UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: ~~September~~April 263, ~~2025~~2026

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 0-11634

STAAR Surgical Company

(Exact Name of Registrant as Specified in its Charter)


Delaware	95-3797439
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
25510 Commercentre Drive Lake Forest, California	92630
(Address of Principal Executive Offices)	(Zip Code)

(626) 303-7902

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common	STAA	NASDAQ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

The registrant has 49,~~741~~788,~~953~~495 shares of common stock, par value $0.01 per share, ~~issued and~~ outstanding as of ~~October~~May 318, ~~2025~~2026.

STAAR SURGICAL COMPANY

INDEX

		PAGENUMBER
PART I – FINANCIAL INFORMATION		1
ITEM 1	FINANCIAL STATEMENTS	1
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	2218
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	2924
ITEM 4.	CONTROLS AND PROCEDURES	2924
PART II – OTHER INFORMATION		3024
ITEM 1.	LEGAL PROCEEDINGS	3024
ITEM 1A.	RISK FACTORS	3025
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32
ITEM 5.	OTHER INFORMATION	25
ITEM 4.	MINE SAFETY DISCLOSURES	32
ITEM 6.	EXHIBITS	26
ITEM 5.	OTHER INFORMATION	32
ITEM 6.	EXHIBITS	33

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value amounts)

(Unaudited)

	September 26, 2025			December 27, 2024
	April 3, 2026			January 2, 2026
ASSETS
Current assets:
Cash and cash equivalents	$	~~176~~131,~~155~~864		$	~~144~~153,~~159~~150
Investments available for sale (amortized cost basis of $16,504 and $86,346 at September 26, 2025 and December 27, 2024, respectively)		16,505			86,335
Investments available for sale (amortized cost basis of $32,028 and $34,385 at April 3, 2026 and January 2, 2026, respectively)		32,025			34,386
Accounts receivable trade, net of allowance for credit losses of $83 and $32 at September 26, 2025 and December 27, 2024, respectively		60,105			77,897
Accounts receivable trade, net of allowance for credit losses of $799 and $83 at April 3, 2026 and January 2, 2026, respectively		81,172			50,064
Inventories, net		5349,~~302~~784			4355,~~305~~496
Prepayments, deposits and other current assets		1517,~~142~~553			1618,~~244~~449
Total current assets		~~321~~312,~~209~~398			~~367~~311,~~940~~545
Property, plant and equipment, net		7271,~~605~~738			8473,~~889~~323
Finance lease right-of-use assets, net		—			37
Operating lease right-of-use assets, net		28,572			29,609
Operating lease right-of-use assets, net		31,339			36,850
Cloud-based software		34,265			30,700
Goodwill		1,786			1,786
Deferred income taxes		1,~~977~~088			~~788~~3,365
Other assets		271,~~446~~271			171,~~234~~350
Total assets	$	~~456~~451,~~362~~118		$	~~509~~451,~~524~~678
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	98,~~180~~696		$	1611,~~704~~574
Obligations under finance leases		—			42
Obligations under operating leases		6,102			5,872
Obligations under operating leases		5,314			3,894
Allowance for sales returns		13,190			10,199
Allowance for sales returns		7,526			6,579
Other current liabilities		33,006			40,859
Other current liabilities		39,617			43,087
Total current liabilities		60,994			68,504
Total current liabilities		61,637			70,306
Obligations under operating leases		31,189			32,481
Obligations under operating leases		33,803			34,807
Asset retirement obligations		44			45
Deferred income taxes		—			297
Deferred rent		89			89
Asset retirement obligations		43			42
Pension liability		6,436			6,375
Deferred rent		89			—
Total liabilities		98,752			107,494
Pension liability		7,010			6,737
Commitments and contingencies (Note 12)
Total liabilities		102,582			112,189
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.01 par value; 60,000 shares authorized: 49,730 and 49,294 shares issued and outstanding at September 26, 2025 and December 27, 2024, respectively		497			493
Common stock, $0.01 par value; 60,000 shares authorized: 50,156 shares issued and 49,780 shares outstanding at April 3, 2026 and 49,779 shares issued and 49,403 outstanding at January 2, 2026		502			498
Additional paid-in capital		~~495~~507,~~986~~921			~~471~~504,~~449~~682
Treasury stock, 376 and 0 shares at September 26, 2025 and December 27, 2024, respectively		(6,461	)		—
Treasury stock, 376 and 376 shares at April 3, 2026 and January 2, 2026, respectively		(6,461	)		(6,461	)
Accumulated other comprehensive loss		(6,~~527~~778	)		(76,~~031~~511	)
Accumulated deficit		(~~129~~142,~~715~~818	)		(67148,~~576~~024	)
Total stockholders’ equity		~~353~~352,~~780~~366			~~397~~344,~~335~~184
Total liabilities and stockholders’ equity	$	~~456~~451,~~362~~118		$	~~509~~451,~~524~~678

See accompanying notes to the condensed consolidated financial statements.

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended						~~Nine Months Ended~~
	September 26, 2025			September 27, 2024			September 26, 2025			September 27, 2024
	April 3, 2026			March 28, 2025
Net sales	$	9493,~~732~~522		$	8842,~~590~~589		$	~~181,641~~		$	~~264,951~~
Cost of sales		1624,~~857~~663			2014,~~103~~584			~~42,962~~			~~57,017~~
Gross profit		7768,~~875~~859			6828,~~487~~005			~~138,679~~			~~207,934~~
Selling, general and administrative expenses:
General and administrative		2017,~~763~~022			2124,~~685~~458			~~66,190~~			~~68,554~~
Selling and marketing		2324,~~461~~509			2826,~~872~~945			~~76,689~~			~~88,535~~
Research and development		9,~~209~~925			1211,~~248~~339			~~30,811~~			~~35,546~~
Merger transaction and related costs		56,~~926~~743			—			~~5,926~~			—
Restructuring, impairment and related charges		262,681			—22,664			~~27,938~~			—
Total selling, general and administrative expenses		5960,~~385~~880			6285,~~805~~406			~~207,554~~			~~192,635~~
Operating income (loss)		187,~~490~~979			5(57,~~682~~401	)		~~(68,875~~	)		~~15,299~~
Other income (expense), net:
Interest income, net		~~790~~907			1,~~407~~366			~~3,522~~			~~4,358~~
Gain (loss) on foreign currency transactions		(~~843~~1,111	)		51,~~931~~418			~~3,138~~			~~585~~
Royalty income		—			—			—			508
Other income, net		443			131
Other income, net		353			139			604			532
Total other income, net		239			2,915
Total other income, net		300			7,477			7,264			5,983
Income (loss) before income taxes		8,218			(54,486	)
Income (loss) before income taxes		18,790			13,159			(61,611	)		21,282
Provision (benefit) for income taxes		3,012			(275	)
Provision for income taxes		9,906			3,179			528			7,262
Net income (loss)	$	5,206		$	(54,211	)
Net income (loss)	$	8,884		$	9,980		$	(62,139	)	$	14,020
Net income (loss) per share:
Net income (loss) per share:
Basic	$	0.10		$	(1.10	)
Basic	$	0.18		$	0.20		$	(1.26	)	$	0.29
Diluted	$	0.10		$	(1.10	)
Diluted	$	0.18		$	0.20		$	(1.26	)	$	0.28
Weighted average shares outstanding:
Weighted average shares outstanding:
Basic		49,908			49,344
Basic		49,633			49,199			49,499			49,078
Diluted		50,900			49,344
Diluted		50,549			49,731			49,499			49,614

See accompanying notes to the condensed consolidated financial statements.

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands)

(Unaudited)

	Three Months Ended						~~Nine Months Ended~~
	September 26, 2025			September 27, 2024			September 26, 2025			September 27, 2024
	April 3, 2026			March 28, 2025
Net income (loss)	$	85,~~884~~206		$	9(54,~~980~~211	)	$	~~(62,139~~	)	$	~~14,020~~
Other comprehensive income (loss):
Defined benefit plans:
Net change in plan assets		(~~514~~43	)		~~(1,708~~950	)		~~(184~~	)		~~(1,573~~	)
Reclassification into other income (expense), net		17(6	)		~~(17~~16	)		49			~~(51~~	)
Investments available for sale:
Change in unrealized gain (loss)		3(5	)		~~134~~(1	)		11			~~101~~
Reclassification into other income (expense), net		1			—			2			2
Foreign currency translation gain (loss)		(321	)		801
Foreign currency translation gain (loss)		(639	)		1,856			866			(182	)
Tax effect		108			(339	)
Tax effect		250			(404	)		(240	)		214
Other comprehensive income (loss), net of tax		(267	)		1,427
Other comprehensive income (loss), net of tax		(882	)		(139	)		504			(1,489	)
Comprehensive income (loss)	$	4,939		$	(52,784	)
Comprehensive income (loss)	$	8,002		$	9,841		$	(61,635	)	$	12,531

See accompanying notes to the condensed consolidated financial statements.

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands)

(Unaudited)

	Three Months Ended
	CommonStock Shares			CommonStock ParValue		AdditionalPaid-InCapital			Treasury Stock Shares			Treasury Stock			AccumulatedOtherComprehen-sive Income(Loss)			AccumulatedDeficit			Total
Balance, at June 27, 2025		49,546		$	495	$	484,801			(261	)	$	(4,479	)	$	(5,645	)	$	(138,599	)	$	336,573
Balance, at January 2, 2026		49,779		$	498	$	504,682			(376	)	$	(6,461	)	$	(6,511	)	$	(148,024	)	$	344,184
Net income		—			—		—			—			—			—			85,~~884~~206			85,~~884~~206
Other comprehensive loss		—			—		—			—			—			(~~882~~267	)		—			(~~882~~267	)
Common stock issued upon exercise of options		~~157~~20			1—		~~2,963~~170			—			—			—			—			~~2,964~~170
Stock-based compensation		—			—		84,~~222~~936			—			—			—			—			84,~~222~~936
Repurchase of common stock		—			—					(115	)		(1,982	)		—			—			(1,982	)
Repurchase of employee common stock for taxes withheld		(96	)		—		(1,867	)		—			—			—			—			(1,867	)
Repurchase of employee common stock for taxes withheld		(2	)		—		—			—			—			—			—			—
Vested restricted and performance stock units		453			4		—			—			—			—			—			4
Vested restricted and performance stock units		29			1		—			—			—			—			—			1
Balance, at April 3, 2026		50,156		$	502	$	507,921			(376	)	$	(6,461	)	$	(6,778	)	$	(142,818	)	$	352,366
Balance, at September 26, 2025		49,730		$	497	$	495,986			(376	)	$	(6,461	)	$	(6,527	)	$	(129,715	)	$	353,780
Balance, at December 27, 2024		49,294		$	493	$	471,449			—		$	—		$	(7,031	)	$	(67,576	)	$	397,335
Balance, at June 28, 2024		49,161		$	492	$	457,402			—		$	—		$	(5,463	)	$	(43,328	)	$	409,103
Net loss		—			—		—			—			—			—			(54,211	)		(54,211	)
Net income		—			—		—			—			—			—			9,980			9,980
Other comprehensive income		—			—		—			—			—			1,427			—			1,427
Other comprehensive loss		—			—		—			—			—			(139	)		—			(139	)
Common stock issued upon exercise of options		52			1		375			—			—			—			—			376
Common stock issued upon exercise of options		105			1		1,656			—			—			—			—			1,657
Stock-based compensation		—			—		6,327			—			—			—			—			6,327
Stock-based compensation		—			—		7,521			—			—			—			—			7,521
Repurchase of employee common stock for taxes withheld		(66	)		—		(1,283	)		—			—			—			—			(1,283	)
Vested restricted and performance stock units		5243			—1		—			—			—			—			—			—1
Balance, at September 27, 2024		49,271		$	493	$	466,579			—		$	—		$	(5,602	)	$	(33,348	)	$	428,122
Balance, at March 28, 2025		49,523		$	495	$	476,868			—		$	—		$	(5,604	)	$	(121,787	)	$	349,972

See accompanying notes to the condensed consolidated financial statements.

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF ~~STOCKHOLDERS’~~CASH ~~EQUITY~~ FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended
	Three Months Ended
	CommonStock Shares			CommonStock ParValue			AdditionalPaid-InCapital			Treasury Stock Shares			Treasury Stock			AccumulatedOtherComprehen-sive Income(Loss)			AccumulatedDeficit			Total
	April 3, 2026			March 28, 2025
Balance, at December 27, 2024		49,294		$	493		$	471,449			—		$	—		$	(7,031	)	$	(67,576	)	$	397,335
Cash flows from operating activities:
Net loss		—			—			—			—			—			—			(62,139	)		(62,139	)
Net income (loss)	$	5,206		$	(54,211	)
Other comprehensive income		—			—			—			—			—			504			—			504
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Common stock issued upon exercise of options		210			2			3,349			—			—			—			—			3,351
Depreciation of property, plant, and equipment		2,107			2,337
Stock-based compensation		—			—			22,543			—			—			—			—			22,543
Amortization of cloud-based software		104			53
Repurchase of common stock		—			—			—			(376	)		(6,461	)		—			—			(6,461	)
Non-cash operating lease expense		857			1,028
Repurchase of employee common stock for taxes withheld		(71	)		(1	)		(1,355	)		—			—			—			—			(1,356	)
Impairment of fixed assets and operating lease right-of-use assets		—			13,216
Vested restricted and performance stock units		297			3			—			—			—			—			—			3
Accretion/Amortization of investments available for sale		(232	)		(129	)
Balance, at September 26, 2025		49,730		$	497		$	495,986			(376	)	$	(6,461	)	$	(6,527	)	$	(129,715	)	$	353,780
Deferred income taxes		2,810			(1,029	)
Balance, at December 29, 2023		48,839		$	488		$	436,947			—		$	—		$	(4,113	)	$	(47,368	)	$	385,954
Change in net pension liability		31			(2,457	)
Net income		—			—			—			—			—			—			14,020			14,020
Stock-based compensation expense		4,823			6,015
Other comprehensive loss		—			—			—			—			—			(1,489	)		—			(1,489	)
Provision for sales returns and credit losses		3,712			(910	)
Common stock issued upon exercise of options		310			3			7,349			—			—			—			—			7,352
Inventory provision		1,575			2,031
Stock-based compensation		—			—			23,679			—			—			—			—			23,679
Changes in working capital:
Repurchase of employee common stock for taxes withheld		(40	)		—			(1,396	)		—			—			—			—			(1,396	)
Accounts receivable		(31,921	)		38,170
Unvested restricted stock		16			—			—			—			—			—			—			—
Inventories		4,088			(6,304	)
Forfeited restricted stock		(5	)		—			—			—			—			—			—			—
Prepayments, deposits, and other assets		353			305
Vested restricted and performance stock units		151			2			—			—			—			—			—			2
Cloud-based software		(3,668	)		(2,167	)
Balance, at September 27, 2024		49,271		$	493		$	466,579			—		$	—		$	(5,602	)	$	(33,348	)	$	428,122
Accounts payable		(2,957	)		(5,961	)
Other current and non-current liabilities		(8,583	)		4,279
Net cash used in operating activities		(21,695	)		(5,734	)
Cash flows from investing activities:
Acquisition of property and equipment		(443	)		(1,468	)
Purchase of investments available for sale		(4,519	)		(14,691	)
Proceeds from maturity of investments available for sale		5,459			51,148
Proceeds from sale of investments available for sale		1,650			362
Net cash provided by investing activities		2,147			35,351
Cash flows from financing activities:
Repayment of finance lease obligations		—			(42	)
Repurchase of employee common stock for taxes withheld		(1,867	)		(1,283	)
Proceeds from the exercise of stock options		170			376
Proceeds from vested restricted and performance stock units		4			1
Net cash used in financing activities		(1,693	)		(948	)
Effect of exchange rate changes on cash and cash equivalents		(45	)		286
Increase (decrease) in cash and cash equivalents		(21,286	)		28,955
Cash and cash equivalents, at beginning of the year		153,150			144,159
Cash and cash equivalents, at end of the period	$	131,864		$	173,114

See accompanying notes to the condensed consolidated financial statements.

