SEC Form 10-Q filed by Axogen Inc.

4/28/26 4:04:10 PM ET

Biotechnology: Electromedical & Electrotherapeutic Apparatus

Health Care

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axgn-20260331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended March 31, 2026


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

For the transition period from ____________ to______________

Commission file number: 001-36046

Axogen, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Minnesota

(State or other jurisdiction of

incorporation or organization)

13631 Progress Blvd., Suite 400 Alachua, FL

(Address of principal executive offices)

41-1301878

(I.R.S. Employer

Identification No.)

32615

(Zip Code)

386-462-6800

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)


Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $0.01 par value	AXGN	The Nasdaq Stock Market

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

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

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


Large accelerated filer	☐	Accelerated filer	☒

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

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

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

As of April 24, 2026, the registrant had 53,177,824 shares of common stock outstanding.

Table of Contents

Axogen, Inc.


Table of Contents
		Page
Part I - Financial Information
Item 1.	Financial Statements	2
	Condensed Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025 (Unaudited)	2
	Condensed Consolidated Statements of Operations for the three months ended March 31, 2026 and 2025 (Unaudited)	3
	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025 (Unaudited)	4
	Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three months ended March 31, 2026 and 2025 (Unaudited)	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22

Item 4.	Controls and Procedures	22

Part II - Other Information

Item 1.	Legal Proceedings	23

Item 1A.	Risk Factors	23

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23

Item 3.	Defaults Upon Senior Securities	23

Item 4.	Mine Safety Disclosures	23

Item 5.	Other Information	23

Item 6.	Exhibits	24

	Signatures	25

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Axogen, Inc.

Forward-Looking Statements

From time to time, in reports filed with the United States Securities and Exchange Commission (the “SEC”) (including this Quarterly Report on Form 10-Q), in press releases, and in other communications to shareholders or the investment community, Axogen, Inc. (including Axogen, Inc.’s wholly owned subsidiaries, Axogen Corporation, Axogen Processing Corporation, Axogen Germany GmbH and Axogen Europe GmbH, the “Company,” “Axogen,” “we,” “our,” or “us”) may provide forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995, concerning possible or anticipated future results of operations or business developments. These statements are based on management’s current expectations or predictions of future conditions, events or results based on various assumptions and management’s estimates of trends and economic factors in the markets in which the Company is active, as well as its business plans. Words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “projects,” “forecasts,” “continue,” “may,” “should,” “will,” “goals,” and variations of such words and similar expressions are intended to identify such forward-looking statements.

The forward-looking statements in this Form 10-Q include, but are not limited to, the following:

•Our belief that we will continue to drive growth in the nerve protection category;

•Our expectations around our targeted strategy relating to the expansion of nerve repair indications with a focus on deepening our presence in high-potential accounts;

•Our expectations of satisfying certain job creation milestones by the end of December 31, 2026 pursuant to our cash grants related to certain economic development grants for our Axogen Processing Center in Vandalia, Ohio;

•Our expectations around the potential positive impact on our business of expanded coverage and reimbursement for peripheral nerve injuries using synthetic conduits or allografts; and

•Our belief that our existing cash and cash equivalents and investments, as well as cash provided by sales of our products will allow us to fund our operations through at least the next twelve months.

The forward-looking statements are and will be subject to risks and uncertainties, which may cause actual results to differ materially from those expressed or implied in such forward-looking statements. Forward-looking statements contained in this Quarterly Report on Form 10-Q should be evaluated together with the many risks and uncertainties that affect the Company’s business and its market, particularly those discussed in the risk factors and cautionary statements set forth in the Company’s filings with the SEC, including as described in “Risk Factors” included in Item 1A and “Risk Factor Summary” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Forward-looking statements are not guarantees of future performance, and actual results may differ materially from those projected. The forward-looking statements are representative only as of the date they are made and, except as required by applicable law, the Company assumes no responsibility to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or otherwise.

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PART I — FINANCIAL INFORMATION

ITEM 1 — FINANCIAL STATEMENTS

Axogen, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands, except share and per share amounts)


	March 31, 2026		December 31, 2025
Assets
Current assets:
Cash and cash equivalents	$	82,654	$	35,548
Restricted cash	2,000		4,000
Investments	18,947		5,980
Accounts receivable, net of allowance for doubtful accounts of $822 and $948, respectively	28,313		26,169
Inventory	46,074		42,373
Prepaid expenses and other assets	6,720		6,352
Total current assets	184,708		120,422
Property and equipment, net	83,038		81,783
Operating lease right-of-use assets	14,280		12,732
Intangible assets, net	7,270		6,750
Other assets	192		—
Total assets	$	289,488	$	221,687

Liabilities and shareholders’ equity
Current liabilities:
Accounts payable and accrued expenses	$	23,898	$	21,184
Current maturities of long-term lease obligations	2,115		2,372
Total current liabilities	26,013		23,556

Long-term debt, net of debt discount and financing fees	—		48,387
Long-term lease obligations	18,527		16,870
Debt derivative liabilities	—		3,886
Other long-term liabilities	140		141
Total liabilities	44,680		92,840

Commitments and contingencies - see Note 14

Shareholders’ equity:
Common stock, $0.01 par value per share; 100,000,000 shares authorized; 53,153,471 and 47,199,797 shares issued and outstanding, respectively	532		472
Additional paid-in capital	570,823		435,338
Accumulated deficit	(326,547)		(306,963)
Total shareholders’ equity	244,808		128,847
Total liabilities and shareholders’ equity	$	289,488	$	221,687

See Notes to Condensed Consolidated Financial Statements.

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Axogen, Inc.

Condensed Consolidated Statements of Operations

(unaudited)

(in thousands, except share and per share amounts)


	Three Months Ended
		March 31, 2026		March 31, 2025
Revenues		$	61,457	$	48,560
Cost of goods sold		15,268		13,627
Gross profit		46,189		34,933
Costs and expenses:
Sales and marketing		28,633		21,045
Research and development		7,517		6,091
General and administrative		12,871		9,458
Total costs and expenses		49,021		36,594
Loss from operations		(2,832)		(1,661)
Other income (expense):
Investment income		768		272

Interest expense		(694)		(2,250)
Loss on extinguishment of debt		(16,849)		—
Change in fair value of debt derivative liabilities		—		(158)
Other income (expense), net		23		(37)
Total other expense, net		(16,752)		(2,173)
Net loss		$	(19,584)	$	(3,834)

Weighted average common shares outstanding - basic		51,591,504		45,204,076
Weighted average common shares outstanding - diluted		51,591,504		45,204,076

Net loss per common share - basic		$	(0.38)	$	(0.08)
Net loss per common share - diluted		$	(0.38)	$	(0.08)

See Notes to Condensed Consolidated Financial Statements.

