AtriCure, Inc.

Previous wording

During the first quarter of 2026, we realized strong growth resulting from our strategic initiatives of product innovation, clinical science and physician education and training to expand awareness and adoption. Our worldwide revenue for the three months ended March 31, 2026 was $141,249, representing an increase of $17,629, or 14.3% (12.8% on a constant currency basis), over the first three months of 2025, highlighted by accelerated adoption in our pain management, appendage management, and open ablation product lines, where recent product innovation contributed to growth. There are limited competitors in our key markets; however, new entrants are developing competing products, procedures, and/or clinical solutions that may cause variability in our results.

Current wording

In 2026, we have maintained growth across most of our key franchises and geographies, resulting from our strategic initiatives of product innovation, clinical science and physician education and training to expand awareness and adoption. Our worldwide revenue for the six months ended June 30, 2026 was $294,853, representing an increase of $35,094, or 13.5% (12.6% on a constant currency basis), over the first six months of 2025, highlighted by accelerated adoption in our pain management, appendage management, and open ablation product lines, where recent product innovation continued to contribute to growth. We have limited competition today; however, our key markets are attracting competition from new entrants developing competing products, procedures, and/or clinical solutions. Increasing competition may lead to loss of market share in critical franchises, pricing and margin pressure, and increased costs, which could adversely affect our revenue and profitability.

Previous wording

PRODUCT INNOVATION. We continue to see growth from our most recent product innovations. We remain focused on sustaining this momentum by advancing our internal research and product development efforts with the objective of enhancing our existing portfolio and supporting the introduction of future products while pursuing regulatory approvals to market and sell globally across all franchises. In April 2026, we received CE mark approval under EU MDR in Europe for our AtriClip FLEX-Mini® and PRO-Mini® devices and expect to launch both products in Europe later this year.

Current wording

PRODUCT INNOVATION. We continue to deliver growth from our most recent product innovations. We remain focused on sustaining this momentum by advancing our internal research and product development efforts with the objective of enhancing our existing portfolio and supporting the introduction of future products while pursuing regulatory approvals to market and sell globally across all franchises. In April 2026, we received CE mark approval under EU MDR in Europe for our AtriClip FLEX-Mini® and AtriClip PRO-Mini® devices and expect to launch both products in Europe later this year.

Previous wording

CLINICAL SCIENCE. We continue to invest in studies to expand labeling claims, support various indications for our products and gather and publish clinical data for therapies and procedures involving our products.

Current wording

CLINICAL SCIENCE. We continue to invest in studies to expand labeling claims, support various indications for our products and gather and publish clinical data for therapies and procedures involving our products. Key trials include:

Previous wording

Worldwide revenue increased 14.3% (12.8% on a constant currency basis). In the United States, we saw a 14.9% increase in revenue driven by key product lines: AtriClip® FLEX-Mini and PRO-Mini devices for appendage management, cryoSPHERE® MAX™ probe for post-operative pain management and EnCompass® clamp for open ablation. Minimally invasive ablation sales declined during the quarter from continued reduction in Hybrid procedures as physicians adopt PFA catheters to treat patients. International sales increased 11.5% (3.3% on a constant currency basis), with growth in appendage management, open ablation and pain management franchises. Additionally, we saw strong growth in most of our direct markets offset by distributor channels.

Current wording

Worldwide revenue increased 12.8% (12.4% on a constant currency basis). In the United States, we realized a 13.6% increase in revenue driven by key product lines: cryoSPHERE® MAX™ probe for post-operative pain management, EnCompass clamp for open ablation and AtriClip FLEX-Mini and AtriClip PRO-Mini devices for appendage management. Minimally invasive ablation sales declined during the quarter from continued reduction in Hybrid procedures as physicians adopt PFA catheters to treat patients. International sales increased 9.6% (7.1% on a constant currency basis), with growth in appendage management, open ablation and pain management franchises.

Previous wording

Other expense. Other expense consists primarily of net interest expense.

Current wording

Other expense. Other expense consists primarily of net foreign currency transaction gains or losses and net interest expense.

