10-Q - NVEC - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2025

☐ 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: 000-12196

NVE CORPORATION

(Exact name of registrant as specified in its charter)

Minnesota	41-1424202
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1 1409 Valley View Road , Eden Prairie , Minnesota	55344
(Address of principal executive offices)	(Zip Code)
( 952 ) 829-9217
(Registrant’s telephone number, including area code)

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 (Section 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

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	NVEC	The NASDAQ Stock Market, LLC

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $0.01 Par Value – 4,837,166 shares outstanding as of September 30, 2025.

Table of Contents

NVE CORPORATION

QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets
Statements of Income for the Quarters EndedSeptember 30, 2025and 2024
Statements of Comprehensive Income for the Quarters EndedSeptember 30, 2025and 2024
Statements of Income for theSix Months EndedSeptember 30, 2025and 2024
Statements of Comprehensive Income for theSix Months EndedSeptember 30, 2025and 2024
Statements of Shareholders’ Equity for theSix MonthsEndedSeptember 30, 2025
Statements of Shareholders’ Equity for theSix MonthsEndedSeptember 30, 2024
Statements of Cash Flows for theSix MonthsEndedSeptember 30, 2025and 2024
Notes to Financial Statements
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 4. Controls and Procedures
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 4. Mine Safety Disclosures
Item 6. Exhibits
SIGNATURES

Table of Contents

PART I–FINANCIAL INFORMATION

Item 1. Financial Statements.

NVE CORPORATION

BALANCE SHEETS

		March 31, 2025
ASSETS
Current assets
Cash and cash equivalents	5,107,481	$	8,036,564
Marketable securities, short-term (amortized cost of 12,597,421 as of September 30, 2025, and 13,730,266 as of March 31, 2025)	12,640,185		13,691,593
Accounts receivable, net of allowance for credit losses of 15,000	2,440,856		3,589,268
Inventories, net	7,418,843		7,449,083
Prepaid expenses and other assets	1,163,093		433,414
Total current assets	28,770,458		33,199,922
Fixed assets
Machinery and equipment	12,783,642		11,758,205
Leasehold improvements	2,059,853		1,956,309
	14,843,495		13,714,514
Less accumulated depreciation and amortization	11,902,066		11,727,615
Net fixed assets	2,941,429		1,986,899
Deferred tax assets	1,079,733		1,867,069
Marketable securities, long-term (amortized cost of 27,771,414 as of September 30, 2025, and 26,353,692 as of March 31, 2025)	27,844,069		26,304,623
Right-of-use asset – operating lease	854,529		917,349
Total assets	61,490,218	$	64,275,862
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable	229,526	$	214,691
Accrued payroll and other	585,395		871,169
Operating lease	155,800		83,010
Total current liabilities	970,721		1,168,870
Long-term operating lease liability	806,542		838,221
Total liabilities	1,777,263		2,007,091
Shareholders’ equity
Common stock, 0.01 par value, 6,000,000 shares authorized; 4,837,166 issued and outstanding as of September 30, 2025 and March 31, 2025	48,372		48,372
Additional paid-in capital	19,894,256		19,821,106
Accumulated other comprehensive income (loss)	90,166		(68,544	)
Retained earnings	39,680,161		42,467,837
Total shareholders’ equity	59,712,955		62,268,771
Total liabilities and shareholders’ equity	61,490,218	$	64,275,862

All values are in US Dollars.

*The March 31, 2025 Balance Sheet is derived from the audited financial statements contained in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025.

See accompanying notes.

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NVE CORPORATION

STATEMENTS OF INCOME

(Unaudited)

	Quarter Ended September 30,
	2025		2024
Revenue
Product sales	$	6,138,772	$	6,104,433
Contract research and development		208,220		654,257
Total revenue, net		6,346,992		6,758,690
Cost of sales		1,378,494		947,254
Gross profit		4,968,498		5,811,436
Expenses
Research and development		873,470		847,603
Selling, general, and administrative		436,919		568,241
Total expenses		1,310,389		1,415,844
Income from operations		3,658,109		4,395,592
Interest income		484,330		464,429
Other income		3,094		-
Income before taxes		4,145,533		4,860,021
Provision for income taxes		834,695		833,876
Net income	$	3,310,838	$	4,026,145
Net income per share – basic	$	0.68	$	0.83
Net income per share – diluted	$	0.68	$	0.83
Cash dividends declared per common share	$	1.00	$	1.00
Weighted average shares outstanding
Basic		4,837,166		4,833,855
Diluted		4,839,243		4,839,291

STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Quarter Ended September 30,
	2025		2024
Net income	$	3,310,838	$	4,026,145
Unrealized gain from marketable securities, net of tax		83,348		680,417
Comprehensive income	$	3,394,186	$	4,706,562

See accompanying notes.