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Axogen, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(in thousands)


	Three Months Ended
	March 31, 2026		March 31, 2025
Cash flows from operating activities:
Net loss	$	(19,584)	$	(3,834)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation	1,604		1,728
Amortization of right-of-use assets	420		87
Amortization of intangible assets	101		67
Amortization of debt discount and deferred financing fees	68		220
(Recovery of) provision for bad debts	(120)		187

Change in fair value of debt derivative liabilities	—		158
Investment losses (gains), net	33		(45)
Loss on extinguishment of debt	16,849		—
Stock-based compensation expense	6,843		2,909
Change in operating assets and liabilities:
Accounts receivable	(2,024)		(2,377)
Inventory	(3,701)		(2,321)
Prepaid expenses and other assets	(368)		(489)
Other assets	(192)		—
Accounts payable and accrued expenses	2,198		(9,079)
Operating lease obligations	(559)		(452)
Cash paid for interest portion of financing lease obligations	(2)		(1)
Other long-term liabilities	(1)		63
Net cash provided by (used in) operating activities	1,565		(13,179)

Cash flows from investing activities:
Purchase of property and equipment	(2,789)		(256)

Purchase of investments	(19,000)		—
Proceeds from sale of investments	6,000		2,000
Cash payments for intangible assets	(175)		(405)
Net cash (used in) provided by investing activities	(15,964)		1,339

Cash flows from financing activities:
Proceeds from issuance of common stock	134,044		—
Payment of stock issuance costs	(792)		—
Repayment of long-term debt	(48,585)		—
Fees paid to lender related to debt extinguishment	(20,498)		—
Fees paid to third parties related to debt extinguishment	(107)		—
Payments of employee tax withholding on vested stock awards	(8,776)		—
Cash paid for debt portion of financing lease obligations	(7)		(1)
Proceeds from exercise of stock options	4,226		2,383
Net cash provided by financing activities	59,505		2,382
Net increase (decrease) in cash and cash equivalents, and restricted cash	45,106		(9,458)
Cash and cash equivalents, and restricted cash, beginning of period	39,548		33,554
Cash and cash equivalents, and restricted cash, end of period	$	84,654	$	24,096

Supplemental disclosures of cash flow activity:
Cash paid for interest	$	625	$	1,513
Supplemental disclosure of non-cash investing and financing activities:
Acquisition of property and equipment change in accounts payable and accrued expenses	$	70	$	116
Acquisition of right-of-use asset in exchange for a lease liability	$	1,967	$	—


Acquisition of intangible assets change in accounts payable and accrued expenses	$	446	$	(36)

See Notes to Condensed Consolidated Financial Statements.

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Axogen, Inc.

Condensed Consolidated Statements of Changes in Shareholders’ Equity

(unaudited)

(in thousands, except share amounts)


	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Shareholders’ Equity
	Shares	Amount








Three Months Ended March 31, 2026
Balance at December 31, 2025	47,199,797	$	472	$	435,338	$	(306,963)	$	128,847
Net loss	—	—		—		(19,584)		(19,584)
Issuance of common shares	4,600,000	46		133,206		—		133,252
Stock-based compensation	—	—		6,843		—		6,843
Issuance of restricted and performance stock units, net of shares withheld for withholding taxes	985,796	10		(8,786)		—		(8,776)
Exercise of stock options	367,878	4		4,222		—		4,226
Balance at March 31, 2026	53,153,471	$	532	$	570,823	$	(326,547)	$	244,808









Three Months Ended March 31, 2025
Balance at December 31, 2024	44,148,836	$	441	$	394,726	$	(291,260)	$	103,907
Net loss	—	—		—		(3,834)		(3,834)
Stock-based compensation	—	—		2,909		—		2,909
Issuance of restricted and performance stock units	1,105,214	11		(11)		—		—
Exercise of stock options	258,573	3		2,380		—		2,383
Balance at March 31, 2025	45,512,623	$	455	$	400,004	$	(295,094)	$	105,365

See Notes to Condensed Consolidated Financial Statements.

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

(in thousands, except share and per share amounts)

1. Nature of Business

Axogen, Inc. (together with its wholly-owned subsidiaries, the “Company”) was incorporated in Minnesota. The Company’s business is focused on the science, development and commercialization of the technologies used for peripheral nerve regeneration and repair. The Company’s products include Avance® (acellular nerve allograft-arwx), Avance® Nerve Graft, Axoguard Nerve Connector®, Axoguard Nerve Protector®, Axoguard HA+ Nerve Protector™, Axoguard Nerve Cap® and Avive+ Soft Tissue Matrix™. The Company is headquartered in Florida. The Company has processing, warehousing and distribution facilities in Ohio and Texas.

The Company manages its operations as a single operating segment. Substantially all of the Company’s assets are maintained in the United States (“U.S.”). The Company derives substantially all of its revenues from sales to customers in the U.S.

2. Summary of Significant Accounting Policies

Please see Note 2 - Summary of Significant Accounting Policies to the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Annual Report on Form 10-K”), filed with the SEC on February 24, 2026, for a description of all significant accounting policies.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company as of March 31, 2026 and December 31, 2025 and for the three months ended March 31, 2026 and 2025. The Company’s condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and therefore do not include all information and footnotes necessary for a fair presentation of consolidated financial position, results of operations and cash flows in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”) and should be read in conjunction with the audited financial statements of the Company for the year ended December 31, 2025, which are included in the 2025 Annual Report on Form 10-K.

The interim condensed consolidated financial statements are unaudited, and in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments necessary for a fair presentation of results for the periods presented. The results of operations for the three months ended March 31, 2026 are not necessarily indicative of the results to be expected for the full year due primarily to the impact of the continued uncertainty of general economic conditions that may impact the Company’s markets for the remainder of fiscal year 2026. All intercompany accounts and transactions have been eliminated in consolidation.

Cash and Cash Equivalents and Concentration

Cash and cash equivalents consist of short-term, highly liquid investments with original maturities of three months or less from the date of acquisition. Certain of the Company’s cash and cash equivalents balances exceed Federal Deposit Insurance Corporation (“FDIC”) insured limits or are invested in money market accounts with investment banks that are not FDIC-insured. The Company places its cash and cash equivalents in what it believes to be credit-worthy financial institutions. As of March 31, 2026, $82,154 of the cash and cash equivalents balance were not FDIC-insured or were in excess of FDIC limits.

Restricted Cash

The following table provides a reconciliation of Cash and cash equivalents, and Restricted cash reported on the Condensed Consolidated Balance Sheets that sum to the total of the same amounts shown on the Condensed Consolidated Statements of Cash Flows as of the periods presented:


(in thousands)	March 31, 2026		December 31, 2025
Cash and cash equivalents	$	82,654	$	35,548
Restricted cash	2,000		4,000
Total Cash and cash equivalents, and Restricted cash shown on the Condensed Consolidated Statements of Cash Flows	$	84,654	$	39,548

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements - Continued

(unaudited)

(in thousands, except share and per share amounts)

Amounts included in restricted cash represent collateral for an irrevocable standby letter of credit required to meet contractual terms of a lease agreement held by the Company. See Note 8 - Long-Term Debt, Net of Debt Discount and Financing Fees - Other Credit Facilities.