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended
	September 26, 2025			September 27, 2024
Cash flows from operating activities:
Net income (loss)	$	(62,139	)	$	14,020
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation of property, plant, and equipment		6,312			4,516
Non-cash operating lease expense		2,665			2,589
Impairment of fixed assets and operating lease right-of-use assets		14,593			—
Accretion/Amortization of investments available for sale		(55	)		(410	)
Deferred income taxes		(718	)		47
Change in net pension liability		43			(162	)
Loss on disposal of property and equipment		23			1,668
Stock-based compensation expense		21,975			22,541
Change in asset retirement obligation		—			24
Provision for sales returns and credit losses		975			1,947
Inventory provision		3,261			1,873
Changes in working capital:
Accounts receivable		18,004			(9,703	)
Inventories		(12,449	)		(5,962	)
Prepayments, deposits, and other assets		(9,709	)		(12,237	)
Accounts payable		(7,911	)		(2,031	)
Other current and non-current liabilities		(5,186	)		(3,637	)
Net cash provided by (used in) operating activities		(30,316	)		15,083
Cash flows from investing activities:
Acquisition of property and equipment		(4,143	)		(17,669	)
Purchase of investments available for sale		(26,464	)		(61,194	)
Proceeds from maturity of investments available for sale		92,984			38,291
Proceeds from sale of investments available for sale		3,377			850
Net cash provided by (used in) investing activities		65,754			(39,722	)
Cash flows from financing activities:
Repayment of finance lease obligations		(42	)		(124	)
Repurchase of common stock		(6,461	)		—
Repurchase of employee common stock for taxes withheld		(1,356	)		(1,396	)
Proceeds from the exercise of stock options		3,351			7,352
Proceeds from vested restricted and performance stock units		3			2
Net cash provided by (used in) financing activities		(4,505	)		5,834
Effect of exchange rate changes on cash and cash equivalents		1,063			(230	)
Increase (decrease) in cash and cash equivalents		31,996			(19,035	)
Cash and cash equivalents, at beginning of the year		144,159			183,038
Cash and cash equivalents, at end of the period	$	176,155		$	164,003

See accompanying notes to the condensed consolidated financial statements.

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 1 — Basis of Presentation and Significant Accounting Policies

STAAR Surgical Company, a Delaware corporation, was first incorporated in 1982, and together with its subsidiaries designs, develops, manufactures, and sells implantable lenses for the eye and accessory delivery systems used to deliver the lenses into the eye. The accompanying Condensed Consolidated Financial Statements present the financial position, results of operations, and cash flows of STAAR Surgical Company and its wholly owned subsidiaries (the “Company”). All significant intercompany accounts and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Commission. In accordance with those rules and regulations, certain information and footnote disclosures normally included in the Comprehensive Financial Statements have been condensed or omitted pursuant to such rules and regulations. The Consolidated Balance Sheet as of ~~December~~January 272, ~~2024~~2026 was derived from the audited financial statements at that date, but does not include all the information and footnotes required by GAAP. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended ~~December~~January 272, ~~2024~~2026.

The Condensed Consolidated Financial Statements for the three ~~and nine~~ months ended ~~September~~April 263, ~~2025~~2026 and ~~September~~March 2728, ~~2024~~2025, in the opinion of management, include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company’s financial condition and results of operations. The results of operations for the three ~~and nine~~ months ended ~~September~~April 263, ~~2025~~2026 and ~~September~~March 2728, ~~2024~~2025, are not necessarily indicative of the results to be expected for any other interim period or for the entire year.

Each of the Company’s fiscal reporting periods ends on the Friday nearest to the quarter ending date and generally consists of 13 weeks. Unless the context indicates otherwise “we,” “us,” the “Company,” and “STAAR” refer to STAAR Surgical Company and its consolidated subsidiaries.

Proposed Merger with Alcon

On August 4, 2025, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Alcon Research, LLC, a Delaware limited liability company (“Alcon”), and Rascasse Merger Sub, Inc., a Delaware corporation and a wholly owned direct subsidiary of Alcon (“Merger Sub”).

The Merger Agreement provides, among other things, that subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of Alcon.

The Board of Directors has unanimously (a) determined that the Merger Agreement and the transactions contemplated thereby are fair to, and in the best interests of, the Company and its stockholders (b) approved and declared advisable the Merger Agreement and the transactions contemplated thereby and (c) resolved to recommend that the Company’s stockholders adopt the Merger Agreement.

On September 24, 2025, Broadwood Partners, L.P. and certain of its affiliates (collectively, the “Broadwood Group”) filed a definitive proxy statement with the SEC to solicit votes of STAAR stockholders in opposition to the Board’s recommendation that stockholders should vote to adopt the Merger Agreement.

The stockholders of the Company will be asked to vote on the adoption of the Merger Agreement at a special meeting of stockholders (the “Special Meeting”). The Special Meeting was originally scheduled for October 23 2025, but was adjourned and later postponed to December 3, 2025. See Note 16 for further details.

Under the Merger Agreement, at the effective time of the Merger (the “Effective Time”), each share of common stock of the Company issued and outstanding immediately prior to the Effective Time (other than certain excluded shares as described in the Merger Agreement) will be cancelled and converted into the right to receive $28.00 in cash, without interest.

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 1 — Basis of Presentation and Significant Accounting Policies (Continued)

Proposed Merger with Alcon (Continued)

The respective obligations of the Company, Alcon and Merger Sub to consummate the transactions contemplated by the Merger Agreement are subject to the satisfaction or waiver of a number of conditions, including: (1) the adoption of the Merger Agreement by the Company’s stockholders; (2) the absence of any law or order prohibiting consummation of the Merger in specified jurisdictions in which the Company, Alcon or their respective subsidiaries have business operations; (3) certain specified regulatory approvals; (4) the accuracy of the other party’s representations and warranties, subject to certain materiality standards set forth in the Merger Agreement; and (5) compliance by the other party in all material respects with such other party’s obligations under the Merger Agreement. In addition, Alcon’s and Merger Sub’s obligation to consummate the transactions contemplated by the Merger Agreement are subject to the satisfaction or waiver of a condition that there has not occurred a material adverse effect on the Company since the date of the Merger Agreement that is continuing. The availability of financing is not a condition to the consummation of the Merger.

If the Merger Agreement is terminated under specified circumstances, the Company may be required to pay Alcon a termination fee of up to $43.4 million, and if the Merger Agreement is terminated under certain other circumstances, Alcon may be required to pay the Company a termination fee equal to $72.4 million.

Reclassifications

The Company reclassified certain personnel costs including salary-related and payroll tax expenses, bonus and stock-based compensation related expenses and travel related expenses previously included in research and development to ~~sales~~selling and marketing. These costs support internal and external training and education of the Company’s existing products, and as such, the Company determined that classification of these costs in ~~sales~~selling and marketing better reflects the nature of the costs and financial performance of the Company as it operates. The Company has made certain reclassification adjustments to conform prior period amounts to current presentation, which include reclassification adjustments between Research and development expenses and ~~Sales~~Selling and marketing expenses on its Condensed Consolidated Statements of Operations as follows (in thousands):

	Three Months Ended September 27, 2024							Nine Months Ended September 27, 2024
	Three Months Ended March 28, 2025
	Prior Presentation		Reclassification			New Presentation		~~Prior Presentation~~		~~Reclassification~~			~~New Presentation~~
Sales and marketing	$	26,623	$	2,249		$	28,872	$	82,150	$	6,385		$	88,535
Selling and marketing	$	24,621	$	2,324		$	26,945
Research and development		1413,~~497~~663		(2,~~249~~324	)		1211,~~248~~339		~~41,931~~		~~(6,385~~	)		~~35,546~~

The reclassification adjustments did not have a material impact on previously recorded amounts and had no impact on the Company’s Total selling, general and administrative expenses, Operating income (loss), Net income (loss) or Net earnings (loss) per share. The Condensed Consolidated Balance Sheets, Condensed Consolidated Statements of Operations, Comprehensive Income (Loss), Stockholders’ Equity and Cash Flows were not affected by changes in the presentation of these costs.

Additionally, non-cash lease expense is now presented on its own line in the Company’s Condensed Consolidated Statements of Cash Flows instead of combined with the changes in other current and non-current liabilities as follows (in thousands):

Nine Months Ended September 27, 2024

Three Months Ended March 28, 2025

Prior Presentation

Reclassification

New Presentation

Non-cash operating lease expense

—

21,~~589~~028

Other current and non-current liabilities

(15,~~048~~307

)

(21,~~589~~028

)

(34,~~637~~279

)

Net cash provided by (used in) operating activities presented in the Condensed Consolidated Statements of Cash Flows was not affected by this change in presentation.

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Net cash used in operating activities presented in the Condensed Consolidated Statements of Cash Flows was not affected by this change in presentation.

Note 1 — Basis of Presentation and Significant Accounting Policies (Continued)

Merger Transaction and Related Costs

In connection with the proposed merger with Alcon, the Company incurred professional service expenses of $5,926,000 during the three months ended September 26, 2025, which are included in Merger transaction and related costs on the Condensed Consolidated Statements of Operations. The Company expects to continue to incur professional service expenses until the Merger is finalized.

Restructuring, Impairment and Related Charges

In the first half of 2025, the Company took a number of steps to change its leadership team, realign its leadership structure to better address market needs, reduce costs and discretionary spending, and better position the Company to return to sustainable growth. AsIn ~~part~~addition, ofas ~~this~~a ~~leadership~~result ~~realignment~~of ~~and related efforts, during~~ the ~~three~~termination ~~and~~of ~~nine months ended September 26, 2025,~~ the ~~Company~~Agreement ~~recognized costs related to severance~~ and ~~reduction~~Plan ~~in workforce~~ of ~~$18,000~~Merger ~~and~~(the ~~$12,471,000,~~“Merger ~~respectively;~~Agreement” ~~consulting~~with ~~expenses~~Alcon ~~of $8~~Research,~~000~~ ~~and $874~~LLC,~~000,~~ ~~respectively;~~a ~~impairment~~Delaware ~~expenses~~limited onliability ~~leasehold~~company ~~improvements~~(“Alcon”) ~~and~~in ~~machinery~~January ~~and~~2026 ~~equipment of $0~~ and ~~$7,759,000, respectively, as~~ the ~~Company~~entry ~~will~~into noa ~~longer~~letter beagreement ~~using~~(the ~~these~~“Cooperation ~~assets;~~Agreement”) ~~and~~with ~~impairment~~Broadwood onPartners, ~~real~~L.P. ~~property right-of-use assets of $0~~ and ~~$4,083,000, respectively, as the Company is actively pursuing subleasing opportunities for two of~~ its ~~leased~~affiliates ~~properties. In addition~~(“Broadwood”), the Company ~~also~~incurred ~~recognized~~additional ~~impairment~~restructuring ofrelated $0charges ~~and~~due ~~$2,751,000, respectively during the three and nine months ended September 26, 2025 for internally developed software that it will no longer be using as it will transition~~ to aleadership ~~cloud-based software solution~~realignment. ~~An aggregate of $26,000 and $27,938,000 for such costs, expenses and charges is included in~~ Restructuring, impairment and related charges onwere ~~the Condensed Consolidated Statements of Operations for the three and nine months ended September 26, 2025. The restructuring effort was substantially completed~~ as offollows ~~June~~(in ~~27, 2025. For more detail, see Notes 5, 7 and 8.~~ thousands):


	Three Months Ended
	April 3, 2026		March 28, 2025
Severance and reduction in workforce(1)	$	1,614	$	8,808
Consulting expenses		1,067		639
Impairment on leasehold improvements and machinery and equipment(2)		—		7,059
Impairment on real property right-of-use assets(3)		—		3,407
Impairment on internally developed software(2)		—		2,751
	$	2,681	$	22,664

(1)

See also Note 7 – Other Current Liabilities

(2)

The Company will no longer be using these assets, see Note 5 – Property, Plant and Equipment.

(3)

The Company is actively pursuing subleasing opportunities, see Note 8 – Operating Leases.

Merger Transactions and Related Costs

In connection with the proposed merger with Alcon and the Cooperation Agreement, the Company incurred professional service expenses of $6,743,000 for the three months ended April 3, 2026. The Cooperation Agreement provided for the reimbursement of certain reasonable out-of-pocket fees and expenses to Broadwood, Yunqi Capital and Defender Capital related to the merger with Alcon. See Note 16 – Related Party Transactions.

Vendor Concentration

There ~~was~~were ~~one~~three ~~vendor~~vendors and two vendors that accounted for over 1060% and 30%, respectively, of the Company’s consolidated accounts payable as of ~~September~~April 263, ~~2025~~2026 and ~~December~~January 272, ~~2024. There was one vendor that accounted for over 10% of the Company’s purchases for the three months ended September 26~~2026, ~~2025~~respectively.

Segment Reporting

The Company’s chief operating decision maker (“CODM”) has been identified as the Co-Chief Executive ~~Officer~~Officers. The Company’s CODM manages and allocates resources to the operations of the Company on a consolidated basis. The CODM assesses performance by comparing actual results to forecasts and decides how to allocate resources, i.e., headcount and compensation, based on ~~consolidated~~net income or on operating results, if a net loss. Significant segment expenses are consistent with those presented on the Condensed Consolidated Statements of Operations.

The measure of segment assets is reported on the balance sheet as total consolidated assets and the expenditures for additions to long-lived assets, and depreciation and amortization expense is consistent with those presented on the Condensed Statement of Cash Flows.

See “Note 14 – Disaggregation of ~~Revenues~~Sales, Geographic Sales and Product Sales” and “Note 15 – Geographic Assets” for specific information regarding the Company’s sales and long-lived assets.

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 1 — Basis of Presentation and Significant Accounting Policies (Continued)

Recent Accounting Pronouncements ~~Not Yet~~ Adopted

In ~~December~~November ~~2023~~2024, the FASB issued ASU ~~2023~~2024-0903, “Income ~~Taxes~~Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (~~Topic~~Subtopic ~~740~~220-40).” ASU ~~2023~~2024-0903 ~~improves~~does not change the ~~transparency~~expense ~~about~~captions ~~income~~an ~~tax~~entity ~~information~~presents ~~through~~on ~~improvements~~the toface of the income ~~tax~~statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures ~~primarily~~within ~~related~~the footnotes to the ~~rate~~financial ~~reconciliation~~statements. ~~and~~ASU ~~income~~2024-03 ~~taxes~~requires ~~paid~~footnote ~~information.~~disclosure Itabout ~~also~~specific ~~includes~~expenses ~~certain~~to ~~other~~disaggregate, ~~amendments~~in toa ~~improve~~tabular presentation, each relevant expense caption on the ~~effectiveness~~face of the income ~~tax~~statement ~~disclosures~~that ~~regarding~~includes any of the following natural expenses: (a1) ~~income~~purchases orof ~~loss~~inventory, ~~from~~(2) ~~continuing~~employee ~~operations~~compensation, ~~disaggregated~~(3) ~~between~~depreciation, ~~domestic~~(4) ~~and~~intangible ~~foreign~~asset amortization, and (b5) ~~income~~depreciation, ~~tax~~depletion ~~expense~~and amortization recognized as part of oil- and gas-production activities or ~~benefit~~other ~~from~~types ~~continuing~~of ~~operations~~depletion ~~disaggregated~~expenses. byThe ~~federal,~~tabular ~~state~~disclosure ~~and~~also ~~foreign~~would include certain other expenses, when applicable. ASU ~~2023~~2024-0903 does not change or remove existing expense disclosure requirements; however, it may affect where that information appears in the footnotes to the financial statements. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company adopted the annual disclosure requirements of ASU 2024-03 at the beginning of fiscal year 2026 and will adopt the interim disclosure requirement beginning in fiscal year 2027. The Company is currently evaluating the annual disclosure requirements and its effect on ~~the~~its ~~Condensed~~annual ~~Consolidated~~report ~~Financial~~for ~~Statements~~fiscal year 2026.

