UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DCD.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 ~~August~~February 31, ~~2025~~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 0-15451

PHOTRONICS, INC.

(Exact name of registrant as specified in its charter)

Connecticut		06-0854886
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

15 Secor Road, Brookfield, Connecticut		06804
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code

(203) 775-9000

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 $0.01 par value	PLAB	NASDAQ Global Select 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 ☒

The registrant had 5958,~~004~~966,~~625~~394 shares of common stock outstanding as of ~~September~~March 45, ~~2025~~2026.

PHOTRONICS, INC.

QUARTERLY REPORT ON FORM 10-Q

~~August~~February 31, ~~2025~~2026

TABLE OF CONTENTS

Glossary of Terms and Acronyms		3	3
Forward-Looking Statements			4
Cautionary Statement Regarding Forward-Looking Statements		4
PART I.	FINANCIAL INFORMATION	~~FINANCIAL INFORMATION~~
Item 1.	Financial Statements (unaudited)	~~Financial Statements (unaudited)~~5	5
	Condensed Consolidated Balance Sheets	~~Condensed Consolidated Balance Sheets~~5	5
	Condensed Consolidated Statements of Income	~~Condensed Consolidated Statements of Income~~6	6
	Condensed Consolidated Statements of Comprehensive Income	~~Condensed Consolidated Statements of Comprehensive Income~~7	7
	Condensed Consolidated Statements of Equity	~~Condensed Consolidated Statements of Equity~~8	8
	Condensed Consolidated Statements of Cash Flows	~~Condensed Consolidated Statements of Cash Flows~~9	10
	Notes to Condensed Consolidated Financial Statements	~~Notes to Condensed Consolidated Financial Statements~~10	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	~~Management’s Discussion and Analysis of Financial Condition and Results of Operations~~24	26
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	~~Quantitative and Qualitative Disclosures about Market Risk~~33	33
Item 4.	Controls and Procedures	~~Controls and Procedures~~33	34
PART II.	OTHER INFORMATION	~~OTHER INFORMATION~~
Item 1.	Legal Proceedings	~~Legal Proceedings~~34	35
Item 1A.	Risk Factors	~~Risk Factors~~34	35
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	~~Unregistered Sales of Equity Securities and Use of Proceeds~~34	35
Item 3.	Defaults Upon Senior Securities	~~Defaults Upon Senior Securities~~35	36
Item 4.	Mine Safety Disclosures	~~Mine Safety Disclosures~~35	36
Item 5.	Other Information	~~Other Information~~35	36
Item 6.	Exhibits	~~Exhibits~~36	37

Table of Contents

Glossary of Terms and Acronyms

Definitions of certain terms and acronyms that may appear in this report are provided below.

	AMOLED	Active-matrix organic light-emitting diode. A technology used in mobile devices.
AI	Artificial Intelligence
	ASC	Accounting Standards Codification
AMOLED	Active-matrix organic light-emitting diode. A technology used in mobile devices.
	ASP	Average Selling Price
Application-specific IC	An integrated circuit customized for a particular use, rather than intended for general-purpose use
	ASU	Accounting Standards Update
ASC	Accounting Standards Codification
	CNY	Chinese Yuan
ASP	Average Selling Price
	DNP	Dai Nippon Printing Co., Ltd.
ASU	Accounting Standards Update
	Exchange Act	The Securities Exchange Act of 1934 (as amended)
CNY	Chinese Yuan
	Form 10-K	Annual Report on Form 10-K
DNP	Dai Nippon Printing Co., Ltd.
	Form 10-Q	Quarterly Report on Form 10-Q
EUV	A wafer lithography technology using the industry standard extreme ultraviolet (EUV) wavelength. EUV photomasks function by selectively reflecting or blocking light, in contrast to conventional photomasks which function by selectively transmitting or blocking light
	FPD	Flat Panel Display
Exchange Act	The Securities Exchange Act of 1934 (as amended)
	FY	Fiscal Year
FASB	Financial Accounting Standards Board
	Generation	In reference to flat panel displays, it refers to the size range of the underlying substrate to which a photomask is applied. Higher generation (or “G”) numbers represent larger substrates
Form 10-K	Annual Report on Form 10-K
	High-end (photomasks)	For IC, photomasks that service IC nodes at 28nm or smaller; for FPD, AMOLED, G10.5+, and LTPS photomasks
Form 10-Q	Quarterly Report on Form 10-Q
	IC	Integrated circuit
FPD	Flat-panel displays, or “displays”
	LTPS	Low-Temperature Poly Silicon, a polycrystalline silicon synthesized at relatively low temperatures; polycrystalline silicon in thin-film transistors (TFTs) are used in liquid-crystal display (LCD) flat panels and to drive organic light-emitting diode (OLED) displays
FY	Fiscal Year
	Mainstream (photomasks)	For IC, photomasks that service IC nodes greater than 28nm; for FPD, G8 and smaller photomasks
Generation	In reference to flat panel displays, it refers to the size range of the underlying substrate to which a photomask is applied. Higher generation (or “G”) numbers represent larger substrates
	PDMCX	Xiamen American Japan Photronics Mask Co., Ltd., a joint venture of Photronics and DNP
High-end (photomasks)	For IC, photomasks that are 28nm or smaller; for FPD, AMOLED, G10.5+, and LTPS photomasks
	ROU (assets)	Right-of-use asset
IC	Integrated circuits, or semiconductors
	SEC	Securities and Exchange Commission
LTPS	Low-Temperature Poly Silicon, a polycrystalline silicon synthesized at relatively low temperatures; polycrystalline silicon in thin-film transistors (TFTs) are used in liquid-crystal display (LCD) flat panels and to drive organic light-emitting diode (OLED) displays
	U.S. GAAP	Accounting principles generally accepted in the United States of America
Mainstream (photomasks)	For IC, photomasks that service IC nodes greater than 28nm; for FPD, G8 and smaller photomasks
	VIE	Variable Interest Entity
Optical proximity correction	A photolithography enhancement technique applied to compensate for the limitations of light to maintain the edge placement integrity of an original design, imaged onto a silicon wafer, for further processing to an etched pattern.
	Wafer	A wafer, or silicon wafer, is a thin slice of semiconductor material that, in the fabrication of microelectronics, serves as the substrate for microelectronic devices built in and upon the wafer
PDMCX	Xiamen American Japan Photronics Mask Co., Ltd., a joint venture of Photronics and DNP
ROU (assets)	Right-of-use asset
SEC	Securities and Exchange Commission
U.S. GAAP	Accounting principles generally accepted in the United States of America
VIE	Variable Interest Entity
Wafer	A wafer, or silicon wafer, is a thin slice of semiconductor material that, in the fabrication of microelectronics, serves as the substrate for microelectronic devices built in and upon the wafer

Table of Contents

Cautionary Statement Regarding Forward-Looking Statements

This Form 10-Q contains forward-looking statements, as defined by the SEC. The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements made by us, or on our behalf. Forward-looking statements are statements other than statements of historical fact, including, without limitation, those statements that include such words as “anticipates”, “believes”, “estimates”, “expects”, “intends”, “may”, “plans”, “predicts”, and similar expressions, and, without limitation, may address our future plans, objectives, goals, strategies, events, or performance, as well as underlying assumptions and other statements that are other than statements of historical facts. On occasion, in other documents filed with the SEC, press releases, conferences, or by other means, we may discuss, publish, disseminate, or otherwise make available, forward-looking statements, including statements contained within Part I, Item 2 – “Management’s Discussion & Analysis of Financial Condition and Results of Operations” of this Form 10-Q.

Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed. Our expectations, beliefs, and projections are expressed in good faith and are believed by us to have a reasonable basis, including, without limitation, management’s examination of historical operating trends, information contained in our records, and information we have obtained from other parties. However, we can offer no assurance that our expectations, beliefs, or projections will be realized, accomplished, or achieved.

Forward-looking statements within this Form 10-Q speak only as of the date of its filing, and we undertake no obligation to update any such statements to reflect changes in events or ~~circumstances~~ circumstances that may subsequently occur. Users of this Form 10-Q are cautioned that various factors may cause actual results to differ materially from those contained in any forward-looking statements found within this Form 10-Q and that they should not place undue reliance on any forward-looking statement. In addition, all forward-looking statements, whether written or oral and whether made by us or on our behalf, are expressly qualified by the risk factors provided in Part I, Item 1A “Risk Factors” contained in Form 10-K for the year ended October 31, ~~2024~~2025, filed with the SEC on December 1917, ~~2024~~2025, as well as any additional risk factors we may provide in Part II, Item 1A in this Quarterly Report on Form 10-Q.

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1.

FINANCIAL STATEMENTS

PHOTRONICS, INC.

Condensed Consolidated Balance Sheets

(in thousands, except per share amounts)

(unaudited)

	August 3,			October 31,
	February 1,			October 31,
	2025			2024
	2026			2025
ASSETS
Current assets:
Cash and cash equivalents	$	~~479~~544,~~521~~133		$	~~598~~492,~~485~~256
Short-term investments		9692,~~277~~738			4295,~~184~~909
Accounts receivable, net of allowance of $1,184 in 2025 and $1,126 in 2024		190,875			200,830
Accounts receivable, net of allowance of $1,153 in 2026 and $1,166 in 2025		199,490			195,921
Inventories		6362,~~490~~653			5661,~~527~~767
Other current assets		4247,~~073~~235			3344,~~036~~199
Total current assets		~~872~~946,~~236~~249			~~931~~890,~~062~~052
Property, plant and equipment, net		~~838~~894,~~988~~620			~~745~~854,~~257~~436
Deferred income taxes		2638,~~419~~255			2340,~~059~~207
Other assets		1522,~~122~~295			1219,~~681~~839
Total assets	$	1,~~752~~901,~~765~~419		$	1,~~712~~804,~~059~~534
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	11		$	~~17,972~~11
Accounts payable		~~100~~111,~~351~~651			7884,~~717~~209
Accrued liabilities		7494,~~563~~987			8781,~~122~~653
Total current liabilities		~~174~~206,~~925~~649			~~183~~165,~~811~~873
Long-term debt		1610			2513
Other liabilities		3944,~~824~~839			4741,~~464~~341
Total liabilities		~~214~~251,~~765~~498			~~231~~207,~~300~~227
Commitments and contingencies (Note 12)
Commitments and contingencies (Note 11)
Equity:
Preferred stock, $0.01 par value, 2,000 shares authorized, none issued and outstanding		-			-
Common stock, $0.01 par value, 150,000 shares authorized, 57,587 shares issued and outstanding as of August 3, 2025, and 61,949 shares issued and outstanding as of October 31, 2024		576			619
Common stock, $0.01 par value, 150,000 shares authorized, 58,108 shares issued and outstanding as of February 1, 2026, and 57,633 shares issued and outstanding as of October 31, 2025		581			576
Additional paid-in capital		~~483~~488,~~081~~806			~~514~~486,~~757~~934
Retained earnings		~~710~~814,~~398~~323			~~691~~772,~~807~~199
Accumulated other comprehensive loss		(6892,~~504~~320	)		(86,~~319~~120	)
Total Photronics, Inc. shareholders’ equity		1,~~125~~211,~~551~~390			1,~~120~~173,~~864~~589
Noncontrolling interests		~~412~~438,~~449~~531			~~359~~423,~~895~~718
Total equity		1,~~538~~649,~~000~~921			1,~~480~~597,~~759~~307
Total liabilities and equity	$	1,~~752~~901,~~765~~419		$	1,~~712~~804,~~059~~534

See accompanying notes to condensed consolidated financial statements.

Table of Contents

PHOTRONICS, INC.

Condensed Consolidated Statements of Income

(in thousands, except per share amounts)

(unaudited)

Three Months Ended

~~Nine Months Ended~~

August 3,

July 28,

August 3,

July 28,

February 1,

February 2,

2025

2024

2025

2024

2026

2025

Revenue

~~210~~225,~~394~~066

~~210~~212,~~984~~138

~~633,524~~

~~644,318~~

Cost of goods sold

~~139~~146,~~539~~364

~~135~~136,~~846~~603

~~409,228~~

~~410,674~~

Gross profit

7078,~~855~~702

75,~~138~~535

~~224,296~~

~~233,644~~

Operating expenses:

Selling, general, and administrative

1821,~~423~~311

19,~~436~~101

~~55,624~~

~~56,753~~

Research and development

42,~~271~~588

34,~~555~~257

~~12,618~~

~~11,291~~

Total operating expenses

2223,~~694~~899

2223,~~991~~358

~~68,242~~

~~68,044~~

Other operating income, net

Other operating income

Operating income

4854,~~161~~859

52,~~148~~177

~~156,054~~

~~165,690~~

Other income (expense):

Foreign currency transactions impact, net

~~(14~~12,~~258~~865

)

418,~~068~~443

~~(26,925~~

)

~~9,926~~

Interest income and other income, net

46,~~830~~809

6,~~135~~585

~~16,745~~

~~17,263~~

Interest expense

-(1

)

(5847

)

~~(52~~

)

~~(258~~

)

Income before income tax provision

3874,~~733~~532

6277,~~293~~158

~~145,822~~

~~192,621~~

Income tax provision

914,~~594~~355

1418,~~124~~901

~~34,209~~

~~48,998~~

Net income

2960,~~139~~177

4858,~~169~~257

~~111,613~~

~~143,623~~

Net income attributable to noncontrolling interests

617,~~248~~238

1315,~~781~~406

~~37,009~~

~~46,804~~

Net income attributable to Photronics, Inc. shareholders

2242,~~891~~939

3442,~~388~~851

~~74,604~~

~~96,819~~

Earnings per share:

Earnings per share attributable to Photronics, Inc. shareholders:

Basic

0.4074

0.5669

~~1.24~~

~~1.57~~

Diluted

0.3974

0.5568

~~1.23~~

~~1.55~~

Weighted-average number of common shares outstanding:

Basic

57,~~937~~794

6162,~~815~~093

~~60,274~~

~~61,681~~

Diluted

58,~~068~~390

62,~~414~~661

~~60,567~~

~~62,369~~

See accompanying notes to condensed consolidated financial statements.

Table of Contents

PHOTRONICS, INC.

Condensed Consolidated Statements of Comprehensive Income

(in thousands)

(unaudited)

	Three Months Ended						~~Nine Months Ended~~
	August 3,			July 28,			August 3,			July 28,
	February 1,			February 2,
	2025			2024			2025			2024
	2026			2025
Net income	$	2960,~~139~~177		$	4858,~~169~~257		$	~~111,613~~		$	~~143,623~~
Other comprehensive (loss) income, net of tax:
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		29(8,~~171~~667	)		(642,~~114~~917	)		~~33,380~~			~~(13,819~~	)
Other		~~(28~~42	)		4870			~~(20~~	)		~~103~~
Net other comprehensive (loss) income		29,143			(6,066	)		33,360			(13,716	)
Net other comprehensive loss		(8,625	)		(42,847	)
Comprehensive income		5851,~~282~~552			4215,~~103~~410			~~144,973~~			~~129,907~~
Less: comprehensive income attributable to noncontrolling interests		1614,~~600~~813			126,~~263~~566			~~52,555~~			~~44,834~~
Comprehensive income attributable to Photronics, Inc. shareholders	$	4136,~~682~~739		$	298,~~840~~844		$	~~92,418~~		$	~~85,073~~

See accompanying notes to condensed consolidated financial statements.

Table of Contents

PHOTRONICS, INC.

