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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 March 31, 2026


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

For the transition period from ___________ to ___________

Commission File Number: 001-42789

Firefly Aerospace Inc.

(Exact name of registrant as specified in its charter)


Delaware	81-5194980
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
2203 Scottsdale Drive Leander, TX	78641 (Zip Code)
(Address of principal executive offices)

512 893-5570

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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 Stock, $0.0001 par value	FLY	The Nasdaq Stock Market LLC (Nasdaq Global Market)

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 ☒

As of April 30, 2026, the registrant had 160,235,217 shares of common stock, $0.0001 par value, outstanding.

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FIREFLY AEROSPACE INC.

QUARTERLY REPORT ON FORM 10-Q

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		Page Number

PART I.	FINANCIAL INFORMATION	2

Item 1.	Financial Statements (Unaudited)	4
	Condensed Consolidated Balance Sheets (Unaudited)	4
	Condensed Consolidated Statements of Net Loss and Comprehensive Loss (Unaudited)	5
	Condensed Consolidated Statements of Cash Flows (Unaudited)	6
	Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) (Unaudited)	7
	Notes to Condensed Consolidated Financial Statements (Unaudited)	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	35
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	50
Item 4.	Controls and Procedures	50

PART II.	OTHER INFORMATION	50

Item 1.	Legal Proceedings	50
Item 1A.	Risk Factors	50
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	51
Item 3.	Defaults Upon Senior Securities	51
Item 4.	Mine Safety Disclosures	51
Item 5.	Other Information	51
Item 6.	Exhibits	52
Signatures		53

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Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q of Firefly Aerospace Inc. (the “Company,” “Firefly,” “we,” “us” or “our”) contains forward-looking statements. Statements included in this Quarterly Report on Form 10-Q that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. These risks and other factors include, but are not limited to, those listed under “Risk Factors.” In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “objective,” “ongoing,” “plan,” “predict,” “project,” “potential,” “should,” “will,” “would,” or the negative of these terms or other comparable terminology. In particular, statements about the markets in which we operate, including growth of our various markets, statements about potential new products and product innovation, statements regarding the expected benefits of the acquisition of SciTec, Inc. (“SciTec”), and other statements regarding our future expectations, beliefs, plans, strategies, objectives, prospects, assumptions, or future events or performance contained in this Quarterly Report on Form 10-Q are forward-looking statements. Some of the factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include:

•

our failure to manage our growth effectively and our ability to achieve and maintain profitability;

•

the potential for delayed or failed launches, and any failure of our launch vehicles and spacecraft to operate as intended;

•

our inability to manufacture our launch vehicles, landers, or orbital vehicles at a quantity and quality that our customers demand;

•

the hazards and operational risks that our products and service offerings are exposed to, including the wide and unique range of risks due to the unpredictability of space;

•

the market for commercial launch services for small- and medium-sized payloads not achieving the growth potential we expect;

•

adverse impacts from future disruptions in U.S. government operations, including as a result of delays or reduction in appropriations or regulatory approvals from our programs, or changes in U.S. government funding and budgetary priorities and spending levels;

•

our dependence on contracts entered into in the ordinary course of business and our dependence on major customers and vendors;

•

we may not be successful in developing new technology;

•

uncertain global macroeconomic and political conditions, including the implementation of tariffs and the Iran conflict;

•

the failure of our information technology systems, physical or electronic security protections;

•

the inability to operate Alpha at our anticipated launch rate (including due to potential regulatory delays) or finalize the development and delivery of Eclipse;

•

the scarcity or unavailability of critical components or raw materials used to manufacture our products or used in our development programs;

•

the fluctuation of our operating results;

•

adverse publicity stemming from any incident involving us, our competitors, or our customers;

•

the failure to adequately protect our proprietary intellectual property rights;

•

shortfalls in available external research and development funding;

•

our inability to comply with our contractual obligations;

•

our failure to establish and maintain important relationships with government agencies and prime contractors;

•

risks relating to the laws, security requirements, regulations and policies applicable to government contracting;

•

the inability to realize our backlog;

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•

the dependence on our facilities;

•

evolving government laws and regulations;

•

potential benefits and synergies in connection with the SciTec acquisition;

•

our ability to implement and maintain effective internal control over financial reporting;

•

our ability to generate sufficient cash to service our indebtedness; and

•

other factors detailed under the section of our Annual Report on Form 10-K entitled “Risk Factors.”

The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date hereof. We undertake no obligation to update any forward-looking statements after the date of this Quarterly Report on Form 10-Q or to conform such statements to actual results or revised expectations, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not rely on our forward-looking statements in making your investment decision. Actual results or events could differ materially from the plans, intentions, and expectations disclosed in the forward-looking statements we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments.

Each of the terms the “Company,” “Firefly,” “we,” “our,” “us” and similar terms used herein refer collectively to Firefly Aerospace Inc., a Delaware corporation, and its consolidated subsidiaries, unless otherwise stated.

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Firefly Aerospace Inc.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

Item 1. Financial Statements


	March 31,			December 31,
	2026			2025
Assets
Current assets
Cash and cash equivalents	$	326,179		$	792,966
Short-term investments		225,447			100,008
Accounts receivable, net		44,800			46,129
Advanced payments, current		61,837			12,350
Other current assets		15,284			11,722
Total current assets		673,547			963,175
Advanced payments, less current portion		10,305			60,496
Property and equipment, net		168,933			163,738
Right-of-use assets - operating leases		18,481			13,938
Right-of-use assets - finance leases		3,327			3,735
Intangible assets, net		160,207			165,709
Goodwill		453,440			450,119
Other assets, less current portion		3,750			4,024
Total assets	$	1,491,990		$	1,824,934

Liabilities, and stockholders' equity
Current liabilities
Accounts payable	$	41,082		$	35,626
Accrued expenses		50,356			42,755
Accounts payable and accrued expenses – related parties		581			330
Operating lease liability, current		2,051			1,161
Finance lease liability, current		1,065			1,056
Deferred revenue, current		146,239			116,135
Notes payable, current		7,116			7,099
Other current liabilities		17,755			9,419
Total current liabilities		266,245			213,581
Operating lease liability, less current portion		21,341			15,832
Finance lease liability, less current portion		1,733			2,004
Deferred revenue, less current portion		52,525			92,565
Notes payable, less current portion		19,684			281,441
Warrant liability		15,978			12,294
Other liabilities, less current portion		9,600			17,278
Total liabilities		387,106			634,995
Commitments and contingencies (See Note 12)
Stockholders' equity
Common stock, $0.0001 par value, 1,000,000 and 1,000,000 shares authorized as of March 31, 2026 and December 31, 2025, respectively; 160,067 and 159,276 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively		17			17
Additional paid-in capital, net		2,221,822			2,210,201
Accumulated deficit		(1,116,955	)		(1,020,279	)
Total stockholders' equity		1,104,884			1,189,939
Total liabilities and stockholders' equity	$	1,491,990		$	1,824,934

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Firefly Aerospace Inc.

