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, ~~and posted on its corporate website, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ 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.:

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 January ~~31, 2018, 44,277,825~~27, 2022, 45,516,200 shares of the registrant’s common stock, $.01 par value, were outstanding.

Throughout this quarterly report on Form 10-Q ~~(the “Report”~~(“this Report”), ~~“Abiomed,~~we refer to various trademarks, service marks and trade names that we use in our business. Abiomed, Impella, Impella 2.5, Impella 5.0, Impella LD, Impella CP, Impella RP, Impella 5.5, Impella Connect, and SmartAssist are registered trademarks of Abiomed, Inc., and are registered in the U.S. and certain foreign countries. Impella ECP, Impella XR Sheath, Impella BTR, CVAD STUDY, STEMI DTU, Automated Impella Controller, Abiomed Breethe OXY-1 System and preCARDIA are pending trademarks of ABIOMED, Inc. Other trademarks and service marks appearing in this Report are the property of their respective holders.

Throughout this Report, unless the context otherwise requires, “ABIOMED, Inc.,” the “Company,” “we,” “us” and “our” refer to ABIOMED, Inc. and its consolidated subsidiaries.

~~ABIOMED, IMPELLA, IMPELLA 2.5, IMPELLA 5.0, IMPELLA LD, IMPELLA CP~~We make available, free of charge on our website located at www.abiomed.com, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and ~~IMPELLA RP are trademarks of ABIOMED, Inc., and are registered in~~any amendments to those reports, as soon as reasonably practicable after filing such reports with or furnishing such reports to the U.S. Securities and ~~certain foreign countries. AB5000~~Exchange Commission (“SEC”). We also use our website for the distribution of Company information. The information we post on our website may be deemed to be material information. Accordingly, investors should monitor our website, in addition to following our press releases, SEC reports and ~~cVAD REGISTRY~~other filings and public conference calls and webcasts. The contents of our website are ~~trademarks of ABIOMED, Inc.~~not incorporated by reference into this Report.

~~ITEM 1:~~

~~FINANCIAL STATEMENTS~~

	December 31, 2021			March 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	144,255		$	232,710
Short-term marketable securities		524,966			350,985
Accounts receivable, net		88,952			97,179
Inventories, net		90,199			81,059
Prepaid expenses and other current assets		36,634			26,032
Total current assets		885,006			787,965
Long-term marketable securities		262,635			264,085
Property and equipment, net		196,880			197,129
Goodwill		77,449			78,568
Other intangibles, net		40,278			42,150
Deferred tax assets		3,680			11,380
Other assets		126,949			113,082
Total assets	$	1,592,877		$	1,494,359
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	32,066		$	34,842
Accrued expenses		66,668			66,046
Deferred revenue		24,867			24,322
Other current liabilities		3,195			3,759
Total current liabilities		126,796			128,969
Other long-term liabilities		10,805			10,162
Contingent consideration		21,539			24,706
Deferred tax liabilities		799			847
Total liabilities		159,939			164,684
Commitments and contingencies (Note 16)
Stockholders' equity:
Class B Preferred Stock, $.01 par value		—			—
1,000 shares authorized; issued and outstanding - 0ne
Common stock, $.01 par value		455			453
100,000 shares authorized; 48,229 and 47,929 shares issued as of December 31, 2021 and March 31, 2021, respectively
45,516 and 45,271 shares outstanding as of December 31, 2021 and March 31, 2021, respectively
Additional paid in capital		853,210			800,690
Retained earnings		904,187			828,007
Treasury stock at cost - 2,713 and 2,658 shares as of December 31, 2021 and March 31, 2021, respectively		(304,425	)		(288,030	)
Accumulated other comprehensive loss		(20,489	)		(11,445	)
Total stockholders' equity		1,432,938			1,329,675
Total liabilities and stockholders' equity	$	1,592,877		$	1,494,359

The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited)

December 31, 2017

March 31, 2017

ASSETS

Current assets:

Cash and cash equivalents

$
50,502

$
39,040

Short-term marketable securities

250,751

190,908

Accounts receivable, net

64,862

54,055

Inventories

46,891

34,931

Prepaid expenses and other current assets

9,192

8,024

Total current assets

422,198

326,958

Long-term marketable securities

49,485

47,143

Property and equipment, net

107,977

87,777

Goodwill

34,814

31,045

In-process research and development

16,241

14,482

Long-term deferred tax assets, net

75,201

34,723

Other assets

13,686

8,286

Total assets

$
719,602

$
550,414

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable

$
21,991

$
20,620

Accrued expenses

41,565

37,703

Deferred revenue

11,797

10,495

Current portion of capital lease obligation

—

799

Total current liabilities

75,353

69,617

Other long-term liabilities

466

3,251

Contingent consideration

10,423

9,153

Long-term deferred tax liabilities

878

783

Capital lease obligation, net of current portion

—

15,539

Total liabilities

87,120

98,343

Commitments and contingencies (Note 10)

Stockholders' equity:

Class B Preferred Stock, $.01 par value

—

—

Authorized - 1,000,000 shares; Issued and outstanding - none

Common stock, $.01 par value

443

437

Authorized - 100,000,000 shares; Issued - 45,995,445 shares at December 31, 2017 and 45,249,281 shares at March 31, 2017

Outstanding - 44,271,905 shares at December 31, 2017 and 43,673,286 shares
at March 31, 2017

Additional paid in capital

605,697

565,962

Retained earnings (accumulated deficit)

103,610

(46,959
)
Treasury stock at cost - 1,723,540 shares at December 31, 2017 and 1,575,995 shares at March 31, 2017

(66,622
)

(46,763
)
Accumulated other comprehensive loss

(10,646
)

(20,606
)
Total stockholders' equity

632,482

452,071

Total liabilities and stockholders' equity

$
719,602

$
550,414

	For the Three Months Ended December 31,					For the Nine Months Ended December 31,
	2021			2020		2021		2020
Revenue	$	261,176		$	231,663	$	761,903	$	606,277
Costs and expenses:
Cost of revenue		47,627			41,110		136,701		115,829
Research and development		40,869			33,004		119,618		89,886
Selling, general and administrative		107,618			86,198		313,881		233,809
Acquired in-process research and development		496			—		115,986		—
		196,610			160,312		686,186		439,524
Operating income		64,566			71,351		75,717		166,753
Other (loss) income:
Investment income, net		891			1,449		2,918		5,668
Other (loss) income, net		(7,580	)		7,935		37,163		42,305
		(6,689	)		9,384		40,081		47,973
Income before income taxes		57,877			80,735		115,798		214,726
Income tax provision		12,125			18,867		39,618		46,057
Net income	$	45,752		$	61,868	$	76,180	$	168,669

Net income per share - basic	$	1.01		$	1.37	$	1.68	$	3.74
Weighted average shares outstanding - basic		45,508			45,201		45,419		45,105

Net income per share - diluted	$	1.00		$	1.35	$	1.66	$	3.69
Weighted average shares outstanding - diluted		45,921			45,706		45,851		45,653

The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited)

For the Three Months Ended December 31,

For the Nine Months Ended December 31,

2017

2016

2017

2016

Revenue:

Product revenue

$

153,989

$

114,624

$

419,202

$

320,541

Funded research and development

33

50

111

83

154,022

114,674

419,313

320,624

Costs and expenses:

Cost of product revenue

24,994

18,987

68,483

51,366

Research and development

17,706

16,349

54,027

50,061

Selling, general and administrative

66,556

53,935

187,233

158,053

109,256

89,271

309,743

259,480

Income from operations

44,766

25,403

109,570

61,144

Other income (expense):

Investment income, net

969

457

2,385

1,068

Other expense, net

(81
)

(34
)

(25
)

(225
)

888

423

2,360

843

Income before income taxes

45,654

25,826

111,930

61,987

Income tax provision

32,208

10,394

36,607

24,770

Net income

$

13,446

$

15,432

$

75,323

$

37,217

Basic net income per share

$

0.30

$

0.36

$

1.71

$

0.86

Basic weighted average shares outstanding

44,247

43,431

44,095

43,125

Diluted net income per share

$

0.29

$

0.34

$

1.65

$

0.83

Diluted weighted average shares outstanding

45,869

44,770

45,731

44,597

	Common Stock						Treasury Stock					Additional Paid			Retained			Accumulated Other			Total Stockholders'
	Shares			Par value			Shares		Amount			in Capital			Earnings			Comprehensive Loss			Equity
Balance, March 31, 2021		45,270,948		$	453			2,658,454	$	(288,030	)	$	800,690		$	828,007		$	(11,445	)	$	1,329,675
Restricted stock units issued		85,284			1			—		—			(1	)		—			—			—
Stock options exercised		55,757			1			—		—			2,119			—			—			2,120
Return of common stock to pay withholding taxes on restricted stock		(34,274	)		(1	)		34,274		(9,589	)		—			—			—			(9,590	)
Stock compensation expense		—			—			—		—			12,608			—			—			12,608
Other comprehensive loss		—			—			—		—			—			—			(766	)		(766	)
Net loss		—			—			—		—			—			(26,525	)		—			(26,525	)
Balance, June 30, 2021		45,377,715		$	454			2,692,728	$	(297,619	)	$	815,416		$	801,482		$	(12,211	)	$	1,307,522
Restricted stock units issued		19,638			—			—		—			—			—			—			—
Stock options exercised		95,916			1			—		—			6,261			—			—			6,262
Return of common stock to pay withholding taxes on restricted stock		(7,753	)		—			7,753		(2,539	)		—			—			—			(2,539	)
Stock issued under employee stock purchase plan		11,047			—			—		—			2,961			—			—			2,961
Stock compensation expense		—			—			—		—			15,749			—			—			15,749
Other comprehensive loss		—			—			—		—			—			—			(2,345	)		(2,345	)
Net income		—			—			—		—			—			56,953			—			56,953
Balance, September 30, 2021		45,496,563		$	455			2,700,481	$	(300,158	)	$	840,387		$	858,435		$	(14,556	)	$	1,384,563
Restricted stock units issued		28,303			—			—		—			—			—			—			—
Stock options exercised		3,134			—			—		—			440			—			—			440
Return of common stock to pay withholding taxes on restricted stock		(12,221	)		—			12,221		(4,267	)		—			—			—			(4,267	)
Stock compensation expense		—			—			—		—			12,383			—			—			12,383
Stock repurchase program		—			—			—		—			—			—			—			—
Other comprehensive loss		—			—			—		—			—			—			(5,933	)		(5,933	)
Net income		—			—			—		—			—			45,752			—			45,752
Balance, December 31, 2021		45,515,779		$	455			2,712,702	$	(304,425	)	$	853,210		$	904,187		$	(20,489	)	$	1,432,938

	Common Stock						Treasury Stock					Additional Paid			Retained		Accumulated Other			Total Stockholders'
	Shares			Par value			Shares		Amount			in Capital			Earnings		Comprehensive Loss			Equity
Balance, March 31, 2020		45,008,687		$	450			2,533,374	$	(265,411	)	$	739,133		$	602,482	$	(11,189	)	$	1,065,466
Restricted stock units issued		124,749			1			—		—			(1	)		—		—			—
Stock options exercised		31,488			—			—		—			1,010			—		—			1,010
Return of common stock to pay withholding taxes on restricted stock		(52,515	)		—			52,515		(9,857	)		—			—		—			(9,857	)
Stock compensation expense		—			—			—		—			9,298			—		—			9,298
Stock repurchase program		(67,649	)		(1	)		67,649		(11,309	)		—			—		—			(11,310	)
Other comprehensive income		—			—			—		—			—			—		2,654			2,654
Net income		—			—			—		—			—			44,588		—			44,588
Balance, June 30, 2020		45,044,760		$	450			2,653,538	$	(286,577	)	$	749,440		$	647,070	$	(8,535	)	$	1,101,848
Restricted stock units issued		11,554			—			—		—			—			—		—			—
Stock options exercised		121,066			1			—		—			4,544			—		—			4,545
Return of common stock to pay withholding taxes on restricted stock		(3,602	)		—			3,602		(1,077	)		—			—		—			(1,077	)
Stock issued under employee stock purchase plan		16,105			1			—		—			1,978			—		—			1,979
Stock compensation expense		—			—			—		—			11,565			—		—			11,565
Other comprehensive income		—			—			—		—			—			—		1,336			1,336
Net income		—			—			—		—			—			62,213		—			62,213
Balance, September 30, 2020		45,189,883		$	452			2,657,140	$	(287,654	)	$	767,527		$	709,283	$	(7,199	)	$	1,182,409
Restricted stock units issued		2,717			—			—		—			—			—		—			—
Stock options exercised		32,875			1			—		—			1,520			—		—			1,521
Return of common stock to pay withholding taxes on restricted stock		(879	)		(1	)		879		(242	)					—		—			(243	)
Stock compensation expense		—			—			—		—			12,856			—		—			12,856
Stock repurchase program		—			—			—		—			—			—		—			—
Other comprehensive income		—			—			—		—			—			—		3,030			3,030
Net income		—			—			—		—			—			61,868		—			61,868
Balance, December 31, 2020		45,224,596		$	452			2,658,019	$	(287,896	)	$	781,903		$	771,151	$	(4,169	)	$	1,261,441

The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited)

For the Three Months Ended December 31,

For the Nine Months Ended December 31,

2017

2016

2017

2016

Net income

$
13,446

$
15,432

$
75,323

$
37,217

Other comprehensive gain (loss):

Foreign currency translation gains (losses)

1,557

(5,873
)

10,406

(6,760
)
Net unrealized losses on marketable securities

(401
)

(269
)

(446
)

(137
)
Other comprehensive gain (loss)

1,156

(6,142
)

9,960

(6,897
)