Shares Withheld to Satisfy Employee Tax Obligations

Upon vesting or settlement of certain share‑based awards, the Company may withhold a portion of the shares otherwise issuable to employees in order to satisfy statutory income and payroll tax withholding requirements. The shares withheld are not issued and therefore are not considered shares repurchased by the Company or reported as treasury stock. The Company records a liability for the amount of taxes to be remitted to tax authorities, and such cash payments are classified as financing activities within the Condensed Consolidated Statements of Cash Flows.

Recent Accounting Pronouncements

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 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 2025-01 — Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date (“ASU 2025-01”). ASU 2024-03 requires additional disclosure of the nature of expenses included in the statement of operations as well as disclosures about specific types of expenses included in the expense captions presented in the statement of operations. ASU 2024-03, as clarified by ASU 2025-01, is effective for annual periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Both early adoption and retrospective application are permitted. Upon adoption, the Company expects to enhance expense disclosures based on the new requirements.

In September 2025, the FASB issued ASU 2025-06 — Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”). ASU 2025-06 was issued to modernize the accounting for software costs that are accounted for under Subtopic 350-40, including removing reference to “project stages” and adding the “probable-to-complete recognition threshold.” ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating these new requirements.

In December 2025, the FASB issued ASU 2025-11 — Interim Reporting (Topic 270): Narrow-Scope Improvements (“ASU 2025-11”). ASU 2025-11 clarifies the interim reporting guidance in the Accounting Standards Codification (“ASC”), adding a comprehensive list of required interim disclosures and a principle that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for interim periods within annual periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating these new disclosure requirements.

All other ASUs issued and not yet effective as of March 31, 2026 and through the date of this report, were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s current or future financial position or results of operations.

3. Inventory

Inventory consists of the following as of the periods presented:


(in thousands)	March 31, 2026		December 31, 2025
Finished goods	$	41,813	$	37,538
Work in process	1,003		1,215
Raw materials	5,414		5,822
Less: inventory reserve	(2,156)		(2,202)
Inventory	$	46,074	$	42,373

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements - Continued

(unaudited)

(in thousands, except share and per share amounts)

4. Property and Equipment, Net

Property and equipment, net consists of the following as of the periods presented:


(in thousands)	March 31, 2026		December 31, 2025
Land	$	1,090	$	731
Building	62,085		60,679
Leasehold improvements	18,405		18,060
Processing equipment	17,098		16,572
Furniture and equipment	10,889		10,850
Projects in process	1,425		1,241
Finance lease right-of-use assets	80		80
Property and equipment, at cost	111,072		108,213
Less: accumulated depreciation	(28,034)		(26,430)
Property and equipment, net	$	83,038	$	81,783

Depreciation expense is as follows for the periods presented:


	Three Months Ended March 31,
(in thousands)		2026		2025
Depreciation expense		$	1,604	$	1,728

5. Intangible Assets, Net

Intangible assets, net consist of the following as of the periods presented:


	March 31, 2026						December 31, 2025
(in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortizable intangible assets:
Patents	$	8,069	$	(1,519)	$	6,550	$	7,498	$	(1,418)	$	6,080



Unamortized intangible assets:
Trademarks	720		—		720		670		—		670
Total intangible assets	$	8,789	$	(1,519)	$	7,270	$	8,168	$	(1,418)	$	6,750

Amortization expense is as follows for the periods presented:


	Three Months Ended March 31,
(in thousands)		2026		2025
Amortization expense		$	101	$	67

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements - Continued

(unaudited)

(in thousands, except share and per share amounts)

As of March 31, 2026, future amortization of patents is as follows:


(in thousands)
2026 (excluding the three months ended March 31, 2026)	$	319
2027	426
2028	426
2029	426
2030	426
Thereafter	4,527
Total	$	6,550

6. Fair Value Measurements

The following tables present the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of the periods presented:


	Balance Sheet Classification	March 31, 2026
(in thousands)		(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Money market funds	Cash and cash equivalents	$	76,719	$	—	$	—	$	76,719
U.S. Treasuries	Investments	10,789		—		—		10,789
Corporate bonds	Investments	—		8,000		—		8,000
Money market funds	Investments	158		—		—		158
Total assets		$	87,666	$	8,000	$	—	$	95,666


	Balance Sheet Classification	December 31, 2025
(in thousands)		(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Money market funds	Cash and cash equivalents	$	28,255	$	—	$	—	$	28,255
U.S. Treasuries	Investments	5,980		—		—		5,980



Total assets		$	34,235	$	—	$	—	$	34,235

Liabilities:

Debt derivative liabilities		$	—	$	—	$	3,886	$	3,886

The changes in Level 3 liabilities measured at fair value on a recurring basis for the periods indicated were as follows:


	Three Months Ended March 31,
(in thousands)	2026		2025
Balance at December 31, 2025 and 2024	$	3,886	$	2,400
Change in fair value included in net loss	—		158
Extinguishment of debt derivative	(3,886)		—
Balance at March 31, 2026 and 2025	$	—	$	2,558

There were no changes in the levels or methodology of the measurement of financial assets or liabilities during the three months ended March 31, 2026 and 2025.

The fair values of cash, restricted cash, accounts receivable, accounts payable and accrued expenses approximate the carrying values because of the short-term nature of these instruments.

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements - Continued

(unaudited)

(in thousands, except share and per share amounts)

7. Leases

The Company leases administrative, manufacturing, research, and distribution facilities through operating leases. Several leases include fixed payments, including rent and non-lease components such as common area or other maintenance costs.

The components of total operating lease expense and sublease income are as follows for the periods indicated:


	Three Months Ended March 31,
(in thousands)		2026		2025




Operating lease costs		$	942	$	911
Short-term lease costs		31		127
Variable lease costs		345		59
Total operating lease expense		$	1,318	$	1,097

Sublease income		$	270	$	269

Supplemental balance sheet information related to the operating and financing leases is as follows as of the periods indicated:


(in thousands, except lease term and discount rate)	March 31, 2026		December 31, 2025
Operating Leases
Right-of-use operating assets	$	14,280	$	12,732
Current maturities of long-term lease obligations	$	2,096	$	2,354
Long-term lease obligations	$	18,500	$	16,838


Financing Leases
Right-of-use financing assets, net of accumulated amortization (1)	$	40	$	44
Current maturities of long-term lease obligations	$	19	$	18
Long-term lease obligations	$	27	$	32

Weighted average operating lease term:	7.8 years		8.1 years
Weighted average financing lease term:	2.5 years		1.8 years

Weighted average discount rate - operating leases	10.29%		10.87%
Weighted average discount rate - financing leases	13.59%		8.01%

__________

(1)Financing leases are included in Property and equipment, net on the Condensed Consolidated Balance Sheets.

