using observable market inputs such as current interest rates and credit spreads for similar instruments.

Our financial instruments measured at fair value on a recurring basis consisted of U.S. treasury securities, equity securities, corporate bonds, and derivatives. Equity securities and certain derivative instruments are classified within Level 1 of the fair value hierarchy as they are valued based on quoted market price in an active market. U.S. treasury securities, corporate bonds, and certain derivative instruments are valued based on quoted prices in markets that are less active, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency are generally classified within Level 2 of the fair value hierarchy.

Financial instruments valued based on unobservable inputs, which reflect the reporting entity’s own assumptions or data that market participants would use in valuing an instrument, are generally classified within Level 3 of the fair value hierarchy.

Our non-financial assets include property and equipment, operating lease right-of-use assets, and intangible assets. Such assets are reported at their carrying values and are not subject to recurring fair value measurements. We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable in accordance with ASC 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets. See Note 2. Basis of Presentation and Summary of Significant Accounting Policies for additional information.

Barnes & Noble Education granted phantom share units as long-term incentive awards that are settled in cash based on the fair market value of a share of common stock of the Company at each vesting date. The fair value of the liability for the cash-settled phantom share unit awards will be remeasured at the end of each reporting period through settlement to reflect current risk-free rate and volatility assumptions. At July 31, 2026 and April 30, 2026 a liability was recorded, which is not material to the balance sheet (Level 2 input) and is reflected in Accrued liabilities on the Condensed Consolidated Balance Sheets. See Note 10. Stock-Based Compensation for additional information.

Financial instruments measured at fair value on a recurring basis as of July 31, 2026 and April 30, 2026 are classified based on the valuation technique in the table below (in thousands):


	July 31, 2026
	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets:
Money Market funds (within cash and cash equivalents)	$	141,249	$	—	$	—	$	141,249
Equity securities		34,698		—		—		34,698
Total assets at fair value	$	175,947	$	—	$	—	$	175,947

Liabilities
Derivative instruments	$	9,076	$	13,598	$	—		22,674
Total liabilities at fair value	$	9,076	$	13,598	$	—	$	22,674


	April 30, 2026
	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets:
Money Market funds (within cash and cash equivalents)	$	109,631	$	—	$	—	$	109,631
Equity securities		42,168		—		—		42,168
Total assets at fair value	$	151,799	$	—	$	—	$	151,799

Liabilities
Derivative instruments	$	2,166	$	9,709	$	—	$	11,875
Total liabilities at fair value	$	2,166	$	9,709	$	—	$	11,875