Condensed Consolidated Statements of Net Loss and Comprehensive Loss

(in thousands, except per share amounts)

(unaudited)


	For the Three Months Ended March 31,
	2026			2025
Revenue	$	80,879		$	55,855
Cost of sales		63,418			53,635
Gross profit		17,461			2,220
Operating expenses
Research and development		67,509			48,012
Selling, general, and administrative		45,620			12,752
Total operating expenses		113,129			60,764
Loss from operations		(95,668	)		(58,544	)
Other expense
Change in fair value of warrant liability		(3,684	)		3,073
Interest income		5,974			1,028
Interest expense		(3,605	)		(6,192	)
Gain on settlement of contingent liabilities		381			—
Other (expense) income, net		(7	)		542
Total other expense, net		(941	)		(1,549	)
Loss before provision for income taxes		(96,609	)		(60,093	)
Provision for income taxes		(67	)		—
Net loss and comprehensive loss		(96,676	)		(60,093	)
Less: Accretion of dividends of Series C Preferred Stock		—			(5,579	)
Less: Accretion of dividends of Series D-1 Preferred Stock		—			(6,609	)
Net loss available to common stockholders	$	(96,676	)	$	(72,281	)

Net loss per common share
Basic and diluted	$	(0.61	)	$	(5.38	)
Weighted-average common shares outstanding
Basic and diluted		159,639			13,442

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Firefly Aerospace Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)


	For the Three Months Ended March 31,
	2026			2025
Cash flows from operating activities
Net loss	$	(96,676	)	$	(60,093	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		15,934			3,996
Stock-based compensation		12,512			431
Change in fair value of warrant liability		3,684			916
Non-cash interest expense		331			615
Non-cash interest income		(637	)		—
Changes in operating assets and liabilities:
Accounts receivable		1,329			(13,900	)
Advanced payments		704			41,660
Other assets		(4,703	)		(2,766	)
Accounts payable		6,596			(2,627	)
Accrued expenses		4,279			5,653
Accounts payable and accrued expenses - related parties		251			213
Other liabilities		1,522			(7,889	)
Right-of-use assets		932			422
Lease liabilities		1,333			(1,993	)
Deferred revenue		(9,936	)		(21,175	)
Net cash used in operating activities		(62,545	)		(56,537	)
Cash flows from investing activities
Purchases of property and equipment and internal-use software		(16,345	)		(2,654	)
Purchases of time deposits		(125,000	)		—
Proceeds from sale of short-term investments		8			—
Net cash used in investing activities		(141,337	)		(2,654	)
Cash flows from financing activities
Proceeds from issuance of Preferred Stock		—			115,304
Principal payments on finance leases		(262	)		(443	)
Proceeds from issuance of notes payable		—			468
Payments on notes payable		(1,752	)		(2,170	)
Proceeds from repayment of employee note		20			359
Repayment of Revolving Credit Facility		(260,000	)		—
Proceeds from exercise of stock options		452			389
Payments for taxes related to net share settlement of equity awards		(1,363	)		—
Net cash (used in) provided by financing activities		(262,905	)		113,907
Net (decrease) increase in cash and cash equivalents and restricted cash		(466,787	)		54,716
Cash and cash equivalents and restricted cash
Balance, beginning of period		792,966			137,558
Balance, end of period	$	326,179		$	192,274
Reconciliation of cash and cash equivalents and restricted cash
Cash and cash equivalents	$	326,179		$	176,879
Restricted cash, current		—			829
Restricted cash, non-current		—			14,566
Total cash and cash equivalents and restricted cash at the end of the period	$	326,179		$	192,274


	For the Three Months Ended March 31,
	2026		2025
Supplemental disclosures of cash flow information
Cash paid for interest	$	4,177	$	5,565
Non-cash investing and financing activities
Property and equipment additions in accounts payable	$	1,943	$	1,576
Capitalized interest (paid-in-kind)	$	—	$	800
Acquisition of internal-use software licenses and obligations	$	431	$	—
Right-of-use asset acquired in exchange for operating lease liabilities	$	5,066	$	—
Right-of-use asset acquired in exchange for finance lease liabilities	$	—	$	1,432
Net working capital adjustment from business combinations	$	3,321	$	—

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Firefly Aerospace Inc.

Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)

(in thousands)

(unaudited)


	Redeemable Convertible								Additional							Total
	Preferred Stock*				Common Stock				Paid-In			Accumulated				Stockholders'
	Shares		Amount		Shares		Amount		Capital, Net				Deficit			Equity
Balance as of December 31, 2025		—	$	—		159,276	$	17	$	2,210,201			$	(1,020,279	)	$	1,189,939
Common stock issued, net of shares withheld for employee taxes		—		—		791		—		(891	)			—			(891	)
Stock-based compensation		—		—		—		—		12,512				—			12,512
Net loss		—		—		—		—		—				(96,676	)		(96,676	)
Balance as of March 31, 2026		—	$	—		160,067	$	17	$	2,221,822			$	(1,116,955	)	$	1,104,884


	Redeemable Convertible								Additional							Total
	Preferred Stock*				Common Stock				Paid-In			Accumulated				Stockholders'
	Shares		Amount		Shares		Amount		Capital, Net				Deficit			Deficit
Balance as of December 31, 2024		41,588	$	759,582		13,241	$	1	$	—			$	(767,623	)	$	(767,622	)
Common stock issued, net of shares withheld for employee taxes		—		—		489		1		747				—			748
Stock-based compensation		—		—		15		—		431				—			431
Issuance of Series D-1 Preferred Stock		6,858		115,304		—		—		—				—			-
Accretion of redeemable convertible preferred stock		—		12,188		—		—		(1,178	)			(11,010	)		(12,188	)
Net loss		—		—		—		—		—				(60,093	)		(60,093	)
Balance as of March 31, 2025		48,446	$	887,074		13,745	$	2	$	—			$	(838,726	)	$	(838,724	)

* Refer to Note 13. Stockholders' Equity and Redeemable Convertible Preferred Stock for details of the classes of Preferred Stock and movements therein.