In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40).” ASU 2024-03 does not change the expense captions an entity presents on the face of the income statement; rather it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. ASU 2024-03 requires footnote disclosure about specific expenses to disaggregate, in a tabular presentation, each relevant expense caption on the face of the income statement that includes any of the following natural expenses: (1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5) depreciation, depletion and amortization recognized as part of oil- and gas-production activities or other types of depletion expenses. The tabular disclosure would also include certain other expenses, when applicable. ASU 2024-03 does not change or remove existing expense disclosure requirements; however, it may affect where that information appears in the footnotes to the financial statements. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company will adopt the annual disclosure requirements of ASU 2024-03 at the beginning of fiscal year 2026 and will adopt the interim disclosure requirement beginning fiscal year 2027. The Company is currently evaluating the disclosure requirements and its effect on the Condensed Consolidated Financial Statements.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law. The OBBBA introduces changes in U.S. tax law, with certain provisions applicable to the Company beginning in 2025. These changes include the immediate expensing of domestic research and experimental expenditures, accelerated tax deductions for qualified property, and modifications to certain international tax frameworks. The Company has incorporated OBBBA into the income tax provision as of September 26, 2025 resulting in an immaterial impact to the effective tax rate. The Company continues to evaluate the impact the new legislation will have on its Condensed Consolidated Financial Statements.

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 2 — Investments Available for Sale

Investments available for sale (“AFS”) and the related fair value measurement consisted of the following (dollars in thousands):

	September 26, 2025
	April 3, 2026
										Fair Value Measurements
	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value		Level 1		Level 2
Commercial paper	$	1411,~~373~~525	$	2—	$	(2	)	$	1411,~~373~~523	$	—	$	1411,~~373~~523
Certificates of deposit		1,~~524~~549		1		—			1,~~525~~550		—		1,~~525~~550
Corporate debt securities		607		—		—			607		—		607
U.S. Treasury securities		999		—		—			999		999		—
Total investments AFS	$	16,504	$	3	$	(2	)	$	16,505	$	—	$	16,505
Corporate debt securities		17,955		2		(4	)		17,953		—		17,953
	December 27, 2024
Total investments AFS	$	32,028	$	3	$	(6	)	$	32,025	$	999	$	31,026
	January 2, 2026
										Fair Value Measurements
	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value		Level 1		Level 2
Commercial paper	$	2114,~~466~~682	$	41	$	(21	)	$	2114,~~468~~682	$	—	$	2114,~~468~~682
Certificates of deposit		~~1,997~~816		—		—			~~1,997~~816		—		~~1,997~~816
U.S. Treasury securities		~~11,356~~990		3—		(4—	)		~~11,355~~990		~~11,355~~990		—
Corporate debt securities		5117,~~527~~897		143		(262	)		5117,~~515~~898		—		5117,~~515~~898
Total investments AFS	$	8634,~~346~~385	$	214	$	(323	)	$	8634,~~335~~386	$	~~11,355~~990	$	7433,~~980~~396

The Company obtains the fair value from third-party pricing services. The pricing services utilize industry standard valuation models, including both income and market-based approaches and observable market inputs to determine value. These observable market inputs include reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers and other industry and economic events.

The Company assessed each debt security in a gross unrealized loss position to determine whether the decline in fair value below amortized cost was a result of credit losses or other factors, whether the Company expects to recover the amortized cost of the debt security, the Company’s intent to sell and whether it is more-likely-than-not that the Company will not be required to sell the debt security before the recovery of the amortized cost basis. There has been no allowance for expected credit losses recorded for the three and nine months ended September 26, 2025 and September 27, 2024, respectively.8

The following table shows the fair value of investments AFS by contractual maturity (dollars in thousands):

	As of September 26, 2025
	Within one year		After one year through five years		Total
Commercial paper	$	14,373	$	—	$	14,373
Certificates of deposit		1,525		—		1,525
Corporate debt securities		607		—		607
Total investments AFS	$	16,505	$	—	$	16,505

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 2 — Investments Available for Sale (Continued)

~~During~~The ~~the~~Company ~~nine~~assessed ~~months~~each ~~ended~~debt ~~September~~security ~~26,~~in ~~2025,~~a ~~several~~gross ofunrealized ~~the~~loss ~~Company’s~~position ~~investments~~to ~~AFS~~determine ~~with~~whether anthe ~~aggregate~~decline in fair value ofbelow ~~$3,377,000,~~amortized ~~were~~cost ~~subject~~was toa ~~early~~result ~~redemption.~~of ~~The~~credit ~~Company~~losses ~~recognized~~or aother ~~gain~~factors, ~~upon~~whether ~~redemption~~the ofCompany ~~$2,000~~expects ~~during~~to recover the ~~nine~~amortized ~~months~~cost ~~ended~~of ~~September~~the 26debt security, ~~2025.~~the ~~During~~Company’s ~~the~~intent ~~nine~~to ~~months~~sell ~~ended~~and ~~September~~whether ~~27,~~it ~~2024,~~is ~~two~~more-likely-than-not ofthat the Company’s ~~investments~~will ~~AFS~~not ~~with~~be anrequired ~~aggregate~~to ~~fair~~sell ~~value~~the ofdebt ~~$850,000~~security ~~were~~before ~~subject~~the torecovery ~~early~~of ~~redemption~~the amortized cost basis. ~~The~~There ~~Company~~has ~~recognized~~been ano ~~realized~~allowance ~~gain~~for ~~upon~~expected ~~sale~~credit oflosses ~~$2,000~~recorded ~~during~~for the ~~nine~~three months ended ~~September~~April 273, ~~2024~~2026 and March 28, 2025.

The following table shows the fair value of investments AFS by contractual maturity (in thousands):


	As of April 3, 2026
	Within one year		After one year through five years		Total
Commercial paper	$	11,523	$	—	$	11,523
Certificates of deposit		1,550		—		1,550
U.S. Treasury securities		999		—		999
Corporate debt securities		17,953		—		17,953
Total investments AFS	$	32,025	$	—	$	32,025

During the three months ended April 3, 2026, several of the Company’s investments AFS with an aggregate fair value of $1,650,000 was subject to early redemption. The Company recognized a gain of less than $1,000 for the three months ended April 3, 2026. During the three months ended March 28, 2025, one of the Company’s investments AFS with an aggregate fair value of $362,000 was subject to early redemption. The Company recognized a gain of less than $1,000 for the three months ended March 28, 2025.

Note 3 — Inventories

Inventories, net are stated at the lower of cost and net realizable value, determined on a first-in, first-out basis and consisted of the following (in thousands):

	September 26, 2025			December 27, 2024
	April 3, 2026			January 2, 2026
Raw materials and purchased parts	$	810,~~759~~718		$	910,~~705~~238
Work in process		116,~~429~~959			8,~~168~~514
Finished goods(1)		34,~~900~~979			2639,~~710~~673
Total inventories, gross		5552,~~088~~656			4458,~~583~~425
Less inventory reserves		(12,~~786~~872	)		(12,~~278~~929	)
Total inventories, net	$	5349,~~302~~784		$	4355,~~305~~496

(1)

Finished goods inventory includes consigned inventory of $137,~~811~~146,000 and $19,~~958~~619,000 atfor ~~September~~April 263, ~~2025~~2026 and ~~December~~January 272, ~~2024~~2026, respectively. See also Note 14 – Disaggregation of Sales, Geographic Sales and Product Sales to the Condensed Consolidated Financial Statements for further details.

Note 4 — Prepayments, Deposits, and Other Current Assets

Prepayments, deposits, and other current assets consisted of the following (in thousands):

	September 26, 2025		December 27, 2024
	April 3, 2026		January 2, 2026
Prepayments and deposits	$	86,~~813~~968	$	7,~~887~~965
Prepaid rent		234		2,910
Prepaid insurance		2,575		3,269
Prepaid insurance		520		2,432
Prepaid income taxes		785		1,917
Value added tax (VAT) receivable		34,~~464~~522		14,~~359~~242
Other(1)		2,111		1,656
BVG (Swiss Pension) prepayment		1,852		—
Total prepayments, deposits and other current assets	$	15,142	$	16,244
Other(1)		851		1,056
Total prepayments, deposits and other current assets	$	17,553	$	18,449

(1)

No individual category in “Other” exceeds 5% of the total prepayments, deposits and other current assets.

~~Note 5 — Property, Plant and Equipment~~9

Property, plant and equipment, net consisted of the following (in thousands):

	September 26, 2025			December 27, 2024
Machinery and equipment	$	44,514		$	46,113
Computer equipment and software		11,387			12,976
Furniture and fixtures		7,723			7,627
Leasehold improvements		19,342			19,766
Construction in process		28,957			32,014
Total property, plant and equipment, gross		111,923			118,496
Less accumulated depreciation		(39,318	)		(33,607	)
Total property, plant and equipment, net	$	72,605		$	84,889

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 5 — Property, Plant and Equipment ~~(Continued)~~

~~As discussed in Note 1~~Property, ~~during~~plant ~~the nine months ended September 26, 2025, the Company recognized fixed asset impairment expense of $7,759,000 primarily on leasehold improvements~~ and ~~machinery and~~ equipment ~~as the Company will no longer be using these assets. The Company also recognized impairment during the nine months ended September 26~~, ~~2025~~net consisted of ~~$2,751,000 for internally developed software that~~ the ~~Company~~following ~~will no longer be using as it will transition to a cloud-based software solution. These amounts are recorded~~ (in ~~Restructuring, impairment and related charges on the Condensed Consolidated Statement of Operations.~~thousands):


	April 3, 2026			January 2, 2026
Machinery and equipment	$	49,014		$	45,137
Computer equipment and software		10,485			10,525
Furniture and fixtures		7,462			7,483
Leasehold improvements		24,475			19,403
Construction in process		21,872			30,340
Total property, plant and equipment, gross		113,308			112,888
Less accumulated depreciation		(41,570	)		(39,565	)
Total property, plant and equipment, net	$	71,738		$	73,323

As discussed in Note 1 – Basis of Presentation and Significant Accounting Policies, during the three months ended March 28, 2025, the Company recognized fixed asset impairment expense of $7,059,000 primarily on leasehold improvements and machinery and equipment as the Company will no longer be using these assets. The Company also recognized impairment of $2,751,000 for internally developed software that the Company will no longer be using as it will transition to a cloud-based software solution. These amounts are recorded in Restructuring, impairment and related charges on the Condensed Consolidated Statements of Operations.

Construction in process primarily consists of the build out and validation of machinery and equipment.

The Company recorded depreciation expense in the following categories as follows (in thousands):

Three Months Ended

~~Nine Months Ended~~

September 26, 2025

September 27, 2024

September 26, 2025

September 27, 2024

April 3, 2026

March 28, 2025

Cost of sales

~~750~~875

~~586~~868

~~2,390~~

~~1,614~~

General and administrative

~~874~~841

~~910~~1,075

~~2,790~~

~~1,857~~

Selling and marketing

~~176~~182

54175

~~525~~

~~446~~

Research and development

~~200~~209

~~171~~182

~~570~~

~~489~~

Total depreciation expense

2,~~000~~107

12,~~721~~300

~~6,275~~

~~4,406~~

Note 6 — Cloud-Based Software

The Company capitalized cloud-based software implementation costs related to several systems, including enterprise resource planning and customer relationship management systems, which ~~are~~were ~~recorded~~placed ~~within~~into ~~Prepayments,~~service ~~deposits~~at ~~and other current assets or Other assets on~~ the ~~Condensed~~beginning ~~Consolidated~~of ~~Balance Sheets, depending upon~~ the ~~short-~~second orquarter ~~long-term nature~~ of ~~such costs~~2026. ~~Assets~~Capitalized ~~are~~cloud-based ~~expected~~software tocosts, benet ~~placed~~consisted ~~into~~of ~~service~~the ~~throughout~~following ~~2025~~(in ~~and 2026.~~ thousands):

Capitalized cloud-based software costs, net consisted of the following (in thousands):


	April 3, 2026			January 2, 2026
Capitalized cloud-based software	$	35,196		$	31,527
Less accumulated amortization		(513	)		(409	)
Total capitalized cloud-based software, net	$	34,683		$	31,118

Capitalized cloud-based software included in prepayments, deposits and other current assets	$	418		$	418
Capitalized cloud-based software included in other assets	$	34,265		$	30,700

	September 26, 2025			December 27, 2024
Capitalized cloud-based software	$	26,827		$	15,763
Less accumulated amortization		(304	)		—
Total capitalized cloud-based software, net	$	26,523		$	15,763
Capitalized cloud-based software included in prepayments, deposits and other current assets	$	418		$	—
Capitalized cloud-based software included in other assets	$	26,105		$	15,763

Activity related to cloud-based software was as follows (in thousands):

Three Months Ended

~~Nine Months Ended~~

September 26, 2025

September 27, 2024

September 26, 2025

September 27, 2024

April 3, 2026

March 28, 2025

Additions to cloud-based software

3,~~963~~668

42,~~094~~167

~~11,064~~

~~9,791~~

Amortization of cloud-based software

104

—53

~~304~~

—

Capitalized software placed into service

—

1,256

1310

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 7 — Other Current Liabilities

Other current liabilities consisted of the following (in thousands):

	September 26, 2025		December 27, 2024
	April 3, 2026		January 2, 2026
Accrued salaries and wages	$	1311,~~321~~508	$	1612,~~140~~891
Accrued bonuses		83,~~156~~912		19,~~300~~424
Severance payable(1)		1,~~757~~728		~~356~~894
Accrued insurance		279		2,701
Marketing obligations		3,158		3,397
Income taxes payable		1,084		6,547
Other(2)		12,700		14,253
Marketing obligations		3,843		2,699
Total other current liabilities	$	33,006	$	40,859
Other(2)		11,177		13,344
Total other current liabilities	$	39,617	$	43,087

(1)

As discussed in Note 1, during the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026, the Company recognized costs in connection with its leadership realignment and related efforts. Of these costs, a total of $121,~~471~~614,000 was recognized for severance costs related to leadership realignment ~~and reduction in workforce~~. This amount is recorded in Restructuring, impairment and related charges on the Condensed Consolidated ~~Statement~~Statements of Operations. A majority of these severance payments ~~were~~will be paid ~~during~~monthly ~~the~~through ~~second quarter of 2025~~mid-2027.

(2)

No individual category in “Other” exceeds 5% of the other current liabilities.

Note 8 — Operating Leases

The Company entered into operating leases primarily related to real property (office, manufacturing and warehouse facilities), automobiles and copiers. These operating leases are two to ten years in length with options to extend. The Company does not include any lease extensions in the initial valuation unless the Company was reasonably certain to extend the lease. Depending on the lease, there are those with fixed payment amounts for the entire length of the contract or payments which increase periodically as noted in the contract or increased at an inflation rate indicator. For operating leases that increase using an inflation rate indicator, the Company used the inflation rate at the time the lease was entered into for the length of the lease term. Supplemental balance sheet information related to operating leases consisted of the following (dollars in thousands):

	September 26, 2025			December 27, 2024
	April 3, 2026			January 2, 2026
Machinery and equipment	$	~~782~~813		$	~~758~~773
Computer equipment and software		~~413~~373			~~446~~413
Real property		4439,095			4739,~~648~~824
Operating lease right-of-use assets, gross		4540,~~290~~281			4841,~~852~~010
Less accumulated depreciation		(1311,~~951~~709	)		(1211,~~002~~401	)
Operating lease right-of-use assets, net	$	3128,~~339~~572		$	3629,~~850~~609
Current operating lease obligations	$	56,~~314~~102		$	35,~~894~~872
Long-term operating lease obligations		3331,~~803~~189			3432,~~807~~481
Total operating lease liability	$	3937,~~117~~291		$	38,~~701~~353
Weighted-average remaining lease term (in years)		6.75			76.17
Weighted-average discount rate		6.0441	%		56.9833	%

As discussed in Note 1, during the ~~nine~~three months ended ~~September~~March 2628, 2025, the Company recognized impairment on real property right-of-use assets of $43,~~083~~407,000~~, respectively~~. The impairment relates to the Company’s decision to exit ~~three~~several of its leased properties, for which the Company has obtained a subtenant for one of its properties and is actively pursuing subleasing ~~for~~ the ~~other~~remaining ~~two~~ properties. The impairment was determined based on market comparables of similar subleased properties. The impairment is recorded in Restructuring, impairment and related charges on the Condensed Consolidated Statements of Operations.