Comprehensive income

$
14,602

$
9,290

$
85,283

$
30,320

	For the Nine Months Ended December 31,
	2021			2020
Operating activities:
Net income	$	76,180		$	168,669
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		20,799			17,271
Acquired in-process research & development		115,986			—
Bad debt recoveries		(19	)		(192	)
Stock-based compensation		40,740			33,719
Write-down of inventory and other		8,899			5,078
Accretion on marketable securities		2,701			1,183
Change in fair value of other investments		(14,265	)		(43,107	)
Gain on previously held interest in preCARDIA		(20,980	)		—
Deferred tax provision		7,049			22,920
Change in fair value of contingent consideration		(833	)		3,016
Other non-cash operating activities		2,331			3,194
Changes in assets and liabilities:
Accounts receivable		7,662			(6,925	)
Inventories		(19,569	)		6,596
Prepaid expenses and other assets		(11,874	)		(7,061	)
Accounts payable		(2,481	)		(8,147	)
Accrued expenses and other liabilities		(6,589	)		(10,000	)
Deferred revenue		681			1,889
Net cash provided by operating activities		206,418			188,103
Investing activities:
Purchases of marketable securities		(581,849	)		(487,753	)
Proceeds from the sale and maturity of marketable securities		404,193			338,331
Purchases of other investments and intangible assets		(7,067	)		(26,104	)
Acquisition of preCARDIA, net of cash acquired		(82,821	)		—
Acquisition of Breethe, net of cash acquired		—			(52,183	)
Proceeds from sales of Shockwave Medical securities		—			67,882
Purchases of property and equipment		(20,872	)		(27,274	)
Net cash used for investing activities		(288,416	)		(187,101	)
Financing activities:
Proceeds from the exercise of stock options		8,822			7,076
Taxes paid related to net share settlement upon vesting of stock awards		(16,396	)		(11,176	)
Payment of Breethe contingent consideration at acquisition date fair value		(2,334	)		—
Repurchase of common stock		—			(11,310	)
Proceeds from the issuance of stock under employee stock purchase plan		2,961			1,978
Net cash used for financing activities		(6,947	)		(13,432	)
Effect of exchange rate changes on cash and cash equivalents		490			1,107
Net decrease in cash and cash equivalents		(88,455	)		(11,323	)
Cash and cash equivalents at beginning of period		232,710			192,341
Cash and cash equivalents at end of period	$	144,255		$	181,018

Supplemental disclosure of cash flow information:
Cash paid for income taxes	$	50,378		$	34,024
Supplemental disclosure of non-cash activities:
Contingent consideration related to the acquisition of Breethe		—			13,300
Property and equipment in accounts payable and accrued expenses		1,433			640
Right-of-use assets obtained in exchange for lease liabilities		5,397			1,378

The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited)

For the Nine Months Ended December 31,

2017

2016

Operating activities:

Net income

$
75,323

$
37,217

Adjustments required to reconcile net income to net cash provided by
operating activities:

Depreciation expense

8,100

4,488

Bad debt expense

(8
)

(12
)
Stock-based compensation

29,170

24,521

Write-down of inventory and other assets

3,212

2,059

Excess tax benefit from stock-based awards

—

(4,595
)
Deferred tax provision

34,740

18,817

Change in fair value of contingent consideration

1,270

612

Changes in assets and liabilities:

Accounts receivable

(10,342
)

(7,555
)
Inventories

(11,974
)

(8,615
)
Prepaid expenses and other assets

(1,033
)

(3,923
)
Accounts payable

2,595

3,542

Accrued expenses and other liabilities

3,874

11,040

Deferred revenue

1,220

265

Net cash provided by operating activities

136,147

77,861

Investing activities:

Purchases of marketable securities

(209,834
)

(177,591
)
Proceeds from the sale and maturity of marketable securities

148,095

144,670

Purchase of other investment

(6,400
)

(149
)
Purchases of property and equipment

(44,168
)

(24,039
)
Net cash used for investing activities

(112,307
)

(57,109
)
Financing activities:

Proceeds from the exercise of stock options

7,626

8,265

Excess tax benefit from stock-based awards

—

4,595

Taxes paid related to net share settlement of vesting of stock awards

(19,860
)

(19,898
)
Proceeds from the issuance of stock under employee stock purchase plan

1,063

769

Principal payments on capital lease obligation

(517
)

(264
)
Net cash used for financing activities

(11,688
)

(6,533
)
Effect of exchange rate changes on cash

(690
)

(1,381
)
Net increase in cash and cash equivalents

11,462

12,838

Cash and cash equivalents at beginning of period

39,040

48,231

Cash and cash equivalents at end of period

$
50,502

$
61,069

Supplemental disclosure of cash flow information:

Cash paid for income taxes

$
845

$
735

Cash paid for interest on capital lease obligation

302

223

Supplemental disclosure of non-cash investing and financing activities:

Property and equipment under capital lease obligation

—

16,784

Property and equipment in accounts payable and accrued expenses

3,836

3,717

~~The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited)~~

~~Abiomed,~~ABIOMED, Inc. (the “Company” or ~~“Abiomed”~~“ABIOMED”) is a provider of ~~mechanical~~medical devices that provide circulatory support ~~devices~~ and ~~offers a continuum of care to heart failure patients.~~oxygenation. The Company develops, manufactures and markets proprietary products that are designed to enable the heart to rest ~~heal~~ and recover by improving blood flow and/or performing the pumping function of the ~~heart.~~heart and provide sufficient oxygenation to those in respiratory failure. The Company’s products are used in the cardiac catheterization lab, or cath lab, by interventional cardiologists and in the heart surgery suite by ~~heart~~cardiac surgeons for patients who are in need of hemodynamic support prophylactically or emergently before, during or after angioplasty or heart surgery procedures.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial reporting as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”) and in accordance with Article 10 of Regulation S-X. Accordingly, they do not include all of the information and note disclosures required by GAAP for complete financial statements. These statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, ~~2017~~2021 that has been filed with the ~~Securities and Exchange Commission (the “SEC”).~~SEC.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all normal and recurring adjustments that are necessary for a fair presentation of results for the interim periods presented. The results of operations for any interim period may not be indicative of results for the full fiscal year or any other subsequent period. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results may differ from these estimates.

There have been no changes in the Company’s significant accounting policies for the three and nine months ended December 31, ~~2017~~2021 as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, ~~2017~~2021 that has been filed with the SEC.

~~New~~The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results may differ from these estimates.

Certain prior period amounts within the notes to the condensed consolidated financial statements have been reclassified to conform to the current period presentation.

The Company is subject to additional risks and uncertainties as a result of the ongoing novel coronavirus (“COVID-19”) pandemic. The ongoing COVID-19 pandemic has adversely impacted and is likely to further adversely impact the Company’s business and markets, including the Company’s workforce and the operations of its customers, suppliers, and business partners. While the COVID-19 (including new variants of COVID-19) pandemic remains fluid and continues to evolve differently across various geographies, the Company believes it is likely to continue to experience variable impacts on its business, including, for example: supply shortages, particularly of its product components; and supply chain disruptions, which may limit its ability to manufacture or distribute its products.

To ensure the health and safety of its global employees, the Company continues to offer onsite COVID-19 testing and vaccinations in order to maintain a safe working environment. The Company’s proactive testing and vaccination programs have reduced exposure with early detection and enabled its manufacturing facilities to operate at full capacity.