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements - Continued

(unaudited)

(in thousands, except share and per share amounts)

Future minimum lease payments under operating and financing leases as of March 31, 2026 are as follows:


(in thousands)
2026 (excluding the three months ended March 31, 2026)	$	3,203
2027	3,569
2028	3,587
2029	3,665
2030	3,593
Thereafter	12,793
Total	30,410
Less: Imputed interest	(9,768)
Total lease obligations	20,642
Less: Current maturities of long-term lease obligations	(2,115)
Long-term lease obligations	$	18,527

Lease Modifications

The Company accounts for lease revisions as a lease modification in accordance with FASB ASC 842, Leases, when the modification effectively terminates the existing lease and creates a new lease.

The Company and Progress Park Buildings Alachua, LLC, a Florida limited liability company (as successor in interest to Alachua Copeland Park Investments, LLC, a Florida limited liability company, who was successor in interest to Ology Bioservices Holdings, LLC, a Delaware limited liability company, who was successor in interest to SNH Medical Office Properties Trust), are parties to a lease dated February 6, 2007, as amended (the “Primary Lease”). Pursuant to the Primary Lease, the Company leases an approximately 19,000 square foot corporate headquarters facility in Alachua, Florida. On February 24, 2026, the Company entered into a seventh amendment to the Primary Lease to extend the term of the Primary Lease to December 31, 2031. The Company recorded a right-of-use asset and lease liability of $1,967 related to this extension.

8. Long-Term Debt, Net of Debt Discount and Financing Fees

Credit Facility

In June 2020, the Company entered into a credit facility (the “Credit Facility”) with Oberland Capital and its affiliates, TPC Investments II LP and Argo LLC (collectively, the “Lender”). The Company obtained the first tranche of the Credit Facility of $35,000 at closing on June 30, 2020. On June 30, 2021, the second tranche of the Credit Facility of $15,000 was drawn down by the Company. Each tranche of the Credit Facility had a term of seven years from the date of issuance.

During the three months ended March 31, 2026 and 2025, the Company paid Credit Facility debt interest of $438 and $1,489, respectively, to the Lender.

In connection with the Credit Facility, the Company entered into a revenue participation agreement (the “Revenue Participation Agreement”) with the Lender, which provided a quarterly royalty payment as a percentage of the Company’s net revenues, up to $70,000 in any given year. The Company recorded $186 and $524 as interest expense for this Revenue Participation Agreement for the three months ended March 31, 2026 and 2025, respectively.

Upon repayment of the Credit Facility, the Company was required to repay the principal balance and provide a make-whole payment calculated to generate an internal rate of return to the Lender equal to 11.5%, less the total of all quarterly interest and royalty payments previously paid to the Lender (the “Make-Whole Payment”).

On January 20, 2026, the Company entered into a payoff letter with the Lender (the “Payoff Letter”). Pursuant to the Payoff Letter, the final payoff amount was $69,707 (the “Payoff Amount”). Upon payment of the Payoff Amount on January 28, 2026 and satisfaction of the other conditions specified in the Payoff Letter, all obligations under the Credit Facility, including the Make-Whole Payment, were paid in full, all liens and security interests securing such obligations were released, and the Credit Facility and related loan documents were terminated, subject to certain customary surviving provisions. Payment

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements - Continued

(unaudited)

(in thousands, except share and per share amounts)

of the Payoff Amount was funded by proceeds from an underwritten public offering of an aggregate of 4,600,000 shares of the Company’s common stock, $0.01 par value per share, at a public offering price of $31.00 per share (the “Offering”) completed by the Company on January 23, 2026. See Note 9 - Stockholders’ Equity for additional details regarding the Offering.

In connection with the repayment of the Credit Facility, the Company recorded a loss on extinguishment of debt of $16,849 during the three months ended March 31, 2026.

Other Credit Facilities

The Company had restricted cash of $2,000 and $4,000 at March 31, 2026 and December 31, 2025, respectively which represents collateral for an irrevocable standby letter of credit required to meet contractual terms of a lease agreement held by the Company.

9. Stockholders’ Equity

On January 21, 2026, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Wells Fargo Securities, LLC and Mizuho Securities USA LLC, as representatives of the underwriters (the “Underwriters”). Pursuant to the terms and conditions of the Underwriting Agreement, the Company agreed to sell 4,000,000 shares of its common stock, $0.01 par value per share, at a public offering price of $31.00 per share, plus an additional 600,000 shares pursuant to the Underwriters’ option to purchase additional shares. The Offering closed on January 23, 2026 with a sale of 4,600,000 shares.

The Company received net proceeds from the Offering of $133,252, after deducting the underwriting discounts and commissions, and expenses in connection with the Offering. Net proceeds from the Offering were used for the early payoff and termination of the Credit Facility for a final repayment amount of $69,707. The remaining net proceeds will be used for working capital, capital expenditures and other general corporate purposes. See Note 8 - Long-Term Debt, Net of Debt Discount and Financing Fees for details regarding the termination of the Credit Facility.

10. Stock-Based Compensation

The Company’s stock-based compensation plans are described in Note 11 - Stock-Based Compensation to its consolidated financial statements included in the 2025 Annual Report on Form 10-K.

During the three months ended March 31, 2026, the following stock-based awards were granted to officers and employees. All awards were granted under the 2019 Amended and Restated Long-Term Incentive Plan.


Type of Award	Target Shares or Units	Weighted Average Grant Date Fair Value




Restricted Stock Units (1)	522,980	$	31.64



Performance Stock Units (2)	525,474	$	31.65

__________

(1)Restricted Stock Units (“RSUs”) awarded to certain officers and employees during the first quarter of 2026 vest 50% after 24 months and an additional 25% on the third and fourth anniversaries of the grant date.

(2)Performance Stock Units (“PSUs”) were awarded to certain executive officers and other employees during the first quarter of 2026 with a target of 381,000 shares and performance metrics tied to the Company’s revenue compounded annual growth rate (“CAGR”) from 2026 through 2028 and total shareholder return (“TSR”) relative to its peers (“2026 CAGR TSR PSUs”) with a payout ranging from 0% to 200% upon achievement of specific revenue CAGR and relative TSR goals. The 2026 CAGR TSR PSUs vest at the end of the three-year period upon determination of the results at the end of the performance period. PSUs were awarded to certain employees during the first quarter of 2026 with a target of 46,452 shares and performance metrics tied to the achievement of sales quota goals.

