IMMERSION CORP Material Event - What Happened

Hey there! Let's break down what's been going on with Immersion Corp in a way that makes sense, without all the confusing finance talk. Think of this as me explaining the news to you over a cup of coffee.

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1. What happened? (The actual event, in plain English)

So, Immersion Corp just announced that they received another warning from Nasdaq because they haven't filed their financial reports on time. Specifically, they got a notice on December 23, 2025, for not filing their Quarterly Report (called a Form 10-Q) for the quarter that ended October 31, 2025. This isn't the first time; they've also missed filing their annual report (Form 10-K) and another quarterly report (Q1 10-Q) earlier this year.

2. When did it happen?

The latest warning from Nasdaq came just recently, on December 23, 2025. This follows previous warnings they received on August 20, 2025, and September 29, 2025, for other late filings.

3. Why did it happen? (The backstory)

To understand why this is a big deal, you need a little background. Immersion Corp is a company that basically owns a lot of patents (which are like legal protections for inventions) related to "haptics." That's the fancy word for the technology that creates the sense of touch – like when your phone vibrates, or a game controller rumbles.

The reason for these repeated late filings is pretty serious: Immersion Corp, along with one of its consolidated subsidiaries, Barnes & Noble Education, Inc. (BNED), has been conducting audit committee investigations. These investigations are so significant that they will lead to a "restatement" of previously-issued financial information.

What's a "restatement"? Imagine you've submitted your taxes, and then realize you made a big mistake and have to go back and correct all the numbers and resubmit them. That's essentially what a restatement is for a company – they have to go back and correct their past financial reports because the numbers they reported earlier were wrong.

Because of these investigations and the work needed for the restatement, Immersion's management hasn't been able to finish preparing their financial statements for the past fiscal year and two quarters. This failure to file on time goes against Nasdaq's rules for companies to remain listed on their stock exchange.

Essentially, this event is a result of serious internal financial issues and investigations that are preventing the company from accurately reporting its financial health.

4. Why does this matter? (The "So What?")

This event is important because repeated late financial filings and the need for a restatement are major red flags for a public company.

• For Immersion's business: It means there are significant problems with their financial reporting and potentially their internal controls (how they track money and operations). This creates a lot of uncertainty about the company's true financial health.
• For its listing: If they don't fix this, Immersion Corp could eventually be delisted from Nasdaq, which would make it much harder for investors to buy and sell their stock.
• For trust: It erodes investor confidence because it suggests that the financial information previously provided might not have been accurate.

In simple terms, it could mean the company is facing serious financial and operational challenges, and its future on Nasdaq is at risk if they don't resolve these issues quickly.

5. Who is affected?

• Immersion Corp itself: This is a huge blow to the company's reputation and could lead to significant financial and operational restructuring. The risk of delisting is a major threat.
• Investors/Shareholders: People who own stock in Immersion Corp are directly affected by the uncertainty. The stock price will likely be volatile and could drop significantly as investors react to the news of financial irregularities and potential delisting. It's also harder for them to make informed decisions without up-to-date, accurate financial reports.
• Barnes & Noble Education, Inc. (BNED): As a consolidated subsidiary, their financial issues are directly contributing to Immersion's problems, and they are also undergoing audit committee investigations.
• Nasdaq: They have rules to uphold, and Immersion's failure to comply puts them in a position to enforce those rules, potentially leading to delisting.
• Employees: While not directly mentioned, significant financial issues and investigations can create stress and uncertainty for employees about the company's stability.

6. What happens next? (Looking ahead)

Now that this has happened, we'll be watching for a few things:

• Compliance Plan Update: Immersion has to submit an updated plan to Nasdaq by January 7, 2026, explaining how they intend to get back on track and file all their overdue reports.
• Completion of Investigations and Restatement: The company needs to finish the audit committee investigations and complete the complex process of restating their past financial information.
• Filing of Overdue Reports: They need to file the Annual Report (Form 10-K) for April 30, 2025, and the Quarterly Reports (Form 10-Q) for July 31, 2025, and October 31, 2025, as soon as possible.
• Nasdaq's Decision: Nasdaq will review Immersion's plan and progress. Their decision will determine if Immersion can remain listed or if further actions, including delisting, will be taken.
• Market Reaction: How will the stock market react to the updated compliance plan and any further news about the investigations or restatement?

7. What should investors/traders know? (Practical takeaways)

If you're someone who owns Immersion stock or is thinking about it, here are a few things to keep in mind:

• This is a serious issue: Late filings are one thing, but an audit committee investigation leading to a "restatement" of past financials is a major red flag. It suggests that previously reported numbers were incorrect, which can severely damage trust.
• High Uncertainty: There's a lot of unknown right now. What exactly caused the need for a restatement? How big will the corrections be? How long will it take to fix? This uncertainty usually leads to higher risk for investors.
• Delisting Risk: While the stock is still trading on Nasdaq for now, the threat of delisting is real if they don't resolve these issues. Delisting can make a stock much harder to sell and often leads to a significant price drop.
• Watch for the Plan: Pay close attention to the updated compliance plan they submit to Nasdaq by January 7, 2026. This will give an indication of their strategy and timeline for resolving the issues.
• It's Not Financial Advice: Remember, this is just an explanation of the news. Always do your own research or talk to a financial advisor before making any investment decisions. This event is one piece of the puzzle, not the whole picture.