The depth and extent to which the COVID-19 pandemic may directly or indirectly impact the Company’s business, results of operations, financial condition and individual markets is dependent upon various factors, including the spread of additional variants; the availability of vaccinations, personal protective equipment, intensive care unit (“ICU”) and operating room capacity, and medical staff; and government interventions to reduce the spread of the virus. When COVID-19 infection rates spike in a particular region, the Company’s patient utilization volumes have generally been negatively impacted as hospitals face capacity limitations, staffing shortages and some in-patient treatments have been deferred.

As the Company started the third quarter of fiscal year 2022, patient utilization of Impella heart pump devices continued to be negatively impacted by an increase in COVID-19 hospitalizations in certain geographies due to the Delta variant and ongoing shortage of hospital workers, that limited ICU capacity and contributed to some deferral of elective procedures. However, as Delta cases

moderated, patient utilization of Impella heart pump devices increased during the last two months of the third quarter, despite on-going hospital labor shortages and the emergence of the Omicron variant. While the Company experienced improvements in overall patient utilization in the third quarter, the Company continues to monitor the impact of the Omicron variant and ongoing hospital labor shortages.

The Company continues to closely monitor the impact of COVID-19 on all aspects of its business and geographies, including any impact on the Company’s customers, employees, suppliers, vendors, business partners and distribution channels, as well as on procedures and the demand for its products by keeping apprised of local, regional, and global COVID-19 surges (including new variants of the virus). As of the date of issuance of these financial statements, the extent to which the COVID-19 pandemic may materially adversely affect the Company’s financial condition, liquidity or results of operations is uncertain.

~~Effective April 1, 2017, the Company adopted~~In December 2019, the Financial Accounting Standards Board (“FASB”) ~~standard update~~issued ASU ~~2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment~~2019-12, “Simplifying the Accounting for Income Taxes (ASC 740).” (“The ASU ~~2016-09”) which~~enhances and simplifies ~~several~~various aspects of the income tax accounting guidance in ASC 740, including requirements related to hybrid tax regimes, the tax basis step-up in goodwill obtained in a transaction that is not a business combination, separate financial statements of entities not subject to tax, the intra-period tax allocation exception to the incremental approach, ownership changes in investments, changes from a subsidiary to an equity method investment, interim-period accounting for ~~share-based payment transactions, including income~~enacted changes in tax ~~consequences, recognition~~law, and the year-to-date loss limitation in interim-period tax accounting. This guidance is effective for the Company for annual and interim periods beginning after December 31, 2020; however, early adoption is permitted. The Company adopted this standard as of ~~stock compensation award forfeitures, classification of awards as either equity or liabilities, the calculation of diluted shares outstanding and classification~~April 1, 2021 on a prospective basis. The adoption did not have a material impact on the ~~statement of cash flows.~~

~~The following table summarizes the most significant impacts of ASU 2016-09 for the three and nine months ended December 31, 2017:~~

~~See table below for the changes in beginning stockholders' equity as a result of this implementation.~~

In ~~May 2014,~~January 2020, the FASB issued ASU ~~2014-09,~~ ~~Revenue from Contracts with Customers~~2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815),” an amendment clarifying the interaction between accounting standards related to ~~provide updated guidance on revenue recognition. This new standard will replace most of the existing revenue recognition guidance in U.S. GAAP when it becomes effective~~equity securities, equity method investments, and permits the use of either the retrospective or cumulative effect transition method. ASU 2014-09 requires a company to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies may need to use more judgment and make more estimates than under the current accounting guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation.certain derivative instruments. The guidance also requires expanded disclosures relating to the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. Additionally, qualitative and quantitative disclosures are required about customer contracts, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract.

is effective for fiscal years beginning after December 15, 2020. The Company is assessing all of the potential impacts of the revenue recognition guidance. Although the Company has not yet completed its assessment of the new revenue recognition guidance, the Company believes that the new revenue recognition guidance generally supports the recognition of revenue at a point-in-time for product sales and over an extended period of time for preventative maintenance service agreements, which is consistent with its current revenue recognition model. The Company does anticipate that the new revenueadopted this standard ~~will result in expanded financial statement disclosures relating to the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers.~~ ~~The Company is reviewing and updating its internal controls and processes over revenue recognition in order to prepare for the adoption of and ongoing accounting under the new standard.~~ As the Company completes its evaluation of this new accounting standard, new information may arise that could change the Company’s current understanding of the impact to revenue and expense recognized and financial statement disclosures. Additionally, the Company will continue to monitor industry activities and any additional guidance provided by regulators, standards setters, or the accounting profession and adjust the Company’s assessment and implementation plans accordingly, if required. ASU 2014-09 can be applied retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of the change recognized at the date of the initial application. The Company will apply the new guidance effective April 1, 2018 using the modified retrospective method to contracts that are not completed as of April 1, ~~2018.~~2021 and the adoption did not have a material impact on the Company’s condensed consolidated financial statements.

In November 2021, the FASB issued ASU 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance” an amendment focused on increasing transparency of government assistance including the disclosure of (1) the types of assistance, (2) an entity’s accounting for the assistance, and (3) the effect of the assistance on an entity’s financial statements. ASU 2021-10 will become effective for the Company in fiscal year 2023. The Company has the option to apply the amendments retrospectively, to all transactions within the scope of the amendment, or prospectively. The Company does not expect the adoption of this standard ~~including the cumulative effect of any adjustment to the opening balance of retained earnings,~~ to have a material impact on its consolidated financial statements. The Company does not expect the adoption of this standard to have a material impact on its consolidated financial statements.

No other new accounting pronouncements issued or effective during the period had, or are expected to have, a material impact on the condensed consolidated financial statements.

The Company acquired 100% interest in preCARDIA , Inc. (“preCARDIA”) on May 28, 2021. preCARDIA is a developer of a proprietary catheter and controller that is expected to complement the ~~FASB issued ASU 2016-01,~~ ~~Recognition~~Company’s product portfolio to expand options for patients with acute decompensated heart failure (“ADHF”). The preCARDIA system is uniquely designed to rapidly treat ADHF-related volume overload by effectively reducing cardiac filling pressures and ~~Measurement~~promoting decongestion to improve overall cardiac and renal function. The Company determined that substantially all of ~~Financial Assets and Financial Liabilities. This guidance changes accounting for financial assets and financial liabilities under~~ the fair value option and includes additional presentation and disclosure requirements for financial instruments. ASU 2016-01 requires certain financial assets to be measured at fair value with changes in fair value recognizedwas concentrated in the ~~statement~~acquired in-process research and development asset in accordance with ASC 805 Business Combinations. As such, the acquisition was accounted for as an asset acquisition.

The Company acquired preCARDIA for a purchase price of ~~operations. ASU 2016-01 eliminates~~$115.2 million, with a potential payout of $5 million payable based on achievement of a commercial milestone. The purchase price included cash consideration of $82.8 million for the ~~available-for-sale classification~~remaining interest in preCARDIA, paid to the selling shareholders and for ~~marketable securities~~transaction costs associated with the acquisition and $32.4 million representing the Company’s previously owned minority interest in ~~which changes~~preCARDIA. The Company recognized a gain of $21.0 million related to its previously owned minority interest in ~~fair value are currently recorded as a component of other comprehensive income. ASU 2016-01 also impacts~~preCARDIA within the ~~recognition and measurement of equity investments, which are currently carried at cost, but will be measured at fair value in the Company’s~~condensed consolidated statement of ~~operations. ASU 2016-01 is effective for annual reporting periods beginning after December 15, 2017, with early adoption permitted with specific application guidance. ASU 2016-01 will become effective~~operations for the nine months ended December 31, 2021.