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements - Continued

(unaudited)

(in thousands, except share and per share amounts)

Non-cash stock-based compensation expense is included in the following line items on the Condensed Consolidated Statements of Operations as follows for the periods indicated:


	Three Months Ended March 31,
(in thousands)		2026		2025
Costs of goods sold		$	919	$	(10)
Sales and marketing		1,558		584
Research and development		1,419		720
General and administrative		2,947		1,615
Total non-cash stock-based compensation expense		$	6,843	$	2,909

11. Net Loss Per Common Share

The following reflects the net loss attributable to common shareholders and share data used in the basic and diluted net loss per common share computations using the two-class method for the periods indicated:


	Three Months Ended March 31,
(in thousands, except per share amounts)		2026		2025
Numerator:
Net loss		$	(19,584)	$	(3,834)

Denominator:
Weighted average shares outstanding - basic		51,591,504		45,204,076
Weighted average shares outstanding - diluted		51,591,504		45,204,076

Net loss per common share - basic		$	(0.38)	$	(0.08)
Net loss per common share - diluted		$	(0.38)	$	(0.08)

Anti-dilutive shares excluded from the calculation of diluted net loss per common share (1)
Stock options		1,469,393		1,355,425
Restricted and performance stock units		3,714,324		2,398,560

__________

(1)These common equivalent shares are not included in the diluted per share calculations as they would be dilutive if the Company was in a net income position.

12. Income Taxes

The Company has not recorded material income tax expense or income tax benefit for the three months ended March 31, 2026 and 2025 due to the generation of fiscal year net operating losses, the benefits of which have been fully reserved.

Deferred income taxes are accounted for using the balance sheet approach, which requires recognition of deferred tax assets and liabilities for the expected future consequences of temporary differences between the financial reporting basis and the tax basis of assets and liabilities as measured by enacted state and federal tax rates. A valuation allowance is provided to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more-likely-than-not that a portion or none of the deferred tax assets will be realized. As of March 31, 2026 and December 31, 2025, management assessed the realizability of deferred tax assets. After consideration of all the evidence, including reversal of deferred tax liabilities, future taxable income and other factors, management determined that a full valuation allowance was necessary as of March 31, 2026 and December 31, 2025. A portion of the net operating loss carryforwards may expire due to limitations imposed by Section 382 of the Internal Revenue Code (“IRC”). In addition, future utilization of the available net operating loss carryforwards may be limited under IRC Section 382 as a result of changes in ownership.

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements - Continued

(unaudited)

(in thousands, except share and per share amounts)

In the normal course of business, the Company is subject to examination by taxing authorities throughout the U.S. The Company’s remaining open tax years subject to examination by federal tax authorities include the years ended December 31, 2022 through 2025. During the three months ended March 31, 2026, the Internal Revenue Service (“IRS”) completed examining the Company’s 2021 federal income tax return with no material findings. The Company’s remaining open tax years subject to examination by state and foreign tax authorities include the years ended December 31, 2020 through 2025. However, for tax years 2004 through 2021, federal and state taxing authorities may examine and adjust loss carryforwards in the years in which those loss carryforwards are ultimately utilized.

13. Segments

The Company determines its operating segments in accordance with FASB ASC 280, Segment Reporting (“ASC 280”). ASC 280 defines operating segments as components where discrete financial information is regularly reviewed by the chief operating decision maker (“CODM”), which for the Company is the Chief Executive Officer, to determine resource allocation and assess performance. As such, based on the way the CODM monitors and makes decisions affecting operations, the Company has concluded that it has one operating and reportable segment. The CODM is regularly provided with only the consolidated expenses as noted on the face of the Condensed Consolidated Statements of Operations. As the Company has only one operating segment and is managed on a consolidated basis, the measure of profit or loss is consolidated net income or loss. The metrics are used to review operating trends, to perform analytical comparisons between periods and to monitor budget to actual variances.

Geographic Areas

International revenues are defined as revenues generated from sales to customers outside of the U.S. The following table details total revenues by major geographic area for the periods indicated:


	Three Months Ended March 31,
(in thousands)	2026		2025
U.S.	$	60,131	$	47,843
International	1,326		717
Total revenues	$	61,457	$	48,560

As of March 31, 2026 and December 31, 2025, all of the Company’s long-lived assets were held within the U.S.

14. Commitments and Contingencies

Service Agreements

The Company pays a third party a facility fee for the use of cleanrooms, manufacturing, storage, and office space and for services in support of its tissue processing including for routine sterilization of daily supplies, providing disposable supplies and microbial services, and office support pursuant to a License and Services Agreement, as amended (the “License and Services Agreement”). Pursuant to the License and Services Agreement, the Company recorded expenses of $182 and $240 for the three months ended March 31, 2026 and 2025, respectively, within Cost of goods sold in the Company’s Condensed Consolidated Statements of Operations. The License and Services Agreement was amended on December 31, 2023 extending the term through December 31, 2026. The License and Services Agreement may be terminated by either party by providing an eighteen-month written notice. The Company utilizes the same third-party vendor for processing and packaging of Avive+ Soft Tissue Matrix™.

Distribution and Supply Agreements

In August 2008, the Company entered into an exclusive distribution agreement with a third party (the “Distributor”) to distribute the Axoguard Nerve Connector® and Axoguard Nerve Protector™ products worldwide and the parties subsequently amended the agreement on August 4, 2023. The distribution agreement expires on December 31, 2030. The distribution agreement establishes a formula for the transfer cost of the Axoguard Nerve Connector® and Axoguard Nerve Protector™ products and requires certain minimum purchases by the Company, although, through mutual agreement, the parties have not established such minimums; and, to date, have not enforced such provision. Under the distribution agreement, the Company

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Axogen, Inc.

Notes to Condensed Consolidated Financial Statements - Continued

(unaudited)

(in thousands, except share and per share amounts)

provides purchase orders to the Distributor, and the Distributor fulfills the purchase orders. The distribution agreement allows for termination provisions for both parties.

In June 2017, the Company entered into the Nerve End Cap Supply Agreement (the “Supply Agreement”) with the Distributor whereby the Distributor is the exclusive contract manufacturer of the Axoguard Nerve Cap®, and the parties subsequently amended the agreement on August 4, 2023. The Supply Agreement expires on December 31, 2030. The Supply Agreement establishes the terms and conditions in which the Distributor will manufacture the product for the Company. Under the Supply Agreement, the Company provides purchase orders to the Distributor and the Distributor fulfills the purchase orders. The Supply Agreement allows for termination provisions for both parties.

In May 2023, the Company entered into the Supply and Manufacturing Agreement (the “HA+ Supply Agreement”) with the Distributor whereby the Distributor is the exclusive contract manufacturer of the Axoguard HA+ Nerve Protector™. The HA+ Supply Agreement expires on July 1, 2030. The HA+ Supply Agreement establishes the terms and conditions in which the Distributor will manufacture, package, label and deliver the product to the Company. Under the HA+ Supply Agreement, the Company provides purchase orders to the Distributor, and the Distributor fulfills the purchase orders. The HA+ Supply Agreement allows for termination provisions for both parties.