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NVE CORPORATION

STATEMENTS OF INCOME

(Unaudited)

	Six Months Ended September 30,
	2025		2024
Revenue
Product sales	$	12,047,342	$	12,720,292
Contract research and development		404,294		821,642
Total revenue, net		12,451,636		13,541,934
Cost of sales		2,561,017		1,922,748
Gross profit		9,890,619		11,619,186
Expenses
Research and development		1,593,701		1,726,131
Selling, general, and administrative		855,559		1,108,645
Total expenses		2,449,260		2,834,776
Income from operations		7,441,359		8,784,410
Interest income		982,538		958,388
Other income		3,905		-
Income before taxes		8,427,802		9,742,798
Provision for income taxes		1,541,146		1,619,066
Net income	$	6,886,656	$	8,123,732
Net income per share – basic	$	1.42	$	1.68
Net income per share – diluted	$	1.42	$	1.68
Cash dividends declared per common share	$	2.00	$	2.00
Weighted average shares outstanding
Basic		4,837,166		4,833,766
Diluted		4,839,049		4,839,145

STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Six Months Ended September 30,
	2025		2024
Net income	$	6,886,656	$	8,123,732
Unrealized gain from marketable securities, net of tax		158,710		709,127
Comprehensive income	$	7,045,366	$	8,832,859

See accompanying notes.

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NVE CORPORATION

STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)

	****	****	****	****	****	Accumulated			****	****	****	****	****	****
	****	****	****	Additional		Other			****	****	****	****	****	****
				Paid-In		Comprehensive			Retained			****	****	****
		Amount		Capital		Income (Loss)			Earnings			Total
Balance as of March 31, 2025*	4,837,166	$	48,372	$	19,821,106	$	(68,544	)	$	42,467,837		$	62,268,771
Comprehensive income:
Unrealized gain on marketable securities, net of tax							75,362						75,362
Net income										3,575,818			3,575,818
Total comprehensive income													3,651,180
Stock-based compensation					6,838								6,838
Cash dividends paid (1.00 per share of common stock)										(4,837,166	)		(4,837,166	)
Balance as of June 30, 2025	4,837,166	$	48,372	$	19,827,944	$	6,818		$	41,206,489		$	61,089,623
Comprehensive income:
Unrealized gain on marketable securities, net of tax							83,348						83,348
Net income										3,310,838			3,310,838
Total comprehensive income													3,394,186
Stock-based compensation					66,312								66,312
Cash dividends (1.00 per share of common stock)										(4,837,166	)		(4,837,166	)
Balance as of September 30, 2025	4,837,166	$	48,372	$	19,894,256	$	90,166		$	39,680,161		$	59,712,955

All values are in US Dollars.

*Balances as of March 31, 2025 are derived from the audited financial statements contained in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025.

See accompanying notes.

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NVE CORPORATION

STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)

	****	****	****	****	****	****	Accumulated			****	****	****	****	****	****
	****	****	****	Additional			Other			****	****	****	****	****	****
				Paid-In			Comprehensive			Retained			****	****	****
		Amount		Capital			Income (Loss)			Earnings			Total
Balance as of March 31, 2024*	4,833,676	$	48,337	$	19,554,812		$	(777,637	)	$	46,743,005		$	65,568,517
Comprehensive income:
Unrealized gain on marketable securities, net of tax								28,710						28,710
Net income											4,097,587			4,097,587
Total comprehensive income														4,126,297
Stock-based compensation					18,442									18,442
Cash dividends (1.00 per share of common stock)											(4,833,676	)		(4,833,676	)
Balance as of June 30, 2024	4,833,676	$	48,337	$	19,573,254		$	(748,927	)	$	46,006,916		$	64,879,580
Exercise of stock options	344		3		(32	)								(29	)
Comprehensive income:
Unrealized gain on marketable securities, net of tax								680,417						680,417
Net income											4,026,145			4,026,145
Total comprehensive income														4,706,562
Stock-based compensation					105,203									105,203
Cash dividends (1.00 per share of common stock)											(4,833,676	)		(4,833,676	)
Balance as of September 30, 2024	4,834,020	$	48,340	$	19,678,425		$	(68,510	)	$	45,199,385		$	64,857,640

All values are in US Dollars.

*Balances as of March 31, 2024 are derived from the audited financial statements contained in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025.

See accompanying notes.