1411

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 8 — Operating Leases (Continued)

Supplemental cash flow information related to operating leases was as follows (in thousands):

Three Months Ended

~~Nine Months Ended~~

September 26, 2025

September 27, 2024

September 26, 2025

September 27, 2024

April 3, 2026

March 28, 2025

Operating lease cost

12,~~757~~124

2,~~128~~149

~~5,704~~

~~6,440~~

Cash paid for amounts included in the measurement of operating lease liabilities:

Operating cash flows

1,~~724~~982

1,~~578~~652

~~5,037~~

~~4,443~~

Right-of-use assets obtained in exchange for new operating lease liabilities

91449

~~4,254~~304

~~2,024~~

~~7,740~~

Future Maturities of Lease Liabilities

Estimated future maturities of lease liabilities under operating ~~and finance~~ leases having initial or remaining non-cancelable lease terms more than one year as of ~~September~~April 263, ~~2025~~2026 is as follows (in thousands):


As of April 3, 2026 12 Months Ended	Operating Leases
March 2027	$	8,380
March 2028		7,388
March 2029		7,114
March 2030		7,021
March 2031		5,922
Thereafter		11,261
Total future minimum lease payments		47,086
Less amounts representing interest		(9,795	)
Total lease liability	$	37,291

As of September 26, 202512 Months Ended	Operating Leases
September 2026	$	7,605
September 2027		7,767
September 2028		6,759
September 2029		6,955
September 2030		6,274
Thereafter		14,495
Total future minimum lease payments		49,855
Less amounts representing interest		(10,738	)
Total lease liability	$	39,117

Note 9 — Income Taxes

The Company recorded an income tax provision (benefit) as follows (in thousands):

	Three Months Ended					~~Nine Months Ended~~
	September 26, 2025		September 27, 2024			September 26, 2025		September 27, 2024
	April 3, 2026		March 28, 2025
Provision for income taxes	$	9,906	$	3,179		$	528	$	7,262
Provision (benefit) for income taxes	$	3,012	$	(275	)

The effective tax rates for the three months ended ~~September~~April 263, ~~2025~~2026 and ~~September~~March 2728, ~~2024~~2025 were 5236.7% and ~~24.2%, respectively, and were (~~0.9)5% ~~and 34.1% for the nine months ended September 26~~, ~~2025 and September 27, 2024,~~ respectively. The Company’s effective tax rates differ from the U.S. federal statutory rate of 21% for the three ~~and nine~~ months ended ~~September~~April 263, ~~2025~~2026 and ~~September~~March 2728, ~~2024~~2025, respectively, primarily due to the income tax expense generated in foreign jurisdictions.

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 10 — Defined Benefit Pension Plans

The Company has defined benefit plans covering employees of its Switzerland and Japan operations. The following table summarizes the components of net periodic pension cost recorded for the Company’s defined benefit pension plans (in thousands):

	Three Months Ended						~~Nine Months Ended~~
	September 26, 2025			September 27, 2024			September 26, 2025			September 27, 2024
	April 3, 2026			March 28, 2025
Service cost(1)	$	~~451~~456		$	~~327~~404		$	~~1,291~~		$	~~965~~
Interest cost(2)		6692			8862			~~191~~			~~259~~
Expected return on plan assets(2)		(~~145~~163	)		(~~140~~135	)		~~(419~~	)		~~(408~~	)
Prior service credit(2),(3)		~~332~~(55	)		(4553	)		~~226~~			~~(135~~	)
Settlement gain(2),(3)		(3—	)		—(4	)		~~(11~~	)		—
Actuarial loss recognized in current period(2),(3)		~~(312~~49	)		2873			~~(166~~	)		84
Net periodic pension cost	$	~~389~~379		$	~~258~~347		$	~~1,112~~		$	~~765~~

(1)

Recognized in selling general and administrative expenses on the Condensed Consolidated Statements of Operations.

(2)

Recognized in other income ~~(expense)~~, net on the Condensed Consolidated Statements of Operations.

(3)

Amounts reclassified from accumulated other comprehensive income (loss).

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 10 — Defined Benefit Pension Plans (Continued)

The Company currently is not required to and does not make contributions to its Japan pension plan. The Company’s contributions to its Swiss pension plan are as follows (in thousands):

Three Months Ended

~~Nine Months Ended~~

September 26, 2025

September 27, 2024

September 26, 2025

September 27, 2024

April 3, 2026

March 28, 2025

Employer contribution

~~361~~353

~~285~~265

~~983~~

~~824~~

Note 11 — Stockholders’ Equity

Incentive Plan

The Company maintains an Amended and Restated Omnibus Equity Incentive Plan, as amended (the “Equity Plan”). The Equity Plan allows for awards of stock options, stock appreciation rights, restricted stock, restricted stock units (“RSUs”) and performance stock units (“PSUs”) and other stock- and cash-based awards, including awards that are subject to service-based and performance-based vesting conditions. As of ~~September~~April 263, ~~2025~~2026, the Company had outstanding grants of stock options, RSUs and PSUs.

Stock options granted under the Equity Plan are granted at fair market value on the date of grant, become exercisable generally over a three-year period, or as determined by the Board of Directors (the “Board”), and expire over periods not exceeding 10 years from the date of grant. Certain stock options and stock-based awards provide for accelerated vesting if there is a change in control and pre-established financial metrics are met (as defined in the Equity Plan). Grants of restricted stock outstanding under the Equity Plan generally vest over periods of one to three years. Grants of RSUs and PSUs outstanding under the Equity Plan generally vest based on service, performance, or a combination of both. On June 19, 2024, stockholders approved a proposal to increase the number of shares under the Equity Plan by 2,600,000 shares, for a total of 22,805,000 shares. As of ~~September~~April 263, ~~2025~~2026, there were 1344,~~179,745~~635 shares available for grant under the Equity Plan.

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 11 — Stockholders’ Equity (Continued)

Stock-Based Compensation

The cost that has been charged against income for stock-based compensation is set forth below (in thousands):

Three Months Ended

~~Nine Months Ended~~

September 26, 2025

September 27, 2024

September 26, 2025

September 27, 2024

April 3, 2026

March 28, 2025

Employee stock options

1,~~566~~134

32,~~592~~362

~~5,611~~

~~10,283~~

Restricted stock

—

~~156~~157

~~302~~

~~354~~

RSUs

32,~~382~~278

32,~~150~~963

~~9,690~~

~~8,493~~

PSUs

21,~~478~~193

~~115~~396

~~5,085~~

~~2,919~~

Nonemployee stock options

~~124~~103

137

~~426~~

~~429~~

Nonemployee RSUs

~~608~~115

10—

~~861~~

Total stock-based compensation expense

84,~~158~~823

76,~~160~~015

~~21,975~~

~~22,541~~

The Company recorded stock-based compensation costs in the following categories (in thousands):

Three Months Ended

~~Nine Months Ended~~

September 26, 2025

September 27, 2024

September 26, 2025

September 27, 2024

April 3, 2026

March 28, 2025

Cost of sales

48224

~~303~~290

~~428~~

~~964~~

General and administrative

51,~~026~~653

32,~~621~~683

~~12,352~~

~~11,677~~

Selling and marketing

1,~~492~~236

1,~~213~~277

~~4,078~~

~~3,742~~

Research and development

1,~~592~~710

21,~~023~~765

~~5,117~~

~~6,158~~

Total stock-based compensation expense, net

84,~~158~~823

76,~~160~~015

~~21,975~~

~~22,541~~

Amounts capitalized as part of inventory

64113

~~361~~312

~~568~~

~~1,138~~

Total stock-based compensation expense, gross

84,~~222~~936

76,~~521~~327

~~22,543~~

~~23,679~~

~~As of September 26, 2025, total unrecognized compensation cost related to non-vested stock-based compensation arrangements were as follows (in thousands):~~13

	September 26, 2025
Stock options	$	7,016
RSUs and PSUs		34,050
Total unrecognized stock-based compensation cost	$	41,066

The cost is expected to be recognized over a weighted-average period of approximately one and one-half years.

Assumptions

The fair value of each stock option award is estimated on the date of grant using a Black-Scholes option valuation model applying the weighted-average assumptions noted in the following table. Expected volatilities are based on historical volatility of the Company’s stock. The expected term of stock options granted is derived from the historical exercises and post-vesting cancellations and represents the period of time that stock options granted are expected to be outstanding. The Company has calculated a 8% estimated forfeiture rate based on historical forfeiture experience. The risk-free rate is based on the U.S. Treasury yield curve corresponding to the expected term at the time of the grant.

	Three Months Ended						Nine Months Ended
	September 26, 2025			September 27, 2024			September 26, 2025			September 27, 2024
Expected dividend yield		0	%		0	%		0	%		0	%
Expected volatility		60	%		59	%		60	%		59	%
Risk-free interest rate		3.83	%		3.70	%		4.07	%		4.17	%
Expected term (in years)		5.05			5.29			5.05			5.29

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 11 — Stockholders’ Equity (Continued)

Stock-Based Compensation (Continued)

As of April 3, 2026, total unrecognized compensation cost related to non-vested stock-based compensation arrangements were as follows (in thousands):


	April 3, 2026
Stock options	$	3,499
RSUs and PSUs		32,214
Total unrecognized stock-based compensation cost	$	35,713

The cost is expected to be recognized over a weighted-average period of approximately two years.

Assumptions

The fair value of each stock option award is estimated on the date of grant using a Black-Scholes option valuation model applying the weighted-average assumptions noted in the following table. Expected volatilities are based on historical volatility of the Company’s stock. The expected term of stock options granted is derived from the historical exercises and post-vesting cancellations and represents the period of time that stock options granted are expected to be outstanding. The Company has calculated a 15% estimated forfeiture rate based on historical forfeiture experience. The risk-free rate is based on the U.S. Treasury yield curve corresponding to the expected term at the time of the grant.


	Three Months Ended
	April 3, 2026			March 28, 2025
Expected dividend yield		0	%		0	%
Expected volatility		62	%		60	%
Risk-free interest rate		3.72	%		4.33	%
Expected term (in years)		4.86			5.05

Stock Options

A summary of stock option activity under the Equity Plan for ~~the~~three ~~nine~~ months ended ~~September~~April 263, ~~2025~~2026 is presented below:

	StockOptions(in 000’s)			Weighted-AverageExercisePrice		Weighted-AverageRemainingContractualTerm (years)		AggregateIntrinsicValue(in 000’s)
Outstanding at December 27, 2024		2,808		$	45.72
Outstanding at January 2, 2026		1,716		$	44.85
Granted		~~121~~23			18.2246
Exercised		(~~210~~20	)		158.9951
Forfeited or expired		(~~870~~85	)		5034.1650
Outstanding at September 26, 2025		1,849		$	45.15		6.02	$	3,284
Outstanding at April 3, 2026		1,634		$	45.47		5.79	$	1,158
Exercisable at September 26, 2025		1,423		$	48.45		5.26	$	2,269
Exercisable at April 3, 2026		1,363		$	48.66		5.26	$	898

Restricted Stock, Restricted Stock Units and Performance Stock Units

A summary of ~~restricted stock,~~ RSU and PSU activity under the Equity Plan for the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026 is presented below (shares in thousands):

	RestrictedStock			RSUs			PSUs
	RSUs			PSUs
Unvested at December 27, 2024		16			695			406
Unvested at January 2, 2026		1,459			802
Granted		—456			~~1,274~~414			~~849~~
Vested		(16453	)		~~(277~~—	)		~~(20~~	)
Forfeited or expired		—(243	)		(~~186~~178	)		~~(433~~	)
Unvested at September 26, 2025		—			1,506			802
Unvested at April 3, 2026		1,219			1,038

~~Share Repurchase Program~~14

In May 2025, the Company’s Board of Directors authorized a share repurchase program under which the Company may repurchase up to $30 million of its outstanding common stock. Under the program, the Company may repurchase shares in the open market, through privately negotiated transactions, by entering into structured repurchase agreements with third parties, by making block purchases, and/or pursuant to Rule 10b5-1 trading plans. The timing, manner, price, and amount of any repurchases under the program will be determined by the Company in its discretion, subject to market conditions, legal requirements, and other considerations. The Company is not obligated to repurchase any specific number of shares, and the program may be modified, suspended, or discontinued at any time, without prior notice. During the three and nine months ended September 26, 2025 the Company purchased 115,115 and 375,630 shares, respectively for an aggregate of $1,982,000 and $6,461,000, respectively, pursuant to its share repurchase program. As of September 26, 2025, $23,539,000 remained available for repurchases pursuant to the program.

Repurchased shares are held in treasury stock. Treasury stock purchases are accounted for under the cost method whereby the cost of the acquired stock is recorded as treasury stock.

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 12 —- Commitments and Contingencies

~~Employment~~Executive Agreements

The Company’s ~~Chief~~has ~~Executive Officer~~ entered into anagreements ~~employment~~with ~~agreement~~certain ~~with~~of ~~the~~its ~~Company,~~executives ~~effective~~that ~~February~~provide ~~26,~~for ~~2025.~~severance Hepayments and ~~certain~~benefits ~~officers~~upon ~~have~~termination ~~as provisions~~ of ~~their~~employment ~~agreements~~by ~~certain~~the ~~rights,~~company ~~including~~without ~~continuance~~“cause” ofor ~~cash~~by ~~compensation~~the ~~and~~executive ~~benefits,~~for ~~upon a~~ “~~change~~good ~~in control,~~reason” ~~which~~as ~~may~~defined ~~include~~in anthe ~~acquisition~~applicable ofagreements. ~~substantially~~Certain ~~all~~executives ofare ~~its~~also ~~assets,~~party orto ~~termination~~agreements ~~“without~~that ~~cause~~provide or for ~~good~~enhanced ~~reason”~~payments asand ~~defined~~benefits in ~~the~~connection with a termination of employment ~~agreements~~upon a “change in control.”

Litigation and Claims

From time to time, the Company is involved in various legal proceedings and other matters arising in the normal course of business. These legal proceedings and other matters may relate to, among other things, contractual rights and obligations, employment matters, or claims of product liability~~, or claims relating to the Merger and related disclosures~~. The Company maintains insurance coverage for various matters, including product liability and certain securities claims. While the Company does not believe that any of the claims known is likely to have a material adverse effect on the Company’s financial condition or results of operations, new claims or unexpected results of existing claims could lead to significant financial harm.

Note 13 — Basic and Diluted Net Income (Loss) Per Share

The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands except per share amounts):

	Three Months Ended					~~Nine Months Ended~~
	September 26, 2025		September 27, 2024			September 26, 2025			September 27, 2024
	April 3, 2026		March 28, 2025
Numerator:
Net income (loss)	$	85,~~884~~206	$	9(54,~~980~~211	)	$	~~(62,139~~	)	$	~~14,020~~
Denominator:
Weighted average common shares:
Common shares outstanding		49,~~633~~908		49,~~199~~344			~~49,499~~			~~49,078~~
Denominator for basic calculation		49,~~633~~908		49,~~199~~344			~~49,499~~			~~49,078~~
Weighted average effects of potentially diluted common stock:
Stock options		9648		~~339~~—			—			~~384~~
Unvested restricted stock		—		1			—			4
RSUs		373		—
RSUs		452		83			—			84
PSUs		571		—
PSUs		368		109			—			64
Denominator for diluted calculation		50,900		49,344
Denominator for diluted calculation		50,549		49,731			49,499			49,614
Net income (loss) per share:
Net income (loss) per share:
Basic	$	0.10	$	(1.10	)
Basic	$	0.18	$	0.20		$	(1.26	)	$	0.29
Diluted	$	0.10	$	(1.10	)
Diluted	$	0.18	$	0.20		$	(1.26	)	$	0.28

Because the Company had a net loss for the ~~nine~~three months ended ~~September~~March 2628, 2025, the number of diluted shares is equal to the number of basic shares. The following table sets forth (in thousands) the weighted average number of options to purchase shares of common stock, restricted stock, RSUs and PSUs with either exercise prices or unrecognized compensation cost per share greater than the average market price per share of the Company’s common stock, which were not included in the calculation of diluted per share amounts because the effects would be anti-dilutive.