The loss of the Company’s ability to sell the Axoguard Nerve Connector®, Axoguard Nerve Protector™, Axoguard Nerve Cap® and Axoguard HA+ Nerve Protector™ products could have a material adverse effect on the Company’s business until other replacement products would become available.

Processing Facilities

The Company is highly dependent on the continued availability of its processing facilities at its Axogen Processing Center (the “APC Facility”) in Vandalia, Ohio and the facility it leases in Dayton, Ohio and could be harmed if the physical infrastructure of these facilities is unavailable for any prolonged period of time.

Certain Economic Development Grants

The Company obtained certain economic development grants from state and local authorities totaling up to $2,685, including $1,250 of cash grants, to offset costs to acquire and develop the APC Facility. Certain of these economic development grants were subject to fixed asset investments and job creation milestones by December 31, 2024 and have clawback clauses if the Company does not meet the job creation milestones. In October 2025, the Company received notification from certain grant authorities that the Company is expected to satisfy its job creation milestone, assuming the Company continues to maintain its existing headcount and payroll amount thresholds through December 31, 2026. If the Company is unable to maintain minimum requirements under its grant agreements, the Company could be obligated to pay back up to approximately $950 as of March 31, 2026 related to these grants. As of March 31, 2026, the Company has received $1,250 in cash grants related to these economic development grants.

Other Commitments

Certain executive officers of the Company are parties to employment contracts. Such contracts have severance payments for certain conditions including change of control.

Legal Proceedings

The Company is and may be subject to various claims, lawsuits and proceedings in the ordinary course of the Company’s business. Such matters are subject to many uncertainties and outcomes are not predictable with assurance. While there can be no assurances as to the ultimate outcome of any legal proceeding or other loss contingency involving the Company, in the opinion of management, such claims are either adequately covered by insurance or otherwise indemnified, or are not expected individually or in the aggregate, to result in a material, adverse effect on the Company’s financial condition, results of operations or cash flows. However, it is possible that the Company’s results of operations, financial position and cash flows in a particular period could be materially affected by these contingencies.

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Axogen, Inc.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(in thousands, except share and per share amounts)

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

The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and the related notes thereto appearing elsewhere in this report and our consolidated financial statements for the year ended December 31, 2025, included in our 2025 Annual Report on Form 10-K. All dollar amounts in the discussion and analysis, unless noted otherwise, are presented in thousands.

Unless the context otherwise requires, all references in this report to “Axogen,” the “Company,” “we,” “us” and “our” refer to Axogen, Inc., and its wholly owned subsidiaries Axogen Corporation, Axogen Processing Corporation, Axogen Europe GmbH and Axogen Germany GmbH.

Overview

We are the leading company focused specifically on the science, development and commercialization of technologies for peripheral nerve regeneration and repair. We are passionate about providing the opportunity to restore nerve function and quality of life for patients with peripheral nerve injuries. We provide innovative, clinically proven and economically effective repair solutions for surgeons and healthcare providers. Peripheral nerves provide the pathways for both motor and sensory signals throughout the body. Every day people suffer traumatic injuries or undergo surgical procedures that impact the function of their peripheral nerves. Physical damage to a peripheral nerve or the inability to properly reconnect peripheral nerves can result in the loss of muscle or organ function, the loss of sensory feeling, or the initiation of pain.

Product Portfolio

Our platform for peripheral nerve repair features a comprehensive portfolio of products, including:

•Avance® (acellular nerve allograft-arwx), an FDA-approved acellular nerve scaffold for the treatment of adult and pediatric patients aged one month or older with sensory, mixed, and motor peripheral nerve discontinuities (“Avance”);

•Avance® Nerve Graft, a biologically active off-the-shelf processed human nerve allograft for bridging severed peripheral nerves without the comorbidities associated with a second surgical site (“Avance Nerve Graft”);

•Axoguard Nerve Connector®, a porcine (pig) submucosa extracellular matrix (“ECM”) coaptation aid for tensionless repair of severed peripheral nerves (“Axoguard Nerve Connector”);

•Axoguard Nerve Protector®, a porcine submucosa ECM product used to wrap and protect damaged peripheral nerves and reinforce the nerve reconstruction while minimizing soft tissue attachments (“Axoguard Nerve Protector”);

•Axoguard HA+ Nerve Protector™, a porcine submucosa ECM base layer coated with a proprietary hyaluronate-alginate gel, a next-generation technology designed to enhance nerve gliding and provide short- and long-term protection for peripheral nerve injuries (“Axoguard HA+ Nerve Protector”);

•Axoguard Nerve Cap®, a porcine submucosa ECM product used to protect a peripheral nerve end and separate the nerve from the surrounding environment to reduce the development of symptomatic or painful neuroma (“Axoguard Nerve Cap”); and

•Avive+ Soft Tissue Matrix™, a multi-layer amniotic membrane allograft used to protect and separate tissues in the surgical bed during the critical phase of tissue healing (“Avive+ Soft Tissue Matrix”).

On December 3, 2025, the FDA approved the BLA for Avance. Continued approval depends on verification and description of clinical benefits in confirmatory studies.

While we offer nerve repair products in the U.S., Canada, Germany, the United Kingdom, Spain and several other countries, we derive substantially all of our revenues from sales of our nerve repair products to customers in the U.S.

Our strategy remains focused on deepening our presence in high-potential accounts, specifically Level 1 trauma centers and academic-affiliated hospitals with a high number of trained microsurgeons. We will drive growth in these accounts through

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Axogen, Inc.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued

(in thousands, except share and per share amounts)

targeted expansion of nerve repair indications and driving deeper adoption of our nerve repair algorithm across multiple surgical specialties.

Business Outlook

We are subject to risks and exposures from the evolving macroeconomic environment, including financial market volatility, geopolitical tensions and escalating trade disputes with U.S. trading partners. While our direct exposure to current tariffs is limited, risk lies in the potential for these disputes to cause a broader trade war, resulting in general economic instability and uncertainty that could cause our net revenue to fluctuate. We are actively assessing steps to mitigate potential adverse effects; however, if these measures are not effective in addressing wider economic disruption, our business, financial condition, results of operations and liquidity could be materially adversely affected.

Summary of Operational and Business Highlights

•Revenues were $61,457 for the quarter ended March 31, 2026, an increase of $12,897 or 26.6% compared to the quarter ended March 31, 2025.

•Gross profit was $46,189 for the quarter ended March 31, 2026, an increase of $11,256 or 32.2% compared to the quarter ended March 31, 2025.

•Received positive coverage decisions from Cigna and Elevance Health, two of the nation’s largest commercial insurers.

•Effective January 1, 2026, CMS created a new Level 3 Nerve Procedure Code, increasing Avance facility reimbursement 40% year-over-year to $9 for hospital outpatient and 35% to $6 for ASC-based procedures.

•On January 23, 2026, Axogen closed an upsized public offering with the sale of 4,600,000 shares of common stock, yielding net proceeds of $133,252. From these net proceeds, $69,707 were used to fully repay and terminate our Credit Facility on January 28, 2026. Remaining funds are available for working capital, capital expenditures, and other general corporate purposes.