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

1. The Company and Initial Public Offering

Firefly Aerospace Inc. (“Firefly” or the “Company”) is headquartered in Cedar Park, Texas. The Company was incorporated under the laws of the State of Delaware on January 27, 2017 and commenced operations on May 1, 2017.

On August 8, 2025, the Company completed an initial public offering (“IPO”) of shares of its common stock, par value $0.0001 per share. The Company’s common stock trades on the NASDAQ under the ticker “FLY.”

The Company is a space and defense technology company providing comprehensive mission solutions to national security, government, and commercial customers with an established track record of success. The Company's mission is to reliably and repeatedly launch, land, and operate space systems from Earth to the Moon and beyond. Backed by a world-class team and proven technology, Firefly designs, develops, and deploys launch vehicles and dynamic spacecraft solutions to support critical missions to space and defense customers. The Company’s vertically-integrated approach encompasses the design, manufacturing and operation of small and medium launch vehicles, landers and spacecraft, as well as the development of complementary remote sensing, missile defense, and command and control software systems. Its purpose-built family of products aligns with the ongoing paradigm shift in government missions and procurement processes, where speed, efficiency, and economics drive customer decision-making. Through its offerings across launch and spacecraft solutions, its vertically-integrated product line, and its infrastructure, Firefly serves as a critical provider for commercial and government customers.

Since Firefly’s formation, it has established itself as a category leader across a diverse range of products and services that takes a comprehensive approach to providing a family of solutions to its customers’ space-based opportunities.

On October 31, 2025, the Company completed its acquisition of SciTec, Inc. (“SciTec”), a leader in advanced national security technologies. The acquisition advances the Company’s comprehensive space services by adding mission-proven defense software analytics, remote sensing, and multi-phenomenology data expertise. SciTec’s core capabilities – which include missile warning, tracking and defense, intelligence, surveillance and reconnaissance, space domain awareness, and autonomous command and control – supplement Firefly’s launch, lunar, and in-space services. SciTec further adds ground and onboard data processing as well as AI-enabled systems designed for low latency operations to support advanced threat tracking and response across multiple domains.

As an early-stage company with a limited commercial operating history, Firefly is subject to all the risks and expenses associated with a start-up company. The Company must, among other things, respond to competitive developments, attract, retain, and motivate qualified personnel, and support the expense of marketing new products based on innovative technology. The Company expects to transition to operating as a manufacturing company, capable of producing and selling products at scale, as of the date the technological feasibility of the Alpha rocket is confirmed. The Company defines technological feasibility as satisfying three specific conditions: (i) reaching product qualification, (ii) achieving production readiness, and (iii) having successfully deployed a customer’s payload into its specific orbit and final destination. The Company has successfully deployed customer payloads into their specific orbits or destinations. The Company’s executive leadership comprised of at least the Chief Operating Officer and the Chief Technology Officer shall determine at what point the Company’s products have been fully qualified to reach technological feasibility and full-rate production. Until this determination is made, the Company has not recorded any inventory amounts, and all costs incurred are expensed.

The unaudited condensed consolidated financial statements of the Company have been prepared on a going concern basis, which contemplates the realization of assets and the discharge of liabilities in the normal course of business. From inception, the Company has incurred an accumulated deficit totaling $1.1 billion as of March 31, 2026, and has incurred $62.5 million and $56.5 million in negative cash flows from operations during the three months ended March 31, 2026 and 2025, respectively.

Initial Public Offering

On August 8, 2025, the Company completed its IPO of an aggregate of 22.2 million shares of its common stock, par value $0.0001, which includes the exercise in full by the underwriters of their option to purchase an additional 2.9 million shares of common stock, at a public offering price of $45.00 per share, for an aggregate offering price of $998.6 million. The Company received aggregate proceeds of $932.3 million, net of $57.4 million of underwriting discounts and commissions and $11.4 million of offering costs.

In connection with the closing of the IPO, all outstanding shares of the Company's Preferred Stock were converted into 105.8 million shares of common stock. All outstanding Common Warrants were automatically exercised into 1.0 million shares of common stock and 0.6 million shares of common stock are reserved for issuance upon exercise of the Series J Warrants (each as defined in Note 9. Fair Value Measurement).

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

On August 8, 2025, the Company used a portion of the net proceeds from the IPO to repay the Term Loans under the Financing Agreement (each as defined in Note 11. Notes Payable), together with the specified prepayment premium of $11.4 million, and accrued interest.

In connection with the IPO, the Company effected a 1-for-3.2544 reverse stock split of its common stock and a proportionate decrease in the number of its authorized shares. All share and per share information, including share-based compensation, throughout the accompanying unaudited condensed consolidated financial statements has been retroactively adjusted to reflect the reverse stock split.

2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information. Certain information and disclosures normally included in the audited consolidated financial statements have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, which are necessary for the fair statement of the unaudited condensed consolidated balance sheets, statements of net loss and comprehensive loss, statements of cash flows, and statements of convertible preferred stock and stockholders’ equity (deficit) for these interim periods. The results for the interim period are not necessarily indicative of the results that may be expected for a full year. All intercompany balances and transactions have been eliminated.

Use of Estimates

The Company's unaudited condensed consolidated financial statements have been prepared in conformity with U.S. GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from these estimates.

Prior Period Reclassifications

Certain immaterial prior period amounts have been reclassified to conform to the current period presentation.