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NVE CORPORATION

STATEMENTS OF CASH FLOWS

(Unaudited)

	Six Months Ended September 30,
	2025			2024
OPERATING ACTIVITIES
Net income	$	6,886,656		$	8,123,732
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		174,451			157,601
Bonds discount amortization		(175,895	)		(124,135	)
Stock-based compensation		73,150			123,645
Deferred income taxes		742,885			(263,556	)
Non-cash operating lease expense (credit)		103,931			(15,174	)
Changes in operating assets and liabilities:
Accounts receivable		1,148,412			192,402
Inventories		30,240			(259,026	)
Prepaid expenses and other assets		(729,679	)		156,116
Accounts payable		14,835			42,923
Accrued payroll and other		(285,774	)		(148,941	)
Net cash provided by operating activities		7,983,212			7,985,587
INVESTING ACTIVITIES
Purchases of fixed assets		(1,128,981	)		(1,125,437	)
Purchases of marketable securities		(10,108,982	)		(6,580,140	)
Proceeds from maturities of marketable securities		10,000,000			2,200,000
Net cash used in investing activities		(1,237,963	)		(5,505,577	)
FINANCING ACTIVITIES
Payments on exercise of stock options		-			(29	)
Payment of dividends to shareholders		(9,674,332	)		(9,667,352	)
Net cash used in financing activities		(9,674,332	)		(9,667,381	)
Decrease in cash and cash equivalents		(2,929,083	)		(7,187,371	)
Cash and cash equivalents at beginning of period		8,036,564			10,283,550
Cash and cash equivalents at end of period	$	5,107,481		$	3,096,179
Supplemental disclosures of cash flow information:
Cash paid during the period for income taxes	$	1,680,555		$	1,809,878

See accompanying notes.

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NVE CORPORATION

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

NOTE 1. DESCRIPTION OF BUSINESS

We develop and sell devices that use spintronics, a nanotechnology that relies on electron spin rather than electron charge to acquire, store, and transmit information.

NOTE 2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited financial statements of NVE Corporation are prepared consistent with accounting principles generally accepted in the United States and in accordance with Securities and Exchange Commission rules and regulations. In the opinion of management, these financial statements reflect all adjustments, consisting only of normal and recurring adjustments, necessary for a fair presentation of the financial statements. Although we believe that the disclosures are adequate to make the information presented not misleading, certain disclosures have been omitted as allowed, and the Notes to Financial Statements have been condensed as permitted. It is suggested that these unaudited financial statements be read in conjunction with the audited financial statements and Notes included in our latest Annual Report on Form 10-K for the fiscal year ended March 31, 2025. Sales, expenses, cash flows, assets, and liabilities can and do vary throughout the year, therefore are not necessarily indicative of the results that may be expected for the full fiscal year ending March 31, 2026.

Significant accounting policies

A description of our significant accounting policies and estimates is provided in Note 2 to the Financial Statements in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025. As of September 30, 2025, there were no changes to our significant accounting policies or estimates.

NOTE 3. NEW ACCOUNTING STANDARDS NOT YET ADOPTED

In July 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2025-05, Financial Instruments—Credit Losses (Topic 326)—Measurement of Credit Losses for Accounts Receivable and Contract Assets. ASU 2025-05 aims to reduce the cost and complexity of estimating credit losses while maintaining decision-useful information for financial statement users. The guidance allows a practical expedient of assuming current conditions as of the balance sheet date remain unchanged for the remaining life of the assets. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025, and interim periods within those annual reporting periods, which will be for fiscal 2027 for us, with early adoption permitted. We are not currently planning early adoption. Adoption of ASU 2025-05 will result in disclosure changes, however we do not currently expect the adoption to have a material impact on our financial statements.

In November 2024, the FASB issued Accounting Standards Update (ASU) No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40). ASU 2024-03 aims to enhance transparency for users of financial statements by requiring public business entities to disaggregate specific expense categories. 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 for non-calendar year-end entities such as us. ASU 2024-03 mandates disclosures in the notes to financial statements detailing the composition and trends of key expense categories within major income statement captions. These enhanced disclosures are intended to help investors more effectively assess the entity’s performance, understand its cost structure, and make more accurate forecasts of future cash flows. For public business entities, ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, which for us will be for fiscal 2028 and for interim reporting periods beginning with the first quarter of fiscal 2029. The adoption will result in disclosure changes only.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires additional quantitative and qualitative income tax disclosures to enable financial statements users to better assess how an entity’s operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. For public business entities, ASU 2023-09 is effective for annual periods beginning after December 15, 2024, which is fiscal 2026 for us. The adoption will result in disclosure changes only in our next Annual Report on Form 10-K.

We do not expect the adoption of other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date to have a material impact on our financial statements when they are adopted.