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Axogen, Inc.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued

(in thousands, except share and per share amounts)

Results of Operations

Comparison of the Three Months Ended March 31, 2026 and 2025

The following table sets forth, for the periods indicated, our results of operations expressed as dollar amounts and percentage of total revenue:


	Three Months Ended March 31,
	2026				2025
(dollars in thousands)	Amount		% of Revenue		Amount		% of Revenue
Revenues	$	61,457	100.0	%	$	48,560	100.0	%
Cost of goods sold	15,268		24.8		13,627		28.1
Gross profit	46,189		75.2		34,933		71.9
Costs and expenses:
Sales and marketing	28,633		46.6		21,045		43.3
Research and development	7,517		12.2		6,091		12.5
General and administrative	12,871		20.9		9,458		19.5
Total costs and expenses	49,021		79.8		36,594		75.3
Loss from operations	(2,832)		(4.6)		(1,661)		(3.4)
Other income (expense):
Investment income	768		1.2		272		0.5

Interest expense	(694)		(1.1)		(2,250)		(4.6)
Loss on extinguishment of debt	(16,849)		(27.4)		—		—
Change in fair value of debt derivative liabilities	—		—		(158)		(0.3)
Other income (expense), net	23		—		(37)		(0.1)
Total other expense, net	(16,752)		(27.3)		(2,173)		(4.5)
Net loss	$	(19,584)	(31.9)	%	$	(3,834)	(7.9)	%

Revenues

Revenues for the three months ended March 31, 2026 increased $12,897, or 26.6%, to $61,457, as compared to $48,560 for the three months ended March 31, 2025. The increase in revenues was primarily driven by an increase in unit volume and the impact of changes in price.

Gross Profit

Gross profit for the three months ended March 31, 2026 increased $11,256, or 32.2%, to $46,189, as compared to $34,933 for the three months ended March 31, 2025. Gross margin as a percentage of revenues was 75.2% and 71.9% for the three months ended March 31, 2026 and 2025, respectively. Higher margins on products sold were driven by lower inventory write-offs and lower shipping costs on products sold, partially offset by higher product costs.

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Axogen, Inc.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued

(in thousands, except share and per share amounts)

Costs and Expenses

Following is a summary of the change in costs and expenses for the three months ended March 31, 2026:


(dollars in thousands)	Total costs and expenses			Sales and marketing			Research and development			General and administrative
For the three months ended March 31, 2025	$	36,594		$	21,045		$	6,091		$	9,458
Change from:

Compensation costs (1)	8,076			5,214			622			2,240
Stock-based compensation (2)	3,005			974			699			1,332
Research and development project costs (3)	835			—			835			—
Marketing program costs	632			632			—			—
Travel costs	587			402			165			20
Professional services fees and expenses	(1,397)			(15)			(892)			(490)
Occupancy related costs	(24)			79			(56)			(47)
Other	713			302			53			358
Total change	12,427			7,588			1,426			3,413
For the three months ended March 31, 2026	$	49,021		$	28,633		$	7,517		$	12,871
Percentage change	34.0		%	36.1		%	23.4		%	36.1		%

__________

(1)Primarily due to higher salaries, employee benefits, sales commissions, incentive compensation and payroll taxes, due to higher headcount and sales volumes.

(2)Primarily due to anticipated above target achievement for certain PSU awards due to sales growth.

(3)Clinical trial costs and expenses represented approximately 59% and 43% of total research and development costs and expenses for the three months ended March 31, 2026 and 2025, respectively. Product development costs and expenses represented approximately 41% and 57% of total research and development costs and expenses for the three months ended March 31, 2026 and 2025, respectively.

Other Expense, Net

Other expense, net for the three months ended March 31, 2026 increased $14,579, or 670.9%, to $16,752, as compared to $2,173 for the three months ended March 31, 2025. The increase in total other expense, net was primarily due to loss on the extinguishment of debt of $16,849, partially offset by a decrease of $1,556 in interest expense and an increase of $496 in investment income.

Income Taxes

We had no material income tax expense or benefit during the three months ended March 31, 2026 and 2025 due to the incurrence of net operating losses in both periods, the benefits of which have a full valuation allowance. From time to time, we receive notices of examination of prior tax filings from federal and state authorities. During the three months ended March 31, 2026, the IRS completed examining our 2021 federal income tax return with no material findings. We do not believe that there are any material additional tax expenses or benefits.

Critical Accounting Estimates

In preparing our financial statements in accordance with generally accepted accounting principles, there are certain accounting policies, which may require substantial judgment or estimation in their application. We believe our accounting policies for Inventories, Derivative Instruments and Stock-based Compensation, as well as the others set forth in Note 2 - Summary of Significant Accounting Policies in the Notes to the Consolidated Financial Statements in our 2025 Annual Report on Form 10-K, are critical to understanding our results of operations and financial condition. See Critical Accounting Estimates in our 2025 Annual Report on Form 10-K. Actual results could differ from our estimates and assumptions, and any such differences could be material to our results of operations and financial condition. During the quarter covered by this report, there have been no material changes to the accounting estimates and assumptions previously disclosed.

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Axogen, Inc.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued

(in thousands, except share and per share amounts)

Liquidity and Capital Resources

As of March 31, 2026, our principal sources of liquidity were our cash and cash equivalents and investments totaling $101,601. Our cash equivalents are comprised of money market mutual funds and our investments primarily consist of U.S. Treasuries and corporate bonds. Our cash and cash equivalents and investments increased $60,073 to $101,601 from $41,528 at December 31, 2025. The increase was primarily as a result of net proceeds from the Offering of $133,252 and the release of $2,000 of restricted cash under the contractual terms of a lease agreement. These increases were partially offset by cash used for early payoff and termination of the Credit Facility of $69,707 and payment of annual bonuses during the first quarter of 2026.

On March 31, 2026 and December 31, 2025, our current assets exceeded our current liabilities by $158,695 and $96,866, respectively, and we had a current ratios of 7.1x and 5.1x, respectively. Based on current estimates, we believe that our existing cash and cash equivalents and investments, as well as cash provided by sales of our products, will allow us to fund our operations through at least the next twelve months from the date of issuance of the accompanying financial statements.

Cash Flow Information

The following table presents a summary of cash flows from operating, investing and financing activities for the periods indicated:


	Three Months Ended March 31,
(in thousands)	2026		2025
Net cash provided by (used in):
Operating activities	$	1,565	$	(13,179)
Investing activities	(15,964)		1,339
Financing activities	59,505		2,382
Net increase (decrease) in cash and cash equivalents, and restricted cash	$	45,106	$	(9,458)

Net Cash Provided by (Used in) Operating Activities

Net cash provided by operating activities was $1,565 during the three months ended March 31, 2026 as compared to net cash used in operating activities of $13,179 during the three months ended March 31, 2025. The increase in net cash provided by operating activities of $14,744, or 111.9%, was primarily due to a net favorable change in non-cash charges and working capital accounts of $20,487 and $10,179, respectively, offset by an increase in net loss of $15,750.