Concentration of Credit Risk

The Company estimates expected credit losses based on relevant information about past events, including historical credit loss experience and current conditions, such as the length of time accounts receivable are past due, customer payment histories, any specific customer collection issues identified, current market conditions which may affect customer financial condition, and reasonable and supportable forecasts of future credit losses. When measuring expected credit losses, the Company will pool assets with similar country risk and credit risk characteristics. Changes in the relevant information may significantly affect the estimates of expected credit losses. The Company writes off accounts receivable that has become uncollectible.

Major customers are defined as those individually comprising more than 10% of the Company’s total revenue. The Company’s revenue related to its major customers during the three months ended March 31, 2026 and 2025 was as follows:


	For the Three Months Ended March 31,
	2026			2025
Customer 1		24.5	%		—
Customer 2		19.3	%		—
Customer 3		14.1	%		90.7	%

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

The customers that accounted for 10% or more of the Company’s total accounts receivable, were as follows:


	March 31,			December 31,
	2026			2025
Customer 1		38.3	%		28.6	%
Customer 2		28.7	%		22.9	%
Customer 3		6.7	%		12.8	%

Recently Issued Accounting Standards

Recently Issued Accounting Pronouncements Not Yet Adopted

ASU 2023-06

In October 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative, which incorporates certain SEC disclosure requirements into the FASB Accounting Standards Codification (“ASC”). The amendments in the ASU are expected to clarify or improve disclosure and presentation requirements of a variety of ASC topics, allow investors to more easily compare entities subject to the SEC’s existing disclosures with those entities that were not previously subject to the requirements, and align the requirements in the ASC with the SEC’s regulations. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The amendments in this ASU are to be applied prospectively. The Company does not expect that ASU 2023-06 will have a material impact on its consolidated financial statements.

ASU 2024-03

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. In January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, which amends the effective date of ASU 2024-03 to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption of ASU 2024-03 is permitted. The Company is currently evaluating the impact of adopting the ASU.

ASU 2025-11

In December 2025, the FASB issued ASU 2025-11 Interim Reporting (Topic 270): Narrow-Scope Improvements. ASU 2025-11 clarifies the applicability of ASC 270, Interim Reporting and the form and content of interim financial statements. In addition, ASU 2025-11 requires entities to disclose material events occurring since the last annual reporting period. ASU 2025-11 will be effective for interim periods beginning January 1, 2028, and can be applied on a prospective or retrospective basis. The Company is in the process of evaluating the impact of this guidance on its financial statements; however, the Company does not expect that it will have a material impact on its consolidated financial statements.

Recently Adopted Accounting Pronouncements

ASU 2025-05

In July 2025, the FASB issued ASU 2025-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides entities with a practical expedient to simplify the estimation of expected credit losses on current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606, Revenue from Contracts with Customers by allowing the assumption that conditions as of the balance sheet date will not change during the remaining life of the asset. ASU 2025-05 is effective for annual periods beginning after December 15, 2025 and interim periods within those annual reporting periods, with early adoption permitted. The Company elected to apply the practical expedient in its assessment of the allowance for credit losses as of January 1, 2026, which did not have a material impact on the Company's consolidated financial statements and related disclosures.

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

ASU 2025-06

In September 2025, the FASB issued ASU 2025-06, Targeted Improvements to the Accounting for Internal-Use Software, to improve the operability and application of guidance related to capitalized software development costs. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, and interim reporting periods within those annual reporting periods, with early adoption permitted. The guidance may be applied prospectively, retrospectively, or using a modified retrospective basis that is based on the status of the project and whether software costs were capitalized before the date of adoption. The Company early adopted ASU 2025-06 effective January 1, 2026 on a prospective basis. The adoption of ASU 2025-06 did not have a material impact on the Company’s consolidated financial statements and related disclosures.

3. Business Combinations

SciTec

On October 31, 2025, the Company completed the acquisition of all of the outstanding capital stock of SciTec for a purchase price of $550.3 million, consisting of $277.4 million in cash, net of cash acquired, $269.6 million in common stock, and a $3.3 million post-closing working capital adjustment (which was accrued as additional cash consideration payable and included in accrued expenses as of March 31, 2026). SciTec has over four decades of experience and offers industry-leading AI-enabled defense software applications and big data processing capabilities in the forms of cloud-based, on-premise, and edge processing of high volumes of data from satellites across all orbits that are complementary to Firefly's launch, lunar, and in-space vehicles. This acquisition is expected to complement the Company's full-service hardware and software offerings to space and defense customers. SciTec is based in Princeton, New Jersey, and has facilities in Boulder, Colorado; El Segundo, California; Fairborn, Ohio; Huntsville, Alabama; and Herndon, Virginia.

The acquisition was accounted for as a business combination under ASC 805, Business Combinations, with the Company identified as the acquirer. The purchase price allocation as of the date of acquisition was based on a preliminary valuation and is subject to revision as more detailed analyses are completed and additional information about the fair value of assets acquired and liabilities assumed becomes available during the measurement period, a period not to exceed 12 months from the acquisition date. In connection with the acquisition, the Company incurred acquisition-related costs of $24.4 million, which were expensed as incurred on the date of closing.

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

The table below sets forth the consideration paid, the fair value of the assets acquired, and liabilities assumed at the acquisition date, as well as the measurement period adjustments recorded as of March 31, 2026:


	Acquisition Date Amounts Recognized as of October 31, 2025		Adjustments		Acquisition Date Amounts Recognized, As Adjusted as of March 31, 2026
Consideration
Cash, net of cash acquired	$	277,417		—	$	277,417
Net working capital adjustment		—		3,321		3,321
Equity (issuance of common stock)		269,556		—		269,556
Total consideration, net of cash acquired	$	546,973	$	3,321	$	550,294

Assets acquired and liabilities assumed
Short-term investments	$	8,413	$	—	$	8,413
Accounts receivable		45,769		—		45,769
Other current assets		1,962		—		1,962
Property and equipment		7,718		—		7,718
Right-of-use assets		2,276		—		2,276
Intangible assets		153,000		—		153,000
Goodwill		433,022		3,321		436,343
Total assets		652,160		3,321		655,481

Accounts payable		11,178		—		11,178
Accrued expenses		49,780		—		49,780
Operating lease liabilities, current		711		—		711
Deferred revenue		1,770		—		1,770
Other current liabilities		840		—		840
Operating lease liabilities, non-current		3,716		—		3,716
Deferred tax liabilities		37,192		—		37,192
Total liabilities		105,187		—		105,187
Net assets acquired	$	546,973	$	3,321	$	550,294

The fair value of the property and equipment, and working capital items including accounts receivable, other current assets, accounts payable, accrued expenses, and other current liabilities, approximates their respective carrying values at the date of the acquisition, as well as the adjustments recorded during the measurement period. Operating lease liabilities were remeasured at the present value of the remaining lease payments using the Company's incremental borrowing rate as of the acquisition date. The corresponding right-of-use assets were measured at an amount equal to the remeasured lease liabilities.