Three Months Ended

~~Nine Months Ended~~

September 26, 2025

September 27, 2024

September 26, 2025

September 27, 2024

April 3, 2026

March 28, 2025

Stock options

4,~~322~~105

37,~~484~~004

~~6,090~~

~~3,350~~

Restricted stock, RSUs and PSUs

~~338~~244

~~204~~914

~~889~~

Total

4,~~660~~349

37,~~688~~918

~~6,979~~

~~3,414~~

1915

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 14 — Disaggregation of Sales, Geographic Sales and Product Sales

100% of the Company’s sales are generated from the ophthalmic surgical product segment and the ~~chief~~CODM ~~operating decision maker~~ makes operating decisions and allocates resources based upon the consolidated operating results, and therefore the Company operates as one operating segment for financial reporting purposes. The Company’s principal products are implantable Collamer ~~lenses~~Lenses (“ICLs”) used in refractive surgery. ~~Historically the Company marketed and sold cataract intraocular lenses (“IOLs”) and related injectors and injector parts.~~ The ~~Company phased out sales of such products in fiscal 2023, and no longer intends to sell any such products. The~~ composition of the Company’s net sales is primarily related to ICL sales. ~~ICL~~Net sales include sales of delivery systems and normal recurring sales adjustments such as sales return allowances. In the following tables, sales are disaggregated by category and sales by geographic market data.

The Company maintains finished goods inventory at different sites in the United States, Switzerland and Japan, and from time to time, consigns or ships finished goods inventory to surgeons, hospitals, and distributors in advance of anticipated demand. The Company maintains title and risk of loss on consigned inventory and generally does not recognize revenue for consignment inventory until the Company is notified that the lenses have been implanted. The following table disaggregates the Company’s consignment sales (in thousands):

Three Months Ended

~~Nine Months Ended~~

September 26, 2025

September 27, 2024

September 26, 2025

September 27, 2024

April 3, 2026

March 28, 2025

Non-consignment sales

6275,~~995~~488

8337,~~703~~851

~~138,371~~

~~250,242~~

Consignment sales

3118,~~737~~034

4,~~887~~738

~~43,270~~

~~14,709~~

Total net sales

9493,~~732~~522

8842,~~590~~589

~~181,641~~

~~264,951~~

In April 2025, in order to mitigate potential financial exposure from tariffs imposed by China, the Company negotiated and implemented consignment agreements with its two distributors in China and delivered consigned inventory to its distributors. ~~During~~in ~~the~~advance ~~quarters~~of ~~ended~~the ~~June~~implementation ~~27,~~of ~~2025~~tariffs and ~~September 26, 2025, the Company~~ delivered additional ~~consigned~~consignment inventory tothroughout ~~its~~fiscal ~~distributors in China~~2025. As this consigned inventory in China is purchased by the Company’s distributors, revenue associated with such consigned inventory will be recorded as consignment sales. China consignment sales for the three ~~and nine~~ months ended ~~September~~April 263, ~~2025~~2026 were $2712,~~969~~634,000 ~~and $30,754,000, respectively~~.

The Company’s ~~markets~~product ~~and~~is ~~sells~~marketed ~~its~~and ~~products~~sold in ~~over~~more 75than 85 countries and ~~conducts~~ its product is manufacturing in the United States and Switzerland. Sales are attributed to countries based on ~~location~~locations of customers. During 2025, the presentation of immaterial amounts related to normal recurring sales adjustments previously presented in foreign other sales are presented in the countries these normal recurring sales adjustments are attributable to. ~~Prior period amounts have been conformed to current presentation in the following table.~~ The composition of the Company’s net sales to unaffiliated customers was as follows (in thousands):

	Three Months Ended					~~Nine Months Ended~~
	September 26, 2025		September 27, 2024			September 26, 2025		September 27, 2024
	April 3, 2026		March 28, 2025
Domestic	$	56,~~632~~667	$	45,~~681~~459		$	~~16,726~~	$	~~15,015~~
Foreign:
China		55,833		52,468			60,255		154,464
China(1)		47,442		(877	)
Japan		1112,~~226~~266		1011,~~534~~395			~~33,536~~		~~30,878~~
Other(1)		22,041		20,907			71,124		64,594
Korea		7,975		7,522
Total foreign sales		89,100		83,909			164,915		249,936
Other(2)		19,172		19,090
Total net sales	$	94,732	$	88,590		$	181,641	$	264,951
Total foreign sales		86,855		37,130
Total net sales	$	93,522	$	42,589

(1)

NoThe ~~other~~China ~~location~~region ~~individually~~includes ~~exceeds~~sales ~~10%~~into ofChina ~~the~~and ~~total~~Hong ~~sales~~Kong.

(2)

20No other location individually exceeds 10% of the total net sales.

The Company’s China distributors accounted for 51% of net sales for the three months ended April 3, 2026, and the Company’s Korea distributor accounted for 18% of net sales for the three months ended March 28, 2025. As of April 3, 2026, the Company’s China distributors accounted for 57% of consolidated trade receivables, and as of January 2, 2026, the Company’s China distributors accounted for 33% of consolidated trade receivables.

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 14 — Disaggregation of Sales, Geographic Sales and Product Sales (Continued)

The Company’s China distributors accounted for an aggregate of 59% and 59% of net sales for the three months ended September 26, 2025 and September 27, 2024, respectively, and 33% and 58% of net sales for the nine months ended September 26, 2025 and September 27, 2024, respectively. As of September 26, 2025 and December 27, 2024, the Company’s China distributors accounted for an aggregate of 38% and 58%, respectively, of consolidated trade receivables.

Note 15 — Geographic Assets

The Company’s long-lived assets are located in the following geographical locations in which the Company operates. Other than the U.S. and Switzerland~~, no other geographic location exceeds 10% of each category of long-lived assets~~. The composition of the Company’s long-lived assets was as follows (in thousands):

	September 26, 2025
	April 3, 2026
	U.S.		Switzerland		Other(1)		Total
Property, plant and equipment, net	$	54,~~948~~174	$	17,~~213~~183	$	~~444~~381	$	7271,~~605~~738
Operating lease ROU assets, net		2220,~~420~~943		5,~~633~~058		32,~~286~~571		3128,~~339~~572
Total	$	77,368	$	22,846	$	3,730	$	103,944
Cloud-based software		34,683		—		—		34,683
	December 27, 2024
Total	$	109,800	$	22,241	$	2,952	$	134,993
	January 2, 2026
	U.S.		Switzerland		Other(1)		Total
Property, plant and equipment, net	$	6855,~~318~~621	$	1617,~~084~~311	$	~~487~~391	$	8473,~~889~~323
Finance lease ROU assets, net		37		—		—		37
Operating lease ROU assets, net		21,454		5,346		2,809		29,609
Operating lease ROU assets, net		27,754		6,414		2,682		36,850
Cloud-based software		31,118		—		—		31,118
Total	$	96108,~~109~~193	$	22,~~498~~657	$	3,~~169~~200	$	~~121~~134,~~776~~050

(1)

No other location individually exceeds 10% of each category of long-lived assets.

Note 16 — ~~Subsequent~~Related ~~Events~~Party Transactions

AsOn ~~discussed~~January in14, ~~Note~~2026, 1following the termination of the Merger Agreement, STAAR entered into the ~~respective~~Cooperation ~~obligations~~Agreement with Broadwood, and agreed, among other things, to increase the size of the ~~Company~~Board from six to seven directors, ~~Alcon~~accept the resignations of Mr. Farrell and ~~Merger~~Dr. ~~Sub~~Yeu from the Board, and appoint each of Messrs. Bradsher, LeBuhn and Wang (each a “New Director”) to ~~consummate~~the Board. Additionally, the ~~transactions~~Company ~~contemplated~~agreed bythat the ~~Merger~~Board ~~Agreement~~would ~~are~~nominate ~~subject~~each toNew Director as a candidate for election as a director at the ~~satisfaction~~2026 orannual ~~waiver~~meeting of ashareholders ~~number~~and that the size of ~~conditions~~the ~~including~~Board, ~~among~~until ~~other~~the ~~things~~conclusion of the 2027 annual meeting of shareholders, will not exceed seven directors. The Company also agreed to reimburse Broadwood, Yunqi Capital and Defender Capital for certain ~~regulatory~~reasonable ~~approvals~~and documented out-of-pocket fees and ~~the~~expenses ~~adoption~~they have incurred. Each of Broadwood and Yunqi Capital were holders of more than 5% of the ~~Merger~~Company’s outstanding stock at the time the Company entered into the Cooperation Agreement. The Cooperation Agreement was reviewed and approved by the Company’s ~~stockholders~~Board, atand it reviewed and approved the ~~Special~~payment ~~Meeting~~of the fees and expenses incurred by Broadwood and Yunqi Capital. The Company paid $5,036,000 to Broadwood and $962,000 to Yunqi Capital, in accordance with the Cooperation Agreement.

~~On September 29, 2025, in connection with the proposed Merger, the applicable waiting period expired under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”).~~17

On October 23, 2025, the Company adjourned the Special Meeting to November 6, 2025, and on October 27, 2025, the Company announced that it had postponed the Special Meeting to December 3, 2025. The new record date for the Special Meeting is the close of business on October 24, 2025. Company stockholders who hold shares as of the record date will be eligible to vote at the postponed Special Meeting on December 3, 2025, and the Company has provided a notice of the meeting and other materials to such stockholders in advance of the meeting date. Such notice was included with the Company’s proxy supplement, filed with the SEC on October 30, 2025, to its definitive proxy statement on Schedule 14A that was filed with the SEC on September 16, 2025.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The matters addressed in this Item 2 that are not historical information constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”), and the Private Securities Litigation Reform Act of 1995, and is subject to the safe harbor created therein. In some cases readers can recognize forward-looking statements by the use of words like “anticipate,” “estimate,” “expect,” “project,” “intend,” “may,” “plan,” “believe,” “will,” “should,” “could,” “forecast,” “potential,” “continue,” “ongoing” (or the negative of those words and similar words or expressions), although not all forward-looking statements contain these words. Forward-looking statements include, without limitation, statements regarding the intent, belief or current expectations of the Company and its management regarding any of the following: demand for our ~~implantable~~Implantable Collamer® ~~lenses (“ICLs”)~~Lenses; the benefits of our leadership realignment and related efforts; China macroeconomic conditions, procedure volumes, demand, and inventory levels; any projections of or guidance as to future earnings, revenue, sales, profit margins, expense rate, cash, effective tax rate, product mix, capital expense or any other financial items; the plans, strategies, and objectives of management for future operations or prospects for achieving such plans; statements regarding new, existing, or improved products, including but not limited to, expectations for success of new, existing, and improved products in the U.S. or international markets or government approval of a new or improved products; commercialization of new or improved products; future economic conditions or size of market opportunities globally; expected costs of operations; statements of belief, including as to achieving business plans for ~~2025~~2026 and beyond; expected regulatory activities and approvals, product launches, and any statements of assumptions underlying any of the foregoing.

Although we believe that the expectations reflected in these forward-looking statements are reasonable, we caution investors and prospective investors that any such forward-looking statements are not guarantees of future performance and involve risks, uncertainties, assumptions and other factors, which if they do not materialize or prove correct, could cause actual results to differ materially from those expressed or implied by such forward-looking statements. We caution you not to place undue reliance on these forward-looking statements and to note they speak only as of the date hereof. Factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, without limitation, ~~those~~our ~~described~~ability to grow and generate profit; our reliance on independent distributors in international markets; a slowdown or disruption to the Chinese economy; global economic conditions; disruptions in our ~~Annual~~supply ~~Report~~chain; fluctuations in foreign currency exchange rates; international trade disputes (including involving tariffs) and substantial dependence on ~~Form~~demand ~~10-K~~from Asia; changes in ~~“Item~~effective ~~1A.~~tax ~~Risk~~rate ~~Factors”~~or ~~filed~~tax onlaws; ~~February~~any 21loss of use of our principal manufacturing facility; competition; potential losses due to product liability claims; our exposure to environmental liability; data corruption, ~~2025.~~cyber-based Weattacks ~~disclaim~~or ~~any~~network ~~intention~~security breaches and/or ~~obligation~~noncompliance with data protection and privacy regulations; acquisitions of new technologies; climate changes; the willingness of surgeons and patients to ~~update~~adopt a new or ~~review~~improved ~~these~~product ~~financial~~and ~~projections~~procedure; orextensive ~~forward-looking~~clinical ~~statements~~trials ~~due~~and resources devoted to research and development; compliance with government regulations; the discretion of regulatory agencies to approve or reject existing, new ~~information~~or improved products, or to require additional actions before or after approval, or to take enforcement action; laws pertaining to healthcare fraud and abuse; changes in FDA or international regulations related to product approval; product recalls or failures; and other ~~events~~important ~~except~~factors; asand ~~required~~those bydescribed ~~law~~in our Annual Report on Form 10-K in “Item 1A. Risk Factors” filed on March 3, 2026.

We disclaim any intention or obligation to update or review these financial projections or forward-looking statements due to new information or other events except as required by law.

The following discussion should be read in conjunction with the Company’s unaudited Condensed Consolidated Financial Statements, including the related notes, provided in this report.

We intend to use our website as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. Such disclosures will be included on our website in the ‘Investor Relations’ sections. Accordingly, investors should monitor such portions of our website, in addition to following our press releases, SEC filings and public conference calls and webcasts.

Overview

STAAR Surgical Company designs, develops, manufactures, and sells implantable lenses for the eye and accessory delivery systems used to deliver the lenses into the eye. We are the leading manufacturer of phakic implantable lenses used worldwide in corrective or “refractive” surgery. We have been dedicated solely to ophthalmic surgery for over 40 years. Our goal is to position our refractive lenses throughout the world as primary and premium solutions for patients seeking visual freedom from wearing eyeglasses or contact lenses while achieving excellent visual acuity through refractive vision correction. We generate worldwide revenue almost exclusively from sales of our ~~implantable~~Implantable Collamer® ~~lenses~~Lenses, or “ICLs.” Our ICLs are made from Collamer, which is a proprietary collagen copolymer material created and exclusively used by STAAR to make our lenses soft, flexible and biocompatible with the eye. Our ICLs are phakic lenses, meaning that they are implanted into the eye without removing the eye’s natural crystalline lens. This distinguishes an ICL procedure from other refractive procedures, as it does not involve the removal of corneal eye tissue. All of our ICLs are foldable, which allows the surgeon to insert them into the eye through a small incision during minimally invasive surgery. Further, while ICLs are intended to be permanent, our ICLs are reversible lens implants, meaning they can be removed by a doctor if desired.

STAAR employs a commercialization strategy that strives for sustainable profitable growth. Our growth strategy includes making our complete ICL product line available in our existing geographic markets and expanding into attractive markets where we do not sell our products today. In addition, we are focused on driving awareness of the ICL procedure and the clinical benefits of our ICLs, and providing surgeon training, support and education, particularly in our newer markets.18

22without removing the eye’s natural crystalline lens. This distinguishes an ICL procedure from other refractive procedures, as it does not involve the removal of corneal eye tissue. All of our ICLs are foldable, which allows the surgeon to insert them into the eye through a small incision during minimally invasive surgery. Further, while ICLs are intended to be permanent, our ICLs are reversible lens implants, meaning they can be removed by a doctor if desired.