In connection with the acquisition, the Company ~~beginning~~acquired net assets of $115.2 million, which included $115.5 million related to the fair value of the in-process research and development asset and $0.3 million for net liabilities assumed. During the three months ended December 31, 2021, the Company made a holdback payment of $0.5 million to former shareholders of preCARDIA. Since the acquired technology platform is pre-commercial and has not reached technical feasibility, the cost of the in-process research and development asset was expensed, resulting in ~~fiscal 2019. The Company is evaluating~~a charge of $116.0 million to the ~~impact to its~~condensed consolidated ~~financial statements but ASU 2016-01 could have a significant impact, including additional volatility in other income (expense) within its~~ statement of operations for the nine months ended December 31, 2021.

The Company acquired Breethe, Inc. (“Breethe”), a Maryland corporation, on April 24, 2020. Breethe is engaged in ~~future periods if there are measurable changes~~research and development of a novel extracorporeal membrane oxygenation (“ECMO”) system that will complement and expand its product portfolio to more comprehensively serve the needs of patients whose lungs can no longer provide sufficient oxygenation, including patients suffering from cardiogenic shock, or respiratory failure, such as ARDS, H1N1, or COVID-19. The Company acquired Breethe for $55.0 million in cash, with additional potential payouts up to a maximum of $55.0 million payable based on the achievement of certain technical, regulatory and commercial milestones.

The acquisition was accounted for as a business combination. The purchase price for the acquisition has been allocated to the assets acquired and liabilities assumed based on their estimated fair values and was finalized in the year ended March 31, 2021.

The acquisition-date fair value of ~~equity investments.~~the consideration transferred is as follows:

The following table summarizes the ~~FASB issued ASU 2016-02,~~ ~~Leases. The new guidance significantly impacts lessee accounting~~estimated fair values of the assets acquired and financial statement disclosures. Specifically, this guidance requires lessees to identify arrangements that should be accounted for as leases. Under this guidance, for lease arrangements exceeding a one year term, a right-of-use asset and lease obligation is recorded by the lessee for all leasesliabilities assumed on the balance sheet, whether operating or financing, while the statement of operations includes lease expense for operating leases and amortization and interest expense for financing leases. The balance sheet amount recorded at the date of ~~adoption of this guidance must be~~acquisition (in thousands):

Goodwill is calculated ~~using~~as the ~~applicable incremental borrowing rate at~~difference between the date of adoption. Leases with a term of one year or less will be accounted for similar to existing guidance for operating leases. The Company is currently in the process of evaluating its lessee arrangements to determine the impact of ASU 2016-02 on its consolidated financial statements. This evaluation includes a reviewacquisition-date fair value of the ~~Company’s existing leasing arrangements on its facilities. ASU 2016-02 must be adopted using a modified retrospective approach~~consideration transferred and the fair values of the assets acquired and liabilities assumed. The goodwill is not deductible for all leases existing at, or entered into after the date of initial adoption, with an option to elect to use certain transition relief. ASU 2016-02 will become effective for the Company beginning in fiscal 2020.income tax purposes.

Basic net income per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing net income by the weighted average number of dilutive common shares outstanding during the period. Diluted shares outstanding are calculated by adding to the weighted average shares outstanding any potential dilutive securities outstanding for the period. Potential dilutive securities include stock options, restricted stock units, performance-based stock awards and shares to be purchased under the Company’s employee stock purchase plan.

For purposes of the diluted net income per share calculation, potential dilutive securities are excluded from the calculation if their effect would be anti-dilutive.

The ~~Company’s~~following tables illustrate the determination of basic and diluted net income per share for each period presented (in thousands, except per share data):

Share-based compensation awards of approximately 0.2 million and 0.2 million shares for the three months ended December 31, 2021 and 2020, respectively, and approximately 0.1 million and 0.3 million shares for the nine months ended December 31, 2021 and 2020, respectively, were outstanding but were not included in the computation of diluted net income per share because the effect of including such shares would have been anti-dilutive or such shares are contingently issuable upon meeting performance criteria in the periods presented.

Revenue is recognized when, or as, obligations under the terms of a contract are satisfied, which occurs when control of the promised products or services is transferred to customers. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products or services to a customer.

Product revenue is generally recognized when the customer obtains control of the Company’s product, which occurs at a point in time, and may be upon shipment or upon delivery based on the contractual shipping terms of a contract.

Service revenue is generally recognized over time as the services are rendered to the customer based on the extent of progress towards completion of the performance obligation. The Company recognizes service revenue over the term of the service contract. Services are expected to be transferred to the customer throughout the term of the contract and the Company believes recognizing revenue ratably over the term of the contract best depicts the transfer of value to the customer. Revenue generated from preventative maintenance calls is recognized at a point in time when the services are provided to the customer.

Revenue from the sale of products and services is evidenced by either a contract with the customer or a valid purchase order and an invoice which includes all relevant terms of sale and shipment of product or service provided has been incurred. The Company performs a review of each specific customer’s credit worthiness and ability to pay prior to acceptance as a customer. Further, the Company performs periodic reviews of its customers’ creditworthiness prospectively.

If a contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price based on the estimated relative standalone selling prices of the promised products or services underlying each performance obligation. The Company determines standalone selling prices based on the price at which the performance obligation is sold separately.

Revenue is disaggregated between product revenue and service and other revenue and by geography, which the Company believes best depicts how the nature, amount, timing, and uncertainty of revenues and cash flows are affected by economic factors. The Company generally sells its products and services through a direct sales force in the U.S. and Germany and through direct sales and distribution agreements in other international markets outside (e.g., Japan, Europe, Canada, Latin America, Asia-Pacific, Middle East).

The following table disaggregates the Company’s revenue by products and services:

The following table disaggregates the Company’s revenue by geographical location:

The Company estimates an allowance for future sales returns based on historical return experience, which requires judgment. The Company estimates the amount of its product sales that may be returned by its customers and records this estimate as a reduction of revenue in the period the related product revenue is recognized. The Company estimates product return liabilities using the expected value method based on its historical sales information and other factors that it believes could significantly impact its expected returns, including product discontinuations, product recalls and expirations, of which it becomes aware. The Company’s cost of replacing defective products has not been material and is accounted for at the time of replacement. The Company’s returns reserve as of December 31, 2021 and March 31, 2021, was 0t material.

The Company provides certain customers with rebates and discounts that are defined in the Company’s contract arrangements with customers and are recorded as a reduction of revenue in the period the related revenue is recognized, resulting in a reduction to revenue and the establishment of a liability, which are all included in accrued expenses in the accompanying consolidated balance sheet. Rebates normally result from performance-based offers that are primarily based on attaining contractually specified sales volumes as well as product usage. Discounts are normally from early payment incentives. The Company estimates the amount of rebates and discounts based on an estimate of the third-party’s sales and the respective rebate or discount defined in the customer contractual arrangement. Revenue adjustments that relate to performance obligations satisfied in prior periods during the three and nine months ended December 31, 2021 and 2020, were not material.