The following table summarizes the fair value of acquired identifiable intangible assets at the date of the acquisition:


	October 31, 2025		Weighted-Average Life
Trade name and trademarks	$	18,000	5 years
Developed technology		74,000	10 years
Customer relationships		61,000	3 years
Total acquired intangible assets	$	153,000

On the acquisition date, trade name and trademarks, developed technology, and customer relationships are classified as finite-lived intangible assets and are subject to annual impairment assessments under ASC 350-30-35-18 through 35-20.

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

The fair value of the acquired intangible assets, including trade name and trademarks and developed technology was determined using the relief from royalty method, while customer relationships were determined using the multi-period excess earnings method. Significant assumptions used in the determination of the fair values include forecasted revenue growth rates, assumed royalty rates and the market-participant discount rate. The useful life used in the valuation analysis was based on the economic life of each intangible asset. The Company assessed the economic useful life of these intangibles and concluded that these periods will be used as the amortization periods going forward.

In consideration of the nature of the amortization, management has concluded that the most appropriate way to reflect the economic benefits of the pattern in which the benefits are realized is to reflect the amortization in a manner consistent with the cash flow build up by period reflected in the valuation report.

In determining the useful lives and amortization policy to apply to the intangible assets acquired, the Company assessed the pattern in which the economic benefits of the assets are consumed. Based on this assessment, the Company amortizes its intangible assets based on the methodology that approximates the pattern in which it expects to benefit economically from these acquired intangible assets. The useful life is also derived from the time period over which the majority of the cash flows are expected to be generated. The Company will employ the useful lives identified through this exercise and amortize amounts using the economic consumption of the intangible asset over the accounting useful life for amortization of the associated intangible asset.

Goodwill generated from this business combination is primarily attributable to expected synergies from the transaction and incremental revenue and profit to be derived from the Company’s expansion into full-service hardware and software for its space and defense customers. The goodwill is not expected to be deductible for U.S. income tax purposes.

Unaudited Pro Forma Information

The following unaudited pro forma financial information presents the combined results of operations as if SciTec had been acquired as of the beginning of fiscal year 2025. The unaudited pro forma results include certain adjustments to revenue and net loss directly attributable to each acquisition, including transaction costs.

For the SciTec acquisition, transaction costs of approximately $29.6 million are assumed to have been incurred on January 1, 2025 and recognized during 2025, of which $24.4 million were incurred by SciTec and $5.2 million were incurred by the Company.

The unaudited pro forma financial information is presented for informational purposes only and is not necessarily indicative of the consolidated results of operations of the combined businesses had the acquisitions actually occurred at the beginning of the respective periods, nor is it indicative of the future results of operations of the combined businesses.


	For the Three Months Ended March 31, 2025
Pro forma revenue	$	98,198
Pro forma net loss and comprehensive loss	$	(88,827	)
Pro forma net loss per common share – basic and diluted	$	(7.51	)

4. Revenue

The following table presents revenue disaggregated by type for the three months ended March 31, 2026 and 2025:


	For the Three Months Ended March 31,
	2026		2025
Launch revenue	$	13,252	$	5,170
Spacecraft Solutions revenue		67,627		50,685
Total revenue	$	80,879	$	55,855

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

Launch Revenue

The Company has contracts with commercial and government entities to provide launch and integration services for payloads requiring transportation into orbit via launch vehicles. These contracts may include milestone payments and deposits. The Company considers the performance obligation under these contracts to be the initiation of the launch and recognizes revenue at that point in time. When the contract contains multiple performance obligations, stand-alone selling prices are established for each performance obligation in the contract based on cost plus margin or market prices for similar goods and services.

The Company also enters into contracts with its customers to provide engineering services and related components, and to develop and provide licenses for intellectual property. In these cases, the Company’s performance obligation is satisfied over time since the tasks are performed according to the customer’s specifications, which creates an asset with no alternative use to the Company, for which the Company has an enforceable right to payment for performance completed to date. The measure of progress over time is based upon an input method using a cost-to-cost measure which best depicts the transfer of control to the customer. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Estimating the total cost at completion of a performance obligation requires management to make estimates related to items such as subcontractor performance, material costs and availability, labor costs and productivity, and the costs of overhead. If the estimate of total costs to be incurred for a contract exceeds the total estimate of revenue to be earned, a provision for the entire loss on the contract is recognized in the period the loss is identified. Engineering services billed hourly are recognized over time.

Spacecraft Solutions Revenue

Spacecraft Solutions revenue includes revenue from contracts with commercial and government entities to provide end-to-end services to integrate payloads into Blue Ghost and Elytra for transport to the Moon and on-orbit space domain awareness missions, respectively, as well as to develop and provide software, sensor, and data processing capabilities for national defense missions. These contracts include firm-fixed-price, time and materials, and cost-plus pricing structures. For commercial payload services we consider the performance obligation to be the integration and delivery of customer payloads to specified destinations. These contracts typically require that the customer make milestone payments as specific conditions and tasks are performed. For software, sensor, and data processing contracts, we consider the performance obligation to be the development and implementation of the contracted solution. These contracts require customers to make milestone payments as specific conditions and tasks are performed, or regular periodic payments as costs are incurred. Performance obligations are satisfied over time since either (1) the tasks are performed according to the customer’s specifications and create an asset with no alternative use to the Company, or (2) the customer receives and consumes benefits as work is completed and the Company has an enforceable right to payment for performance completed to date.