~~Proposed~~STAAR ~~Merger~~employs ~~with~~a ~~Alcon~~commercialization strategy that strives for sustainable, profitable growth. Our growth strategy includes making our complete ICL product line available in our existing geographic markets and expanding into attractive markets where we do not sell our products today. In addition, we are focused on driving awareness of the ICL procedure and the clinical benefits of our ICLs, and providing surgeon training, support and education, particularly in our newer markets.

On August 4, 2025, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Alcon Research, LLC, a Delaware limited liability company (“Alcon”), and Rascasse Merger Sub, Inc., a Delaware corporation and a wholly owned direct subsidiary of Alcon (“Merger Sub”). The Merger Agreement provides, among other things, that subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will merge with and into the Company (the “Merger”), with STAAR surviving the Merger as a wholly owned subsidiary of Alcon. The respective obligations of STAAR, Alcon and Merger Sub to consummate the transactions contemplated by the Merger Agreement are subject to the satisfaction or waiver of a number of conditions, as further discussed in Notes 1 and 16 to the Condensed Consolidated Financial Statements included in this Quarterly Report.

Business Environment and Factors Affecting Comparability

For the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026, wenet ~~reported~~sales were $~~181~~93.65 million ~~of net sales~~, aup ~~decrease of 31~~119.6% ~~compared~~from to $~~265~~42.06 million ~~of net sales~~ for the ~~nine~~three months ended ~~September~~March 2728, ~~2024~~2025. ~~This~~The ~~significant~~increase ~~decrease~~was is primarily ~~due~~driven toby ~~dynamics~~strong ~~within~~sales ~~our~~performance ~~business~~ in China, while distributor inventory was maintained at or below contractual levels. Net sales to our two distributors in China were $6047.34 million for the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026, compared to net ~~sales~~returns of $~~154~~0.59 million ~~for the nine months ended September 27, 2024. During the nine months ended September 26, 2025, our distributors~~ in China purchased fewer ICLs, as they were able to satisfy procedural demand largely from their existing inventory. Our distributors in China have historically purchased products from us in bulk shipments in advance of anticipated demand, which they use to satisfy orders from hospital customers based on scheduled surgeries. During fiscal 2024, our distributors in China purchased lenses above contracted minimums in anticipation of higher procedural volumes during what is typically a summer “high season” in China. Due to dynamic macroeconomic conditions and other factors, the ~~number~~prior-year ~~of ICL procedures performed during the high season and the second half of 2024 overall was lower than expected~~period. Accordingly, our distributors in China held, as of December 27, 2024, elevated levels of ICL product inventory. The level of inventory owned by our distributors in China has decreased substantially since December 27, 2024, and has now returned to historical levels. However, as anticipated we reported minimal China ICL sales in the first half of fiscal 2025. Our ability to successfully address these challenges will depend on a number of factors, including the risk of a prolonged slowdown or disruption in China and the status of trade tariffs both globally and between the United States and China.

~~China~~During ~~net sales for~~ the ~~three~~first ~~months~~quarter ~~ended September 26, 2025, were $55.8 million, an increase~~ of ~~6% compared to $52.5 million for the three months ended September 27~~2026, ~~2024.~~we ~~China~~completed ~~net sales included $25.9 million related to~~ the ~~previously~~launch ~~disclosed~~of ~~December~~EVO+ ~~2024~~ ICL ~~shipment~~in ~~that was subject to extended payment terms~~China, ~~and~~ which was ~~paid~~met inwith ~~full~~strong ~~during~~market ~~the~~acceptance. ~~three~~EVO+ ~~months~~ICL ~~ended~~carries ~~September~~a 26premium selling price, ~~2025~~supporting ~~pursuant~~potential tomargin ~~such~~expansion ~~payment~~as ~~terms~~production ~~(the~~volumes ~~“December~~increase ~~China~~over ~~Shipment”)~~time. As previously disclosed, weshipments ~~shipped $27.5 million of ICLs in December 2024~~ to ~~one~~the oftwo ~~our~~ distributors in China ~~for which the distributor requested extended payment terms through September 2025. Given the extended payment terms, net sales for the shipment~~ were ~~not~~largely ~~recognized~~suspended byduring ~~us until payments were received. As~~ the ~~cost~~first half of ~~sales~~2025 ~~associated~~due ~~with the December China Shipment was recognized in December 2024, the payments, when made, were recognized at 100% gross margin in the applicable quarter. We recognized $1.6 million related~~ to ~~this~~elevated ~~shipment~~inventory inlevels ~~the~~following ~~three~~a ~~months~~market ~~ended~~slowdown ~~June 27, 2025, and we recognized the remaining $25.9 million~~ in ~~the three months ended September 26~~2024, ~~2025,~~with inprocedure ~~each~~demand ~~case~~primarily ~~upon~~fulfilled ~~receipt~~from ofexisting ~~corresponding payment~~inventory. ~~While the remaining $25.9 million related to the shipment was recognized in full during the three months ended September 26, 2025, the associated ICL procedures took place throughout 2025.~~

InGross ~~April~~margin ~~2025,~~increased inyear-over-year ~~response~~ to ~~the~~73.6% ~~announcement~~from of65.8%, ~~tariffs~~reflecting bycost ~~the~~reduction ~~United~~initiatives ~~States~~implemented onin ~~Chinese~~the ~~goods,~~first ~~China~~quarter ~~announced~~of ~~retaliatory tariffs on U~~2025.~~S.-origin~~ ~~goods.~~This Inimprovement ~~order~~was topartially ~~mitigate~~offset ~~potential~~by ~~financial~~higher ~~exposure~~per-unit ~~from~~manufacturing ~~such~~costs ~~tariffs,~~associated ~~we negotiated and implemented consignment agreements~~ with ~~our~~low ~~two~~production ~~distributors~~volumes inat ~~China,~~the ~~and~~new weSwiss ~~delivered~~facility ~~consigned~~during ~~inventory~~2025. toAs ~~China~~production in ~~advance~~Switzerland ofhas ~~the~~scaled ~~implementation~~in ~~of tariffs. During the quarters ended June 27~~2026, ~~2025~~unit ~~and~~costs ~~September~~have ~~26,~~begun ~~2025, we delivered additional consignment inventory~~ to ~~our distributors in China~~improve. ~~While~~By the ~~tariff~~end ~~situation~~of isfiscal ~~evolving~~2026, we ~~believe~~expect ~~that these efforts~~ to ~~increase~~manufacture ~~the~~and ~~amount~~supply 100% of ~~ICLs~~EVO inand ~~China~~EVO+ ~~reduce~~ICL ~~the~~lenses ~~Company’s~~for ~~tariff risk in~~ China infrom ~~the near-term. In addition, we are rapidly ramping up our production capabilities in~~ Switzerland towithout ~~supplement~~exposure ~~our manufacturing capacity in the United States~~ to ~~provide optionality under multiple tariff scenarios~~tariffs.

~~Given~~As ~~that~~a weresult ~~now~~of ~~maintain~~significantly ~~consigned~~increased ~~inventory in China~~sales, wehigher ~~believe~~gross ~~that~~profit, ~~purchases~~and byreduced ~~our~~operating ~~distributors~~expenses, ~~will~~GAAP ~~largely~~net beincome ~~satisfied~~for ~~from~~the ~~our~~first ~~consigned~~quarter ~~inventory~~of ~~in-country~~2026 inwas ~~the~~$5.2 ~~near-term,~~million ~~rather~~or ~~than~~$0.10 ~~through~~per ~~bulk~~diluted ~~purchases.~~share, Asup from a ~~result,~~net weloss ~~expect~~of ~~our~~$(54.2) ~~distributors~~million ~~will~~or ~~likely~~$(1.10) ~~make~~per ~~more~~share ~~frequent~~for ~~purchases~~the ofprior ~~ICLs~~year inquarter. ~~smaller~~Although ~~quantities~~cash ~~that~~and ~~are~~investments ~~more~~available ~~closely~~for ~~aligned~~sale decreased to ~~actual~~$163.9 ~~procedural~~million ~~volumes~~at asApril ~~opposed~~3, to2026 ~~anticipated~~from ~~demand~~$187.5 Wemillion ~~believe~~due ~~this~~to ~~will~~front-loaded ~~reduce~~payments ~~the~~for ~~risk~~seasonal ofbonuses ~~elevated~~and ~~inventory~~other ~~buildup~~employee byincentives, ~~our~~global ~~distributors~~sales meetings, ~~while~~severance, atand ~~the~~costs ~~same~~associated ~~time~~with ~~maintaining~~our ~~sufficient~~Cooperation ~~ICL~~Agreement ~~inventory~~with inBroadwood ~~China~~Partners, towe ~~support~~expect ~~quick~~to ~~and~~generate ~~efficient~~cash ~~delivery~~during ~~and~~the ~~fulfillment~~remainder ~~for~~of ~~surgical~~the ~~procedures~~year.

Critical Accounting Estimates

This Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses and analyzes data in our unaudited Condensed Consolidated Financial Statements provided in this report, which we have prepared in accordance with U.S. generally accepted accounting principles. Preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. Management bases its estimates on historical experience and on various other assumptions that it believes 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. Senior management has discussed the development, selection and disclosure of these estimates with the Audit Committee of our Board ~~of Directors~~. Actual ~~conditions~~results may differ, ~~from~~significantly ~~our~~at ~~assumptions~~times, ~~and~~from ~~actual~~these ~~results~~estimates ~~may~~if ~~materially~~actual conditions differ from our ~~estimates~~assumptions.

Management believes that there have been no significant changes during the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026 to the items that we disclosed as our critical accounting estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended ~~December~~January 272, ~~2024~~2026.

Results of Operations

The following table shows the percentage of our total sales represented by certain items reflected in our Condensed Consolidated Statements of Income for the periods indicated.

	Percentage of Net Sales for
	Three Months Ended						~~Nine Months Ended~~
	September 26, 2025			September 27, 2024			September 26, 2025			September 27, 2024
	April 3, 2026			March 28, 2025
Net sales(1)		100.0	%		100.0	%		100.0	%		100.0	%
Net sales		100.0	%		100.0	%
Cost of sales(1)		17.8	%		22.7	%		23.7	%		21.5	%
Cost of sales		26.4	%		34.2	%
Gross profit(1)		82.2	%		77.3	%		76.3	%		78.5	%
Gross profit		73.6	%		65.8	%
General and administrative		2118.92	%		2457.54	%		~~36.4~~	%		~~25.9~~	%
Selling and marketing		2426.82	%		3263.63	%		~~42.2~~	%		~~33.4~~	%
Research and development		910.76	%		1326.86	%		~~17.0~~	%		~~13.4~~	%
Merger transaction and related costs		67.32	%		0.0	%		~~3.3~~	%		~~0.0~~	%
Restructuring, impairment and related charges		02.09	%		053.02	%		~~15.3~~	%		~~0.0~~	%
Total selling, general and administrative		6265.71	%		70200.95	%		~~114.2~~	%		~~72.7~~	%
Operating income (loss)		198.5	%		6(134.47	)%		~~(37.9~~	)%		~~5.8~~	%
Total other income, net		0.3	%		86.58	%		~~4.0~~	%		~~2.2~~	%
Income (loss) before income taxes		198.8	%		14(127.9	)%		~~(33.9~~	)%		~~8.0~~	%
Provision for income taxes		10.5	%		3.6	%		0.3	%		2.7	%
Provision (benefit) for income taxes		3.2	%		(0.6	)%
Net income (loss)		95.36	%		11(127.3	)%		~~(34.2~~	)%		~~5.3~~	%

(1) For the three and nine months ended September 26, 2025, amounts include $25.9 million and $27.5 million, respectively, of net sales related to the December China Shipment. As the associated cost of sales was recognized upon shipment in December 2024, these amounts were recognized at 100% gross margin.

Net Sales

The following table presents our net sales (dollars in thousands):

Three Months Ended

PercentageChange

~~Nine Months Ended~~

~~PercentageChange~~

September 26, 2025

September 27, 2024

2025 vs. 2024

September 26, 2025

September 27, 2024

2025 vs. 2024

April 3, 2026

March 28, 2025

2026 vs. 2025

Net sales

9493,~~732~~522

8842,~~590~~589

~~6.9~~—

~~181,641~~

~~264,951~~

~~(31.4~~

~~Net~~* ~~sales~~Denotes ~~for~~change the three months ended September 26, 2025 increased 7% from the same period of 2024. Net sales for the three months ended September 26, 2025 included $25.9 million of sales related to the previously disclosed December China Shipment, which was paid in full during the three months ended September 26, 2025. The composition of our net sales is ~~primarily~~greater ~~related~~than ~~to ICL sales. ICL sales include normal recurring sales adjustments such as sales return allowances. The sales increase was driven by the Asia Pacific (“APAC”) region, which increased 6~~+100%~~, with ICL unit increase of 7%~~. ~~The increase in~~

24Net sales for the three months ended April 3, 2026 increased 119.6% from the same period of 2025, primarily due to increased sales in China. The composition of our net sales is primarily related to ICL sales. Net sales also include sales of delivery system sales and normal recurring sales adjustments such as sales return allowances. The sales increase was driven by the Asia Pacific (“APAC”) region, which increased by 218%, with ICL unit increase of 227%. The increase in the APAC region was driven by increased sales in China, Japan and Korea. The Europe, Middle East and Africa region sales decreased 3%, with ICL units down 11%, due to decreased sales in our distributor markets, partially offset by increased sales in our direct markets. The Americas region sales increased 26%, with ICL unit growth up 28%, primarily due to sales growth in the U.S. Changes in foreign currency favorably impacted net sales by $1.2 million.

the APAC region was driven by sales growth in Korea, Japan and China, partially offset by decreased sales in other APAC distributors. The Europe, Middle East and Africa (“EMEA”) region sales increased 8% with ICL unit growth up 23%, due primarily to sales growth in our distributor markets, partially offset by decreased sales in our direct markets and changes in our sales return allowances. The Americas region sales increased 20% with ICL unit growth up 15%, due to sales growth in Canada and U.S. Changes in foreign currency favorably impacted net sales by $0.9 million.

Net sales for the nine months ended September 26, 2025 decreased 31% from the same period of 2024 primarily due to decreased China sales. Net sales for the nine months ended September 26, 2025 included $27.5 million of sales related to the previously disclosed December China Shipment, of which payment of $1.6 million was received during the three months ended June 27, 2025 and the remaining $25.9 million was paid in full during the three months ended September 26, 2025. The sales decrease was driven by the APAC region, which decreased 42%, with ICL unit decrease of 43%. The decrease in the APAC region was driven by decreased sales in China, partially offset by sales growth in India, Korea and Japan. The EMEA region sales increased 12% with ICL unit growth up 14%, due primarily to sales growth in our distributor and direct markets. The Americas region sales increased 13% with ICL unit growth up 9%, due to sales growth in Canada, Latin America distributor markets and U.S. Changes in foreign currency favorably impacted net sales by $1.3 million.