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NOTE 4. NET INCOME PER SHARE

Net income per basic share is computed based on the weighted-average number of common shares issued and outstanding during each period. Net income per diluted share amounts assume exercise of all stock options. The following tables show the components of diluted shares:

	Quarter Ended September 30,
	2025	2024
Weighted average common shares outstanding – basic	4,837,166	4,833,855
Dilutive effect of stock options	2,077	5,436
Shares used in computing net income per share – diluted	4,839,243	4,839,291
	Six Months Ended September 30,
---	---	---
	2025	2024
Weighted average common shares outstanding – basic	4,837,166	4,833,766
Dilutive effect of stock options	1,883	5,379
Shares used in computing net income per share – diluted	4,839,049	4,839,145

NOTE 5. MARKETABLE SECURITIES

The following table shows the major categories of our marketable securities and their contractual maturities as of September 30, 2025:

	Total		<1 Year		1–3 Years		3–4 Years
Money market funds	$	4,742,269	$	4,742,269	$	-	$	-
Treasury securities		4,727,539		-		4,727,539		-
Corporate bonds		35,756,715		12,640,185		16,110,709		7,005,821
Total	$	45,226,523	$	17,382,454	$	20,838,248	$	7,005,821

Total marketable securities and money market funds represented approximately 74% of our total assets as of September 30, 2025. Marketable securities as of September 30, 2025, had remaining maturities between 16 weeks and 43 months.

Money market funds are included on the balance sheets in “Cash and cash equivalents.” Corporate bonds are included in “Marketable securities, short term” and “Marketable securities, long term.” Treasury securities are included in “Marketable securities, long term.” Accrued interest receivables were $400,667 as of September 30, 2025, and $340,241 as of March 31, 2025, and are included in the balance sheets in “Prepaid expenses and other assets.”

We monitor the credit ratings of our marketable securities at least quarterly as reported by Standard & Poor’s. The following table summarizes the fair values of our marketable securities as of September 30, 2025, aggregated by credit rating:

Credit Rating		Fair Value
AAA	$	9,469,808
AA+		3,956,140
AA		4,912,125
AA-		13,771,565
A+		13,116,885
Total	$	45,226,523

The following table shows the estimated fair value of our marketable securities, aggregated by fair value hierarchy inputs used in estimating their fair values:

	As of September 30, 2025						As of March 31, 2025
	Level 1		Level 2		Total		Level 1		Level 2		Total
Money market funds	$	4,742,269	$	-	$	4,742,269	$	7,905,042	$	-	$	7,905,042
Treasury securities		-		4,727,539		4,727,539		-		4,715,238		4,715,238
Corporate bonds		-		35,756,715		35,756,715		-		35,280,978		35,280,978
Total	$	4,742,269	$	40,484,254	$	45,226,523	$	7,905,042	$	39,996,216	$	47,901,258

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Our available-for-sales securities as of September 30 and March 31, 2025, aggregated into classes of securities, were as follows:

	As of September 30, 2025									As of March 31, 2025
	Amortized<br><br><br>Cost		Gross<br><br><br>Unrealized<br><br><br>Holding<br><br><br>Gains		Gross<br><br><br>Unrealized<br><br><br>Holding<br><br><br>Losses			Estimated<br><br><br>Fair<br><br><br>Value		Amortized<br><br><br>Cost		Gross<br><br><br>Unrealized<br><br><br>Holding<br><br><br>Gains		Gross<br><br><br>Unrealized<br><br><br>Holding<br><br><br>Losses			Estimated<br><br><br>Fair<br><br><br>Value
Money market funds	$	4,742,269	$	-	$	-		$	4,742,269	$	7,905,042	$	-	$	-		$	7,905,042
Treasury securities		4,699,770		27,769		-			4,727,539		4,699,686		15,552		-			4,715,238
Corporate bonds		35,669,065		106,357		(18,707	)		35,756,715		35,384,272		55,858		(159,152	)		35,280,978
Total	$	45,111,104	$	134,126	$	(18,707	)	$	45,226,523	$	47,989,000	$	71,410	$	(159,152	)	$	47,901,258

The following table shows the gross unrealized holding losses and estimated fair value of our marketable securities, aggregated by category of securities and length of time that individual securities had been in a continuous unrealized loss position as of September 30 and March 31, 2025.

	Less Than 12 Months					12 Months or Greater					Total
	Estimated<br><br><br>Fair<br><br><br>Value		Gross<br><br><br>Unrealized<br><br><br>Holding<br><br><br>Losses			Estimated<br><br><br>Fair<br><br><br>Value		Gross<br><br><br>Unrealized<br><br><br>Holding<br><br><br>Losses			Estimated<br><br><br>Fair<br><br><br>Value		Gross<br><br><br>Unrealized<br><br><br>Holding<br><br><br>Losses
As of September 30, 2025
Corporate bonds	$	1,964,850	$	(498	)	$	8,199,095	$	(18,209	)	$	10,163,945	$	(18,707	)
Total	$	1,964,850	$	(498	)	$	8,199,095	$	(18,209	)	$	10,163,945	$	(18,707	)
As of March 31, 2025
Corporate bonds	$	7,323,059	$	(31,808	)	$	21,020,717	$	(127,344	)	$	28,343,776	$	(159,152	)
Total	$	7,323,059	$	(31,808	)	$	21,020,717	$	(127,344	)	$	28,343,776	$	(159,152	)

None of the securities were impaired at acquisition, and subsequent declines in fair value are attributable to interest rate increases. We do not intend to sell, and it is not more likely than not that we will be required to sell, these securities before recovery of their amortized cost basis. The issuers continue to make timely interest payments on these securities.