Condensed Consolidated Statements of Equity

(in thousands)

(unaudited)

	Three Months Ended August 3, 2025
	Three Months Ended February 1, 2026
	Photronics, Inc. Shareholders
													Accumulated
							Additional						Other			Non-
	Common Stock						Paid-in			Retained			Comprehensive			controlling			Total
	Shares			Amount			Capital			Earnings			Income (Loss)			Interests			Equity
Balance as of May 4, 2025		58,711		$	587		$	489,205		$	698,423		$	(87,295	)	$	395,849		$	1,496,769
Balance as of October 31, 2025		57,633		$	576		$	486,934		$	772,199		$	(86,120	)	$	423,718		$	1,597,307
Net income		-			-			-			2242,~~891~~939			-			617,~~248~~238			2960,~~139~~177
Other comprehensive income		-			-			-			-			18,791			10,352			29,143
Other comprehensive loss		-			-			-			-			(6,200	)		(2,425	)		(8,625	)
Shares issued under equity plans		54475			15			~~394~~(979	)		-			-			-			~~395~~(974	)
Share-based compensation expense		-			-			32,~~294~~851			-			-			-			32,~~294~~851
Purchase and retirement of common stock through repurchase program		(1,178	)		(12	)		(9,812	)		(10,916	)		-			-			(20,740	)
Other changes in equity		-			-			-			(815	)		-			-			(815	)
Balance as of August 3, 2025		57,587		$	576		$	483,081		$	710,398		$	(68,504	)	$	412,449		$	1,538,000
Balance as of February 1, 2026		58,108		$	581		$	488,806		$	814,323		$	(92,320	)	$	438,531		$	1,649,921

	Three Months Ended July 28, 2024
	Three Months Ended February 2, 2025
	Photronics, Inc. Shareholders
													Accumulated
							Additional						Other			Non-
	Common Stock						Paid-in			Retained			Comprehensive			controlling			Total
	Shares			Amount			Capital			Earnings			Income (Loss)			Interests			Equity
Balance as of April 28, 2024		61,799		$	618		$	506,621		$	623,550		$	(95,932	)	$	333,172		$	1,368,029
Balance as of October 31, 2024		61,949		$	619		$	514,757		$	691,807		$	(86,319	)	$	359,895		$	1,480,759
Net income		-			-			-			3442,~~388~~851			-			1315,~~781~~406			4858,~~169~~257
Other comprehensive loss		-			-			-			-			(434,~~548~~006	)		(18,~~518~~841	)		(642,~~066~~847	)
Shares issued under equity plans		40549			-6			(45727	)		-			-			-			(45721	)
Share-based compensation expense		-			-			3,~~342~~334			-			-			-			3,~~342~~334
Balance as of July 28, 2024		61,839		$	618		$	509,918		$	657,938		$	(100,480	)	$	345,435		$	1,413,429
Purchase and retirement of common stock through repurchase program		(195	)		(2	)		(1,622	)		(2,949	)		-			-			(4,573	)
Balance as of February 2, 2025		62,303		$	623		$	515,742		$	731,709		$	(120,325	)	$	366,460		$	1,494,209

See accompanying notes to condensed consolidated financial statements.

Table of Contents

	Nine Months Ended August 3, 2025
	Photronics, Inc. Shareholders
													Accumulated
							Additional						Other			Non-
	Common Stock						Paid-in			Retained			Comprehensive			controlling		Total
	Shares			Amount			Capital			Earnings			Income (Loss)			Interests		Equity
Balance as of October 31, 2024		61,949		$	619		$	514,757		$	691,807		$	(86,319	)	$	359,895	$	1,480,759
Net income		-			-			-			74,604			-			37,009		111,613
Other comprehensive income		-			-			-			-			17,815			15,545		33,360
Shares issued under equity plans		626			6			(319	)		-			-			-		(313	)
Share-based compensation expense		-			-			10,003			-			-			-		10,003
Purchase and retirement of common stock through repurchase program		(4,988	)		(49	)		(41,360	)		(56,013	)		-			-		(97,422	)
Balance as of August 3, 2025		57,587		$	576		$	483,081		$	710,398		$	(68,504	)	$	412,449	$	1,538,000

	Nine Months Ended July 28, 2024
	Photronics, Inc. Shareholders
										Accumulated
					Additional					Other			Non-
	Common Stock				Paid-in			Retained		Comprehensive			controlling			Total
	Shares		Amount		Capital			Earnings		Loss			Interests			Equity
Balance as of October 31, 2023		61,310	$	613	$	502,010		$	561,119	$	(88,734	)	$	300,601		$	1,275,609
Net income		-		-		-			96,819		-			46,804			143,623
Other comprehensive loss		-		-		-			-		(11,746	)		(1,970	)		(13,716	)
Shares issued under equity plans		529		5		(1,933	)		-		-			-			(1,928	)
Share-based compensation expense		-		-		9,841			-		-			-			9,841
Balance as of July 28, 2024		61,839	$	618	$	509,918		$	657,938	$	(100,480	)	$	345,435		$	1,413,429

See accompanying notes to condensed consolidated financial statements.

Table of Contents

PHOTRONICS, INC.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

	Nine Months Ended
	Three Months Ended
	August 3,			July 28
	February 1,			February 2,
	2025			2024
	2026			2025
Cash flows from operating activities:
Net income	$	~~111~~60,~~613~~177		$	~~143~~58,~~623~~257
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		5919,~~234~~802			6120,~~613~~792
Share-based compensation		102,~~003~~851			93,~~841~~334
Changes in assets and liabilities:
Accounts receivable		12(2,~~378~~543	)		(57,~~181~~869	)
Inventories		(~~6,094~~982	)		(52,~~788~~533	)
Other current assets		(82,~~007~~187	)		(~~2,778~~522	)
Accounts payable, accrued liabilities, and other		~~(19~~20,~~153~~136	)		(8,~~256~~731	)
Net cash provided by operating activities		~~159~~97,~~974~~254			~~193~~78,~~074~~466
Cash flows from investing activities:
Purchases of property, plant and equipment		(~~120~~47,~~588~~635	)		(8735,~~733~~200	)
Purchases of short-term investments		(9636,~~571~~611	)		~~(100,558~~-	)
Proceeds from maturities of short-term investments		4241,~~148~~483			4441,~~696~~482
Government incentives		12,~~469~~567			~~1,541~~620
Other		(5780	)		(457	)
Net cash used in investing activities		(173,599	)		(142,058	)
Net cash (used in) provided by investing activities		(40,276	)		6,845
Cash flows from financing activities:
Repayments of debt		(~~17,969~~3	)		(415,~~500~~343	)
Common stock repurchases		~~(97,422~~-	)		-(4,573	)
Proceeds from share-based arrangements		~~2,120~~752			1,~~074~~433
Net settlements of restricted stock awards		~~(2,013~~-	)		(31,~~002~~995	)
Net cash used in financing activities		(115,284	)		(6,428	)
Net cash provided by (used in) financing activities		749			(20,478	)
Effects of exchange rate changes on cash, cash equivalents, and restricted cash		10(5,~~129~~915	)		(621,~~454~~202	)
Net change in cash, cash equivalents, and restricted cash		(118,780	)		38,134
Net increase in cash, cash equivalents, and restricted cash		51,812			43,631
Cash, cash equivalents, and restricted cash at beginning of period		~~601~~495,~~243~~113			~~501~~601,~~867~~243
Cash, cash equivalents, and restricted cash at end of period		~~482~~546,~~463~~925			~~540~~644,~~001~~874
Less: Ending restricted cash		2,~~942~~792			2,~~670~~674
Cash and cash equivalents at end of period	$	~~479~~544,~~521~~133		$	~~537~~642,~~331~~200
Supplemental disclosure of non-cash information:
Accruals for property, plant and equipment purchased not yet paid	$	2720,~~366~~359		$	910,~~163~~911

See accompanying notes to condensed consolidated financial statements.

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PHOTRONICS, INC.

Notes to Condensed Consolidated Financial Statements

(unaudited)

(in thousands, except share amounts and per share data)

NOTE 1 – NATURE OF BUSINESS AND BASIS OF PRESENTATION

Description of Business

Photronics, Inc. (“Photronics”, “the Company”, “we”, “our”, or “us”) is one of the world’s leading manufacturers of photomasks, which are high-precision photographic quartz or glass plates containing microscopic images of electronic circuits. Photomasks are a key element in the manufacture of ICs and FPDs and are used as masters to transfer circuit patterns onto semiconductor wafers and FPD substrates during the fabrication of ICs, a variety of FPDs and, to a lesser extent, other types of electrical and optical components. The Company ~~operates~~currently has eleven manufacturing facilities, ~~which are~~ located in Taiwan (3), ~~South~~China ~~Korea~~ (12), ~~China~~South Korea (21), the United States (3), and Europe (2).

Basis of Presentation

The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect amounts reported in them. The Company’s estimates are based on on historical experience and on various assumptions that ~~the~~are ~~Company~~believed ~~believes~~ to be reasonable ~~under~~based on the facts and circumstances available at the time they are made. ~~Actual~~Subsequent actual results may differ from such estimates. The Company reviews these ~~estimates~~ estimates periodically and reflects any effects of revisions in the period in which they are determined.

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements (“the financial statements”) have been prepared in accordance with U.S. GAAP for interim financial reporting information, and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of management, adjustments, all of which are of a normal recurring nature, considered necessary for a fair presentation have been included. The financial statements include the accounts of Photronics, its wholly owned subsidiaries, and the majority-owned subsidiaries which it controls. All intercompany balances and transactions have been eliminated in consolidation. These financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Form 10-K for the fiscal year ended October 31, ~~2024~~2025, which provides additional information about the Company’s accounting policies and the methods and assumptions used in the Company’s estimates.

The Company’s business is typically impacted during the first quarter of the Company’s fiscal year by the North American, European, and Asian holiday periods, as some customers ~~reduce~~may change their development and buying activities during this period. Operating results for the interim periods are not necessarily indicative of the results that may be expected for the fiscal year ending October 31, ~~2025~~2026.

Recent Accounting Pronouncements

In ~~November~~December ~~2024~~2025, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. ~~2024~~2025-0311, ~~Income~~“Interim ~~Statement -~~ Reporting ~~Comprehensive Income - Expense Disaggregation Disclosures~~ (~~Subtopic~~Topic ~~220-40~~270): ~~Disaggregation~~Narrow ofScope ~~Income Statement Expenses (“ASU 2024-03~~Improvements”), ~~and~~which inimproves ~~January 2025,~~ the ~~FASB~~navigability ~~issued~~of ~~ASU~~the ~~No.~~required ~~2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):~~interim ~~Clarifying~~disclosures ~~the~~and ~~Effective~~clarifies ~~Date,~~when ~~which~~that ~~clarified~~guidance ~~the~~is ~~effective~~applicable. ~~date~~The ofguidance ~~ASU~~in ~~2024-03.~~this ASU ~~2024-03~~ will ~~require~~be ~~the~~effective ~~Company~~for toPhotronics ~~disclose~~for ~~the~~interim ~~amounts~~reporting ofperiods ~~purchases~~in ofits ~~inventory,~~fiscal ~~employee~~year ~~compensation,~~2028 ~~depreciation~~Form ~~and intangible asset amortization, as applicable, as well as qualitatively describe remaining amounts included in those captions~~10Q. The ~~guidance~~amendments incan ~~this ASU will~~ be ~~effective~~applied ~~for~~either ~~Photronics~~(1) inprospectively ~~its~~or ~~fiscal~~(2) retrospectively ~~year~~to ~~2028~~any ~~Form~~or ~~10-K,~~all ~~with~~prior ~~early~~periods ~~application~~presented ofin the ~~amendments~~financial ~~allowed~~statements. The Company is ~~currently~~does ~~evaluating~~not ~~the~~expect ~~impact the~~ adoption of this ASU ~~may~~to have a material effect on the Company’s consolidated financial statements and related disclosures.

11 In December 2025, the FASB issued ASU No. 2025-10, “Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities”. This update establishes authoritative guidance on the accounting for government grants received by business entities. The guidance in this ASU will be effective for Photronics in its fiscal year 2030 Form 10-K, with early application of the amendments allowed. The standard may be applied using a modified prospective, modified retrospective or full retrospective transition approach. The Company is currently evaluating the timing and impact of this ASU on the Company’s consolidated financial statements and related disclosures.

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In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”) and in January 2025, the FASB issued ASU No. 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date, which clarified the effective date of ASU 2024-03. ASU 2024-03 will require the Company to disclose the amounts of purchases of inventory, employee compensation, depreciation and intangible asset amortization, as applicable, as well as qualitatively describe remaining amounts included in those captions. The guidance in this ASU will be effective for Photronics in its fiscal year 2028 Form 10-K, with early application of the amendments allowed. The Company is currently evaluating the impact the adoption of this ASU may have on the Company’s consolidated financial statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”, to enhance the transparency and decision usefulness of income tax disclosures. The amendments in this ASU related to the rate reconciliation and income taxes paid disclosures to improve the transparency of income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. The amendments allow investors to better assess, in their capital allocation decisions, how an entity’s worldwide operations and related tax risks and tax planning and operational opportunities affect its income tax rate and prospects for future cash flows. The guidance in this ASU will be effective for Photronics in its fiscal year 2026 Form 10-K, with early application of the amendments allowed. The Company is currently evaluating the effect of this ASU adoption on its disclosures.

In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”, which improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The guidance in this ASU is effective for Photronics in its fiscal year 2025 Form 10-K. The Company is currently evaluating the effect the adoption of this ASU may have on the Company’s disclosures.

NOTE 2 – ACCOUNTS RECEIVABLE, NET

The components of Accounts Receivable, net at the balance sheet dates are presented below.

	August 3,			October 31,
	February 1,			October 31,
	2025			2024
	2026			2025
Accounts Receivable	$	~~161~~172,~~658~~569		$	~~172~~166,~~741~~511
Unbilled Receivables		3028,~~401~~074			2930,~~215~~576
Allowance for Credit Losses		(1,~~184~~153	)		(1,~~126~~166	)
	$	~~190~~199,~~875~~490		$	~~200~~195,~~830~~921

NOTE 3 – CASH, CASH EQUIVALENTS AND INVESTMENTS

The Company invests excess cash primarily in bank time deposits and ~~various~~money ~~marketable~~market ~~securities~~funds. The Company’s classification of investments is as follows:

-	Maturing within three months or less from the date of purchase	Cash and cash equivalents
-	Maturing, as of the date of purchase, more than three months, but with remaining maturities of less than one year, from the balance sheet date	Short-term investments
-	Maturing one year or more from the balance sheet date	Long-term marketable investments

The accounting framework for determining fair value includes a hierarchy for ranking the quality and reliability of the information used to measure fair value, which enables the reader of the financial statements to assess the inputs used to develop those measurements. The fair value hierarchy consists of three tiers as follows:

Level 1- These are investments where values are based on unadjusted quoted prices for identical assets in an active market the Company has the ability to access.

Level 2- These are investments where values are based on quoted market prices that are not active or model derived valuations in which all significant inputs are observable in active markets.

Level 3- These are investments where values are derived from techniques in which one or more significant inputs are unobservable.