The Company’s deferred revenue balance was $24.9 million and $24.3 million as of December 31, 2021 and March 31, 2021, respectively. The deferred revenue balance is due to the timing of product shipment and completion of recognizing revenue when the customer obtains control of the product, and additional preventative maintenance service contracts and the subsequent recognition of

the contract ratably over the term of the service contract. The Company recognized $3.6 million and $21.6 million of revenue during the three and nine months ended December 31, 2021, respectively, that was included in the deferred revenue balance as of March 31, 2021. The Company recognized $3.0 million and $17.6 million of revenue during the three and nine months ended December 31, 2020, that was included in the deferred revenue balance as of March 31, 2020.

The Company’s cash equivalents and marketable securities at December 31, 2021 and March 31, 2021 are invested in the following:

Gross realized gains and losses on sales of marketable securities were not material for the three and nine months ended December 31, ~~2017~~2021 and ~~2016 were~~2020.

In October 2019, the Company entered into an intercompany agreement in which it loaned 85.0 million Euro to Abiomed Europe GMBH, its German subsidiary. In conjunction with this intercompany loan agreement, the Company entered into a cross-currency swap agreement to convert a notional amount of 85.0 million Euro equivalent to $93.5 million denominated intercompany loan into U.S. dollars. The objective of this cross-currency swap is to hedge the variability of cash flows related to the forecasted interest and principal payments on the Euro denominated fixed rate loan against changes in the exchange rate between the U.S. dollar and the Euro. Under the terms of this cross-currency swap contract, which has been designated as ~~follows (in thousands, except per share data)~~a cash flow hedge, the Company will make interest payments in Euro and receive interest in U.S. dollars. Upon the maturity of this contract, the Company will pay the principal amount of the loan in Euro and receive U.S. dollars from the counterparty. The cross-currency swap is carried on the consolidated balance sheet at fair value, and changes in the fair values are recorded as unrealized gains or losses in accumulated other comprehensive income.

The Company does not enter into derivative instruments for any purpose other than cash flow hedging.

The following table summarizes the terms of the cross-currency swap agreement as of December 31, 2021 (amounts in thousands):

The following table presents the fair value of the Company’s derivative instrument (in thousands):

The Company has structured its cross-currency swap agreement to be 100% effective and, as a result, there was no net impact to earnings resulting from hedge ineffectiveness. Changes in the fair value of the cross-currency swap are designated as a hedging instrument that effectively offsets the variability of cash flows and are reported in accumulated other comprehensive income. These amounts subsequently are reclassified into the consolidated statements of operations in the same period in which the related hedged item affects earnings. The change in fair value of the cross-currency swap during the three and nine months ended December 31, 2021 was mainly due to fluctuations in the Euro to the U.S. dollar exchange rates.

For the three and nine months ended December 31, ~~2017, approximately 2,600 and 4,800 shares underlying out-of-the-money stock options, respectively, were excluded in~~2021, the ~~computation of diluted earnings per share because their effect would have been anti-dilutive. Also, approximately 128,000 restricted shares in each~~Company recorded income related to the interest rate differential of the ~~three~~cross-currency swap of $0.4 million and ~~nine months ended December 31, 2017,~~$1.2 million, respectively ~~related to performance-based and market-based awards for which milestones have not been met, were not included~~ in other (loss) income, net, within the ~~computation~~condensed consolidated statements of ~~diluted earnings per share.~~

operations. For the three and nine months ended December 31, ~~2016, approximately~~ ~~28,000~~ ~~and 17,000 shares underlying out-of-the-money stock options, respectively, were excluded in~~2020, the ~~computation of diluted earnings per share because their effect would have been anti-dilutive. Also, approximately~~ ~~185,000~~ ~~restricted shares in each~~Company recorded income related to the interest rate differential of the ~~three~~cross-currency swap of $0.5 million and ~~nine months ended December 31, 2016,~~$1.2 million, respectively ~~related to performance-based and market-based awards for which milestones have not been met, were not included~~ in other (loss) income, net, within the ~~computation~~condensed consolidated statements of ~~diluted earnings per share.~~operations.

The Company’s marketable securities are classified as available-for-sale securities and, accordingly, are recorded at fair value. The difference between amortized cost and fair value is included in stockholders’ equity. At December 31, 2017 and March 31, 2017, the Company’s financial instruments consist primarily of cash and cash equivalents, marketable securities, accounts receivable, accounts payable and contingent consideration. The carrying amounts of accounts receivable and accounts payable are considered reasonable estimates of their fair value, due to the short maturity of these investments.

~~The Company’s marketable securities at December 31, 2017 and March 31, 2017 are invested in the following:~~

Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three categories:

~~Level 1: Quoted market prices in active markets for identical assets or liabilities.~~

~~Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data.~~

Level 1 primarily consists of financial instruments whose values are based on quoted market prices such as exchange-traded instruments and listed equities.

Level 2 includes financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including time value, yield curve, volatility factors, prepayment speeds, default rates, loss severity, current market and contractual prices for the underlying financial instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace.

Level 3 is comprised of unobservable inputs that are supported by little or no market activity. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.

The following ~~table presents~~tables present the Company’s ~~financial instruments recorded~~assets and liabilities measured at fair value ~~in the condensed consolidated balance sheets, classified according to the three categories described above:~~on a recurring basis:

	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
December 31, 2017:	(in $000's)
December 31, 2021									(in thousands)
Assets
Money market funds									$	61,243	$	—	$	—	$	61,243
Repurchase agreements										—		10,000		—		10,000
Short-term U.S. Treasury mutual fund securities	$	—	$	21,043	$	—	$	21,043		—		143,388		—		143,388
Short-term government-backed securities		—		152,243		—		152,243		—		126,499		—		126,499
Short-term corporate debt securities		—		77,465		—		77,465		—		63,761		—		63,761
Short-term commercial paper										—		191,318		—		191,318
Long-term U.S. Treasury mutual fund securities										—		128,348		—		128,348
Long-term government-backed securities		—		47,491		—		47,491		—		113,957		—		113,957
Long-term corporate debt securities		—		1,994		—		1,994		—		20,330		—		20,330
Investment in Shockwave Medical										52,920		—		—		52,920
Liabilities
Cross-currency swap agreement										—		2,131		—		2,131
Contingent consideration		—		—		10,423		10,423		—		—		21,539		21,539

	Level 1		Level 2		Level 3		Total		Level 1			Level 2		Level 3		Total
March 31, 2017:	(in $000's)
March 31, 2021									(in thousands)
Assets
Money market funds									$	124,297		$	—	$	—	$	124,297
Repurchase agreements										—			33,000		—		33,000
Short-term U.S. Treasury mutual fund securities	$	—	$	45,186	$	—	$	45,186		—			72,249		—		72,249
Short-term government-backed securities		—		90,113		—		90,113		—			128,669		—		128,669
Short-term corporate debt securities		—		55,434		—		55,434		—			104,832		—		104,832
Long-term U.S. Treasury mutual fund securities		—		1,995		—		1,995
Short-term commercial paper										—			45,235		—		45,235
Long-term government-backed securities		—		43,471		—		43,471		—			225,384		—		225,384
Long-term corporate debt securities		—		1,852		—		1,852		—	��		38,701		—		38,701
Investment in Shockwave Medical										38,655			—		—		38,655
Liabilities
Cross-currency swap agreement										—			4,298		—		4,298
Contingent consideration		—		—		9,153		9,153		—			—		24,706		24,706

The Company has determined that the estimated fair value of its ~~investments~~money market funds and its investment in Shockwave Medical, a publicly traded medical device company, are reported as Level 1 financial assets as they are valued at quoted market prices in active markets. The investment in Shockwave Medical is classified within other assets in the condensed consolidated balance sheets.