For Spacecraft Solutions arrangements, the measure of progress over time is based upon an input method using a cost-to-cost measure which best depicts the transfer of control to the customer. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Estimating the total costs at completion of a performance obligation requires management to make estimates related to items such as subcontractor performance, material costs and availability, labor costs and productivity, and the costs of overhead. If estimates of total costs to be incurred on a contract exceed total estimates of revenue to be earned, a provision for the entire loss on the contract is recognized in the period the loss is estimated.

Generally, our Spacecraft Solutions contracts do not contain an embedded lease because the Company is able to derive more than insignificant economic benefits from the various capabilities provided through these contracts. However, in the limited instances when the customer obtains substantially all of the economic benefits, determined at contract inception, the contract is determined to include an embedded lease. For such arrangements, the Company has determined that the customer is the deemed accounting owner of the asset during the construction period. As a result, the Company determined it is providing services for the integration and delivery of the customer payload for those arrangements, and accounts for them based on the guidance for contracts with customers.

For all revenue streams, the Company considers customer payments that are contingent on the success of a mission or that are dependent on award criteria to be variable consideration. We assess the likelihood of success of a mission or achievement of contractual award requirements at inception and may defer the recognition of some or all of the variable consideration until success of the mission is assured or the award fee amount is determined.

The Company’s contracts may provide customers with termination for convenience clauses, which may or may not include termination penalties. In some contracts, the size of the contractual termination penalty increases closer to the scheduled launch date. At the inception

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

of each contract, the Company evaluates the contract’s termination provisions and the impact on the accounting contract term (i.e., the period in which the Company has enforceable rights and obligations). This includes evaluating whether there are termination penalties and if so, whether they are considered substantive. The Company applies judgment in determining whether the termination penalties are substantive.

The Company has elected the following practical expedients for Launch and Spacecraft Solutions revenue: (1) the Company does not account for significant financing components if the period between revenue recognition and when the customer pays for the product or service will be one year or less, (2) the Company recognizes revenue equal to the amount it has a right to invoice when the amount corresponds directly with the value to the customer of the Company's performance to date, (3) the Company does not account for shipping and handling activities as a separate performance obligation, but rather as an activity performed to transfer the promised good or service, and (4) the Company will allocate the total consideration expected to be received from the customer to the total goods or services expected to be provided to the customer, including any expected contract term renewals.

The Company includes in its computation of remaining performance obligations customer orders for which it has accepted signed sales orders. Due to their nature, time and materials contracts contain variable consideration; however, in general, the Company's performance obligations under time and materials contracts qualify for the “right to invoice” practical expedient. Under this practical expedient, the Company recognizes revenue over time, in the amount to which the Company has a right to invoice. In addition, the Company is not required to estimate such variable consideration upon inception of the contract and reassess the estimate each reporting period. The Company determined that this method best represents the transfer of services, as upon billing the Company has a right to consideration from a customer in an amount that directly corresponds with the value to the customer of the Company's performance completed to date. As of March 31, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations was $652.6 million. The Company expects to recognize approximately 36.9% of its remaining performance obligations as revenue within the next 12 months. The remaining performance obligations are expected to be recognized over the next five years. The remaining performance obligations do not include variable consideration that was determined to be constrained as of March 31, 2026.

Contract Balances

Contract assets and liabilities reflect timing differences between the receipt of consideration and the fulfillment of performance obligations under a contract with a customer. Contract assets reflect performance obligations satisfied, and revenue recognized in advance of customer billings. Contract liabilities reflect consideration received in advance of the satisfaction of a performance obligation under a contract with a customer. Contract assets become trade receivables once the Company’s rights to consideration become unconditional. Such rights are considered unconditional if only the passage of time is required before payment of that consideration is due. Retainage represents a portion of the contract amount that has been billed, but that the contract allows the customer to retain until final contract settlement. Billings for such retainage balances are generally collected within one year of the completion of the project. Contract costs are those costs directly related to fulfillment of specified customer contracts. Contract assets are recorded within accounts receivable, net or other current assets, depending on whether they represent an unconditional right to consideration, and contract liabilities are recorded within deferred revenue on the unaudited condensed consolidated balance sheets.

Contract assets consisted of the following:


	March 31, 2026		December 31, 2025
Unbilled receivables	$	23,262	$	16,117
Retainage		855		879
Total contract assets	$	24,117	$	16,996

Deferred revenue consisted of the following:


	March 31, 2026		December 31, 2025
Launch	$	71,125	$	77,843
Spacecraft Solutions		127,639		130,857
Total deferred revenue	$	198,764	$	208,700

During the three months ended March 31, 2026 and 2025, the Company recognized $27.3 million and $44.9 million, respectively, of revenue that was included in the contract liabilities balance at the beginning of each period.

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

Loss Contracts

The Company recognizes a contract loss when the current estimate of the consideration expected to be received is less than the current estimate of total estimated costs to complete the contract. For purposes of determining the existence or amount of a contract loss, the Company considers total contract consideration, including any variable consideration, constrained for revenue recognition purposes. The Company may experience favorable or unfavorable changes in contract losses from time to time due to changes in estimated contract costs and modifications that result in changes to contract prices. The Company did not recognize any additional loss provisions during the three months ended March 31, 2026 and 2025.

5. Property and Equipment, Net

Property and equipment, net consisted of the following as of March 31, 2026 and December 31, 2025:


	March 31,			December 31,
	2026			2025
Machinery and equipment	$	50,039		$	47,124
Test stands		42,874			42,255
Buildings		54,230			48,999
Land and land improvements		5,906			5,123
Construction in progress		32,374			38,654
Furniture and fixtures		4,729			3,359
Computer equipment		5,833			5,713
Software		1,141			1,141
Vehicles		501			479
Leasehold improvements		18,589			12,984
Total		216,216			205,831
Less: Accumulated depreciation		(47,283	)		(42,093	)
Property and equipment, net	$	168,933		$	163,738

Depreciation expense was $8.7 million and $4.0 million for the three months ended March 31, 2026 and 2025 respectively, and was recorded in the unaudited condensed consolidated statements of net loss within cost of sales, research and development, and selling, general, and administrative expenses.