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The following are cash, cash equivalents and investments measured at fair value on a recurring basis using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2) and significant unobservable inputs (Level 3):

August 3, 2025

October 31, 2024

February 1, 2026

October 31, 2025

Cash and cash equivalents

Short-term investments

Total Fair Value

Cash and cash equivalents

Short-term investments

Total Fair Value

Cash

~~171~~237,~~146~~349

~~414~~222,~~074~~166

Level 1

U.S. Government Securities

~~5,503~~-

2419,~~986~~127

3019,~~489~~127

-3,789

-25,157

-28,946

Money market funds

1429,~~782~~340

3611,~~322~~159

Level 2

Commercial paper

4342,~~093~~452

25,~~618~~985

4548,~~711~~437

-30,747

-2,259

-33,006

Time deposits

~~244~~234,~~997~~992

6867,~~673~~626

~~313~~302,~~670~~618

~~148~~224,~~089~~395

4268,~~184~~493

~~190~~292,~~273~~888

~~479~~544,~~521~~133

9692,~~277~~738

~~575~~636,~~798~~871

~~598~~492,~~485~~256

4295,~~184~~909

~~640~~588,~~669~~165

Restricted Cash (1)

2,~~942~~792

2,~~758~~857

Cash, cash equivalents, and restricted cash

~~482~~546,~~463~~925

~~601~~495,~~243~~113

⁽¹⁾

Restricted cash is included in other assets and primarily relates to customs requirements and land lease agreements.

Based upon the Company’s intent and ability to hold its time deposits to maturity (which maturities range up to twelve months at purchase), such securities have been classified as held-to-maturity and are carried at amortized cost, which approximates market value. The Company’s U.S. Government Securities, Commercial paper and Money market funds are classified as available-for-sale. Available-for-sale investments are reported at fair value, with unrealized gains or losses (net of tax) reported in Accumulated other comprehensive income (loss). In the event of a sale of these securities, the Company would determine the cost of the investment sold at the specific individual security level and would include any gain or loss in Interest income and other income, net, where the Company also reports periodic interest earned and the amortization (accretion) of discounts (premiums) related to these investments. For the periods ended ~~August~~February 31, ~~2025~~2026, and October 31, ~~2024~~2025, the unrealized gains or losses related to short-term investments were immaterial.

NOTE 4 - INVENTORIES

The components of Inventories at the balance sheet dates are presented below.

	August 3,		October 31,
	February 1,		October 31,
	2025		2024
	2026		2025
Raw materials	$	6160,~~908~~768	$	5660,~~128~~150
Work in process		1,~~560~~880		~~398~~1,616
Finished goods		225		1
	$	6362,~~490~~653	$	5661,~~527~~767

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NOTE 5 - PROPERTY, PLANT AND EQUIPMENT, NET

Presented below are the components of Property, plant and equipment, net at the balance sheet dates.

	August 3,			October 31,
	February 1,			October 31,
	2025			2024
	2026			2025
Land	$	12,~~298~~309		$	1112,~~419~~245
Buildings and improvements		~~192~~198,~~625~~547			~~188~~192,~~756~~860
Machinery and equipment		2,~~143~~120,~~635~~747			12,~~990~~109,~~610~~456
Leasehold improvements		2120,~~037~~063			1920,~~268~~474
Furniture, fixtures, and office equipment		1819,~~598~~456			1819,~~091~~394
Construction in progress		~~108~~167,~~743~~882			91134,~~213~~880
		2,496,936			2,319,357
		2,539,004			2,489,309
Accumulated depreciation and amortization		(1,~~657~~644,~~948~~384	)		(1,~~574~~634,~~100~~873	)
	$	~~838~~894,~~988~~620		$	~~745~~854,~~257~~436

Information on ROU assets resulting from finance leases, at the balance sheet dates, is presented below. During the first half of 2025, the Company exercised its early buy-out option for a high-end lithography tool and a high-end inspection tool. ~~Please refer to Note 7 for further information.~~

	August 3,			October 31,
	February 1,			October 31,
	2025			2024
	2026			2025
Machinery and equipment	$	5554		$	~~42,815~~54
Accumulated amortization		(5054	)		(~~10,522~~53	)
	$	5-		$	~~32,293~~1

The following table presents depreciation expense (including the amortization of ROU assets), related to property, plant and equipment incurred during the reporting periods.

	Three Months Ended				~~Nine Months Ended~~
	August 3,		July 28,		August 3,		July 28,
	February 1,		February 2,
	2025		2024		2025		2024
	2026		2025
Depreciation Expense	$	1819,~~764~~716	$	20,~~036~~702	$	~~58,971~~	$	~~61,332~~

NOTE 6 - PDMCX JOINT VENTURE

In January 2018, Photronics, Inc., through its wholly-owned Photronics Singapore PTE. LTD. subsidiary (hereinafter, within this Note “we”, “Photronics”, “us”, or “our”), and DNP, through its wholly owned subsidiary DNP Asia Pacific PTE, Ltd., entered into a joint venture under which DNP obtained a 49.99% interest in the Company’s IC business in Xiamen, China. The joint venture, which the Company refers to as “PDMCX”, was established to develop and manufacture photomasks for semiconductors. The Company entered into this joint venture to enable the Company to compete more effectively for the merchant photomask business in China, and to benefit from the additional resources and investment that DNP provides to enable the Company to offer advanced-process technology to the Company’s customers.

Under the joint venture agreement, should either Photronics’ or DNP’s ownership interest fall below 20.0% for a period of more than six consecutive months, such party (an “exiting party”) has the option to sell to the other party, and the other party has the option to purchase from such exiting party, the exiting party’s remaining ownership interest. In either case, the sales of ownership interests would be at the exiting party’s ownership percentage of the joint venture’s net book value, with closing to take place within three business days of obtaining required approvals and clearance.

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The following table presents the net income the Company recorded from the operations of PDMCX during the reporting periods.

	Three Months Ended				~~Nine Months Ended~~
	August 3,		July 28,		August 3,		July 28,
	February 1,		February 2,
	2025		2024		2025		2024
	2026		2025
Net income from PDMCX	$	35,~~485~~113	$	43,~~369~~368	$	~~14,410~~	$	~~16,296~~

As required by the guidance in ASC Topic 810 - “Consolidation”, the Company evaluated the Company’s involvement in PDMCX for the purpose of determining whether the Company should consolidate its results in the Company’s financial statements. The initial step of the Company’s evaluation was to determine whether PDMCX was a VIE. Due to its lack of sufficient equity at risk to finance its activities without additional subordinated financial support, the Company determined that it is a VIE. Having made this determination, the Company then assessed whether the Company was the primary beneficiary of the VIE and concluded that the Company was the primary beneficiary during the current and prior years reporting periods; thus, as required, the PDMCX financial results have been consolidated with Photronics. The Company’s conclusion was based on the fact that the Company held a controlling financial interest in PDMCX (which resulted from the Company’s having the power to direct the activities that most significantly impacted its economic performance) and had both the obligation to absorb losses and the right to receive benefits that could potentially be significant to PDMCX. The Company’s conclusion that the Company had the power to direct the activities that most significantly affected the economic performance of PDMCX during the current and prior year periods were based on the Company’s right to appoint the majority of its Board of Directors, which has, among others, the powers to manage the business (through its rights to appoint and evaluate PDMCX’s management), incur indebtedness, enter into agreements and commitments, and acquire and dispose of PDMCX’s assets. In addition, as a result of the 50.01% variable interest the Company held during the current and prior year periods, the Company had the obligation to absorb losses, and the right to receive benefits, which could potentially be significant to PDMCX.

The following table presents the carrying amounts of PDMCX assets and liabilities included in the Company’s condensed consolidated balance sheets. General creditors of PDMCX do not have recourse to the assets of Photronics (other than the net assets of PDMCX); therefore, the Company’s maximum exposure to loss from PDMCX is the Company’s interest in the carrying amount of the net assets of the joint venture.

August 3,

October 31,

February 1,

October 31,

2025

2024

2026

2025

Classification

Carrying

Photronics

Carrying

Photronics

Amount

Interest

Amount

Interest

Current assets

~~169~~208,~~077~~288

84104,~~555~~165

~~174~~180,~~059~~289

8790,~~047~~163

Noncurrent assets

~~166~~172,~~996~~757

8386,~~515~~396

~~151~~166,~~039~~756

7583,~~535~~395

Total assets

~~336~~381,~~073~~045

~~168~~190,~~070~~561

~~325~~347,~~098~~045

~~162~~173,~~582~~558

Current liabilities

2639,~~852~~355

1319,~~429~~681

4023,~~691~~193

2011,~~350~~599

Noncurrent liabilities

23,~~407~~034

1,~~204~~517

32,~~320~~970

1,~~660~~485

Total liabilities

2942,~~259~~389

1421,~~633~~198

4426,~~011~~163

2213,~~010~~084

Net assets

~~306~~338,~~814~~656

~~153~~169,~~437~~363

~~281~~320,~~087~~882

~~140~~160,~~572~~474

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NOTE 7 – REVENUE

The Company recognizes revenue when, or as, control of a good or service transfers to a customer, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring those goods or services. The Company accounts for an arrangement as a revenue contract when each party has approved and is committed to perform under the contract, the rights of the contracting parties regarding the goods or services to be transferred and the payment terms are identifiable, the arrangement has commercial substance, and collection of consideration is probable. Substantially all of the Company’s revenue comes from the sales of photomasks. The Company typically contracts with its customers to sell sets of photomasks, which are comprised of multiple layers, the predominance of which the Company invoices as they ship to customers. As the photomasks are manufactured to customer specifications, they have no alternative use to the Company and, as the Company’s contracts generally provide it with the right to payment for work completed to date, the Company recognizes revenue as it performs, or “over time,” on most of its contracts. The Company measures its performance to date using an input method, which is based on the Company’s estimated costs to complete the various manufacturing phases of a photomask. At the end of a reporting period, there are a number of uncompleted revenue contracts on which the Company has performed; for any such contracts under which the Company is entitled to be compensated for its costs incurred plus a reasonable profit, the Company recognizes revenue and a corresponding contract asset for such performance. The Company accounts for shipping and handling activities that it performs after a customer obtains control of a good as being activities to fulfill the Company’s promise to transfer the good to the customer, rather than as promised services, or performance obligations, under the contract. The Company reports its revenue net of any sales or similar taxes the Company collects on behalf of governmental entities.

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NOTE 7 - DEBT

The balance of long-term debt and its current portion was comprised of the following finance leases as described below:

	August 3,		October 31,
	2025		2024
Principal due:
Next 12 months	$	11	$	17,972
Months 13 – 24	$	12	$	12
Months 25 – 36		4		12
Months 37 – 48		-		1
Months 49 – 60		-		-
Long-term debt		16		25
Total debt	$	27	$	17,997
Interest rate at balance sheet date		N/A		N/A
Basis spread on interest rates		N/A		N/A
Interest rate reset		N/A		N/A
Maturity date		N/A		N/A
Periodic payment amount		Varies as Lease matures		Varies as Lease matures
Periodic payment frequency		Monthly		Monthly
Loan collateral (carrying amount) (1)	$	5	$	32,293

(1) Represents the carrying amount at the balance sheet date of the related ROU assets, in which the lessors have secured interests.

Finance Leases

In February 2021, the Company entered into a five-year $7.2 million finance lease for a high-end inspection tool. Monthly payments on the lease, which commenced in February 2021, were $0.1 million per month. The lease agreement provided an early buyout option to purchase the tool for $2.4 million upon the fiftieth monthly payment and prior to the fifty-first monthly payment, which the Company exercised during the second quarter of fiscal year 2025.

In December 2020, the Company entered into a five-year $35.5 million finance lease for a high-end lithography tool. Monthly payments on the lease, which commenced in January 2021, increased from $0.04 million during the first three months to $0.6 million for the following nine months, followed by forty-eight monthly payments of $0.5 million. The lease agreement provided an early buyout option to purchase the tool for $14.1 million, which the Company exercised during the first quarter of fiscal year 2025.

Xiamen Working Capital Loans

In November 2018, PDMCX obtained approval for revolving, unsecured credit of CNY 200 million ($25 million), pursuant to which PDMCX may enter into separate loan agreements with varying terms to maturity. In December 2022, the Company repaid the Company’s entire outstanding balance of CNY 25.6 million ($3.6 million). The interest rates are variable, based on the CNY Loan Prime Rate of the National Interbank Funding Center. Interest incurred on the loans related to the amount borrowed was eligible for reimbursement through incentives provided by the Xiamen Torch Hi-Tech Industrial Development Zone, which provided such reimbursements up to a prescribed limit and duration. This facility is subject to annual reviews and extensions. In July 2025, the Company was issued an extension to the revolving, unsecured credit agreement for CNY 200 million or USD 25 million with an expiration date of July 31, 2026. As of August 3, 2025, PDMCX had no outstanding borrowings against the approval.

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NOTE 8 – REVENUE

The Company recognizes revenue when, or as, control of a good or service transfers to a customer, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring those goods or services. The Company accounts for an arrangement as a revenue contract when each party has approved and is committed to perform under the contract, the rights of the contracting parties regarding the goods or services to be transferred and the payment terms are identifiable, the arrangement has commercial substance, and collection of consideration is probable. Substantially all of the Company’s revenue comes from the sales of photomasks. The Company typically contracts with the Company’s customers to sell sets of photomasks, which are comprised of multiple layers, the predominance of which the Company invoices as they ship to customers. As the photomasks are manufactured to customer specifications, they have no alternative use to the Company and, as the Company’s contracts generally provide the Company with the right to payment for work completed to date, the Company recognizes revenue as the Company performs, or “over time,” on most of the Company’s contracts. The Company measures the Company’s performance to date using an input method, which is based on the Company’s estimated costs to complete the various manufacturing phases of a photomask. At the end of a reporting period, there are a number of uncompleted revenue contracts on which the Company has performed; for any such contracts under which the Company is entitled to be compensated for the Company’s costs incurred plus a reasonable profit, the Company recognizes revenue and a corresponding contract asset for such performance. The Company accounts for shipping and handling activities that the Company performs after a customer obtains control of a good as being activities to fulfill the Company’s promise to transfer the good to the customer, rather than as promised services, or performance obligations, under the contract. The Company reports the Company’s revenue net of any sales or similar taxes the Company collects on behalf of governmental entities.

As stated above, photomasks are manufactured to customer specifications in accordance with their proprietary designs; thus, they are individually unique. Due to their uniqueness and other factors, their transaction prices are individually established through negotiations with customers; consequently, the Company’s photomasks do not have standard or “list” prices. The transaction prices of the vast majority of the Company’s revenue contracts include only fixed amounts of consideration. In certain instances, such as when the Company offers a customer an early payment discount, an estimate of variable consideration would be included in the transaction price, but only to the extent that a significant reversal of revenue would not occur when the uncertainty related to the variability was resolved.

Contract Assets, Contract Liabilities, and Accounts Receivable

The Company recognizes a contract asset when its performance under a contract precedes the Company’s receipt of consideration from a customer, or before payment is due, and the right to receive consideration is conditional upon factors other than the passage of time. Contract assets reflect the Company’s transfer of control to customers of photomasks that are in process or completed but not yet shipped to customers. A receivable is recognized when the Company has an unconditional right to payment, which generally occurs upon the shipment of the photomasks. The Company’s contract assets primarily consist of in-process production orders and fully manufactured photomasks which have not yet shipped, for which the Company has an enforceable right to consideration (including a reasonable profit) in the event the in-process orders are cancelled by customers. On an individual contract basis, the Company nets contract assets with contract liabilities ~~(deferred revenue)~~ for financial reporting purposes. The Company did not identify impairment indicators for any outstanding contract assets during the three~~-month~~ ~~or nine-~~month periods ended ~~August~~February 31, ~~2025~~2026, or ~~July~~February 282, ~~2024~~2025.