Unrealized gains on our marketable securities and their tax effects are as follows:

	Quarter Ended September 30,
	2025			2024
Unrealized gain on marketable securities	$	106,692		$	870,990
Tax effects		(23,344	)		(190,573	)
Unrealized gain on marketable securities, net of tax	$	83,348		$	680,417
	Six Months Ended September 30,
---	---	---	---	---	---	---
	2025			2024
Unrealized gain on marketable securities	$	203,162		$	907,741
Tax effects		(44,452	)		(198,614	)
Unrealized gain on marketable securities, net of tax	$	158,710		$	709,127

NOTE 6. INVENTORIES

Inventories are shown in the following table:

		Sept. 30, 2025		March 31, 2025
Raw materials	$	1,667,650	$	1,608,632
Work in process		3,326,526		3,609,273
Finished goods		2,424,667		2,231,178
Total inventories	$	7,418,843	$	7,449,083

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NOTE 7. STOCK-BASED COMPENSATION

Stock-based compensation expense was $66,312 for the second quarter of fiscal 2026, $105,203 for the second quarter of fiscal 2025, $73,150 for the first six months of fiscal 2026, and $123,645 for the first six months of fiscal 2025. We calculate share-based compensation expense using the Black-Scholes-Merton standard option-pricing model.

	Quarter Ended <br>September 30,			Six Months Ended <br>September 30,
	2025		2024	2025		2024
Stock options grant		4,000	4,000		6,500	6,500
Stock options exercised		-	1,000		-	-

NOTE 8. INCOME TAXES

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. As of September 30, 2025, federal and state estimated tax overpayments of $462,533 were included in the balance sheet in “Prepaid expenses and other assets.”

We had no unrecognized tax benefits as of September 30, 2025, and we do not expect any significant unrecognized tax benefits within 12 months of the reporting date. We recognize interest and penalties related to income tax matters in income tax expense. As of September 30, 2025, we had no accrued interest related to uncertain tax positions. The tax years ended March 31, 2021 through March 31, 2025 remain open to examination by the major taxing jurisdictions to which we are subject.

NOTE 9. LEASES

We conduct our operations in a leased facility under a non-cancellable operating lease expiring May 31, 2031. Our lease does not provide an implicit interest rate, so we used our incremental borrowing rate to determine the present value of lease payments. Lease expense is recognized on a straight-line basis over the lease term. Effective November 4, 2024 we executed an Amendment extending our lease, which would have expired March 31, 2026 without the Amendment. Details of our lease are as follows:

	Quarter Ended Sept. 30				Six Months Ended Sept. 30
	2025			2024	2025			2024
Operating lease cost	$	48,214		37,754	$	96,429		75,507
Cash paid for amounts included <br>in the measurement of lease liabilities
Operating cash flows for leases	$	(53,751	)	43,341	$	(7,503	)	90,682
Right-of-use assets obtained in exchange for new lease liabilities
Operating lease	$	710,665			$	710,665
Remaining lease term		68 months		18 months		68 months		18 months
Discount rate		7.8%		3.5%		7.8%		3.5%

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The following table shows the maturities of lease liabilities as of September 30, 2025:

Year Ending March 31,	Operating Lease Liabilities
2026		92,497
2027		172,142
2028		213,284
2029		220,216
2030		227,373
2031		234,762
2032		40,399
Total lease payments		1,200,673
Imputed lease interest		(238,331	)
Total lease liabilities	$	962,342

NOTE 10. STOCK REPURCHASE PROGRAM

On January 21, 2009, we announced that our Board of Directors authorized the repurchase of up to $2,500,000 of our Common Stock from time to time in open market, block, or privately negotiated transactions. The timing and extent of any repurchases depend on market conditions, the trading price of the company’s stock, and other factors, and subject to the restrictions relating to volume, price, and timing under applicable law. On August 27, 2015, we announced that our Board of Directors authorized up to $5,000,000 of additional repurchases. Our repurchase program does not have an expiration date and does not obligate us to purchase any shares. The Program may be modified or discontinued at any time without notice. We intend to finance any stock repurchases with cash provided by operating activities or maturing marketable securities. The remaining authorization was $3,520,369 as of September 30, 2025. We have not repurchased any of our Common Stock during fiscal 2026.