Gross Profit

The following table presents our gross profit and gross profit margin (dollars in thousands):

	Three Months Ended						PercentageChange			~~Nine Months Ended~~						~~PercentageChange~~
	September 26, 2025			September 27, 2024			2025 vs. 2024			September 26, 2025			September 27, 2024			2025 vs. 2024
	April 3, 2026			March 28, 2025			2026 vs. 2025
Gross profit	$	7768,~~875~~859		$	6828,~~487~~005			~~13.7~~—	%*	$	~~138,679~~		$	~~207,934~~			~~(33.3~~	)%
Gross margin		82.2	%		77.3	%					76.3	%		78.5	%
Gross profit margin		73.6	%		65.8	%

~~Gross~~* ~~profit~~Denotes ~~for~~change ~~the~~is ~~three~~greater ~~months~~than ended September 26, 2025 increased 13.7% from the same period of 2024. Gross profit margin increased to 82.2% of sales for the three months ended September 26, 2025 compared to 77.3% of sales for the three months ended September 27, 2024 due primarily to timing of the recognition of the cost of sales associated with the December China Shipment. The cost of sales for the December China Shipment was recognized in December 2024 when product was shipped, and the net sales of $25.9 million was recognized upon payment in September 2025 at +100% ~~gross margin~~. ~~The increase in gross margin also reflected decreased period costs as a result of our cost reductions implemented in the quarter ended March 28, 2025.~~

Gross profit for the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026 ~~decreased~~increased 33145.39%, from the same period of ~~2024~~2025. Gross profit margin ~~decreased~~increased to 7673.36% of revenue for the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026 compared to 7865.58% of revenue for the ~~nine~~three months ended ~~September~~March 2728, ~~2024~~2025, due ~~primarily~~ to ~~higher~~the ~~manufacturing~~elimination ~~costs~~of ~~per~~period ~~unit~~costs ~~due~~related to ~~lower~~the ~~production~~ramp-up ~~volume~~of ~~and~~manufacturing ~~increased~~in ~~excess and obsolete inventory reserves~~Switzerland, ~~partially~~a ~~offset~~reduction byin ~~decreased~~Advanced ~~period~~Manufacturing ~~costs~~expenses as a result of our cost reductions implemented induring the ~~quarter~~three months ended ~~March 28, 2025 and timing of the recognition of cost of sales associated with the December China Shipment.~~

March 28, 2025, lower inventory provisions, and decreased freight and other cost of sales as a percentage of sales. This was partially offset by higher per unit manufacturing costs resulting from lower production volume in 2025.

General and Administrative Expense

The following table presents our general and administrative expenses (dollars in thousands):

Three Months Ended

PercentageChange

~~Nine Months Ended~~

~~PercentageChange~~

September 26, 2025

September 27, 2024

2025 vs. 2024

September 26, 2025

September 27, 2024

2025 vs. 2024

April 3, 2026

March 28, 2025

2026 vs. 2025

General and administrative expense

2017,~~763~~022

2124,~~685~~458

(430.34

~~66,190~~

~~68,554~~

~~(3.4~~

Percentage of sales

2118.92

2457.54

~~36.4~~

~~25.9~~

General and administrative expenses for the three months ended ~~September~~April ~~26, 2025 decreased 4.~~3~~% from the same period of 2024 due to decreased outside services and facilities costs~~, ~~partially~~2026 ~~offset by increased stock-based compensation and bonus expenses. General and administrative expenses for the nine months ended September 26, 2025~~ decreased 330.4% from the same period of ~~2024~~2025 due to decreased outside services, ~~partially offset by increased~~ bonus and stock-based compensation expenses, and salary-related and payroll tax expenses ~~and facilities related costs~~.

Selling and Marketing Expense

The following table presents our selling and marketing expenses (dollars in thousands):

Three Months Ended

PercentageChange

~~Nine Months Ended~~

~~PercentageChange~~

September 26, 2025

September 27, 2024

2025 vs. 2024

September 26, 2025

September 27, 2024

2025 vs. 2024

April 3, 2026

March 28, 2025

2026 vs. 2025

Selling and marketing expense

2324,~~461~~509

2826,~~872~~945

(189.70

~~76,689~~

~~88,535~~

~~(13.4~~

Percentage of sales

2426.82

3263.63

~~42.2~~

~~33.4~~

Selling and marketing expenses for the three months ended ~~September~~April 263, ~~2025~~2026 decreased 189.70% from the same period of ~~2024~~2025 due to decreased advertising and promotional activities and astrade ashows ~~result of costs~~ and ~~charges~~sales inmeeting ~~the prior year period associated with the opening of our new experience center~~expenses, partially offset by ~~increased~~bad ~~bonus~~debt ~~and~~expense ~~stock-based compensation expenses. Selling~~ and marketing expenses for the nine months ended September 26, 2025 decreased 13.4% from the same period of 2024 due to decreased advertising and promotional activities and as a result of higher costs and charges in the prior year period associated with the opening of our new experience center and travel related expenses, partially offset by increased bonus and stock-based compensation expenses ~~and salary-related and payroll tax expenses~~.

Research and Development Expense

The following table presents our research and development expenses (dollars in thousands):

Three Months Ended

PercentageChange

~~Nine Months Ended~~

~~PercentageChange~~

September 26, 2025

September 27, 2024

2025 vs. 2024

September 26, 2025

September 27, 2024

2025 vs. 2024

April 3, 2026

March 28, 2025

2026 vs. 2025

Research and development expense

9,~~209~~925

1211,~~248~~339

(2412.85

~~30,811~~

~~35,546~~

~~(13.3~~

Percentage of sales

910.76

1326.86

~~17.0~~

~~13.4~~

Research and development expenses for the three months ended ~~September~~April 263, ~~2025~~2026 decreased 2412.85% from the same period of ~~2024~~2025, ~~primarily~~due asmainly ~~a result of purchases of in-process research and development in the prior year period related~~ to ~~external AI tools for measurement and lens size selection and~~ decreased salary-related and payroll tax expenses. ~~Research~~ and ~~development~~bonus ~~expenses~~and ~~for the nine months ended September 26, 2025 decreased 13.3% from the same period of 2024 primary as a result of purchases of in~~stock-~~process~~based ~~research~~compensation ~~and development in the prior year period related to external AI tools for measurement and lens size selection, decreased clinical~~ expenses ~~associated with U~~.~~S. post-approval clinical activities and outside services.~~

Merger Transaction and Related Costs

At the special meeting of shareholders held on January 6, 2026, the Company’s shareholders voted against the merger with Alcon. Following the termination of the Merger Agreement, the Company entered into the Cooperation Agreement with Broadwood, which provided for the reimbursement of certain reasonable out-of-pocket fees and expenses to Broadwood, Yunqi Capital and Defender Capital related to the merger with Alcon. The following table presents our professional ~~service~~services expenses we incurred in connection with ~~our~~the proposed merger with Alcon and the Cooperation Agreement (dollars in thousands):

	Three Months Ended						PercentageChange			~~Nine Months Ended~~						~~PercentageChange~~
	September 26, 2025			September 27, 2024			2025 vs. 2024			September 26, 2025			September 27, 2024			2025 vs. 2024
	April 3, 2026			March 28, 2025			2026 vs. 2025
Merger transaction and related costs	$	56,~~926~~743		$	—			—	*	$	~~5,926~~		$	—			—	*
Percentage of sales		67.32	%		0.0	%					~~3.3~~	%		~~0.0~~	%

* Denotes change is greater than +100%.

Restructuring, Impairment and Related Charges

The following table presents our restructuring, impairment and related charges (dollars in thousands):


	Three Months Ended						Percentage Change
	April 3, 2026			March 28, 2025			2026 vs. 2025
Restructuring, impairment and related charges	$	2,681		$	22,664			(88.2	)%
Percentage of sales		2.9	%		53.2	%

	Three Months Ended						PercentageChange			Nine Months Ended						PercentageChange
	September 26, 2025			September 27, 2024			2025 vs. 2024			September 26, 2025			September 27, 2024			2025 vs. 2024
Restructuring, impairment and related charges	$	26		$	—			—	*	$	27,938		$	—			—	*
Percentage of sales		0.0	%		0.0	%					15.3	%		0.0	%

* Denotes change is greater than +100%.


	Three Months Ended
	April 3, 2026		March 28, 2025
Severance and reduction in workforce	$	1,614	$	8,808
Consulting expenses		1,067		639
Impairment on leasehold improvements and machinery and equipment(1)		—		7,059
Impairment on real property right-of-use assets(2)		—		3,407
Impairment on internally developed software(1)		—		2,751
	$	2,681	$	22,664

(1)

InThe the first half of 2025, we took a number of steps to change our leadership team, realign our leadership structure to better address market needs, reduce costs and discretionary spending, and better position the Company to return to sustainable growth. As part of this leadership realignment and related efforts, during the three and nine months ended September 26, 2025, we recognized costs related to severance and reduction in workforce of $18,000 and $12,471,000, respectively; consulting expenses of $8,000 and $874,000, respectively; impairment expenses on leasehold improvements and machinery and equipment of $0 and $7,759,000, respectively, as we will no longer be using these assets~~; and impairment on real property right-of-use assets of $0 and $4,083,000, respectively, as we are actively pursuing subleasing opportunities for two of our leased properties~~. In addition, we also recognized impairment of $0 and $2,751,000 during the three and nine months ended September 26, 2025, respectively, for internally developed software that we will no longer be using as we will transition to a cloud-based software solution. The restructuring effort was substantially completed as of June 27, 2025.

(2)

The Company is actively pursuing subleasing opportunities.

Other Income, Net

The following table presents our other income, net (dollars in thousands):

Three Months Ended

PercentageChange

~~Nine Months Ended~~

~~PercentageChange~~

September 26, 2025

September 27, 2024

2025 vs. 2024

September 26, 2025

September 27, 2024

2025 vs. 2024

April 3, 2026

March 28, 2025

2026 vs. 2025

Other income, net

~~300~~239

72,~~477~~915

(9691.08

~~7,264~~

~~5,983~~

~~21.4~~

Percentage of sales

0.3

86.58

~~4.0~~

~~2.2~~

~~Other~~The decrease in other income, net ~~decreased~~ for the three months ended ~~September~~April 263, ~~2025~~2026, was due mainly to higher foreign exchange losses ~~and decreased interest income. Other income, net increased~~ for the ~~nine~~three months ended ~~September~~April 263, ~~2025 due to foreign exchange gains, partially offset by decreased interest income~~2026.

Provision (Benefit) for Income Taxes

The following table presents our income tax provision (benefit) (dollars in thousands):

	Three Months Ended					PercentageChange			~~Nine Months Ended~~				~~PercentageChange~~
	September 26, 2025		September 27, 2024			2025 vs. 2024			September 26, 2025		September 27, 2024		2025 vs. 2024
	April 3, 2026		March 28, 2025			2026 vs. 2025
Income tax provision	$	9,906	$	3,179			—	*	$	528	$	7,262		(92.7	)%
Provision (benefit) for income taxes	$	3,012	$	(275	)		—	*

* Denotes change is greater than +100%.

The ~~income~~effective tax ~~provision~~rates ~~increased~~for ~~during~~ the three months ended ~~September~~April 263, ~~2025~~2026 ~~due~~and toMarch ~~the reversal of income tax benefits recorded during the six months ended June 27~~28, 2025, aswere a36.7% ~~result~~and ~~of the recognition of the $25~~0.95%, ~~million December China Shipment~~respectively. Our ~~The~~effective ~~income~~ tax ~~provision~~rates ~~decreased~~differ ~~during~~from the ~~nine~~U.S. ~~months~~federal ~~ended~~statutory ~~September~~rate 26of 21%, ~~2025~~primarily due to ~~losses before taxes recognized during~~ the ~~nine~~income ~~months~~tax ~~ended~~expense ~~September~~generated ~~26,~~in ~~2025,~~foreign ~~compared to the nine months ended September 27, 2024~~jurisdictions.

The effective tax rates for the three months ended September 26, 2025 and September 27, 2024 were 52.7% and 24.2%, respectively. The effective tax rates for the nine months ended September 26, 2025 and September 27, 2024 were (0.9)% and 34.1%, respectively. Our effective tax rates differ from the U.S. federal statutory rate of 21%, primarily due to the income tax expense generated in foreign jurisdictions.

Our future effective income tax rate depends on various factors, such as changes in tax laws, regulations, accounting principles, or interpretations thereof, and the geographic composition of our pre-tax income. We carefully monitor these factors and adjust our effective income tax rate accordingly.

2722

Liquidity and Capital Resources

Our principal sources of liquidity are cash, cash equivalents, investments available for sale (“AFS”) and cash flow from operating activities. We believe these sources of liquidity will be sufficient to meet our anticipated cash needs, including working capital needs, capital expenditures and contractual obligations for at least 12 months from the issuance date of the financial statements. We expect that cash flow from operating activities may fluctuate in future periods as a result of a number of factors, including fluctuations in our operating results, working capital needs, capital expenditures, and capital deployment decisions. In addition, future capital requirements will depend on many factors including our growth rate in net sales, the timing and extent of spending to support our growth strategy, the expansion of selling and marketing activities, the timing of introductions of new products, as well as global macroeconomic factors. If our anticipated future cash flow from operating activities is insufficient to satisfy our future capital requirements in the long-term, we may need to seek additional capital. Our financial condition at ~~September~~April 263, ~~2025~~2026 and ~~December~~January 272, ~~2024~~2026 included the following (in thousands):

September 26, 2025

December 27, 2024

2025 vs. 2024

April 3, 2026

January 2, 2026

2026 vs. 2025

Cash and cash equivalents

~~176~~131,~~155~~864

~~144~~153,~~159~~150

31(21,~~996~~286

)

Investments available for sale

1632,~~505~~025

8634,~~335~~386

(692,~~830~~361

)

Total

~~192~~163,~~660~~889

~~230~~187,~~494~~536

(3723,~~834~~647

)

Current assets

~~321~~312,~~209~~398

~~367~~311,~~940~~545

~~(46,731~~853

)

Current liabilities

6160,~~637~~994

7068,~~306~~504

(87,~~669~~510

)

Working capital

~~259~~251,~~572~~404

~~297~~243,~~634~~041

~~(38~~8,~~062~~363

)

Cash and cash equivalents include cash and balances in deposits and money market accounts held at banks and financial institutions. Our investment policy’s primary objective is capital preservation while maximizing our return on investment. Investments available for sale may include U.S. government and corporate debt securities, commercial paper, certain certificates of deposit and related security types, that are rated by two nationally recognized statistical rating organizations with minimum investment grade ratings of AAA to A-/A-1+ to A-2, or the equivalent. The maturity of individual investments may not extend 24 months from the date of purchase. There are also limits to the amount of credit exposure in any given security type. We do not have any off-balance sheet arrangements.

A summary of cash flows for the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026 and ~~September~~March 2728, ~~2024~~2025 was as follows (in thousands):

	Nine Months Ended
	Three Months Ended
	September 26, 2025			September 27, 2024
	April 3, 2026			March 28, 2025
Cash flows from:
Operating activities	$	(3021,~~316~~695	)	$	15(5,~~083~~734	)
Investing activities		652,~~754~~147			~~(39~~35,~~722~~351	)
Financing activities		(41,~~505~~693	)		~~5,834~~(948	)
Effect of exchange rate changes		~~1,063~~(45	)		~~(230~~286	)
Net increase (decrease) in cash and cash equivalents		31(21,~~996~~286	)		~~(19~~28,~~035~~955	)
Cash and cash equivalents, at beginning of year		~~144~~153,~~159~~150			~~183~~144,~~038~~159
Cash and cash equivalents, at end of period	$	~~176~~131,~~155~~864		$	~~164~~173,~~003~~114

For the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026, net cash used in operating activities consisted of $6242.17 million ~~net loss and $17.3 million~~ in working-capital changes primarily related to ~~changes~~increases in ~~inventories,~~accounts ~~current~~receivable ~~liabilities,~~due ~~capitalization~~to ofhigher ~~cloud-based~~sales ~~software~~in ~~and~~the ~~changes~~first inquarter ~~accounts~~of ~~receivable;~~2026, partially offset by $4915.18 million in non-cash items primarily related to stock-based compensation, ~~expenses~~provision for sales returns and ~~impairment~~credit onlosses ~~fixed~~and ~~assets~~depreciation of property, plant and equipment and $5.2 million in net income. For the ~~nine~~three months ended ~~September~~March 2728, ~~2024~~2025, net cash ~~provided~~used byin operating activities consisted of $3454.62 million in ~~non-cash~~net ~~items~~loss; ~~primarily~~partially ~~related~~offset toby ~~stock~~$28.3 million in working-~~based~~capital ~~compensation~~changes ~~expenses~~primarily ~~and~~related ~~net~~to ~~income~~changes ofin ~~$14.0~~accounts ~~million~~receivable, partially offset by changes in inventory, and $3320.62 million in ~~working~~non-~~capital~~cash ~~changes~~items primarily related to ~~the~~impairment ~~capitalization~~on offixed ~~cloud-based~~assets ~~software~~ and ~~changes~~operating inleases ~~accounts~~and ~~receivable~~stock-based compensation.