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The following table provides information about the Company’s contract balances at the balance sheet dates.

	August 3,		October 31,
	February 1,		October 31,
Classification	~~2025~~2026		~~2024~~2025
Contract Assets
Other current assets	$	1511,~~233~~644	$	1112,~~532~~670
Contract Liabilities
Accrued liabilities	$	1122,~~349~~380	$	129,~~375~~491
Other liabilities		54,~~760~~509		85,~~910~~041
	$	1726,~~109~~889	$	2114,~~285~~532

The Company did not recognize any revenue from performance obligations satisfied in the previous periods. The following table presents revenue recognized from contract liabilities that existed at the beginning of the reporting periods.

	Three Months Ended				~~Nine Months Ended~~
	August 3,		July 28,		August 3,		July 28,
	February 1,		February 2,
	2025		2024		2025		2024
	2026		2025
Revenue recognized from beginning liability	$	1,~~873~~157	$	74,~~057~~369	$	~~7,273~~	$	~~11,072~~

The Company generally records accounts receivable at their billed amounts. All outstanding past due customer invoices are reviewed for collectability during, and at the end of, every reporting period. To the extent the Company believes a loss on the collection of a customer invoice is probable, the Company would record the loss and credit an allowance for credit losses. In the event that an amount is determined to be uncollectible, the Company charges the allowance for credit losses and derecognizes the related receivable. The Company did not incur any credit losses on the Company’s accounts receivable during the three~~-month~~ ~~or nine-~~month periods ended ~~August~~February 31, ~~2025~~2026, or ~~July~~February 282, ~~2024~~2025.

The Company’s invoice terms generally range from net thirty to ninety days, depending on both the geographic market in which the transaction occurs and the Company’s payment agreements with specific customers. In the event that the Company’s evaluation of a customer’s business prospects, and financial condition indicate that the customer presents a collectability risk, the Company will modify terms of sale, which may require payment in advance of performance. At the time of adoption, the Company elected the practical expedient allowed under ASC Topic 606 “Revenue from Contracts with Customers” (“Topic 606”) that permits the Company not to adjust a contract’s promised amount of consideration to reflect a financing component when the period between when the Company transfers control of goods or services to customers and when the Company is paid is one year or less.16

In instances when the Company is paid in advance of the Company’s performance, the Company records a contract liability and, as allowed under the practical expedient in Topic 606, recognizes interest expense only if the period between when the Company receives payment from the customer and the date when the Company expects to be entitled to the payment is greater than one year. Historically, advance payments the Company has received from customers have generally not preceded the completion of the Company’s performance obligations by more than one year.

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The Company’s invoice terms generally range from net thirty to ninety days, depending on both the geographic market in which the transaction occurs and the Company’s payment agreements with specific customers. In the event that the Company’s evaluation of a customer’s business prospects, and financial conditions indicate that the customer presents a collectability risk, the Company will modify terms of sale, which may require payment in advance of performance. At the time of adoption, the Company elected the practical expedient allowed under ASC Topic 606 “Revenue from Contracts with Customers” (“Topic 606”) that permits the Company not to adjust a contract’s promised amount of consideration to reflect a financing component when the period between when the Company transfers control of goods or services to customers and when the Company is paid is one year or less.

Disaggregation of Revenue

The following tables present the Company’s revenue for the three~~-month~~ ~~and nine-~~month periods ended ~~August~~February 31, ~~2025~~2026, and ~~July~~February 282, ~~2024~~2025, disaggregated by product type, geographic origin, and timing of recognition.

Three Months Ended

~~Nine Months Ended~~

August 3,

July 28,

August 3,

July 28,

February 1,

February 2,

Revenue by Product Type

~~2025~~2026

~~2024~~2025

~~2025~~

~~2024~~

High-end

5371,~~648~~282

4960,~~499~~105

~~173,053~~

~~168,417~~

Mainstream

94,~~176~~009

~~106~~93,~~385~~851

~~284,605~~

~~305,984~~

Total IC

~~147~~165,~~824~~291

~~155~~153,~~884~~956

~~457,658~~

~~474,401~~

FPD

High-end

5346,~~486~~949

4849,~~394~~679

~~146,778~~

~~146,987~~

Mainstream

912,~~084~~826

68,~~706~~503

~~29,088~~

~~22,930~~

Total FPD

6259,~~570~~775

5558,~~100~~182

~~175,866~~

~~169,917~~

~~210~~225,~~394~~066

~~210~~212,~~984~~138

~~633,524~~

~~644,318~~

Three Months Ended

~~Nine Months Ended~~

August 3,

July 28,

August 3,

July 28,

February 1,

February 2,

Revenue by Geographic Origin*

~~2025~~2026

~~2024~~2025

~~2025~~

~~2024~~

Taiwan

6874,~~429~~319

6873,~~182~~035

~~216,524~~

~~218,557~~

China

5062,~~618~~719

5553,~~301~~558

~~162,919~~

~~172,131~~

South Korea

4341,~~716~~080

3840,~~412~~237

~~121,547~~

~~118,033~~

United States

37,~~754~~402

3836,~~833~~898

~~105,379~~

~~104,880~~

Europe

98,~~050~~781

97,~~759~~940

~~25,143~~

~~29,390~~

Other

~~827~~765

~~497~~470

~~2,012~~

~~1,327~~

~~210~~225,~~394~~066

~~210~~212,~~984~~138

~~633,524~~

~~644,318~~

* This table disaggregates revenue by the location in which it was earned.

	Three Months Ended				Nine Months Ended
	August 3,		July 28,		August 3,		July 28,
Revenue by Timing of Recognition	2025		2024		2025		2024
Over time	$	201,986	$	202,177	$	607,249	$	616,893
At a point in time		8,408		8,807		26,275		27,425
		210,394		210,984		633,524		644,318

Contract Costs

The Company pays commissions to third-party sales agents for certain sales they procure on the Company’s behalf. However, the basis of the commissions are the transaction prices of the sales, which are completed in less than one year; thus, no relationship is established with a customer that will result in future business. Therefore, the Company does not recognize any portion of these sales commissions as costs of obtaining a contract, nor does the Company currently foresee other circumstances under which the Company would recognize contract obtainment costs as assets.

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	Three Months Ended
	February 1,		February 2,
Revenue by Timing of Recognition	2026		2025
Over time	$	218,197	$	205,076
At a point in time		6,869		7,062
	$	225,066	$	212,138

Contract Costs

The Company pays commissions to third-party sales agents for certain sales they procure on the Company’s behalf. However, the bases of the commissions are the transaction prices of the sales, which are completed in less than one year; thus, no relationship is established with a customer that will result in future business. Therefore, the Company would not recognize any portion of these sales commissions as costs of obtaining a contract, nor does the Company currently foresee other circumstances under which the Company would recognize such assets.

Remaining Performance Obligations

As the Company is typically required to fulfill customer orders within a short time period, the Company’s backlog of orders is generally not in excess of one to two weeks for IC photomasks and two to three weeks for FPD photomasks. However, the demand for some IC photomasks can extend beyond the traditional time period; thus, the backlog, in some individual cases, can extend to as long as two to three months. More recently however, backlogs for most high demand products have returned to historical levels of less than a month. As allowed under ASC 606 – Revenue Contracts with Customers, the Company has elected not to disclose the Company’s remaining performance obligations, which represent the costs associated with the completion of the manufacturing process of in-process photomasks related to contracts that have an original duration of one year or less.

Product Warranties

The Company’s photomasks are sold under warranties that generally range from one to twenty-four months. The Company warrants that the Company’s photomasks conform to customer specifications, and the Company will typically repair, replace, or issue a refund for any photomasks that fail to do so. The warranties do not represent separate performance obligations in the Company’s revenue contracts. Historically, customer claims under warranties have been immaterial.

NOTE 98 - SHARE-BASED COMPENSATION

On April 2, 2025, at its annual meeting of shareholders, the shareholders of Photronics, Inc., approved the Company’s 2025 Equity Incentive Compensation Plan (the “2025 Plan”) under which incentive stock options, non-qualified stock options, stock grants, stock-based awards, restricted stock, restricted stock units, stock appreciation rights, performance units, performance stock, and other stock or cash awards may be granted. The maximum number of shares of common stock that may be issued under the 2025 Plan is five million shares. At the time of approval of the 2025 Plan, the Company’s 2016 Equity Incentive Compensation Plan (which was largely replicated by the 2025 Plan) was due to expire in early 2026 and had a limited quantity of shares remaining available for issuance. Awards may be granted to officers, employees, directors, consultants, advisors, and independent contractors of Photronics or its subsidiaries. In the event of a change in control (as defined in the 2025 Plan), the vesting of awards may be accelerated. The 2025 Plan prohibits further awards from being issued under prior plans. The table below presents information on the Company’s share-based compensation expenses.

	Three Months Ended				Nine Months Ended
	August 3,		July 28,		August 3,		July 28,
	2025		2024		2025		2024
Expense reported in:
Cost of goods sold	$	816	$	683	$	2,378	$	1,946
Selling, general, and administrative		2,174		2,388		6,729		7,126
Research and development		304		271		896		769
Total expense incurred	$	3,294	$	3,342	$	10,003	$	9,841
Expense by award type:
Restricted stock awards	$	2,943	$	3,342	$	9,029	$	9,841
Restricted stock units		294		-		803		-
Employee stock purchase plan		57		-		171		-
Total expense incurred	$	3,294	$	3,342	$	10,003	$	9,841
Income tax benefits on share-based compensation	$	461	$	323	$	1,313	$	745

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	Three Months Ended
	February 1,			February 2,
	2026			2025
Expense reported in:
Cost of goods sold	$	931		$	776
Selling, general, and administrative		2,483			2,268
Research and development		(563	)		290
Total expense incurred	$	2,851		$	3,334

Expense by award type:
Restricted stock awards	$	2,043		$	3,277
Restricted stock units		770			-
Employee stock purchase plan		38			57
Total expense incurred	$	2,851		$	3,334

Income tax benefits of share-based compensation	$	582		$	446

The research and development credit for the quarter ended February 1, 2026, was primarily attributable to the forfeiture of previously granted time-vesting restricted stock awards, following the departure of an executive.

Restricted Stock Awards

The Company ~~has~~periodically ~~historically~~grants ~~granted~~ restricted stock awards ~~on a periodic basis~~, the restrictions on which typically lapse over a service period of one to four years. The fair ~~value~~values of the awards isare determined on the date of grant, based on the closing stock price of the Company’s common stock. The table below presents information on the Company’s restricted stock awards.

	Three Months Ended				~~Nine Months Ended~~
	August 3,		July 28,		August 3,		July 28,
	February 1,		February 2,
	2025		2024		2025		2024
	2026		2025
Number of shares granted in period		-		-345,500		~~583,238~~		~~825,050~~
Weighted-average grant-date fair value of awards (in dollars per share)	$	-	$	-23.82	$	~~23.42~~	$	~~29.77~~
Compensation cost not yet recognized	$	24,414	$	25,750	$	24,414	$	25,750
Compensation costs not yet recognized	$	18,078	$	25,786
Weighted-average amortization period for cost not yet recognized (in years)		2.8		2.9		2.8		2.9
Weighted-average amortization period (in years)		2.4		3.0
Shares outstanding at balance sheet date		1855,~~421,897~~124		1,~~513~~256,~~827~~697		~~1,421,897~~		~~1,513,827~~

Restricted Stock Units

Commencing Q2 FY25, the Company began granting restricted stock units, the restrictions on which typically lapse over a service period of one to four years. The fair value of the awards is determined on the date of grant, based on the closing price of the Company’s common stock. The table below presents information on the Company’s restricted stock unit awards.

	Three Months Ended				Nine Months Ended
	August 3,		July 28,		August 3,		July 28,
	2025		2024		2025		2024
Number of units granted in period		109,830		-		162,666		-
Weighted-average grant-date fair value of awards (in dollars per share)	$	18.21	$	-	$	19.61	$	-
Compensation cost not yet recognized	$	2,387	$	-	$	2,387	$	-
Weighted-average amortization period for cost not yet recognized (in years)		3.3		-		3.3		-
Restricted stock units outstanding at balance sheet date		132,474		-		132,474		-

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	Three Months Ended
	February 1,		February 2,
	2026		2025
Number of units granted in period		509,072		-
Weighted-average grant-date fair value of awards (in dollars per share)	$	33.21	$	-
Compensation costs not yet recognized	$	16,486	$	-
Weighted-average amortization period (in years)		3.9		-
Restricted stock units outstanding at balance sheet date		634,402		-

Stock Options

~~Option~~Stock option awards generally vest in one to four years and have a ten-year contractual term. All incentive and non-qualified stock option grants must have an exercise price no less than the market value of the underlying common stock on the date of grant. The grant-date fair values of options are based on closing prices of the Company’s common stock on the dates of grant and are calculated using the Black-Scholes option pricing model. Expected volatility is based on the historical volatility of the Company’s common stock. The Company uses historical option exercise behavior and employee termination data to estimate expected term, which represents the period of time that options granted are expected to remain outstanding. The risk-free rate of return for the estimated term of an option is based on the U.S. Treasury yield curve in effect at the date of grant. The table below presents information on the Company’s stock options.

	Three Months Ended				~~Nine Months Ended~~
	August 3,		July 28,		August 3,		July 28,
	February 1,		February 2,
	2025		2024		2025		2024
	2026		2025
Number of options granted in period		-		-		-		-
Cash received from options exercised	$	~~400~~634	$	201,272	$	~~1,698~~	$	~~1,074~~
Compensation cost not yet recognized	$	-	$	-	$	-	$	-
Weighted-average amortization period for cost not yet recognized (in years)		-		-		-		-
Weighted-average amortization period (in years)		-		-

Information regarding outstanding and exercisable option awards as of February 1, 2026, is presented below.

Options		Shares				Weighted Average Exercise Price				Weighted Average Remaining Contractual Life (in years)				Aggregate Intrinsic Value
Outstanding and exercisable at February 1, 2026			56,750			$	9.54				1.80			$	1,420

NOTE 9 - INCOME TAXES

The Company calculates its provision for income taxes at the end of each interim reporting period on the basis of an estimated annual effective tax rate adjusted for tax items that are discrete to each period. The table below sets forth the primary reasons that the Company’s effective income tax rates differed from the U.S. statutory tax rates in effect during the periods ended February 1, 2026, and February 2, 2025.

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Reporting Period	U.S. Statutory Tax Rates	Photronics Effective Tax Rates	Primary Reasons for Differences

Three months ended February 1, 2026	21.0%	19.3%	Non-U.S. pre-tax income being taxed at higher statutory rates in the non-U.S. jurisdictions, and changes in uncertain tax positions in non-U.S. jurisdictions more than offset by the impact of tax credit in a non-U.S. jurisdiction.

Three months ended February 2, 2025	21.0%	24.5%	Non-recognition of the tax benefit of losses that, in certain jurisdictions, have been offset by valuation allowances, non-U.S. pre-tax income being taxed at higher statutory rates in the non-U.S. jurisdictions and the establishment of uncertain tax positions in non-U.S. jurisdictions.

Uncertain Tax Positions

Although the timing of reversal of uncertain tax positions may be indeterminate at this time, the Company believes the resolution of these uncertainties in a manner inconsistent with our expectations could have a material impact on our results of operations and financial condition. Resolution of these uncertain tax positions may result from either or both the lapses of statutes of limitations and tax settlements. The Company is no longer subject to tax authority examinations in the U.S., major foreign, or state tax jurisdictions for years prior to fiscal year 2019. The table below presents information on unrecognized tax benefits as of the balance sheet dates.

