Strata Critical Medical, Inc. Quarterly report [Sections 13 or 15(d)]

Quarterly report [Sections 13 or 15(d)]

Discontinued Operations

Discontinued Operations

9 Months Ended

Sep. 30, 2025

Discontinued Operations and Disposal Groups [Abstract]

Passenger Business Divestiture

On August 29, 2025, the Company completed the sale of its Passenger business to Joby Buyer pursuant to that certain Equity Purchase Agreement, dated as of August 1, 2025 (the “Joby Purchase Agreement”), among the Company, Strata Critical, Inc. (f/k/a Trinity Medical Intermediate II, Inc.), a wholly owned subsidiary of the Company, Blade Urban Air Mobility, LLC (f/k/a Blade Urban Air Mobility, Inc.), Joby Aviation and Joby Buyer, a wholly owned subsidiary of Joby Aviation. The transaction followed restructuring activities to separate the Passenger business from the Company’s remaining operations. The majority of the Passenger business sold was previously reported as the Company’s Passenger segment under ASC 280, Segment Reporting, and consisted of offering, marketing and arranging air transportation services for passengers on aircraft operated by third parties as well as related ground transportation services.

At closing, the Company received consideration valued at approximately $75,357 (based on Joby Aviation’s closing stock price of $14.15 on August 29, 2025), after giving effect to pre-closing adjustments. The consideration consisted of 5,325,585 shares of Joby Aviation’s common stock, par value $0.0001 per share (the “Buyer Shares”). The Company subsequently sold the Buyer Shares for net proceeds of $70,163. The Company may also receive up to an additional $35,000, payable in cash or Buyer Shares at Joby Buyer’s election, upon the achievement of certain financial performance and employee retention targets within 12 and 18 months, respectively, following the closing, as well as the release of up to $10,000 in indemnity holdbacks. The estimated fair value of the contingent consideration for retention and earn-out and indemnity holdbacks is $27,825 and $8,400, respectively. The fair value of the contingent consideration earn-out was determined using a probability-weighted discounted cash flow analysis based on internal projections of the buyer’s expected future sales.

In connection with the sale, the Company reclassified $2,818 of cumulative foreign currency translation gain from accumulated other comprehensive income to income from discontinued operations. Following the sale, no balance remained related to foreign currency translation in accumulated other comprehensive income.

On August 29, 2025, the Company also entered into a Transition and Transaction Bonus Agreement with its former Chief Executive Officer, Robert Wiesenthal, modifying his outstanding equity awards. A total of 2,950,219 previously granted performance stock units (“PSUs”) and restricted stock units (“RSUs”) were amended, consisting of (i) PSUs (the “Earn-out PSUs”) that vest based on the level of adjusted EBITDA achieved by the Passenger business for the 12-month measurement period following closing (zero to 150% payout range determined by linear interpolation), and (ii) time-based awards for the 18-month measurement period that vest upon the Company’s receipt of the retention earn-out payment under the Joby Purchase Agreement.

The aggregate fair value of the Earn-out PSUs and time-based awards as of August 29, 2025, was $12,742, comprising $2,850 for the Earn-out PSUs and $9,892 for the time-based awards.

•The Earn-out PSUs were valued using a risk-neutral Monte Carlo simulation model that simulates risk-adjusted EBITDA outcomes and correlated stock-price paths, incorporating market inputs such as the Company’s stock price, volatility, risk-free rates, and credit-adjusted discount rates.

•The time-based awards were valued as the Company’s closing stock price of $4.37 multiplied by the number of RSUs, adjusted for the probability of the retention earn-out being achieved. As of the closing date, management considered payment of the full retention earn-out probable, and therefore applied the stock price to all awards in determining fair value.

Because the former executive is no longer providing services to the Company as of the sale date, the awards are accounted for as nonemployee awards. The related compensation expense recognized in discontinued operations reflects the $12,742 fair value of the modified awards. The awards vest based on conditions that are not classified as a service, market or performance condition and as a result such awards are classified as a liability. The awards will continue to be remeasured at fair value each reporting period until settlement, with any subsequent changes in fair value recognized in continuing operations. (Refer to Note 5 for additional information on the award modification and valuation methodology.)

The fair value measurements related to the earn-out awards and contingent consideration are classified as Level 3 within the fair-value hierarchy due to the use of unobservable inputs. The Company will assess changes in these fair values at each reporting date, with any adjustments recognized in earnings in the period identified. (Refer to Note 11 for additional information.)

The following table summarizes the results of operations of the Passenger business which are presented as discontinued operations:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Revenue	$	32,505	$	38,815	$	76,556	$	83,907

Operating expenses
Cost of revenue	21,495		26,486		53,673		62,152
Software development	298		383		1,124		1,410
General and administrative	2,186		6,543		12,989		23,617
Selling and marketing	1,335		1,848		3,790		5,661
Total operating expenses	25,314		35,260		71,576		92,840

Operating income (loss)	7,191		3,555		4,980		(8,933)
Gain on sale and disposal of discontinued operations	60,435		—		60,435		—
Income (loss) from discontinued operations before income taxes	67,626		3,555		65,415		(8,933)
Income tax (benefit) on discontinued operations	553		(118)		557		(150)
Net income (loss) from discontinued operations	$	67,073	$	3,673	$	64,858	$	(8,783)

The tax expense for the three months ended September 30, 2025 is attributable to the sale of the Passenger business and was primarily due to limitations on the utilization of net operating losses in the U.S federal, state and local jurisdictions. U.S. federal net operating losses generated in periods beginning on or after January 1, 2018 can only offset up to 80% of taxable income. Various state and local jurisdictions provide for similar limitations. The tax benefit in the 2024 period was attributed entirely to Blade Monaco.

The cash flows related to discontinued operations have not been segregated and are included in the unaudited interim condensed consolidated statements of cash flows. The following table presents depreciation and amortization, capital expenditures and other non-cash operating activities of the discontinued operations related to the Passenger business:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2025	2024	2025	2024
Depreciation and amortization	259	446	1,285	2,247
Capital expenditures	108	664	296	1,696
Stock-based compensation	34	277	874	1,140
Gain on sale of Passenger business	(60,435)	—	(60,435)	—

The following table summarizes the major classes of assets and liabilities which represent only those related to the Passenger business, classified as held for sale presented as discontinued operations at September 30, 2025 and December 31, 2024, respectively:


	September 30, 2025		December 31, 2024
Cash and cash equivalents	$	—	$	2,306
Restricted cash	—		1,006
Accounts receivable, net	—		1,769
Prepaid expenses and other current assets	—		6,071
Property and equipment, net	—		2,453
Intangible assets, net	—		5,689
Goodwill	—		25,510
Operating right-of-use asset	—		6,044
Other non-current assets	—		1,319


Total assets of discontinued operations	$	—	$	52,167

Accounts payable and accrued expenses	$	—	$	3,546
Deferred revenue	—		6,656
Operating lease liability - current	—		2,622
Operating lease liability - non-current	—		3,682
Deferred tax liability	—		185
Total liabilities of discontinued operations	$	—	$	16,691

During the third quarter of 2025 after meeting the criteria to be classified as held for sale, the Company performed impairment analyses and allocated goodwill to the Passenger business divestiture disposal groups and no impairments were identified. Refer to Note 4 for additional information. During the reporting period that the Passenger business disposal group was classified as held for sale, the Company assessed whether the fair value less cost to sell were less than the carrying value of the disposal group.