NOTE 11. INFORMATION AS TO EMPLOYEE STOCK PURCHASE, SAVINGS, AND SIMILAR PLANS

All of our employees are eligible to participate in our 401(k) savings plan the first quarter after reaching age 18. Employees may contribute up to the Internal Revenue Code maximum. We make matching contributions of 100% of the first 3% of participants’ salary deferral contributions. Our matching contributions were $23,742 for the second quarter of fiscal 2026, $21,300 for the second quarter of fiscal 2025, $52,575 for the first six months of fiscal 2026, and $50,067 for the first six months of fiscal 2025.

NOTE 12. SUBSEQUENT EVENTS

On October 22, 2025, we announced that our Board of Directors had declared a quarterly cash dividend of $1.00 per share of Common Stock to be paid November 28, 2025, to shareholders of record as of the close of business on November 3, 2025.

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

Forward-looking statements

Some of the statements made in this Report or in the documents incorporated by reference in this Report and in other materials filed or to be filed by us with the Securities and Exchange Commission (“SEC”) as well as information included in verbal or written statements made by us constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to the safe harbor provisions of the reform act. Forward-looking statements may be identified by the use of terminology such as may, will, expect, anticipate, intend, believe, estimate, should, or continue, or the negatives of these terms or other variations on these words or comparable terminology. To the extent that this Report contains forward-looking statements regarding the financial condition, operating results, business prospects, or any other aspect of NVE, you should be aware that our actual financial condition, operating results, and business performance may differ materially from that projected or estimated by us in the forward-looking statements. We have attempted to identify, in context, some of the factors that we currently believe may cause actual future experience and results to differ from their current expectations. These differences may be caused by a variety of factors, including but not limited to risks related to our reliance on several large customers for a significant percentage of revenue, uncertainties related to the economic environments in the industries we serve, uncertainties related to future sales and revenues, risks and uncertainties related to tariffs, customs, duties, and other trade barriers, risks and uncertainties related to future stock repurchases and dividend payments, and other specific risks that may be alluded to in this Report or in the documents incorporated by reference in this Report.

Further information regarding our risks and uncertainties is contained in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended March 31, 2025.

General

NVE Corporation referred to as NVE, we, us, or our, develops and sells devices that use spintronics, a nanotechnology that relies on electron spin rather than electron charge to acquire, store, and transmit information. We manufacture high-performance spintronic products including sensors and couplers that are used to acquire and transmit data.

Critical accounting policies

A description of our critical accounting policies is provided in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025. As of September 30, 2025, our critical accounting policies and estimates continued to include marketable securities valuation, inventory valuation, and deferred tax assets estimation.

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Quarter ended September 30, 2025, compared to quarter ended September 30, 2024

The table shown below summarizes the percentage of revenue and quarter-to-quarter changes for various items:

	Percentage of Revenue<br><br><br>Quarter Ended September 30,				Quarter-<br><br><br>to-Quarter
	2025		2024		Change
Revenue
Product sales	96.7	%	90.3	%	0.6	%
Contract research and development	3.3	%	9.7	%	(68.2	)%
Total revenue	100.0	%	100.0	%	(6.1	)%
Cost of sales	21.7	%	14.0	%	45.5	%
Gross profit	78.3	%	86.0	%	(14.5	) %
Expenses
Research and development	13.8	%	12.5	%	3.1	%
Selling, general, and administrative	6.8	%	8.4	%	(23.1	)%
Total expenses	20.6	%	20.9	%	(7.4	)%
Income from operations	57.7	%	65.1	%	(16.8	) %
Interest income	7.6	%	6.9	%	4.3	%
Other income	0.0	%	-	%	-
Income before taxes	65.3	%	72.0	%	(14.7	)%
Provision for income taxes	13.1	%	12.4	%	(7.1	) %
Net income	52.2	%	59.6	%	(16.3	)%

Total revenue for the quarter ended September 30, 2025 (the second quarter of fiscal 2026) decreased 6% compared to the quarter ended September 30, 2024 (the second quarter of fiscal 2025). The decrease was due to a 68% decrease in contract research and development revenue, partially offset by a 1% increase in product sales. The increase in product sales was due to a significant increase in nondefense product sales, partially offset by a decrease in sales to the defense industry. Defense industry sales can be highly variable because of procurement cycles. The decrease in contract research and development revenue was due to the timing of revenue recognition and fewer research and development contracts in the quarter ended September 30, 2025 compared to the prior-year quarter.

