Immersion

2 serious warning signs in Immersion’s filings.

We look for five warning signs: doubt it can keep going, weak checks on its own accounts, a notice that its past accounts can't be relied on, a change of auditor, and one customer bringing in a big share of sales. We don't check lawsuits, investigations or debt yet.

We checked the auditor's report, internal controls, restatement notices, auditor changes and big customers in the 10-K filed 24 Jul 2026, plus the 10-Q filed 14 Sep 2026 and 2 later 8-Ks.

• Weak checks on its own accounts

  Serious

  The company said its checks on its own accounts did not work at year end. Mistakes could slip into the numbers.

  “In light of these material weaknesses, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were not effective as of April 30, 2026.”

  Show the full paragraph

  As described below, material weaknesses existed as of April 30, 2026 in our internal control over financial reporting relating to: (i) Barnes & Noble Education, whose financial information is consolidated into our consolidated financial statements; and (ii) our accounting for the acquisition of a controlling interest in Barnes & Noble Education and the related consolidation accounting. In light of these material weaknesses, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were not effective as of April 30, 2026.

  From the 10-K filed 24 July 2026, Item 9A. Controls and Procedures. Read it in the filing

• Its past accounts can't be relied on

  Serious

  It told the SEC its earlier accounts should no longer be relied on, usually because they contained errors.

  8-K Item 4.02 filed 9 Sep 2025: the company said its earlier financial statements should no longer be relied on.

  From an 8-K filed 9 September 2025: Previously issued accounts should no longer be relied on. Open the filing

Cheap for a reason is the question the numbers cannot answer.

Whether the price already reflects the risks is what the deep dive is for.

• Provisions in our charter documents, Rights Agreement, and Delaware law could prevent or delay a change in control, which could reduce the market price of our common stock.

  Could happen

  On November 7, 2025, the Board declared a dividend to the holders of the Company’s common stock outstanding at the close of business on November 17, 2025 (the “Record Date”) of one preferred share purchase right (a “Right”) for each share of the Company’s common stock. Each Right is payable on the Record Date and initially entitles the registered holder to purchase from the Company one one-thousandth of a share of Series C Junior Participating Preferred Stock, par value $0.001 per share (“Preferred Share”), of the Company at a price of $20.58 per one one-thousandth of a Preferred Share, subject to adjustment. The description and terms of the Rights are set forth in a Rights Agreement, dated November 7, 2025 (the “Rights Agreement”), between the Company and Computershare Trust Company, N.A., as rights agent. In general terms, the Rights Agreement imposes a significant penalty upon any person or group that acquires 9.99% or more of the shares of common stock without the approval of the Board. As a result, the overall effect of the Rights Agreement and the issuance of the Rights may be to render more difficult or discourage a merger, tender or exchange offer or other business combination involving the Company that is not approved by the Board.

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• Barnes & Noble Education may be required to indemnify its current and former directors, officers and employees in connection with litigation and other actions which could result in significant legal expenses and other costs to us.

  Could happen

  Barnes & Noble Education’s corporate governance documents and applicable indemnification agreements require Barnes & Noble Education to defend and indemnify its current and former directors and officers, and certain employees and contractors against enumerated liabilities and expenses incurred as a result of legal proceedings and investigations, including any potential regulatory actions or litigation arising out of the matters related to the Investigation and Restatement. As a result, Barnes & Noble Education may be obligated to advance and ultimately pay substantial legal costs, settlement amounts, or judgments on behalf of these individuals. These indemnification obligations could significantly increase Barnes & Noble Education’s legal expenses and could materially adversely affect its financial condition and cash flows.

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• Matters relating to or arising from the subject of the Investigation, including expenses and diversion of personnel and resources, regulatory investigations, and proceedings and litigation matters, could have an adverse effect on Barnes and Noble Education’s and our business, results of operations, and financial condition.

  Could happen

  In addition, Barnes & Noble Education elected to self-report the Investigation to the Securities and Exchange Commission (the “SEC”). If the SEC or any other regulator were to commence legal action against Barnes & Noble Education, Barnes & Noble Education could be required to pay significant penalties and become subject to injunctions, cease and desist orders, or other remedies. Barnes & Noble Education can provide no assurances as to the outcome of any governmental inquiry or investigation. Further, Barnes & Noble Education, its officers, and members of the Barnes & Noble Education Board could be named as defendants in lawsuits asserting claims arising out of the subject matter of the Investigation. As a result of any legal proceedings and any related indemnification requirements to Barnes & Noble Education’s officers and directors, Barnes & Noble Education could be required to pay monetary damages that may be in excess of its insurance coverage or may have additional penalties or other remedies imposed against Barnes & Noble Education or its officers and directors.

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• Matters relating to or arising from the subject of the Investigation, including expenses and diversion of personnel and resources, regulatory investigations, and proceedings and litigation matters, could have an adverse effect on Barnes and Noble Education’s and our business, results of operations, and financial condition.

  Already happened

  As previously reported, in July 2025, certain information regarding the recording of cost of digital sales was brought to the attention of the Barnes & Noble Education’s Audit Committee of the Board of Directors (the “Barnes & Noble Education Audit Committee”). With the assistance of outside counsel and advisors, the Barnes & Noble Education Audit Committee conducted an investigation into these matters (the “Investigation”). The Investigation was completed in the fall of 2025 and based on the Investigation, the Barnes & Noble Education Audit Committee concluded that a former Barnes and Noble Education employee made unsupported manual journal entries that improperly reduced cost of sales. As a result of the Investigation and additional accounting matters, the Barnes & Noble Education Audit Committee concluded that Barnes & Noble Education’s previously-issued audited consolidated financial statements and related disclosures for certain prior periods should no longer be relied upon, and Barnes & Noble Education has since restated those financial statements in its Annual Report on Form 10-K for the fiscal year ended May 3, 2025 (the “BNED Restatement”).

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• We may incur greater tax liability than we have provided for or have anticipated and may incur additional tax liability due to certain indemnification agreements with certain licensees, which could adversely affect our financial condition and operating results.

  Already happened

  During the fiscal quarter ended January 31, 2026, the Company determined that it would discontinue litigation related to certain Korean withholding tax matters involving LGE. Because the recoverability of provisional deposits previously made in connection with those matters depended on successful resolution of the related proceedings, the Company concluded that the remaining carrying amount of such deposits was not recoverable. Accordingly, the Company recorded additional income tax expense of approximately $5.9 million and reduced the carrying amount of the related long-term deposits to zero. The income tax expense was partially offset by the reversal of the related unrecognized tax benefit accrual of $0.3 million.

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