The Company has determined that the estimated fair value of its repurchase agreements, U.S. Treasury mutual fund securities, government-backed securities, ~~and~~ corporate debt securities and commercial paper and cross-currency swap agreement are reported as Level 2 financial assets and liabilities as they are ~~not exchange-traded instruments.~~based on model-driven valuations in which all significant inputs are observable, or can be derived from or corroborated by observable market data for substantially the full term of the asset or liability.

The Company evaluates transfers between fair value levels at the end of each reporting period. There were no transfers of assets or liabilities between fair value levels during the nine months ended December 31, 2021.

The Company periodically makes investments in medical device companies that focus on heart failure and heart pumps and other medical device technologies. The Company measures these investments at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment. The Company monitors any events or changes in circumstances that may have a significant effect on the fair value of investments, either due to impairment or based on observable price changes and records adjustments as needed.

The Company’s ~~financial liabilities consisted~~other investments are classified as a Level 3 assets and are not included in the fair value table above. The carrying value of ~~contingent~~the Company’s portfolio of other investments and the change in the balance for the nine months ended December 31, 2021 are as follows:

Contingent consideration ~~potentially payable~~represents potential milestones that the Company may pay as additional consideration related to the acquisition of ECP Entwicklungsgesellschaft mbH (“ECP”) in July 2014 and the acquisition of Breethe in April 2020. Changes in fair value of contingent consideration are reflected within research and development expenses in the Company’s condensed consolidated statements of operations. There is no assurance that any of the conditions for the milestone payments will be met.

In July 2014, the Company acquired ECP and AIS GmbH Aachen Innovative Solutions (“AIS”)~~, in July 2014. The Company acquired ECP~~ for $13.0 million in cash, with additional potential payouts totaling $15.0 million based on the achievement of ~~certain clinical~~CE Mark approval in the European Union and ~~regulatory and~~a revenue-based ~~milestones~~milestone related to the development of the future Impella ECP^TM expandable catheter pump technology. These potential milestone payments may be made, at the Company’s option, by a combination of cash or ~~Abiomed~~ABIOMED common stock.

The Company uses a combination of an income approach, based on various revenue and cost assumptions and ~~applying~~applies a probability to each outcome and a Monte-Carlo valuation ~~model. For~~model, both of which consider significant unobservable inputs. Probabilities are applied to the clinical and regulatory ~~milestone, probabilities were applied to~~milestones, for each potential scenario and the resulting values ~~were~~are discounted using a rate that considers weighted average cost of capital as well as a specific risk premium associated with the riskiness of the earn out itself, the related projections, and the overall business. The r~~evenue-based~~revenue-based milestone is valued using a Monte-Carlo valuation model, which simulates estimated future revenues during the earn out-period using ~~management's~~management’s best estimates. ~~Projected~~

Key unobservable inputs include the discount rate used to present value the projected revenues and cash flows (ranging from 1.8% to 2.2%), the probability of achieving the various technical, regulatory and commercial milestones (estimated to range from 15% to 80%) and projected revenues, which are based on ~~our~~the Company’s most recent internal operational budgets and long-range strategic plans.

In April 2020, the Company acquired Breethe for $55.0 million in cash, with additional potential payouts up to a maximum of $55.0 million payable based on the achievement of certain technical, regulatory and commercial milestones.

The Company uses a combination of an income approach, based on various revenue and cost assumptions and applies a probability to each outcome and a Monte-Carlo valuation model, both of which consider significant unobservable inputs. For the regulatory milestones, probabilities are applied to each potential scenario and the resulting values are discounted using a rate that considers weighted average cost of capital as well as a specific risk premium associated with the riskiness of the earn out itself, the related projections, and the overall business. The commercial milestones are valued using a Monte-Carlo valuation model, which simulates estimated future revenues during the earn out-period using management’s best estimates.

Key unobservable inputs include the discount rates used to present value the projected revenues and cash flows (ranging from 1.7% to 2.3%), the probability of achieving the various technical, regulatory and commercial milestones (estimated to range from 15% to 75%) and projected revenues, which are based on the Company’s most recent internal operational budgets and long-range strategic plans.

~~This liability~~Contingent consideration is ~~reported~~classified as a Level 3 liability as the estimated fair value of the contingent consideration related to the ~~acquisition~~acquisitions of ECP ~~requires~~and Breethe require significant management judgment or ~~estimation and is calculated using the following valuation methods:~~

The following table summarizes the change in fair value, as determined by Level 3 inputs of the contingent consideration for the ~~three and~~ nine months ended December 31, ~~2017 and 2016:~~2021:

The change in fair value of the contingent consideration was primarily due to estimates related to development timelines and the passage of time on the fair value measurement of ~~milestones related to~~milestones.

The significant unobservable inputs used in the ~~ECP acquisition. Adjustments associated with the change in~~ fair value of the Company’s contingent consideration are ~~included in research~~the discount rate and ~~development expenses~~forecasted financial information. Significant increases (decreases) in the ~~Company’s condensed consolidated statements of operations.~~discount rate would have resulted in a significantly lower (higher) fair value measurement. Significant increases ~~or decreases~~(decreases) in ~~any of~~ the ~~probabilities of success or changes in expected timelines for achievement of any of these milestones could result~~forecasted financial information would have resulted in a significantly higher ~~or lower~~(lower) fair value measurement. As of December 31, 2021 and March 31, 2021, the present value of expected payments related to the Company’s contingent consideration was $21.5 million and $24.7 million, respectively. The undiscounted value of the ~~liability. The fair value~~payments, assuming that all contingencies are met, would be $67.5 million as of ~~the contingent consideration at each reporting date is updated by reflecting the changes in fair value reflected in the Company’s statement of operations.~~ ~~There is no assurance that any of the conditions for the milestone payments will be met.~~

The Company periodically makes investments in private medical device companies that focus on heart failure, heart pump and other medical device technologies. The aggregate carrying amount of the Company’s other investments was $12.6 million and $7.2 million at December 31, 2017 and March 31, 2017, respectively, and is classified within other assets in the unaudited condensed consolidated balance sheets. During the nine months ended December 31, 2017, the Company made investments of $6.4 million in private medical device companies. These investments are accounted for using the cost method and are evaluated for impairment and measured at fair value only if there are identified events or changes in circumstances that may have a significant adverse effect on the fair value of these investments.2021.