Gross margin for the second quarter of fiscal 2026 was 78% of revenue compared to 86% the prior-year quarter. The decrease in gross margin percentage was due to a less profitable product mix and increased distributor sales for the quarter. Distributor sales typically have lower gross margin than direct sales.

Total operating expenses decreased 7% for the second quarter of fiscal 2026 compared to the second quarter of fiscal 2025, due to a 3% increase in research and development expense and a 23% decrease in selling, general, and administrative expense. The increase in research and development expense was due to increased new product development. The decrease in selling, general, and administrative expenses was primarily due to the timing of sales and marketing activities, and reassignment of some selling, general and administrative resources to manufacturing and new product development.

Interest income increased 4% due to an increase in interest rates compared to the prior year.

Our effective tax rate, which is the provision for income taxes as a percentage of income before taxes, increased to 20% for the second quarter of fiscal 2026 compared to 17% for the second quarter of fiscal 2025. The increase in our effective tax rate was primarily due to the non-cash impact of tax law changes on certain tax deductions this fiscal year. We currently expect a full-year tax rate of 16% to 17% in fiscal 2026 because we expect advanced manufacturing investment tax credits of between $700,000 and $1,000,000 to offset the impact of other tax law changes.

The decrease in net income in the second quarter of fiscal 2026 compared to the prior-year quarter was primarily due to decreased revenue, decreased gross margin, and an increase in our effective tax rate, partially offset by decreased operating expenses and increased interest income.

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Six months ended September 30, 2025, compared to six months ended September 30, 2024

The table shown below summarizes the percentage of revenue and year-to-year changes for various items:

	Percentage of Revenue<br><br><br>Six Months Ended Sept. 30,				Period-<br><br><br>to-Period
	2025		2024		Change
Revenue
Product sales	96.8	%	93.9	%	(5.3	)%
Contract research and development	3.2	%	6.1	%	(50.8	)%
Total revenue	100.0	%	100.0	%	(8.1	)%
Cost of sales	20.6	%	14.2	%	33.2	%
Gross profit	79.4	%	85.8	%	(14.9	) %
Expenses
Research and development	12.8	%	12.7	%	(7.7	)%
Selling, general, and administrative	6.9	%	8.2	%	(22.8	)%
Total expenses	19.7	%	20.9	%	(13.6	)%
Income from operations	59.7	%	64.9	%	(15.3	) %
Interest income	7.9	%	7.1	%	2.5	%
Other income	0.0	%	-	%	-
Income before taxes	67.6	%	72.0	%	(13.5	)%
Provision for income taxes	12.3	%	12.0	%	(8.5	) %
Net income	55.3	%	60.0	%	(14.5	)%

Total revenue for the six months ended September 30, 2025 decreased 8% compared to the six months ended September 30, 2024. The decrease was due to a 5% decrease in product sales and a 51% decrease in contract research and development revenue. The decrease in product sales was primarily due to a decrease in defense industry sales during the six months ended September 30, 2025 compared to the prior-year period. Defense industry sales can be highly variable because of procurement cycles. The decrease in contract research and development revenue was primarily due to the timing of revenue recognition and fewer research and development contracts for the six months ended September 30, 2025, compared to the prior-year period.

Gross margin for the first six months of fiscal 2026 was 79% of revenue, compared to 86% for the first six months of fiscal 2025. The decrease in gross margin percentage was due to a less profitable product mix and increased distributor sales for the six months ended September 30, 2025, compared to the prior-year period.

Total operating expenses decreased 14% for the first six months of fiscal 2026 compared to the first six months of fiscal 2025, due to an 8% decrease in research and development expense and a 23% decrease in selling, general, and administrative expense. The decrease in research and development expense was due to the completion of some of our wafer-level chip scale packaging activities and reassignment of some research and development resources to manufacturing. The decrease in selling, general, and administrative expenses was primarily due to the timing of sales and marketing activities, and reassignment of some selling, general and administrative resources to manufacturing and new product development.

Our effective tax rate increased to 18% for the first six months of fiscal 2026 compared to 17% for the first six months of fiscal 2025. The increase in our effective tax rate was primarily due to the non-cash impact of tax law changes on certain tax deductions this fiscal year.

The decrease in net income in the first six months of fiscal 2026 compared to the prior-year period was primarily due to decreased revenue, decreased gross margin, and an increase in our effective tax rate, partially offset by decreased operating expenses and increased interest income.

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Liquidity and Capital Resources

Overview

Cash and cash equivalents were $5,107,481 as of September 30, 2025, compared to $8,036,564 as of March 31, 2025. The $2,929,083 decrease in cash and cash equivalents during the first six months of fiscal 2026 was due to $1,237,963 of net cash used in investing activities and $9,674,332 of cash used in financing activities, partially offset by $7,983,212 in net cash provided by operating activities.