	February 1, 2026		October 31, 2025
Unrecognized tax benefits related to uncertain tax positions	$	12,638	$	11,379
Unrecognized tax benefits that, if recognized, would impact the effective tax rate	$	12,638	$	11,379
Accrued interest and penalties related to uncertain tax positions	$	649	$	551

Subsequent to the balance sheet date of February 1, 2026, one of the subsidiaries in a foreign jurisdiction received official notice of a FY24 income tax audit, which was settled. The impact is immaterial and will be recorded in Q2 FY26. In addition, another subsidiary in a foreign jurisdiction reached a settlement with the local tax authority for the FY23 and FY24 income tax audits. The impact of the settlement is also immaterial and will be recorded in Q2 FY26.

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~~Information~~NOTE ~~regarding~~10 ~~outstanding~~- ~~and~~EARNINGS ~~exercisable~~PER ~~option awards as of August 3, 2025, is presented below.~~SHARE

Weighted

Average

Remaining

Aggregate

Exercise

Contractual

Intrinsic

Options

Price

Life (in years)

Value

Outstanding and exercisable at August 3, 2025

115,075

10.31

1.88

1,091

The calculation of basic and diluted earnings per share is presented below.

NOTE 10 - INCOME TAXES

	Three Months Ended
	February 1,		February 2,
	2026		2025
Net income attributable to Photronics, Inc. shareholders	$	42,939	$	42,851

Weighted-average common shares outstanding (in thousands):
Basic		57,794		62,093
Effect of dilutive securities:
Share-based payment awards		596		568
Potentially dilutive common shares		596		568

Weighted-average common shares - Diluted		58,390		62,661

Earnings per share:
Net Income attributable to Photronics shareholders -Basic	$	0.74	$	0.69
Net Income attributable to Photronics shareholders - Diluted	$	0.74	$	0.68

The ~~Company~~table ~~calculates~~below ~~its~~sets ~~provision~~forth ~~for~~the ~~income~~outstanding ~~taxes~~weighted-average atshare-based ~~the~~payment ~~end~~awards ofthat ~~each~~were ~~interim~~excluded ~~reporting~~from ~~period on~~ the ~~basis~~calculation of andiluted ~~estimated~~earnings ~~annual~~per ~~effective~~share ~~tax~~because ~~rate~~their ~~adjusted~~exercise ~~for~~price ~~tax~~exceeded ~~items~~the ~~that~~average ~~are~~market ~~discrete~~value toof ~~each period. The table below sets forth~~ the ~~primary~~common ~~reasons~~shares ~~that~~for the ~~Company’s~~period ~~effective~~or, ~~income~~under ~~tax~~application ~~rates~~of ~~differed from~~ the ~~U.S.~~treasury ~~statutory~~stock ~~tax~~method, ~~rates~~they inwere ~~effect~~otherwise ~~during~~determined ~~the~~to ~~periods~~be ~~ended August 3, 2025, and July 28, 2024~~antidilutive.

Reporting Period	U.S. Statutory Tax Rates		Photronics Effective Tax Rates	Primary Reasons for Differences
	Three Months Ended
Three months ended August 3, 2025	21.0%		24.8%	Non-recognition of the tax benefit of losses that, in certain jurisdictions, have been offset by valuation allowances, non-U.S. pre-tax income being taxed at higher statutory rates in the non-U.S. jurisdictions, and changes in uncertain tax positions in non-U.S. jurisdictions.
	February 1,			February 2,
Three months ended July 28, 2024	21.0%		22.7%	Non-recognition of the tax benefit of losses that, in certain jurisdictions, have been offset by valuation allowances, non-U.S. pre-tax income being taxed at higher statutory rates in the non-U.S. jurisdictions and the establishment of uncertain tax positions in non-U.S. jurisdictions.
	2026			2025
Nine Months Ended August 3, 2025	21.0%		23.5%	Non-recognition of the tax benefit of losses that, in certain jurisdictions, have been offset by valuation allowances, non-U.S. pre-tax income being taxed at higher statutory rates in the non-U.S. jurisdictions, and changes in uncertain tax positions in non-U.S. jurisdictions.
Share-based payment awards, in shares		158			488
Nine Months Ended July 28, 2024	21.0%		25.4%	Non-recognition of the tax benefit of losses that, in certain jurisdictions, have been offset by valuation allowances, non-U.S. pre-tax income being taxed at higher statutory rates in the non-U.S. jurisdictions, and the establishment of uncertain tax positions in non-U.S. jurisdictions.
Total potentially dilutive shares excluded		158			488

NOTE 11 - COMMITMENTS AND CONTINGENCIES

The Company is subject to various claims that arise in the ordinary course of business. The Company believes that the potential liability under such claims, individually and in the aggregate, will not have a material effect on the Company’s condensed consolidated financial statements.

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~~United~~NOTE ~~States~~12 ~~Tax~~- ~~Law~~CHANGES ~~Change~~ IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT

OnThe ~~July~~following 4,tables ~~2025,~~set forth the changes ~~One Big Beautiful Bill Act (“OBBBA”) was enacted~~ in the ~~United~~Company’s ~~States.~~accumulated ~~The~~other ~~OBBBA~~comprehensive ~~includes~~income a(loss) ~~number~~by component (net of tax) for ~~provisions~~the ~~and~~three ~~multiple~~month ~~effective~~periods ~~dates~~ended ~~commencing~~February in1, ~~fiscal year~~ 2026., ~~The~~and ~~Company~~February is2, ~~currently evaluating the effect of the OBBBA enactment on its consolidated financial statements~~2025.

Uncertain Tax Positions

	Three Months Ended February 1, 2026
	Foreign Currency
	Translation
	Adjustments			Other			Total

Balance at October 31, 2025	$	(85,513	)	$	(607	)	$	(86,120	)
Other comprehensive income (loss)		(8,667	)		42			(8,625	)
Other comprehensive income (loss)
attributable to noncontrolling interests		2,451			(26	)		2,425

Balance at February 1, 2026	$	(91,729	)	$	(591	)	$	(92,320	)

	Three Months Ended February 2, 2025
	Foreign Currency
	Translation
	Adjustments			Other			Total

Balance at October 31, 2024	$	(85,587	)	$	(732	)	$	(86,319	)
Other comprehensive income (loss)		(42,917	)		70			(42,847	)
Other comprehensive income (loss)
attributable to noncontrolling interests		8,875			(34	)		8,841

Balance at February 2, 2025	$	(119,629	)	$	(696	)	$	(120,325	)

	August 3, 2025		October 31, 2024
Unrecognized tax benefits related to uncertain tax positions	$	15,028	$	14,720
Unrecognized tax benefits that, if recognized, would impact the effective tax rate	$	15,028	$	14,720
Accrued interest and penalties related to uncertain tax positions	$	1,484	$	1,028

NOTE 13 – SHARE REPURCHASE PROGRAM

~~Subsequent~~In September 2020, the Company’s Board of Directors authorized the repurchase of up to $100 million of its common stock, pursuant to a repurchase plan under Rule 10b-18 of the ~~balance~~Exchange ~~sheet~~Act. The repurchase authorization by the Board of Directors has no expiration date, does not obligate the Company ~~was~~to ~~notified~~acquire ~~that~~any itcommon ~~will~~stock, beand is subject to amarket ~~routine~~conditions. From ~~income~~September ~~tax~~2020 ~~audit~~through byOctober ~~authorities~~2022, inthe Company repurchased 5.8 million shares at a ~~foreign~~cost ~~jurisdiction~~of $68.3 ~~The~~million. ~~audit~~In ~~process~~August is2024, inthe ~~its~~Board ~~initial~~of ~~stages~~Directors authorized an increase to the Company’s existing share repurchase program from the remaining $31.7 million up to $100 million. In June 2025, ~~and~~the atBoard ~~this~~of ~~time~~Directors authorized an additional $25 million share repurchase. In fiscal year 2025, the Company isrepurchased ~~unable~~ 5.0 million shares at a cost of $97.4 million (an average of $19.52 per share). All shares repurchased under the program have been retired prior to ~~reasonably~~the ~~estimate~~end of the fiscal quarter in which they were purchased. During the three month period ended February 1, 2026, the Company did not repurchase any ~~potential~~additional ~~impact~~shares. ~~from~~As of February 1, 2026, $27.6 million remained available under this authorization for the ~~tax~~repurchase ~~audit~~of shares.

NOTE 1114 - ~~EARNINGS~~SEGMENT ~~PER SHARE~~REPORTING

The ~~following~~Company ~~sets~~operates ~~forth~~and manages its business as one operating and reportable segment based on the ~~computation~~organizational structure of ~~basic~~the Company and ~~diluted~~information ~~earnings~~reviewed ~~per~~by ~~share:~~the Company’s Chief Executive Officer, who is also the chief operating decision maker (“CODM”). The CODM allocates capital resources across the Company’s entire asset base to maximize profitability without regard to geography, legal entity, or end market basis and evaluates the performance based on consolidated net income attributable to Photronics, Inc. shareholders.

	Three Months Ended				Nine Months Ended
	August 3,		July 28,		August 3,		July 28,
	2025		2024		2025		2024
Net income attributable to Photronics, Inc. shareholders	$	22,891	$	34,388	$	74,604	$	96,819
Weighted-average common shares outstanding (in thousands):
Basic		57,937		61,815		60,274		61,681
Effect of dilutive securities:
Share-based awards		131		599		293		688
Dilutive common shares		131		599		293		688
Weighted-average common shares - Diluted		58,068		62,414		60,567		62,369
Earnings per share attributable to Photronics, Inc. shareholders:
Basic	$	0.40	$	0.56	$	1.24	$	1.57
Diluted	$	0.39	$	0.55	$	1.23	$	1.55

The table below illustrates the outstanding weighted-average share-based awards that were excluded from the calculation of diluted earnings per share because their exercise price exceeded the average market value of the common shares for the period or, under application of the treasury stock method, they were otherwise determined to be antidilutive.

	Three Months Ended				Nine Months Ended
	August 3,		July 28,		August 3,		July 28,
	2025		2024		2025		2024
Share-based payment awards, in shares		1,094		551		894		264
Total potentially dilutive shares excluded		1,094		551		894		264

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~~NOTE~~The 12following -table ~~COMMITMENTS~~presents ~~AND~~selected ~~CONTINGENCIES~~financial information with respect to the Company’s single operating segment for the periods ended February 1, 2026 and February 2, 2025:

As of August 3, 2025, the Company’s unrecognized commitments for the acquisition of property, plant and equipment were $147.2 million, including commitments with a remaining term in excess of one year of approximately $32.5 million. This amount does not include the Company’s commitments under the Company’s debt and lease arrangements.

	Three Months Ended
	February 1, 2026			February 2, 2025
Revenue	$	225,066		$	212,138
Cost of goods sold		(146,364	)		(136,603	)
Gross Profit		78,702			75,535

Selling, general and administrative expense		(21,311	)		(19,101	)
Research and development expense		(2,588	)		(4,257	)
Other operating income		56			-
Operating Income		54,859			52,177

Other income (expense), net		19,673			24,981
Income tax provision		(14,355	)		(18,901	)
Net income attributable to noncontrolling interests		(17,238	)		(15,406	)
Net income attributable to Photronics, Inc. shareholders	$	42,939		$	42,851

The Company is subject to various other claims that arise in the ordinary course of business. The Company believes that the Company’s potential liability under such claims, individually or in the aggregate, will not have a material effect on the Company’s consolidated financial statements.

NOTE 13 - CHANGES IN ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME BY COMPONENT

The following tables set forth the changes in the Company’s accumulated other comprehensive (loss) income by component (net of tax) for the three-month and nine-month periods ended August 3, 2025, and July 28, 2024.

	Three Months Ended August 3, 2025
	Foreign Currency
	Translation
	Adjustments			Other			Total
Balance at May 4, 2025	$	(86,568	)	$	(727	)	$	(87,295	)
Other comprehensive (loss) income		29,171			(28	)		29,143
Other comprehensive (loss) income attributable to noncontrolling interests		(10,365	)		13			(10,352	)
Balance at August 3, 2025	$	(67,762	)	$	(742	)	$	(68,504	)

	Three Months Ended July 28, 2024
	Foreign Currency
	Translation
	Adjustments			Other			Total
Balance at April 28, 2024	$	(95,271	)	$	(661	)	$	(95,932	)
Other comprehensive (loss) income		(6,114	)		48			(6,066	)
Other comprehensive (loss) income attributable to noncontrolling interests		1,534			(16	)		1,518
Balance at July 28, 2024	$	(99,851	)	$	(629	)	$	(100,480	)

	Nine Months Ended August 3, 2025
	Foreign Currency
	Translation
	Adjustments			Other			Total
Balance at October 31, 2024	$	(85,587	)	$	(732	)	$	(86,319	)
Other comprehensive (loss) income		33,380			(20	)		33,360
Other comprehensive (loss) income attributable to noncontrolling interests		(15,555	)		10			(15,545	)
Balance at August 3, 2025	$	(67,762	)	$	(742	)	$	(68,504	)

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	Nine Months Ended July 28, 2024
	Foreign Currency
	Translation
	Adjustments			Other			Total
Balance at October 31, 2023	$	(88,044	)	$	(690	)	$	(88,734	)
Other comprehensive (loss) income		(13,819	)		103			(13,716	)
Other comprehensive (loss) income attributable to noncontrolling interests		2,012			(42	)		1,970
Balance at July 28, 2024	$	(99,851	)	$	(629	)	$	(100,480	)

NOTE 14 – SHARE REPURCHASE PROGRAM

In September 2020, the Company’s Board of Directors authorized the repurchase of up to $100 million of its common stock, pursuant to a repurchase plan under Rule 10b-18 of the Exchange Act. The repurchase authorization by the Board of Directors has no expiration date, does not obligate the Company to acquire any common stock, and is subject to market conditions. From September 2020 through October 2022, the Company repurchased 5.8 million shares at a cost of $68.3 million. No shares were repurchased during the three- or nine-month periods ended July 28, 2024. In August 2024, the Board of Directors authorized an increase to the Company’s existing share repurchase program from the remaining $31.7 million up to $100 million. During the three-month period ended August 3, 2025, the Company repurchased 1.2 million shares at a cost of $20.7 million pursuant to Rule 10b-18 of the Exchange Act. During the nine-month period ended August 3, 2025, the Company repurchased 5 million shares at a cost of $97.4 million pursuant to Rule 10b-18 of the Exchange Act. In June 2025, the Board of Directors authorized an additional $25 million share repurchase. As a result, as of August 3, 2025, $27.6 million remained available under this authorization. All shares repurchased under the program have been retired.

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Item 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

Management’s discussion and analysis (“MD&A”) of the Company’s financial condition and results of operations should be read in conjunction with its condensed consolidated financial statements and related notes. Various sections of this MD&A contain forward-looking statements, all of which are presented based on current expectations, which may be adversely affected by uncertainties and risk factors (presented throughout this filing and in the Company’s Form 10-K for fiscal year ~~2024~~2025), that may cause actual results to materially differ from these expectations. See “Cautionary Statement Regarding Forward-Looking Statements”.