6. Accrued Expenses

Accrued expenses consisted of the following as of:


	March 31,		December 31,
	2026		2025
Payroll-related expenses	$	18,297	$	17,617
Professional services expenses		13,452		5,854
Interest expense		—		1,108
Net working capital adjustment		3,321		—
Other accrued expenses		15,286		18,176
Accrued expenses	$	50,356	$	42,755

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

7. Intangible Assets, Net

The intangible assets gross carrying amount and accumulated amortization as of March 31, 2026 and December 31, 2025 are detailed below.


		March 31, 2026
	Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Internal-use software licenses	1-3 years	$	19,953	$	(4,660	)	$	15,293
Internally-developed software	3-5 years		247		—			247
Trade name and trademarks	5 years		18,000		(1,500	)		16,500
Developed technology	10 years		74,000		(3,083	)		70,917
Customer relationships	3-9 years		61,000		(3,750	)		57,250
Total		$	173,200	$	(12,993	)	$	160,207


		December 31, 2025
	Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Internal-use software	1-3 years	$	18,484	$	(2,442	)	$	16,042
Trade name and trademarks	5 years		18,000		(600	)		17,400
Developed technology	10 years		74,000		(1,233	)		72,767
Customer relationships	3-9 years		61,000		(1,500	)		59,500
Total		$	171,484	$	(5,775	)	$	165,709

The Company capitalizes certain development costs incurred in connection with its internal-use software products including specific software upgrades and enhancements when it is probable the expenditures will result in additional features and functionality. Costs incurred prior to meeting the probable-to-complete threshold are expensed as incurred. Once the probable-to-complete threshold is satisfied, internal and external costs, if direct and incremental, are capitalized until the application is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial testing, at which time amortization of the capitalized software begins. Internally-developed software is amortized on a straight-line basis over its estimated useful life, generally three to five years.

The Company capitalized $2.0 million of both internal-use software licenses and software-in-development during the three months ended March 31, 2026. Capitalized costs associated with internally-developed software are not amortized until the related assets are substantially complete and ready for their intended use. Amortization expense related to the Company's finite-lived intangible assets was $7.2 million for the three months ended March 31, 2026. The Company did not recognize any amortization expense related to its finite-lived assets for the three months ended March 31, 2025.

The table below presents expected amortization expense related to the Company's intangible assets as of March 31, 2026:


2026 (for the remaining period)	$	21,184
2027		25,849
2028		22,703
2029		16,667
2030		16,067
Thereafter		57,490
Internally-developed software not yet subject to amortization		247
Total future amortization	$	160,207

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

8. Goodwill

Changes in the carrying amount of goodwill are detailed below:


Balance at December 31, 2025	$	450,119
SciTec acquisition net working capital adjustment		3,321
Balance at March 31, 2026	$	453,440

Goodwill is defined as an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. At March 31, 2026, the Company has only one operating segment, which represents its only reportable segment.

During the three months ended March 31, 2026 the Company settled the post-closing working capital adjustment related to the acquisition of SciTec, which resulted in an increase to goodwill of $3.3 million.

9. Fair Value Measurement

The Company measures its financial assets and liabilities at fair value each reporting period using a fair value hierarchy that prioritizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. A financial instrument’s classification within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.

The Company uses the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.

The carrying amounts of the Company’s financial instruments, which include cash equivalents, accounts receivable, accounts payable, certain prepaid expenses, other current assets, accrued liabilities, and other current liabilities approximate fair value because of their short-term maturities.

The Company issued warrants to purchase Series J Preferred Stock (the “Series J Warrants”) in connection with the Company’s entrance into the Term Loans and issued warrants to purchase common stock (the “Common Warrants,” together with the “Series J Warrants,” the “Warrants”) and two tranche obligations: (1) the RPM Call Option and (2) the Majority Sponsor Top-Up (both as defined in Note 13. Stockholders’ Equity and Redeemable Convertible Preferred Stock) in connection with the Company’s issuance of the Series D-1 Preferred Stock. The Company determined that the Warrants and tranche obligations should be classified as either liabilities or assets on the unaudited condensed consolidated balance sheets depending on valuation and are recorded at fair value both initially and subsequently, with changes in fair value recorded through earnings.

In March 2025, the Majority Sponsor Top-Up expired unexercised when the total amount of Series D-1 Preferred Stock purchased by investors exceeded $250.0 million. On March 24, 2025, the RPM Call Option was terminated via amendment of the Series D stock purchase agreement. As a result, the $0.2 million Majority Sponsor Top-Up and $4.2 million RPM Call Option were derecognized from the unaudited condensed consolidated balance sheet and recognized in other income, net in the unaudited condensed consolidated statement of net loss and comprehensive loss for the three months ended March 31, 2025.

In connection with the IPO, the Common Warrants were net exercised into 1.0 million shares of common stock. The Series J Warrants remained outstanding as of March 31, 2026.

Prior to the Company’s IPO on August 8, 2025, the Company used a Monte Carlo simulation model and probability weighted valuations based on different scenarios including change of control, IPO and default scenarios to value the Warrants. The value per Warrant under the change of control scenario was the average value per unit under 50,000 Monte Carlo simulations, the value per Warrant under the

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

IPO scenario was based on the number of common stock equivalent shares (including the Warrants) and total estimated equity value of the Company, and the value per Warrant under the default scenario was assumed to be zero.

The Company used a Black-Scholes option-pricing valuation model to value the Series J Warrants as of March 31, 2026. The following table presents the key inputs applied in the valuation of the Series J Warrants:


	March 31, 2026
Common stock price	$		28.47
Exercise price for the Series J Warrants	$		21.17
Risk-free rate		4.09%-4.14%
Volatility		94.0%-99.0%
Term (years)		7.30-8.14
Black-Scholes value (per share)	$	24.70-24.80
Number of warrants			646
Value of Series J Warrants	$		15,978

The following tables present the key inputs applied in the valuation of the Series J Warrants as of December 31, 2025:


	December 31, 2025
Common stock price	$		22.37
Exercise price for the Series J Warrants	$		21.17
Risk-free rate		3.94%-4.01%
Volatility		92.5%-97.5%
Term (years)		7.55-8.39
Black-Scholes value (per share)	$	19.00-19.06
Number of warrants			646
Value of Series J Warrants	$		12,294

During each of the three months ended March 31, 2026, and March 31, 2025 no warrants were issued. The fair value remeasurement of the Series J Warrants resulted in an increase in fair value of $3.7 million and $0.9 million for the three months ended March 31, 2026 and March 31, 2025, respectively. No warrants were exercised during the three months ended March 31, 2026 and March 31, 2025.