For the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026, net cash provided by investment activities was $652.81 million which consisted of $937.01 million inof proceeds from the ~~maturities~~maturity and sale of investments AFS, partially offset by $264.5 million of purchases of investments AFS. ~~During~~For the ~~first~~three ~~half~~months ofended March 28, 2025, ~~upon~~net ~~maturity~~cash ofprovided ~~investments~~by ~~AFS,~~investment ~~funds~~activities ~~were~~was ~~placed~~$35.4 ~~into~~million ~~money~~which ~~market~~consisted ~~accounts~~of to$51.1 ~~serve~~million asof ~~liquidity~~proceeds ~~for~~from ~~operations, and during~~ the ~~three~~maturity ~~months~~of ~~ended~~investments ~~September 26~~AFS, ~~2025,~~partially weoffset ~~began~~by ~~to purchase investments~~$14.7 ~~For~~million ~~the nine months ended September 27, 2024, net cash used~~ in ~~investment~~purchases ~~activities~~of ~~was~~investments ~~$39~~AFS.~~7 million which~~

For the three months ended April 3, 2026, net cash used in financing activities was $1.7 million which primarily consisted of $1.9 million to repurchase employee common stock for taxes withheld. For the three months ended March 28, 2025, net cash used in financing activities was $0.9 million which primarily consisted of $1.3 million to repurchase employee common stock for taxes withheld.

consisted of $61.2 million in purchases of investments AFS and $17.7 million in purchases of property, plant and equipment, partially offset by $38.3 million of proceeds from the maturity of investments AFS.23

For the nine months ended September 26, 2025 net cash used in financing activities was $4.5 million which primarily consisted of $6.5 million of repurchases of common stock pursuant to our share repurchase program and $1.4 million to repurchase employee common stock for taxes withheld, partially offset by $3.4 million of proceeds from the exercise of stock options. For the nine months ended September 27, 2024, net cash provided by financing activities was $5.8 million which consisted of $7.4 million of proceeds from the exercise of stock options, partially offset by $1.4 million to repurchase employee common stock for taxes withheld.

Commitments

~~Employment~~Executive Agreements

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

During the ~~nine~~three months ended ~~September~~April 263, ~~2025~~2026, there have been no material changes in the Company’s qualitative and quantitative market risk since the disclosure in the Company’s Annual Report on Form 10-K for the year ended ~~December~~January 272, ~~2024~~2026.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our ~~CEO~~Co-CEOs and CFO, of the effectiveness of the design and operation of the disclosure controls and procedures of the Company. Based on that evaluation, our ~~CEO~~Co-CEOs and CFO concluded, as of the end of the period covered by this quarterly report on Form 10-Q, that our disclosure controls and procedures were effective. For purposes of this statement, the term “disclosure controls and procedures” means controls and other procedures of the Company that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act (15 U.S.C. 78a et seq.) is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Our management, including the ~~CEO~~Co-CEOs and the CFO, do not expect that our disclosure controls and procedures or our internal control over financial reporting will necessarily prevent all fraud or material errors. An internal control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations on all internal control systems, our internal control system can provide only reasonable assurance of achieving its objectives and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of internal control is also based in part upon certain assumptions about the likelihood of future events, and can provide only reasonable, not absolute, assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in circumstances, or the degree of compliance with the policies and procedures may deteriorate.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended ~~September~~April 263, ~~2025~~2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, the Company is involved in various legal proceedings and other matters arising in the normal course of business. These legal proceedings and other matters may relate to, among other things, contractual rights and obligations, employment matters, or claims of product liability. The Company maintains insurance coverage for various matters, including product liability and certain securities claims. While the Company does not believe that any of the claims known is likely to have a material adverse effect on the Company’s financial condition or results of operations, new claims or unexpected results of existing claims could lead to significant financial harm.

ITEM 1A. RISK FACTORS

Our short and long-term success is subject to many factors that are beyond our control. Investors and prospective investors should consider carefully information contained in this report and the risks and uncertainties described in “Part I—Item 1A—Risk Factors” of the Company’s Form 10-K for the fiscal year ended ~~December~~January 272, ~~2024~~2026. Such risks and uncertainties could materially adversely affect our business, financial condition or operating results. ~~The following risk factors represent new risks that have emerged since the filing of the Company’s Form 10-K for the fiscal year ended December 27, 2024.~~

The announcement and pendency of our proposed acquisition by Alcon could adversely impact our business, financial condition, and results of operations.

On August 4, 2025, we entered into the Merger Agreement. Uncertainty about the effect of the Merger on our employees, customers, and other parties may have an adverse effect on our business, financial condition, and results of operations regardless of whether the Merger is completed. These risks to our business include the following, all of which could be exacerbated by a delay in the completion of the Merger:

the impairment of our ability to attract, retain, and motivate our employees, including key personnel;

the diversion of significant management time and resources toward the completion of the Merger and responding to related stockholder activism, including by the Broadwood Group, which has filed a definitive proxy statement to solicit votes in opposition to the Merger and announced its intent to request a separate special meeting of stockholders to remove several of the Company’s directors;

difficulties maintaining relationships with customers, suppliers, and other business partners;

delays or deferments of certain business decisions by our customers, suppliers, and other business partners;

the inability to pursue alternative business opportunities or make appropriate changes to our business because the Merger Agreement requires us to use commercially reasonable efforts to carry on its business in the ordinary course of business and preserve intact its material business organization and existing relationships;

litigation relating to the Merger and the costs related thereto; and

the incurrence of significant costs, expenses, and fees for professional services and other transaction costs in connection with the Merger and responding to related stockholder activism.

The completion of the Merger is subject to certain closing conditions, including stockholder approval and certain regulatory conditions, which may not be satisfied on a timely basis or at all, and the failure to consummate the Merger within the expected timeframe or at all could adversely impact our business, financial condition, and results of operations.

The obligations of the Company, Alcon and Merger Sub to consummate the transactions contemplated by the Merger Agreement are subject to the satisfaction or waiver of a number of conditions, including the adoption of the Merger Agreement by holders of a majority of the Company’s outstanding shares of common stock. Ownership of our common stock is currently concentrated among a few investors, and our largest investor, the Broadwood Group, reported beneficial ownership as of October 24, 2025 of approximately 27.4% of our outstanding shares of common stock. On September 2, 2025, Broadwood filed a Schedule 13D/A and issued a related press release indicating, among other things, that it intends to vote against the adoption of the Merger Agreement. On September 24, 2025, Broadwood and other members of the Broadwood Group filed a definitive proxy statement with the SEC to solicit votes of STAAR stockholders in opposition to the adoption of the Merger Agreement by STAAR stockholders, and thereafter, the Broadwood Group announced its intent to request a separate special meeting of STAAR stockholders to remove several of the Company’s directors. If our largest investors do not vote their shares in support of the adoption of the Merger Agreement, our ability to satisfy this closing condition would be materially adversely affected. Further, the Company may be unable to obtain the votes required to approve the adoption of the Merger Agreement

by STAAR stockholders in the absence of any change to the terms of the Merger Agreement. The proxy contest resulting from the Broadwood Group filing will cause STAAR to incur additional solicitation and other costs, and may impair STAAR’s ability to obtain the votes required to approve the adoption of the Merger Agreement by STAAR’s stockholders.

In addition, the Merger remains subject to the receipt of certain antitrust approvals, including in China and Japan. While the applicable waiting period expired under the HSR Act, other governmental entities may impose requirements, limitations or costs or place restrictions on the conduct of our or Alcon’s business following the Merger as a condition to approval or not grant approval at all.

Other conditions that must be satisfied or waived before one or more of the parties will be obligated to consummate the Merger are (1) the accuracy of the other party’s representations and warranties, subject to certain materiality standards set forth in the Merger Agreement; (2) compliance by the other party in all material respects with such other party’s obligations under the Merger Agreement, (3) the absence of any law or order prohibiting consummation of the Merger in specified jurisdictions in which the Company, Alcon or their respective subsidiaries have business operations; and (4) in the case of Alcon’s and Merger Sub’s obligation to consummate the Merger, a condition that there has not occurred a material adverse effect on the Company since the date of the Merger Agreement that is continuing.

We can provide no assurance that the closing conditions will be fulfilled (or waived, if applicable) in a timely manner or at all, and, if all closing conditions are timely fulfilled (or waived, if applicable), we can provide no assurance as to the terms, conditions, and timing of the completion of the Merger. Many of the conditions to completion of the Merger are not within either our, Alcon’s or Merger Sub’s control, and we cannot predict when or if these conditions will be fulfilled (or waived, if applicable).

The Merger Agreement also includes termination provisions for both the Company and Alcon. If the Merger Agreement is terminated under specified circumstances, the Company may be required to pay Alcon a termination fee of up to $43.4 million, and if the Merger Agreement is terminated under certain circumstances, including a failure to timely receive required regulatory approvals, Alcon may be required to pay the Company a termination fee equal to $72.4 million.

There can be no assurance that a remedy will be available to us in the event of a breach of the Merger Agreement by Alcon or its affiliates or that we will wholly or partially recover for any damages incurred by us in connection with the Merger. A failed transaction may result in negative publicity and a negative impression of us among our customers or in the investment community or business community generally. Further, any disruptions to our business resulting from the announcement and pendency of the Merger, including any adverse changes in our relationships with our stockholders, customers, suppliers, lenders, partners, officers, employees, governmental entities, and other third parties could continue or accelerate in the event of a failed transaction. In addition, if the Merger is not completed, and there are no other parties willing and able to acquire the Company at a price of $28.00 per share or higher, on terms acceptable to us, the share price of the common stock of the Company may decline to the extent that the current market price of the common stock reflects an assumption that the Merger will be completed.

Also, we have incurred, and will continue to incur, significant costs, expenses, and fees for professional services and other transaction costs in connection with the Merger, for which we will have received little or no benefit if the Merger is not completed. Some of these fees and costs will be payable by us even if the Merger is not completed and may relate to activities that we would not have undertaken other than to complete the Merger.

For additional information related to the Merger Agreement, please refer to our Current Report on Form 8-K filed with the SEC on August 5, 2025, and definitive proxy statement on Schedule 14A filed with the SEC on September 16, 2025, as previously supplemented by a proxy supplement filed with the SEC on October 14, 2025, and as further supplemented by a proxy supplement filed with the SEC on October 30, 2025. The foregoing description of the Merger Agreement is qualified in its entirety by reference to the full text of the Merger Agreement attached as Exhibit 2.1 to the Form 8-K filed on August 5, 2025.

Lawsuits may be filed against us or our directors or officers challenging the transactions contemplated by the Merger Agreement or the Merger, which could prevent or delay the completion of the Merger or result in the payment of damages.

Litigation relating to the Merger has been filed, and additional litigation relating to the Merger may be filed against us or our directors or officers. Among other remedies, claimants could seek damages and/or to enjoin the Merger and the other transactions contemplated by the Merger Agreement. An adverse ruling in any such lawsuit may delay or prevent the proposed Merger from being completed. Any such actions may create uncertainty relating to the Merger and may be costly and distracting to our management.

If the Merger is not consummated for any reason, litigation could be filed in connection with the failure to consummate the Merger.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table summarizes the Company’s share repurchase activity for the three months ended September 26, 2025, on a monthly basis:

Period	Total Number of Shares (or Units) Purchased		Average Price Paid per Share (or Unit)		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares that may yet to be Purchased Under the Plans or Programs (in thousands)(1)
June 28 - July 25, 2025		115,115	$	17.20		375,630	$	23,539
July 26 - August 22, 2025		—		—		—		23,539
August 23 - September 26, 2025		—		—		—		23,539
Total		115,115				375,630

On May 16, 2025, the Company announced that its Board of Directors authorized a share repurchase program under which the Company may repurchase up to $30 million of its outstanding common stock. During the three months ended September 26, 2025 the Company purchased 115,115 shares for an aggregate of $2.0 million. As of September 26, 2025, approximately $23.5 million remained available for repurchases pursuant to our share repurchase program. Under the share repurchase program, the Company may repurchase shares in the open market, through privately negotiated transactions, by entering into structured repurchase agreements with third parties, by making block purchases, and/or pursuant to Rule 10b5-1 trading plans. The timing, manner, price, and amount of any repurchases under the program will be determined by the Company in its discretion, subject to market conditions, legal requirements, and other considerations. The Company is not obligated to repurchase any specific number of shares, and the program may be modified, suspended, or discontinued at any time, without prior notice.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

(c)

Trading Plans

During the quarter ended ~~September~~April 263, ~~2025~~2026, no director or officer (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated:

(i)

Any contract, instruction or written plan for the purchase or sale of securities of the Company intended to satisfy the affirmative defense conditions of Rule 10b5-1(c); and

(ii)

Any “non-Rule 10b5-1 trading arrangement” as defined in paragraph (c) of item 408(a) of Regulation S-K.

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ITEM 6. EXHIBITS

Exhibit Number		Description
2.1		Agreement and Plan of Merger, dated as of August 4, 2025, by and among STAAR Surgical Company, Alcon Research, LLC and Rascasse Merger Sub, Inc. (incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K as filed with the Commission on August 5, 2025).
3.1		Amended and Restated Certificate of Incorporation (incorporated by reference to Appendix 2 of the Company’s Proxy Statement on Form DEF 14A as filed with the Commission on April 26, 2018).
3.2		Amended and Restated Bylaws (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K as filed with the Commission on March 17, 2025).
4.1		Form of Certificate for Common Stock, par value $0.01 per share (incorporated by reference to Exhibit 4.1 to Amendment No. 1 to the Company’s Registration Statement on Form 8 -A/A as filed with the Commission on April 18, 2003).
10.1		Cooperation Agreement dated January 14, 2026 between the Company and Broadwood Partners, L.P. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K as filed with the Commission on January 15, 2026).
10.2		Separation and Consulting Agreement dated January 14, 2026 between the Company and Stephen C. Farrell (incorporated by reference to Exhibit 10.30 to the Company’s Annual Report on Form 10-K as filed with the Commission on March 3, 2026).
10.3		Interim Co-CEO Letter Agreement dated February 1, 2026 between the Company and Warren Foust (incorporated by reference to Exhibit 10.31 to the Company’s Annual Report on Form 10-K as filed with the Commission on March 3, 2026).
10.4		Separation Agreement dated February 4, 2026 between the Company and Nathaniel Sisitsky (incorporated by reference to Exhibit 10.32 to the Company’s Annual Report on Form 10-K as filed with the Commission on March 3, 2026).
10.5		Consulting Agreement dated February 4, 2026 between the Company and Nathaniel Sisitsky (incorporated by reference to Exhibit 10.33 to the Company’s Annual Report on Form 10-K as filed with the Commission on March 3, 2026).
31.1	*	Certifications Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	*	Certifications Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	**	Certification Pursuant to 18 U.S.C. Section 1350, Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. **
101	*	Financial statements from the quarterly report on Form 10-Q of STAAR Surgical Company for the quarter ended ~~September~~April 263, ~~2025~~2026 formatted in Inline Extensible Business Reporting Language (iXBRL), are filed herewith and include: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Income, (iii) the Condensed Consolidated Statements of Comprehensive Income, (iv) the Condensed Consolidated Statements of Stockholders’ Equity, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) the Notes to Condensed Consolidated Financial Statements tagged as blocks of text.
104		The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended ~~September~~April 263, ~~2025~~2026, has been formatted in Inline XBRL with applicable taxonomy extension information contained in Exhibit 101.

*			Filed herewith.
**			Certification furnished herewith solely to accompany this ~~annual~~quarterly report pursuant to 18 U.S.C. Section 1350. Certification is not deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section. Such certification is not deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act except to the extent that the registrant specifically incorporates it by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		STAAR SURGICAL COMPANY
Dated:	~~November~~May 513, ~~2025~~2026	By:	/s/ DEBORAH ANDREWS
			Deborah Andrews
			Chief Financial Officer
			Interim Co-Chief Executive Officer and Chief Financial Officer
			(on behalf of the Registrant and as its principal financial officer)
			(on behalf of the Registrant and as its principal executive officer and principal financial officer)

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