We sell substantially all of our photomasks to ~~semiconductor~~ designers and manufacturers, of IC and ~~manufacturers~~FPD ofelectronic ~~FPDs~~devices. Photomask technology is also being applied to the fabrication of other ~~higher~~high-~~performance~~technology ~~electronic~~ products including advanced packaging modules, micro-optical components for applications such as virtual reality/augmented reality and silicon photonics, ~~microelectronic~~micro-electronic mechanical systems (MEMS), and ~~certain~~diverse nanotechnology applications. Our selling cycle is tightly interwoven with the development and release of new semiconductor and display designs and applications, particularly as they relate to the semiconductor industry’s migration to more advanced ~~product innovation,~~ design ~~methodologies,~~nodes and fabrication processes. The demand for photomasks is primarily ~~depends~~correlated onwith new product design activity ~~rather~~and ~~than~~to ~~sales~~a ~~volumes from~~lesser ~~products~~extent ~~manufactured~~scaling ~~using~~up ~~photomask~~of ~~technologies~~manufacturing of end products. Consequently, an increase in semiconductor or display sales does not ~~necessarily~~always result in a corresponding increase in photomask sales. ~~However,~~To the ~~reduced~~extent ~~use~~integrated ofcircuit ~~customized~~and ~~ICs,~~flat ~~reductions in~~panel ~~design~~display ~~complexity,~~applications ~~other~~rely ~~changes~~less inon ~~the~~new ~~technology~~design oractivity, ~~methods~~it ofcould ~~manufacturing~~result orin ~~designing semiconductors, or~~ a ~~slowdown~~reduction in ~~the~~demand ~~introduction~~for ofphotomasks. In addition, new ~~semiconductor~~design ormethodologies ~~display~~driving ~~designs~~a reduction in complexity of photomasks could also reduce demand for photomasks ‒ even if the demand for semiconductors and ~~displays~~FPDs increases. ~~Advances~~More broadly, advances in semiconductor, display, and photomask design and production methods that shift the burden of achieving device performance away from lithography could also reduce the demand for photomasks. ~~Historically~~ While there is no indication today that such diminishing of long-range photomask demand is occurring or will occur, the microelectronics industry has been volatile, experiencing periodic downturns and slowdowns in design activity. These negative trends have been characterized by, among other things, diminished product demand, excess production capacity, and accelerated erosion of selling prices, with a concomitant effect on revenue and profitability.

We are typically required to fulfill customer orders within a short period of time, sometimes within twenty-four hours. This results in a minimal level of backlog orders, typically ~~two~~one to ~~three~~two weeks of backlog for ~~FPD~~IC photomasks and ~~one~~two to ~~two~~three weeks of backlog for ICFPD photomasks. However, the demand for some IC photomasks ~~has~~can inextend ~~the~~longer ~~past~~than ~~expanded beyond~~ the ~~industry’s capacity to supply them within the~~ traditional time period; thus, for some products, ~~the~~our backlog can expand to as long as two to three months.

The global semiconductor and FPD industries are driven by end markets which have ~~been~~broad ~~closely~~application ~~tied~~in tothe ~~consumer-driven~~global ~~applications~~economy ~~of high-performance devices,~~ including, but not limited to consumer-driven applications, ~~mobile~~data ~~display~~centers ~~devices, mobile~~that ~~communications~~support AI implementation, electric vehicles and ~~computing~~national ~~solutions~~security. While we cannot predict the timing of the industry’s transition to volume production of next-generation technology nodes, or the timing of up and down-cycles with precise accuracy, we believe ~~that~~ that such transitions and cycles will continue into the future, beneficially and adversely affecting our business, financial condition, and operating results as they occur. We believe our ability to remain successful in these environments is ~~dependent~~ dependent upon the achievement of our goals of being a service and technology leader and efficient solutions supplier, which we believe should enable us to continually reinvest in our global infrastructure.

26We are focused on improving our competitiveness by advancing our technology and reducing costs and, in connection therewith, have invested and plan to continue to invest in manufacturing equipment to serve both the high-end photomask and mainstream markets. As we face challenges that require us to make significant improvements in our competitiveness, we continue to implement programs to streamline, drive efficiency and reduce costs in our infrastructure.

State-of-the-art production for semiconductor masks is considered to be 4 or 5 nanometer and smaller including EUV lithography for ICs and Generation 8.6 AMOLED display-based process technologies for FPDs. However, we define our high-end product category as 28nm and below for semiconductors and Generation 10.5 plus, Generation 6 and 8 AMOLED and LTPS for displays. This is consistent with current merchant mask industry definitions. Moreover, design nodes above 28nm and FPD processes for standard LCD displays below Generation 10 are considered mainstream or standard products.

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At these geometries and various high-end nodes, we can produce full lines of photomasks, and there is no significant technology employed by our competitors that is not available to us. We expect advanced-generation designs to continue to move to production throughout fiscal 2026, and we believe we are well positioned to service an increasing volume of this business as a result of our investments in manufacturing processes and technology in the regions where our customers are located.

The photomask industry has been and is expected to continue to be characterized by technological change and evolving industry standards. In order to remain competitive, we will be required to continually anticipate, respond to, and utilize changing technologies. In particular, we believe that, as semiconductor geometries continue to become smaller and/or more complex, and display designs become larger or otherwise more advanced, we will be required to manufacture even more complex products, including photomasks with advanced optical proximity correction, insertion of curvilinear patterning and EUV photomasks. Additionally, demand for photomasks has been, and could in the future be, adversely affected by changes in high-performance electronics fabrication methods that affect the type or quantity of photomasks used, such as changes in semiconductor demand that favor programmable IC devices and other approaches that replace application-specific ICs, or the use of certain chip-stacking methodologies that lessen the emphasis on conventional lithography technology. Furthermore, increased market acceptance of alternative methods of transferring circuit designs onto semiconductor wafers could reduce or eliminate the need for photomasks in the production of semiconductors.

Our revenues have benefited, and our costs, including depreciation, have been affected by the increased demand for high-end-technology photomasks that require more advanced manufacturing capabilities, but generally command higher ASPs. Our year-to-date capital expenditure payments were $47.6 million and $35.2 million in Q1 FY26 and Q1 FY25, respectively. Nonetheless, we intend to continue to make the required investments to support the technological and production requirements of our customers that we believe will continue to enable our growth. This includes investments to replace end-of-life mask-making equipment with higher-performing systems that better serve our customers. In support of this effort, we expect capital expenditure payments to be approximately $330 million in fiscal year 2026.

The manufacture of photomasks for use in fabricating ICs, FPDs, and other related products built using comparable photomask-based process technologies has been, and continues to be, capital intensive. Our employees and our integrated global manufacturing network represent a significant portion of our fixed operating cost base. Should our revenue decrease as a result of a decrease in design releases from our customers, we may have excess or underutilized production capacity, which could significantly impact our operating margins, or result in write-offs from asset impairments.

Results of Operations

~~The~~All the following ~~tables~~tabular ~~present~~comparisons, ~~selected~~unless ~~operating~~otherwise ~~information~~indicated, ~~expressed~~are asfor athe ~~percentage~~three ofmonths ~~revenue~~ended February 1, 2026 (Q1 FY26), October 31, 2025 (Q4 FY25) and February 2, 2025 (Q1 FY25). The ~~columns~~tables ~~may~~in this section may not foot due to rounding.

	Three Months Ended									Nine Months Ended
	August 3,			May 4,			July 28,			August 3,			July 28,
	2025			2025			2024			2025			2024
Revenue		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%
Cost of goods sold		66.3			63.1			64.4			64.6			63.7
Gross profit		33.7			36.9			35.6			35.4			36.3
Operating expenses:
Selling, general, and administrative		8.8			8.6			9.2			8.8			8.8
Research and development		2.0			1.9			1.7			2.0			1.8
Operating income		22.9			26.4			24.7			24.6			25.7
Other income (expense), net		(4.5	)		(12.2	)		4.8			(1.6	)		4.2
Income before income tax provision		18.4			14.2			29.5			23.0			29.9
Income tax provision		4.6			2.7			6.7			5.4			7.6
Net income		13.8			11.5			22.8			17.6			22.3
Net income attributable to noncontrolling interests		3.0			7.3			6.5			5.8			7.3
Net income attributable to Photronics, Inc. shareholders		10.9	%		4.2	%		16.3	%		11.8	%		15.0	%

~~Note: All the following tabular comparisons, unless otherwise indicated, are for the three months ended August 3, 2025 (Q3 FY25), May 4, 2025 (Q2 FY25) and July 28, 2024 (Q3~~Table ~~FY24)~~ of ~~and for the nine months ended August 3, 2025 (YTD FY25) and July 28, 2024 (YTD FY24).~~Contents

The following tables present selected operating information expressed as a percentage of revenue.

	Three Months Ended
	February 1,			October 31,			February 2,
	2026			2025			2025
Revenue		100.0	%		100.0	%		100	%
Cost of goods sold		65.0			65.0			64.4
Gross profit		35.0			35.0			35.6

Selling, general, and administrative expenses		9.5			9.3			9.0
Research and development expenses		1.1			1.5			2.0
Operating income		24.4			24.1			24.6

Other income (expense), net		8.7			11.1			11.8
Income before income tax provision		33.1			35.2			36.4

Income tax provision (benefit)		6.4			(1.2	)		8.9
Net income		26.7			36.4			27.5

Net income attributable to noncontrolling interests		7.7			7.8			7.3
Net income attributable to Photronics, Inc. shareholders		19.1	%		28.6	%		20.2	%

Revenue

Our quarterly revenues can be affected by the seasonal purchasing practices of our customers. As a result, demand for our products is typically ~~reduced~~impacted during the first quarter of our fiscal year by the North American, European, and Asian holiday periods, as some of our customers ~~reduce~~may ~~their~~adjust ~~development and, consequently,~~ their buying activities during those periods.

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The following tables present changes in revenue disaggregated by product type and geographic origin, in Q3Q1 ~~FY25~~FY26 from revenue in prior reporting periods.

Quarterly Changes in Revenue by Product Type ($ in millions)

	Q3 FY25 compared with Q2 FY25								Q3 FY25 compared with Q3 FY24						YTD FY25 compared with YTD FY24
	Q1 FY26 compared with Q4 FY25								Q1 FY26 compared with Q1 FY25
	Revenue in		Increase			Percent			Increase			Percent			~~Revenue in~~		~~Increase~~			~~Percent~~
	Q3 FY25		(Decrease)			Change			(Decrease)			Change			YTD FY25		(Decrease)			Change
	Q1 FY26		(Decrease)			Change			(Decrease)			Change
IC
High-end*	$	53.6	$	(5.7	)		(9.5	)%	$	4.1			8.4	%	$	173.1	$	4.6			2.8	%
High-end *	$	71.3	$	5.5			8.3	%	$	11.2			18.6	%
Mainstream		94.20		(2.4	)		(2.56	)%		~~(12~~0.2	)		~~(11~~0.52	)%		~~284.6~~		~~(21.4~~	)		~~(7.0~~	)%
Total IC	$	~~147~~165.83	$	(87.19	)		(5.20	)%	$	(811.14	)		(57.24	)%	$	~~457.7~~	$	~~(16.8~~	)		~~(3.5~~	)%
FPD
High-end*	$	53.5	$	9.9			22.6	%	$	5.1			10.5	%	$	146.8	$	(0.2	)		(0.1	)%
High-end *	$	46.9	$	(1.8	)		(3.7	%)	$	(2.7	)		(5.5	%)
Mainstream		912.18		(23.42	)		~~(21~~33.09	)%		2.4.3			3550.58	%		~~29.0~~		~~6.2~~			~~26.9~~	%
Total FPD	$	6259.68	$	71.54			132.5	%	$	71.56			132.67	%	$	~~175.8~~	$	~~6.0~~			~~3.5~~	%
Total Revenue	$	~~210~~225.41	$	(09.63	)		(04.3	)%	$	(013.60	)		(06.31	)%	$	~~633.5~~	$	~~(10.8~~	)		~~(1.7~~	)%

* High-end photomasks typically have higher ASPs than mainstream products.

Quarterly Changes in Revenue by Geographic Origin ($ in millions) **

	Q3 FY25 compared with Q2 FY25								Q3 FY25 compared with Q3 FY24						YTD FY25 compared with YTD FY24
	Q1 FY26 compared with Q4 FY25								Q1 FY26 compared with Q1 FY25
	Revenue in		Increase			Percent			Increase			Percent			~~Revenue in~~		~~Increase~~			~~Percent~~
	Q3 FY25		(Decrease)			Change			(Decrease)			Change			YTD FY25		(Decrease)			Change
	Q1 FY26		(Decrease)			Change			(Decrease)			Change
Taiwan	$	6874.43	$	(67.60	)		(810.84	)%	$	01.23			01.48	%	$	~~216.5~~	$	~~(2.0~~	)		~~(0.9~~	)%
China		5062.67		(84.16	)		~~(13.~~8.0	)%		(49.72	)		(817.51	)%		~~162.9~~		~~(9.2~~	)		~~(5.4~~	)%
South Korea		4341.71		64.1			1611.31	%		50.38			132.81	%		~~121.5~~		~~3.5~~			~~3.0~~	%
United States		37.84		7(6.01	)		22(14.91	%)		~~(1.~~0.5	)		(21.84	)%		~~105.4~~		~~0.5~~			~~0.5~~	%
Europe		98.18		(0.92	)		11(1.07	%)		(0.78	)		(710.36	)%		~~25.2~~		~~(4.3~~	)		~~(14.5~~	)%
Other		0.8		(0.1	)		15(16.58	%)		0.34			6662.48	%		~~2.0~~		~~0.7~~			~~51.6~~	%
	$	210.4	$	(0.6	)		(0.3	)%	$	(0.6	)		(0.3	)%	$	633.5	$	(10.8	)		(1.7	)%
Total revenue	$	225.1	$	9.3			4.3	%	$	13.0			6.1	%

** This table disaggregates revenue by the location in which it was earned.

Revenue in Q3Q1 ~~FY25~~FY26 of $~~210~~225.41 million represented aan ~~decrease~~increase of 04.3% compared with Q2Q4 FY25 and Q3an ~~FY24,~~increase ~~as weakness in IC revenue was partially offset by strength in FPD demand. Revenue in YTD FY25~~ of ~~$633~~6.~~5 million represented a decrease of~~ 1.7% ~~compared~~from toQ1 ~~the~~FY25 ~~same period in FY24,~~ primarily due to ICyear-over-year ~~mainstream~~growth ~~revenue decrease~~ in ~~Asia,~~more ~~offset~~advanced ~~slightly~~geometries byand anoverall ~~increase~~semiconductor inindustry ~~FPD mainstream revenue~~growth.

IC revenue ~~decreased~~increased $87.19 million or 5.20% in Q3Q1 ~~FY25~~FY26 from Q2Q4 FY25, primarily due to aan ~~decrease~~increase in ~~both~~ high-end ~~and~~of mainstream revenue in Asia reflecting continued headwinds experienced in 2025, including geopolitical trade restrictions and unresolved tariff negotiations. Comparing Q3 FY25 to Q3 FY24, IC revenue decreased $85.15 million or 58.23%, ~~mainly~~as ~~due~~a toresult ~~reduced~~of ~~mainstream~~the accelerated demand in Asia, ~~partially~~before ~~offset~~Chinese byNew ~~strong~~Year. ~~high-end~~Comparing ~~order~~Q1 ~~patterns~~FY26 to inQ1 ~~the~~FY25, ~~United States.~~ IC revenue ~~decreased~~ increased $1611.84 million or 37.54% ~~in YTD FY25 from YTD FY24,~~ mainly due to ~~reduced~~higher ~~mainstream~~ demand infor ~~Asia and Europe, partially offset by increased~~ high-end ~~demand~~products in ~~the United States~~Asia.