The fair value of the Series J Warrants on March 31, 2026 was $16.0 million.


	March 31, 2026
	Level 1		Level 2		Level 3		Total
Assets:
Cash	$	275,880	$	—	$	—	$	275,880
Money market funds		50,299		—		—		50,299
Time deposits		225,447		—		—		225,447
Total financial assets	$	551,626	$	—	$	—	$	551,626
Liabilities:
Series J Warrants	$	—	$	15,978	$	—	$	15,978
Total financial liabilities	$	—	$	15,978	$	—	$	15,978

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

The fair value of the Series J Warrants on December 31, 2025 was $12.3 million.


	December 31, 2025
	Level 1		Level 2		Level 3		Total
Assets:
Cash	$	787,747	$	—	$	—	$	787,747
Money market funds		—		5,219		—		5,219
Time deposits		100,008		—		—		100,008
Total financial assets	$	887,755	$	5,219	$	—	$	892,974
Liabilities:
Series J Warrants	$	—	$	12,294	$	—	$	12,294
Total financial liabilities	$	—	$	12,294	$	—	$	12,294

There were no transfers between levels within the fair value hierarchy during the three months ended March 31, 2026 and 2025.

10. Leases

The Company has existing operating and finance leases for corporate offices and facilities, vehicles and certain equipment. The Company's leases have remaining lease terms of less than one year to 16 years, some of which include options to extend the lease term. For purposes of calculating lease liabilities, lease terms include options to extend the lease when it is reasonable certain that the Company will exercise such options.

The components of lease expense were as follows:


	For the Three Months Ended March 31,
	2026		2025
Finance lease expense:
Amortization of right-of-use assets	$	408	$	305
Interest on lease liabilities		93		127
Operating lease expense		826		408
Total lease expense	$	1,327	$	840

Amortization of right-of-use assets was recorded within research and development, and selling, general, and administrative expenses, interest on lease liabilities was recorded within interest income, interest expense, and operating lease expense was recorded within research and development, and selling, general, and administrative expenses, each in the unaudited condensed consolidated statements of net loss.

On October 24, 2025, the Company signed a new office building lease, which commenced on March 1, 2026. The term of the lease is seven years. Upon lease commencement the Company recognized an initial lease liability of $2.8 million and a right-of-use asset of $4.5 million in accordance with ASC 842.

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

Operating and finance lease right-of-use assets and liabilities as of March 31, 2026 and December 31, 2025 were as follows:


	March 31,		December 31,
	2026		2025
Assets:
Operating lease right-of-use assets	$	18,481	$	13,938
Finance lease right-of-use assets	$	3,327	$	3,735

Liabilities:
Current:
Operating lease liabilities	$	2,051	$	1,161
Finance lease liabilities	$	1,065	$	1,056
Non-current:
Operating lease liabilities	$	21,341	$	15,832
Finance lease liabilities	$	1,733	$	2,004

As most of the Company’s operating leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on information available at the commencement date in determining the present value of lease payments.

Failed Sale and Leaseback

The Company leases various equipment through purchase and leaseback agreements with terms between five and seven years. The purchase and leaseback agreements provide an option for Firefly to purchase the equipment for nominal consideration that the Company is reasonably certain to exercise. The purchase and leaseback agreements were evaluated under the sale and leaseback guidance in ASC 842-40, Leases – Sale and Leaseback Transactions. Due to the purchase option, the transactions were accounted for as failed sales and leasebacks, and the Company has accounted for the purchase and leaseback agreements as financings.

As a result, the Company continues to reflect the manufacturing equipment on its unaudited condensed consolidated balance sheets in property and equipment, net, and continues to recognize depreciation expense over its estimated useful life. In 2024, the Company recorded an initial financing liability of $34.7 million, net of transaction costs, in notes payable. As of March 31, 2026, the Company’s related notes payable, current and non-current, were $6.1 million and $19.5 million, respectively. As of December 31, 2025, the Company’s related notes payable, current and non-current, were $6.0 million and $21.1 million, respectively. The Company does not recognize rent expense related to these purchase and leaseback agreements. Instead, periodic lease payments are recognized as interest expense and reductions of the principal balance of the finance liability.

For the three months ended March 31, 2026, payments of $1.4 million were made under the purchase and leaseback agreements in addition to interest expense of $0.5 million.

For the three months ended March 31, 2025, payments of $1.3 million were made under the purchase and leaseback agreements in addition to interest expense of $0.6 million.

11. Notes Payable

Financing Agreement

On July 17, 2023, the Company entered into a financing agreement (as amended from time to time and last amended August 13, 2024, the “Financing Agreement”) among the Company, as the Borrower, certain subsidiaries of the Company (collectively, “Guarantors”), lenders (the “Lenders”) and U.S. Bank Trust Company, N.A., as administrative agent and collateral agent (“Agent”). The Financing Agreement provided term loans in the aggregate principal amount of $136.1 million, comprised of $103.5 million principal amount of term A loans (the “Term A Loans”) and $32.6 million principal amount of term B loans (the “Term B Loans,” and together with the Term A Loans, and along with the incremental term loans from subsequent amendments from time to time, the “Term Loans”). The Term Loans mature on July 17, 2028 (the “Term Loan Maturity Date”).

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Firefly Aerospace Inc.

Notes to Condensed Consolidated Financial Statements

(in thousands, except per share amounts)

(unaudited)

All obligations under the Financing Agreement were guaranteed by the Company and Guarantors, comprised of all wholly owned domestic subsidiaries of the Company other than certain excluded subsidiaries, and were secured by substantially all of the Company’s assets.

An AON Insurance Policy was issued to the Agent on behalf of the Lenders, which indemnified the Lenders up to $103.5 million of the Term A Loans for any loss incurred if the Company fails to pay the Term Loans when due. The Company paid the initial insurance premium of $15.0 million using the proceeds from the Term Loans. The Company was required to pay the insurer an exit fee equal to 0.75% of the principal amount of the Term A Loans on the date on

Firefly Aerospace Inc. 10-Q