Operating Activities

Net cash provided by operating activities related to product sales and research and development contract revenue was our primary source of working capital for the current and prior-year periods.

Non-cash operating lease expenses increased $103,931 primarily due to our receipt of a $100,000 leasehold improvement allowance.

Accounts receivable decreased $1,148,412 during the first six months of fiscal 2026 primarily due to the timing of customer payments.

Prepaid expenses and other assets increased $729,679 primarily due to increased accrued bond interest and a decrease in federal and state taxes due. The decrease in taxes due was because we deducted previously unamortized research and development expenses in the quarter ended September 30, 2025 as permitted under the Federal budget reconciliation bill enacted July 4, 2025. We expect accelerated deductions of previously unamortized research and development expenses to reduce our cash taxes by approximately $1,000,000 over the three quarters beginning with the quarter ending December 31, 2025.

Accrued payroll and other current liabilities decreased $285,774 primarily due to the payment of federal and state taxes balance due as of March 31, 2025.

Investing Activities

Cash used by investing activities during the six months ended September 30, 2025, consisted of $10,108,982 of marketable securities purchases and $1,128,981 of fixed asset purchases, partially offset by $10,000,000 in proceeds from maturities of marketable securities. Fixed asset purchases were primarily production equipment. We currently expect an additional $1,000,000 to $1,500,000 of fixed asset purchases in the last six months of the fiscal year to complete a production expansion.

Financing Activities

Cash used in financing activities during the six months ended September 30, 2025, consisted of $9,674,332 of cash dividends paid to shareholders.

In addition to cash dividends paid to shareholders in the first half of fiscal 2026, on October 22, 2025, we announced that our Board of Directors had declared a cash dividend of $1.00 per share of Common Stock, or $4,837,166 based on shares outstanding as of September 30, 2025, to be paid on November 28, 2025.

We plan to fund dividends through cash provided by operating activities and proceeds from maturities of marketable securities. All future dividends will be subject to Board approval and subject to the company’s results of operations, cash and marketable security balances, estimates of future cash requirements, and other factors the Board may deem relevant. Furthermore, dividends may be modified or discontinued at any time without notice.

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Item 4. Controls and Procedures.

Disclosure Controls and Procedures

Management, with the participation of the Chief Executive Officer and Principal Financial Officer, has performed an evaluation of our disclosure controls and procedures that are defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”) as of the end of the period covered by this Report. This evaluation included consideration of the controls, processes, and procedures that are designed to ensure that information required to be disclosed by us in the reports we file under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Principal Financial Officer, as appropriate to allow timely decisions regarding required disclosure. Our management concluded that, as of September 30, 2025, our disclosure controls and procedures were effective.

Changes in Internal Controls

During the quarter ended September 30, 2025, there was no change in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II–OTHER INFORMATION

Item 1. Legal Proceedings.

In the ordinary course of business, we may become involved in litigation. At this time, we are not aware of any material pending or threatened legal proceedings or other proceedings contemplated by governmental authorities that we expect would have a material adverse impact on our future results of operation and financial condition.

Item 1A. Risk Factors.

There have been no material changes from the risk factors disclosed in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025.

Item 4. Mine Safety Disclosures.

None.

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Item 6. Exhibits.

Exhibit #	Description
31.1	Certification by Daniel A. Baker pursuant to Rule 13a-14(a)/15d-14(a).
31.2	Certification by Daniel Nelson pursuant to Rule 13a-14(a)/15d-14(a).
32	Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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)
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

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SIGNATURES

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

	NVE CORPORATION
	(Registrant)
October 22, 2025	/s/ DANIEL A. BAKER
Date	Daniel A. Baker
	President and Chief Executive Officer
October 22, 2025	/s/ DANIEL NELSON
Date	Daniel Nelson
	Principal Financial Officer

Certification

Exhibit 31.1

CERTIFICATION

I, Daniel A. Baker, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of NVE Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 22, 2025

/s/ DANIEL A. BAKER
Daniel A. Baker
President and Chief Executive Officer

Certification

Exhibit 31.2

CERTIFICATION

I, Daniel Nelson, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of NVE Corporation;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 22, 2025

/s/ DANIEL NELSON
Daniel Nelson
Principal Financial Officer

Certification

Exhibit 32

CERTIFICATION PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002 (18 U.S.C. SECTION 1350)

The undersigned certify pursuant to 18 U.S.C. Section 1350, that to the undersigned’s knowledge:

The accompanying Annual Report of NVE Corporation (the “Company”) on Form 10-Q for the quarter ended September 30, 2025, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: October 22, 2025

/s/ DANIEL A. BAKER
Daniel A. Baker
President and Chief Executive Officer
/s/ DANIEL NELSON
---
Daniel Nelson
Principal Financial Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.