FPD revenue increased $71.54 million or 132.5% in Q3Q1 ~~FY25~~FY26 from Q2Q4 FY25, ~~driven~~and ~~by an increase in high-end of~~ $91.96 million or 222.67%. ~~Comparing~~from Q3Q1 FY25 toas Q3a ~~FY24,~~result ~~FPD~~of ~~revenue~~strong ~~increased $7.5 million or 13.6%, driven by increased~~ demand in ~~both high-end and~~ mainstream ~~markets particularly in South Korea. FPD revenue increased by $6.0 million or 3.5% in YTD FY25~~ from ~~YTD~~the ~~FY24,~~China ~~mainly~~IT ~~due~~display ~~to increased mainstream demand in Asia~~market.

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Gross Margin ($ in millions)

							Percent						Percent									~~Percent~~
	Q3 FY25			Q2 FY25			Change			Q3 FY24			Change			YTD FY25			YTD FY24			Change
	Q1 FY26			Q4 FY25			Change			Q1 FY25			Change
Gross profit	$	7078.97		$	7775.95			(94.02	)%	$	75.15			(54.62	)%		~~224.3~~			~~233.6~~			~~(4.0~~	)%
Gross margin		3335.70	%		3635.90	%					35.6	%					~~35.4~~	%		~~36.3~~	%

Gross margin ~~decreased~~remained byunchanged ~~320 basis points~~ in Q3Q1 ~~FY25~~FY26 compared towith Q2Q4 FY25, ~~primarily~~ as a ~~result~~favorable ~~of an unfavorable~~ product mix, ~~reflected~~was inoffset ~~material~~by ~~costs~~higher ~~increase of 8.2%, or 207 basis points as a percentage of revenue as well as an increase in~~ labor and benefits costs ~~of 6~~.~~3%, or 70 basis points as a percentage of revenue.~~

Gross margin decreased byslightly ~~190~~to ~~basis~~35.0% ~~points~~ in Q3Q1 ~~FY25,~~FY26 from ~~Q3 FY24, primarily as a result of an unfavorable product mix, reflected by material costs increase of 11~~35.46%, orin ~~278~~Q1 ~~basis points as a percentage of revenue~~FY25, ~~partially~~primarily ~~offset~~due byto ~~a decrease~~changes in ~~other~~product ~~cost of goods sold of 11.2%~~mix, orwhich ~~111~~resulted ~~basis~~in ~~points~~higher asmaterial ~~a percentage of revenue~~costs.

Gross margin decreased by 90 basis points in YTD FY25 as compared to YTD FY24, mainly due to the decrease in revenue of 1.7% as well as an unfavorable product mix resulting in material costs increase by 2.5% or 102 basis points as a percentage of revenue, partially offset by decreased labor and benefits costs of 4.3%, or 31 basis points as a percentage of revenue.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were $1821.43 million in Q3Q1 ~~FY25~~FY26, compared with $1820.10 million in Q2Q4 FY25, and $19.41 million in Q3Q1 ~~FY24~~FY25. The $01.3 million increase from Q2Q4 FY25 ~~was~~and ~~primarily the result of an increase in professional fees of~~ $02.2 million. ~~The~~increase ~~$1.0 million decrease~~ from Q3Q1 ~~FY24~~FY25 ~~was~~were primarily the result of ~~decreased~~higher ~~professional~~labor ~~fees~~and ofbenefits $0costs.~~8 million.~~

Selling, general and administrative expenses were $55.6 million in YTD FY25, compared with $56.8 million in YTD FY24. The $1.2 million decrease from YTD FY24 was a result of a decrease in labor and benefits cost of $1.1 million.

Research and Development Expenses

Research and development expenses, which primarily consist of development and qualification efforts related to process technologies for high-end IC and FPD applications, ~~were~~decreased $40.36 million into ~~Q3 FY25, compared with~~ $42.16 million in Q2Q1 FY26 from Q4 FY25,; the decrease was primarily caused by reduced labor and $3benefits costs.6 ~~million~~Research and development expenses in Q3Q1 ~~FY24.~~FY26 ~~The~~decreased ~~increase~~by $1.7 million from Q2Q1 FY25, ~~and~~as Q3a ~~FY24~~result ~~was~~of ~~primarily~~less ~~caused~~labor byand ~~increased~~benefits ~~qualification~~costs ~~activities~~and less development activity in ~~Asia~~the U.S.

Research and development expenses were $12.6 million in YTD FY25, compared with $11.3 million in YTD FY24. The $1.3 million increase from YTD FY24 was a result of increased development activities in the U.S.

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Other Income (Expense), net ($ in millions)

	Q3 FY25			Q2 FY25			Q3 FY24			YTD FY25			YTD FY24
	Q1 FY26			Q4 FY25			Q1 FY25
Foreign currency transactions impact, net	$	~~(14~~12.39	)	$	~~(31~~18.16	)	$	418.14		$	~~(26.9~~	)	$	~~9.9~~
Interest expense		-			-			(0.1	)		(0.1	)		(0.3	)
Interest income and other income, net		6.8			5.3			6.6
Interest income and other income, net		4.8			5.3			6.1			16.8			17.3
Other income (expense), net	$	19.7		$	23.9		$	25.0
Other income (expense), net	$	(9.4	)	$	(25.8	)	$	10.1		$	(10.2	)	$	26.9

*Other ~~The~~Income ~~columns~~decreased ~~may~~$4.2 ~~not~~million ~~foot~~in Q1 FY26 from Q4 FY25 and $5.3 million from Q1 FY25, primarily due to ~~rounding~~foreign currency impacts. The foreign currency impacts were primarily driven by less favorable movements of the South Korean won and the New Taiwan dollar, against the U.S. dollar.

Other Expense, net decreased in Q3 FY25 from Q2 FY25 by $16.4 million primarily driven by favorable movements of the New Taiwan dollar and the South Korean won, against the U.S. dollar. Other Expense, net increased in Q3 FY25 from Q3 FY24 by $19.5 million primarily driven by unfavorable movements of the New Taiwan dollar and the South Korean won, against the U.S. dollar.

Other Expense, net increased in YTD FY25 from YTD FY24 by $37.1 million, primarily due to foreign currency impacts which were driven by unfavorable movements of the New Taiwan dollar and the South Korean won, against the U.S. dollar.

Income Tax Provision ($ in millions)

	Q3 FY25			Q2 FY25			Q3 FY24			YTD FY25			YTD FY24
	Q1 FY26			Q4 FY25			Q1 FY25
Income tax provision	$	914.64		$	5(2.7	)	$	1418.19		$	~~34.2~~		$	~~49.0~~
Effective income tax rate		2419.83	%		19(3.15	)%		2224.75	%		~~23.5~~	%		~~25.4~~	%

On December 15, 2022, the European Union (EU) Member States formally adopted the EU’s Pillar Two Directive, which generally provides for a minimum effective tax rate of 15%, as established by the Organization for Economic Co-operation and Development (OECD) Pillar Two Framework. The EU effective dates ~~are~~were January 1, 2024, and January 1, 2025, for different aspects of the directive. A significant number of other countries ~~are~~continue ~~expected~~ to ~~also~~ implement similar legislation with varying effective dates. The Company is currently subject to Pillar Two, but we estimate that the financial impact is currently immaterial. We will ~~continue~~continuously toevaluate ~~monitor~~the ~~further~~potential ~~developments~~impact toof ~~determine~~the ~~any~~Pillar ~~potential~~Two ~~impact~~Framework inas ~~the~~future changes ~~countries~~ in ~~which~~legislation ~~we operate~~are enacted.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the United States. The OBBBA includes significant changes to federal tax law and other regulatory provisions that may impact the Company. ~~The~~As the legislation enacted ~~will~~applies ~~be effective~~to ~~for~~tax ~~Photronics~~years ~~commencing~~beginning inafter ~~our~~December ~~fiscal~~31, ~~year~~2024, ~~2026.~~the Weimpacts ~~will~~are ~~continue~~effective tostarting ~~monitor~~in ~~and~~FY26. The ~~evaluate~~Company ~~the~~has ~~impact~~evaluated applicable provisions of the ~~legislative~~OBBBA ~~changes~~for asFY26 ~~more~~and ~~guidance~~has ~~becomes~~included ~~available~~the estimated impacts within the FY26 provision.

The effective income tax rate is sensitive to the jurisdictional mix of earnings~~, due in part to the non-recognition of tax benefits on losses in jurisdictions with valuation allowances where the tax benefits of the losses are not available~~.

The effective income tax rate ~~increases~~increased in Q3Q1 ~~FY25~~FY26, compared with Q2Q4 FY25 ~~and Q3 FY24~~, ~~are~~ primarily due to ~~changes~~the inU.S. ~~the~~federal ~~jurisdictional~~and ~~mix~~state ofvaluation ~~earnings~~allowance releases recorded in Q4 FY25.

The effective income tax rate ~~decrease~~decreased in ~~YTD~~Q1 ~~FY25~~FY26, compared with ~~YTD~~Q1 ~~FY24~~FY25, is primarily due to ~~changes~~an investment tax credit in ~~the~~a ~~jurisdictional~~non‑U.S. ~~mix~~jurisdiction ofin ~~earnings~~FY26.

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Net Income Attributable to Noncontrolling Interests

Net income attributable to noncontrolling interests was $617.2 million in Q3Q1 ~~FY25~~FY26, compared with $1516.~~4 million in Q2 FY25 and $13.~~8 million in Q3Q4 ~~FY24~~FY25; the ~~decrease~~increase ~~from Q2 FY25 and Q3 FY24~~ was the result of ~~the~~an ~~decrease~~increase in the net ~~income~~incomes of ~~the Company’s~~our joint ~~ventures~~venture operations. Net income attributable to noncontrolling interests ~~was~~increased ~~$37.0~~by ~~million in YTD FY25, compared with~~ $461.8 million in ~~YTD~~Q1 ~~FY24.~~FY26 ~~The~~from ~~decrease~~Q1 ~~was~~FY25, as a result of ~~decreased~~increased net income at the Company’s ~~joint~~China-~~venture~~based ~~operations~~IC facility.

Liquidity and Capital Resources

Our primary sources of liquidity are our cash on hand and cash we generate from operations. Cash and cash equivalents were $~~479~~544.51 million and $~~598~~492.53 million as of ~~August~~February 31, ~~2025~~2026, and October 31, ~~2024~~2025, respectively. As of ~~August~~February 31, ~~2025~~2026, total cash and cash equivalents included $~~416~~472.12 million held by foreign subsidiaries, including an aggregate of $~~328~~391.25 million held by our joint ventures in Taiwan and China. In addition, we currently have CNY 200 million or ~~USD~~ $25 million of borrowing capacity, at our discretion, in China to support local operations. ~~See~~This ~~Note~~facility 7is –subject ~~Debt~~ to ~~the~~annual ~~consolidated financial~~reviews ~~statements~~and ~~for~~extensions ~~additional~~with ~~information~~a oncurrent ~~the~~expiration ~~Company’s~~date ~~outstanding~~of ~~debt~~July ~~and~~31, ~~currently available financing~~2026. ~~The~~As ~~Company’s primary sources~~ of ~~liquidity~~February ~~are~~1, ~~the~~2026, ~~Company’s~~PDMCX ~~cash~~had onno ~~hand~~outstanding ~~and~~borrowings against ~~cash~~the ~~we generate from operations~~facility.

We continually evaluate alternatives for efficiently funding ~~the~~our ~~Company’s~~ capital expenditures and ongoing operations. These reviews may result in ~~the~~our ~~Company’s~~ engagement in a variety of investing and financing transactions, in the transfer of cash among subsidiaries, and/or the repatriation of cash to the U.S. The transfer of funds among subsidiaries could be subject to foreign withholding taxes; in certain jurisdictions, repatriation of these funds to the U.S. may subject them to U.S. state income taxes and/or local country withholding taxes. We believe that ~~the~~our ~~Company’s~~ liquidity, including available financing, is sufficient to meet ~~the~~our ~~Company’s~~ requirements through the next twelve months and thereafter for the foreseeable future. Through the utilization of ~~the~~our ~~Company’s~~ existing liquidity, the cash we generate from operations and short-term investments, we plan to continue to invest in ~~the~~our ~~Company’s~~ business, with ~~the~~our ~~Company’s~~ investments targeted to align with the Company’s customers’ technology road maps. In addition, we stand ready to invest in mergers, acquisitions, or strategic partnerships, should a suitable opportunity arise.

We estimate our capital expenditures for ~~the Company’s~~ fiscal year ~~2025~~2026 will be approximately $~~200~~330 million mainly in Asia and the U.S.; these investments will be targeted towards high-end and mainstream capacity that will increase the ~~Company’s~~ operating capability and efficiency, and enable us to support our customers’ near-term demands. As of ~~August~~February 31, ~~2025~~2026, we had outstanding capital commitments of approximately $~~147~~190.26 million and accrued liabilities related to capital equipment purchases of approximately $2829.3 million. Although payment timing could vary, primarily as a result of the timing of tool delivery, installation and testing, we currently estimate that we will fund $~~154~~180.82 million of ~~the~~our ~~Company’s~~ total $~~175~~219.5 9 million committed and recognized obligations for capital expenditures over the next twelve months.

On August 28, 2024, the Board of Directors authorized an increase to the Company’s existing share repurchase program from the remaining $31.7 million to $100 million. In June 2025, the Board of Directors authorized an additional $25 million share repurchase. During the ~~nine-month~~fiscal ~~period~~year ended ~~August~~October 331, 2025, the Company repurchased 5 .0 million shares for $97.4 million. InDuring ~~June~~the ~~2025,~~three ~~the~~month ~~Board~~period ofended ~~Directors~~February ~~authorized~~1, an2026, ~~additional~~the ~~$25~~Company ~~million~~did ~~share~~not repurchase any shares. As a result, ~~as of August 3, 2025,~~ $27.6 million remained available under this authorization as of February 1, 2026. Depending on market conditions, we may utilize some or the entire remaining approved amount to reacquire additional shares.

As discussed in Note 6 – PDMCX Joint Venture of the Company’s condensed consolidated financial statements, DNP, the noncontrolling interest in the Company’s China-based joint ~~venture~~ venture has, under certain circumstances, the right to put its interest in the joint venture to Photronics, or to purchase the Company’s interest in the joint venture. Under all such circumstances, the sale of DNP’s interest would be at its ownership percentage of the joint venture’s net book value, with closing to take place within three business days of obtaining required approvals and clearance. As of the date of issuance of this report, DNP had not indicated its intention to exercise this right. As of ~~August~~February 31, ~~2025~~2026, Photronics and DNP each had net investments in this joint venture of approximately $~~153~~169.4 million.

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Cash Flows ($ in millions)

	YTD FY25			YTD FY24
	Q1 FY26			Q1 FY25
Net cash provided by operating activities	$	~~160~~97.03		$	~~193~~78.15
Net cash used in investing activities	$	(173.6	)	$	(142.1	)
Net cash (used in) provided by investing activities	$	(40.3	)	$	6.8
Net cash used in financing activities	$	(115.3	)	$	(6.4	)
Net cash provided by (used in) financing activities	$	0.7		$	(20.5	)

Operating Activities: Net cash ~~provided~~from by operating activities reflects net income adjusted for certain non-cash items, including depreciation and amortization, share-based compensation, and the effects of changes in operating assets and liabilities. Net cash provided by operating activities ~~decreased~~increased by $3318.18 million in ~~FY25~~the first quarter of FY26, compared with the same period of ~~FY24~~FY25, primarily due to ~~decreased~~changes ~~net~~in working ~~income~~capital.