Net Cash (Used in) Provided by Investing Activities

Net cash used in investing activities for the three months ended March 31, 2026 was $15,964 compared to net cash provided by investing activities of $1,339 for the three months ended March 31, 2025. The unfavorable change in net cash used in investing activities of $17,303 was primarily due to the purchase of $19,000 of investments, offset by the sale of $4,000 of investments, during the three months ended March 31, 2026, compared to the sale of $2,000 of investments during the three months ended March 31, 2025, and an increase in purchases of property and equipment of $2,533.

Net Cash Provided by Financing Activities

Net cash provided by financing activities was $59,505 and $2,382 for the three months ended March 31, 2026 and 2025, respectively, an increase of $57,123 primarily as a result of net proceeds from the Offering and proceeds from the exercise of stock options, partially offset by cash used for early payoff and termination of the Credit Facility and payments of employee tax withholding on vested stock awards in exchange for shares withheld.

Sources of Capital

Our expected future capital requirements may depend on many factors including expanding our customer base and sales force and timing and extent of spending in obtaining regulatory approval and introduction of new products. Additional sources of liquidity available to us include issuance of additional equity securities through public or private equity offerings, debt financings or from other sources. The sale of additional equity may result in dilution to our shareholders. Should additional capital not become available to us as needed, we may be required to take certain actions, such as slowing sales and marketing expansion, delaying regulatory approvals, or reducing headcount.

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Axogen, Inc.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - Continued

(in thousands, except share and per share amounts)

Contractual Obligations and Commitments


(in thousands)	2026		2027-2028		2029-2030		Thereafter		Total




Operating and finance lease obligations (1)	$	3,203	$	7,156	$	7,258	$	12,793	$	30,410

__________

(1)See Note 7 - Leases in the Notes to the Condensed Consolidated Financial Statements in this Form 10-Q.

Table of Contents

Axogen, Inc.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For a discussion of our market risks, refer to Item 7A, “Quantitative and Qualitative Disclosures about Market Risk,” included in our 2025 Annual Report on Form 10-K.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission (the “SEC”)’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, and Board of Directors, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable assurance of achieving the desired objectives, and we necessarily are required to apply our judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures.

Our management, including our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of March 31, 2026, and concluded that our disclosure controls and procedures were effective.

Changes in Internal Controls Over Financial Reporting

There were no changes in our internal control over financial reporting during the three months ended March 31, 2026 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting (as defined in Rules 13a-15(d) or 15d-15(f) of the Exchange Act).

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Axogen, Inc.

PART II – OTHER INFORMATION

ITEM 1 – LEGAL PROCEEDINGS

As disclosed in Note 14 - Commitments and Contingencies in the Notes to the Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q, we are engaged in certain legal proceedings, and the disclosure set forth in Note 14 - Commitments and Contingencies relating to legal proceedings is incorporated herein by reference.

ITEM 1A - RISK FACTORS

There have been no material changes to the risk factors disclosed in our 2025 Annual Report on Form 10-K. Any investment in our business involves a high degree of risk. Before making an investment decision, you should carefully consider the information we include in this Quarterly Report on Form 10-Q, including our unaudited interim condensed consolidated financial statements and accompanying notes, our Annual Report on Form 10-K for the year ended December 31, 2025, including our financial statements and related notes contained therein, and the additional information in the other reports we file with the SEC. These risks may result in material harm to our business and our financial condition and results of operations. In this event, the market price of our common stock may decline, and you could lose part or all of your investment. Additional risks that we currently believe are immaterial may also impair our business operations. Our business, financial condition and future prospects and the trading price of our common stock could be harmed as a result of any of these risks.

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

None.

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4 - MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5 - OTHER INFORMATION

Rule 10b5-1 Trading Plans

During the three months ended March 31, 2026, our Section 16 officers and directors adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” as such terms are defined under Item 408 of Regulation S-K as noted below.

Name and Title

Action

Date

Trading Arrangement

Aggregate Number of Securities to be Sold

Expiration Date

Rule 10b5-1 (1)

Non-Rule 10b5-1 (2)

Marc Began, Executive Vice President, General Counsel and Chief Compliance Officer

Adopt

3/11/2026

67,500

12/31/2026

__________

(1)Intended to satisfy the affirmative defense of Rule 10b5-1(c).

(2)Not intended to satisfy the affirmative defense of Rule 10b5-1(c).

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Axogen, Inc.

ITEM 6 - EXHIBITS

Exhibit
Number

Description

Filings Referenced for Incorporation by Reference

*†10.1

Form of 2026 Performance Stock Unit Award Agreement pursuant to the Axogen, Inc. 2019 Stock Incentive Plan, as amended and restated as of March 26, 2026.

Filed herewith

*10.2

Form of 2026 Restricted Stock Unit Award Agreement pursuant to the Axogen, Inc. 2019 Stock Incentive Plan, as amended and restated as of March 26, 2026.

Filed herewith

31.1

Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Filed herewith

31.2

Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Filed herewith

Certifications of the Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Furnished herewith

101.INS

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.

Filed herewith

101.SCH

Inline XBRL Taxonomy Extension Schema Document.

Filed herewith

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

Filed herewith

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document.

Filed herewith

101.LAB

Inline XBRL Extension Labels Linkbase.

Filed herewith

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Filed herewith

104

Cover Page Interactive Data File – The cover pages do not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

Filed herewith

* Management contract or compensatory plan or arrangement.

† Portions of this exhibit (indicated by asterisks) have been redacted in compliance with Regulation S-K Item 601(b)(2)(ii).

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Axogen, Inc.

SIGNATURES

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


			AXOGEN, INC.


Dated: April 28, 2026			/s/ Michael Dale
			Michael Dale Chief Executive Officer and President (Principal Executive Officer)

Dated: April 28, 2026			/s/ Lindsey Hartley
			Lindsey Hartley Chief Financial Officer (Principal Accounting Officer)

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Date	Price Target	Rating	Analyst
2/19/2026	$40.00	Overweight	Wells Fargo
12/1/2025	$40.00	Outperform	Mizuho
3/17/2025	$30.00	Buy	Lake Street
7/1/2024	$13.00	Outperform	Raymond James
11/11/2022	$15.00	Buy	Jefferies
5/9/2022	$10.00 → $15.00	Hold → Buy	Canaccord Genuity
3/11/2022	$21.00	Overweight	Cantor Fitzgerald
11/4/2021	$25.00 → $20.00	Market Outperform	JMP Securities

SEC Form 10-Q filed by Axogen Inc.

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SEC Form DEF 14A filed by Axogen Inc.