Previous wording

Cost of revenue and gross margin. Cost of revenue increased $946 reflecting higher sales volumes. Gross margin increased 246 basis points, driven primarily by favorable product and geographic mix.

Current wording

Cost of revenue and gross margin. Cost of revenue increased $1,264 reflecting higher sales volumes. Gross margin increased 258 basis points, driven primarily by favorable product and geographic mix.

Previous wording

Selling, general and administrative expenses. Selling, general and administrative expenses increased $8,496, or 11.2%, driven by a $6,499 increase in personnel costs, including travel and share-based compensation, largely as a result of growth in headcount to support sales growth. Additional spending related to meeting costs increasing $788 and marketing and training costs increasing $679 driven by expanded tradeshow and training activities.

Current wording

Selling, general and administrative expenses. Selling, general and administrative expenses increased $12,668, or 8.2%, driven by $8,727 higher personnel costs, including travel and share-based compensation, largely as a result of incremental headcount to support sales growth. Marketing and training costs increased $2,036 driven by expanded training activities. IT expenses increased $783 while operational growth drove the remaining increase in general and administrative costs.

Previous wording

As of March 31, 2026, we had cash and cash equivalents of $146,165 and outstanding debt of $61,000. We had unused borrowing capacity of $62,750 (see Note 6 – Borrowings and Financing Obligation for related discussion). All cash equivalents and most of our operating cash is held in United States financial institutions. A small portion of our cash is held in foreign banks to support our international operations. We had net working capital of $240,502 and an accumulated deficit of $413,095 as of March 31, 2026.

Current wording

As of June 30, 2026, we had cash and cash equivalents of $167,786 and outstanding debt of $61,000. We had unused borrowing capacity of $62,750 (see Note 6 – Borrowings and Financing Obligation for related discussion). All cash equivalents and most of our operating cash is held in United States financial institutions. A small portion of our cash is held in foreign banks to support our international operations. We had net working capital of $263,615 and an accumulated deficit of $404,140 as of June 30, 2026.

Previous wording

Consolidated Cash Flows - For the three months ended March 31, 2026 and 2025

Current wording

Consolidated Cash Flows - For the six months ended June 30, 2026 and 2025

Previous wording

Cash flows used in operating activities. Net cash used in operating activities decreased $7,030 from 2025 to 2026, reflecting improved operating results of $6,855, driven by higher sales and improved operating margin. These improvements were offset by an increase of $1,855 in working capital cash outflows primarily due to an increase in accounts receivable from increased sales as well as investments in inventory to support future growth.

Current wording

Cash flows provided by operating activities. Net cash provided by operating activities increased $7,605 from 2025 to 2026, reflecting improved operating results of $22,000, driven by higher sales, improved operating margin and no acquired IPR&D expense in 2026. In 2025, we incurred $5,000 related to the acquired IPR&D milestone payment. These improvements were offset by an increase of $13,142 in working capital cash outflows primarily due to an increase in accounts receivable from increased sales as well as investments in inventory to support future growth.

Previous wording

Cash flows used in investing activities. Net cash used in investing activities increased by $2,171 from 2025 to 2026, due to a $1,671 increase in purchases of property and equipment and $500 in capital grant proceeds received in 2025.

Current wording

Cash flows used in investing activities. Net cash used in investing activities improved by $1,725 from 2025 to 2026, due to the decrease of $5,000 for the 2025 acquired IPR&D milestone payment, offset by a $2,775 increase in purchases of property and equipment and $500 in capital grant proceeds received in 2025.

Previous wording

Cash flows used in financing activities. Net cash used in financing activities increased by $2,930 from 2025 to 2026. This increase was a result of $777 cash used to pay financing costs as part of the First Amendment to the ABL Facility, $865 paid to reduce outstanding borrowings and a $1,270 increase in shares repurchased for payment of taxes on stock awards.

Current wording

Cash flows used in financing activities. Net cash used in financing activities increased by $3,087 from 2025 to 2026. This increase was a result of $777 cash used to pay financing costs as part of the First Amendment to the ABL Facility, $865 paid to reduce outstanding borrowings and a $1,178 increase in shares repurchased for payment of taxes on stock awards.