Investing Activities: Net cash flows ~~used~~from in investing activities ~~increased~~decreased by $3147.51 million in ~~FY25~~the first quarter of FY26, compared to the same period in ~~FY24~~FY25, primarily driven by an increase ofin purchases of property, plant and equipment of $3212.94 million ~~partially~~and ~~offset~~purchases ~~by a decrease~~ in ~~purchases of~~ short -term investments of $436.06 million.

Financing Activities: Net cash ~~used~~from in financing activities increased by $~~108~~21.92 million in ~~FY25~~the first quarter of FY26, compared to the same period ofin ~~FY24~~FY25. This was primarily driven by ~~the repurchase~~a ofdecrease ~~the~~in ~~Company’s~~debt ~~common~~repayments ~~shares as part~~ of ~~the Share Repurchase Program of~~ $9715.43 million and ~~increase~~common ofstock ~~debt~~repurchases ~~repayments~~ of $134.56 million.

~~Effects~~The ~~of exchange rate changes on the~~ Company’s cash, cash equivalents, and restricted cash balances ~~increased~~were negatively impacted by ~~$16.6~~changes ~~million~~in ~~from~~foreign ~~unfavorable~~currency ~~$6.5~~exchange ~~million~~rates during ~~YTD~~the ~~FY24~~first toquarter ~~favorable~~of FY26 by $105.19 million ~~during the same period of FY25~~.

Non-GAAP Financial Measures

Non-GAAP Net Income attributable to Photronics, Inc. shareholders and non-GAAP diluted earnings per share attributable to Photronics, Inc. shareholders are “non-GAAP financial measures” as such term is defined by Regulation G of the Securities and Exchange Commission and may differ from similarly named non-GAAP financial measures used by other companies. The financial tables below reconcile Photronics, Inc. financial results under U.S. GAAP to our non-GAAP financial information. We believe these non-GAAP financial measures that exclude certain items are useful for analysts and investors to evaluate the Company’s on-going performance because they enable a more meaningful comparison of historical results of the Company’s core business. These non-GAAP metrics are not a measure of consolidated operating results under U.S. GAAP and should not be considered as an alternative to Net income (loss), Net income (loss) per share, or any other measure of consolidated results under U.S. GAAP. The items excluded from these non-GAAP metrics but included in the calculation of their closest U.S. GAAP equivalent, are significant components of the condensed consolidated statement of income and must be considered in performing a comprehensive assessment of overall financial performance.

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The following table reconciles U.S. GAAP ~~Net~~net ~~Income~~income and ~~Earnings~~diluted earnings per ~~Share~~share attributable to Photronics, Inc. shareholders to the ~~Non~~non-GAAP ~~Net~~net income and ~~Earnings~~diluted earnings per ~~Share~~share attributable to Photronics, Inc. shareholders for the indicated periods. The columns may not foot due to rounding.

	Three Months Ended
	Three Months ended
	August 3,			May 4,			July 28,
	Feb 1,			Oct 31,			Feb 2,
	2025			2025			2024
	2026			2025			2025
U.S. GAAP Net Income attributable to Photronics, Inc. shareholders	$	22,891		$	8,861		$	34,388
Reconciliation of U.S. GAAP to non-GAAP net income:
FX (gain) loss		14,258			31,111			(4,068	)
U.S. GAAP net income attributable to Photronics, Inc. shareholders	$	42,939		$	61,801		$	42,851
Estimated tax effects of above		(3,663	)		(8,337	)		914
FX (gain) loss		(12,865	)		(18,615	)		(18,443	)
Estimated noncontrolling interest effects of above		(4,130	)		(7,376	)		681
Estimated tax effects of FX (gain) loss		2,553			4,781			5,152
Non-GAAP Net Income attributable to Photronics, Inc. shareholders	$	29,356		$	24,259		$	31,915
Estimated noncontrolling interest effects of above		3,032			3,341			2,823
Weighted-average number of common shares outstanding - Diluted		58,068			60,974			62,414
Reversal of deferred tax valuation allowance		-			(16,751	)		-
U.S. GAAP diluted earnings per share attributable to Photronics, Inc. shareholders	$	0.39		$	0.15		$	0.55
Non-GAAP net income attributable to Photronics, Inc. shareholders	$	35,659		$	34,557		$	32,383
Effects of the above non-GAAP adjustments		0.12			0.25			(0.04	)
Weighted-average number of common shares outstanding - Diluted		58,390			57,977			62,661
Non-GAAP diluted earnings per share attributable to Photronics, Inc. shareholders	$	0.51		$	0.40		$	0.51
Reconciliation of U.S. GAAP to non-GAAP EPS:
U.S. GAAP diluted earnings per share attributable to Photronics, Inc. shareholders	$	0.74		$	1.07		$	0.68
Effects of the non-GAAP adjustments above		(0.13	)		(0.47	)		(0.16	)
Non-GAAP diluted earnings per share attributable to Photronics, Inc. shareholders	$	0.61		$	0.60		$	0.52

Business Outlook

Our current business outlook and guidance was provided in the Photronics Q3Q1 ~~FY25~~FY26 earnings press release, earnings presentation, and financial results conference call, but is not incorporated herein. These can be accessed in the investor section of our website - www.photronics.com. Information included on our website is not incorporated in this Form 10-Q.

Our future results of operations and the other forward-looking statements contained in this filing and in the Photronics Q3Q1 ~~FY25~~FY26 earnings press release, and the related financial results conference call and earnings presentation involve a number of risks and uncertainties, some of which were discussed in Part I, Item 1A of our ~~2024~~2025 Form 10-K. These factors and a number of other unforeseeable factors could cause actual results to differ materially from our expectations.

Critical Accounting Estimates

Please refer to Part II, Item 7 of our ~~2024~~2025 Form 10-K for discussion of our critical accounting estimates. There have been no changes to our critical accounting estimates since the filing of our Form 10-K for the year ended October 31, ~~2024~~2025.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Currency Exchange Rate Risk

We conduct business in several major currencies throughout our worldwide operations, and our financial performance may be affected by fluctuations in the exchange rates of these currencies. Changes in exchange rates can positively or negatively affect our reported revenue, operating income, assets, liabilities, and equity. The functional currencies of our Asian subsidiaries are the South Korean won, the New Taiwan dollar, the Chinese yuan, and the Singapore dollar. The functional currencies of our European subsidiaries are the British pound and the euro. In addition, we engage in transactions and have exposures to the Japanese yen.

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Item 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Currency Exchange Rate Risk

We conduct business in several major currencies throughout our worldwide operations, and our financial performance may be affected by fluctuations in the exchange rates of these currencies. Changes in exchange rates can positively or negatively affect our reported revenue, operating income, assets, liabilities, and equity. The functional currencies of our Asian subsidiaries are the South Korean won, the New Taiwan dollar, the Chinese yuan, and the Singapore dollar. The functional currencies of our European subsidiaries are the British pound sterling and the euro. In addition, we engage in transactions and have exposures to the Japanese yen.

We attempt to minimize our risk of foreign currency transaction losses by producing products in the same country in which the products are sold (thereby generating revenues and incurring expenses in the same currency), and by managing our working capital. However, in some instances, we sell products in a currency other than the functional currency of the entity where it was produced, or purchase products in a currency that differs from the functional currency of the purchasing entity. We may also enter into derivative contracts to mitigate our exposure to foreign currency fluctuations when we have a significant purchase obligation or significant receivable denominated in a currency that differs from the functional currency of the transacting subsidiary. We do not enter into derivatives for speculative purposes. There can be no assurance that this approach will protect us from the need to recognize significant foreign currency transaction gains and losses, especially in the event of a significant adverse movement in the value of any foreign currency in which we conduct business against any of our functional currencies, including the U.S. dollar.

Our primary net foreign currency exposures as of ~~August~~February 31, ~~2025~~2026, included the South Korean won, the Japanese yen, the New Taiwan dollar, the Chinese yuan, the Singapore dollar, the British pound sterling, and the euro. As of that date, a 10% adverse movement in the value of currencies different from the functional currencies of our subsidiaries would have resulted in a net unrealized pre-tax loss of $69.71 million, which represents a decrease of $1.6 0 million from our exposure atas ~~May~~of 4October 31, 2025. Our most significant exposures at ~~August~~February 31, ~~2025~~2026, were exposures of the New Taiwan ~~dollar,~~Dollar and the South Korean won ~~and~~against the ~~Chinese yuan to the~~ U.S. dollar~~, which were, respectively, $36~~.1 ~~million, $24.9 million and $5.4 million at that date.~~ We do not believe that a 10% change in the exchange rates of other non-USU.S. dollar currencies, other than the aforementioned currencies ~~and the Japanese yen~~, would have had a material effect on our ~~August~~February 31, ~~2025~~2026, condensed consolidated financial statements.

Interest Rate Risk

A 10% adverse or favorable movement in the interest rates on our variable rate borrowings would not have had a material effect on the Company’s ~~August~~February 31, ~~2025~~2026, condensed consolidated financial statements, as there were no variable rate borrowings outstanding as of the balance sheet date.

Inflation Risk

Inflationary factors generally affect us by increasing our labor and overhead costs, as well as costs associated with certain risks identified above, which may adversely affect our results of operations and financial position. We have historically been able to recover the impacts of inflation through sales price increases; however, we cannot reasonably estimate our ability to successfully recover any impact of inflation through price increases in the future. Our inability to do so could harm our results of operations and financial position.

Item 4.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We have established, and currently maintain, disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act, designed to provide reasonable assurance that information required to be disclosed in reports filed under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of the end of the period covered by this report.

Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting during the third fiscal quarter ended August 3, 2025, which have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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Changes in Internal Control over Financial Reporting

There were no changes to our internal control over financial reporting during the fiscal quarter ended February 1, 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

Please refer to Note 1211 within Part I, Item 1 of this report for information on legal proceedings involving the Company.

Item 1A.

RISK FACTORS

There have been no material changes, ~~except the paragraph below,~~ to our risk factors as set forth in “Item 1A. Risk Factors” in our ~~2024~~2025 Form 10-K.

Risks Related to Tariffs and Global Trade Policies

In FY25, new tariffs were announced on imports to the U.S., followed by various modifications and delays. Further changes are expected to be made in the future, which may include additional sector-based tariffs or other measures. The U.S. Department of Commerce has initiated an investigation under Section 232 of the Trade Expansion Act of 1962, as amended, into, among other things, imports of semiconductors, semiconductor manufacturing equipment, and their derivative products, including downstream products that contain semiconductors. Tariffs and trade restrictions may increase costs and complexity in our supply chain, including the procurement of semiconductor manufacturing equipment, raw materials, and critical components. They may also elevate the cost of our products, reduce demand, and negatively affect customer purchasing behavior. These risks, individually or collectively, could adversely affect our business, financial condition, and results of operations.

Item 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

In September 2020, the Company’s Board of Directors authorized the repurchase of up to $100 million of its common stock, pursuant to a repurchase plan under Rule 10b-18 of the Exchange Act. The repurchase authorization by the Board of Directors has no expiration date, does not obligate the Company to acquire any common stock, and is subject to market conditions. From September 2020 through October 2022, the Company repurchased 5.8 million shares at a cost of $68.3 million. ~~No shares were repurchased during the three- or nine-month periods ended July 28, 2024.~~ In August 2024, the Board of Directors authorized an increase to the Company’s existing share repurchase program from the remaining $31.7 million up to $100 million. ~~During~~In June 2025, the ~~three-month~~Board ~~period~~of ~~ended~~Directors ~~August~~authorized 3,an additional $25 million share repurchase. In fiscal year 2025, the Company repurchased 15.20 million shares at a cost of $2097.74 million ~~pursuant~~(an toaverage ~~Rule 10b-18~~ of ~~the~~$19.52 ~~Exchange~~per ~~Act~~share). ~~During~~All shares repurchased under the ~~nine-month~~program ~~period~~have ~~ended~~been ~~August~~retired 3,prior ~~2025,~~to the ~~Company repurchased~~end 5of ~~million~~the ~~shares~~fiscal atquarter ain ~~cost~~which they ofwere ~~$97~~purchased.4 ~~million~~During ~~pursuant~~the tothree ~~Rule~~month ~~10b-18~~period ofended ~~the~~February ~~Exchange~~1, ~~Act. In June 2025~~2026, the ~~Board~~Company ofdid ~~Directors~~not ~~authorized~~repurchase anany additional ~~$25 million share repurchase~~shares. As ~~a result, as~~ of ~~August~~February 31, ~~2025~~2026, $27.6 million remained available under this authorization~~. All~~ ~~shares~~for ~~repurchased under~~ the ~~program~~repurchase ~~have~~of ~~been retired~~shares.

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The following table provides information relating to the Company’s repurchase of common stock during the third quarter of fiscal year 2025. This table excludes shares repurchased to settle employee tax withholding related to the vesting of stock awards.

	Total Number of Shares Purchased		Average Price Paid Per share		Total Number of Shares Purchased as Part of Publicly Announced Program		Dollar Value of Shares That May Yet Be Purchased (in millions)
May 5, 2025 – June 1, 2025		366,900	$	17.34		366,900	$	16.9
June 2, 2025 – June 29, 2025		810,630	$	17.72		810,630	$	27.6
June 30, 2025 – August 3, 2025		-	$	-		-	$	27.6
Total		1,177,530				1,177,530

Item 3.

DEFAULTS UPON SENIOR SECURITIES

None.

Item 4.

MINE SAFETY DISCLOSURES

Not applicable

Item 5.

OTHER INFORMATION

Rule 10b5-1 Trading Arrangements

Our directors and officers (as defined in Rule 16a-1 under the Exchange Act) may from time to time enter into plans or other arrangements for the purchase or sale of our shares that are intended to satisfy the affirmative defense conditions of Rule 10b5–1(c) or may represent a non-Rule 10b5-1 trading arrangement under the Exchange Act.

No such plans or arrangements were adopted or terminated, including by modification, by any director or officer (as defined in Rule 16a-1 under the Exchange Act) during the quarter ended ~~August~~February 31, ~~2025~~2026.

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Item 6.

EXHIBITS

		Incorporated by Reference
Exhibit Number	Description	Form	Exhibit	Filing Date	Filed or Furnished Herewith


31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.				X

31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.				X

32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.				X

32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.				X

101.INS	Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)				X

101.SCH	Inline XBRL Taxonomy Extension Schema Document				X

101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document				X

101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document				X

101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document				X

101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document				X

104	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)				X

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SIGNATURES

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

	Photronics, Inc.
	(Registrant)
By:	/s/ ERIC RIVERA
	ERIC RIVERA
	Executive Vice President,
	President, Chief Financial Officer
	Chief Financial Officer
	(Principal Financial Officer)
	(Principal Financial Officer
Date: March 11, 2026
	/Principal Accounting Officer)
Date: September 9, 2025

By:	/s/ RUI (ELIE) ZHANG
	RUI (ELIE) ZHANG
	Vice President, Corporate Controller Chief Accounting Officer (Principal Accounting Officer)

Date: March 11, 2026

Filing Compare · PHOTRONICS INC