The Company’s inventories relate to its Impella^®andAbiomed Breethe OXY-1 System™ (“Breethe OXY-1”) product platforms. Finished goods and work-in-process inventories consist of direct material, labor and overhead.

In October 2017, the Company entered into a purchase and sale agreement to acquire the Company’s headquarters that it had been leasing in Danvers, Massachusetts. The total acquisition cost for the land and building was approximately $16.5 million, with $3.0 million being recorded to land and $13.0 million being recorded to building and building improvements. In addition, the Company reclassified $32.6 million in leasehold improvements to building and building improvements due to the termination of the lease agreement upon the property acquisition.

In December 2016, the Company entered into a purchase and sale agreement to acquire its existing European headquarters in Aachen, Germany, consisting of 33,000 square feet of space. The Company acquired the property in February 2017. The original acquisition cost for the land and building was approximately $12.6 million, with $4.0 million being recorded to land and $8.6 million being recorded to the building and building improvements.

Note 6.9. Goodwill and ~~In-Process Research and Development~~Other Intangible Assets, net

The carrying amount of goodwill atas of December 31, ~~2017~~2021 and March 31, ~~2017~~2021 was ~~$34.8~~$77.4 million and ~~$31.0~~$78.6 million, respectively, and has been recorded in connection with the Company’s acquisition of Impella Cardiosystems AG, in May 2005, ~~and~~ ECP ~~and AIS~~ in July ~~2014.~~2014 and Breethe in April 2020. The carrying value of goodwill ~~activity is~~and the change in the balance for the nine months ended December 31, 2021 are as follows:

The Company evaluates goodwill ~~and in-process research and development (“IPR&D”) assets~~ at least annually aton October 31, as well as whenever events or changes in circumstances suggest that the carrying amount may not be recoverable. The Company has no0 accumulated impairment losses on ~~goodwill or IPR&D assets.~~goodwill.

The ~~carrying amount~~Company’s finite-lived intangible asset represents developed technology associated with the estimated fair value of ~~IPR&D assets~~theBreethe OXY-1 System. The estimated fair value of developed technology was determined using a probability-weighted income approach, which discounts expected future cash flows to present value. The projected cash flow estimates for the Breethe OXY-1 System were based on certain key assumptions, including estimates of future revenue and expenses, the stage of development of the technology at ~~December 31, 2017~~the acquisition date and the time and resources needed to complete development. During the year ended March 31, ~~2017 was $16.2 million~~2021, the Company reclassified the in-process research and ~~$14.5 million, respectively,~~development (“IPR&D”) asset to developed technology upon receiving U.S. Food and ~~was recorded in conjunction with~~Drug Administration or FDA 510(k) clearance of the Breethe OXY-1 System and began amortizing the intangible asset on a straight-line basis over an estimated useful life of 15 years.

The Company’s IPR&D asset represents the estimated fair value of the Impella ECP^TM related to the acquisition of ECP and AIS, in July 2014. The estimated fair value of the IPR&D ~~assets~~asset at the acquisition date was determined using a probability-weighted income approach, which discounts expected future cash flows to present value. The projected cash flow estimates for the future Impella ECP^TM expandable catheter pump ~~technology~~ were based on certain key assumptions, including estimates of future revenue and expenses, taking into account the stage of development of the technology at the acquisition date and the time and resources needed to complete development.

The Company ~~used a discount rate of 21% and cash flows~~evaluates the other intangible assets at least annually on October 31, as well as whenever events or changes in circumstances suggest that ~~have been probability adjusted to reflect~~ the ~~risks of product commercialization, which the~~carrying amount may not be recoverable. The Company ~~believes are appropriate and representative of market participant assumptions.~~

has 0 accumulated impairment losses on other intangible assets. The ~~carrying value of the Company’s IPR&D assets and the~~ change in the indefinite-lived intangible assets balance for the nine months ended December 31, ~~2017~~2021, related to the impact of foreign currency translation.

During the three months ended December 31, 2021 and 2020, the Company recorded a loss of $8.2 million and a gain of $8.3 million, respectively in other (loss) income, net. During the nine months ended December 31, 2021 and 2020, the Company recorded gains of $14.3 million and $43.0 million, respectively, in other (loss) income, net. During the nine months ended December 31, 2020, the Company sold approximately 1.4 million of its shares in Shockwave Medical for cash proceeds of $67.9 million and recognized a gain of $47.3 million.

The Company’s other intangible assets and other assets is comprised primarily of license manufacturing rights to certain technology from third parties and other long-term assets such as from third parties and other long-term assets such as prepayments related to the Company’s clinical trial activities.

The following table presents supplemental balance sheet information related to the Company’s operating leases:

Expense charged to operations under operating leases was $6.7 million and $12.4 million for the three and nine months ended December 31, 2021, respectively.Expense charged to operations under operating leases was $1.0 million and $2.9 million for the three and nine months ended December 31, 2020, respectively.

Future minimum lease payments under non-cancelable operating leases as of December 31, 2021 are as follows:

In March 2021, as part of the $17.5 million purchase of a building located in Danvers, Massachusetts, we assumed existing leases with third parties for a portion of the building which are classified as operating leases. The leases have annual escalating payments and the latest expires in March 2025 in accordance with the terms and conditions of the existing agreement. For the nine months ended December 31, 2021, operating lease income was not material.

~~Employee~~The accrual for employee compensation consists primarily of accrued bonuses, ~~accrued~~ commissions, ~~and accrued~~ employee benefits and payroll taxes at December 31, ~~2017~~2021 and March 31, ~~2017.~~2021.

The Company has authorized 1,000,000 shares of Class B Preferred Stock, $.01 par value, of which the board of directors can set the designation, rights and privileges. NaN shares of Class B Preferred Stock have been issued or are outstanding.

In August 2019, the Company’s Board of Directors authorized a stock repurchase program for up to $200.0 million of shares of its common stock. Under this stock repurchase program, the Company is authorized to repurchase shares through open market purchases, privately negotiated transactions or otherwise in accordance with applicable federal securities laws, including through Rule 10b5-1 trading plans and under Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The stock repurchase program has no time limit and may be suspended for periods or discontinued at any time. The Company is funding the stock repurchase program with its available cash and marketable securities. The remaining authorization under the stock repurchase program was $103.8 million as of December 31, 2021.

The Company did not buy shares through the stock repurchase program during either of the three or nine months ended December 31, 2021. The following table provides shares bought through the stock repurchase program during the three and nine months ended December 31, 2020:

The components of accumulated other comprehensive loss, are as follows (in thousands):

The following table summarizes stock-based compensation expense by financial statement line item in the Company’s condensed consolidated statements of ~~operations~~operation for each of the three and nine months ended December 31, ~~2017~~2021 and ~~2016:~~2020:

The following table summarizes the stock option activity for the nine months ended December 31, ~~2017:~~2021:


						Weighted									Weighted
				Weighted		Average		Aggregate					Weighted		Average		Aggregate
				Average		Remaining		Intrinsic					Average		Remaining		Intrinsic
	Options			Exercise		Contractual		Value		Options			Exercise		Contractual		Value
	(in thousands)			Price		Term (years)		(in thousands)		(in thousands)			Price		Term (years)		(in thousands)
Outstanding at beginning of period		1,646		$	32.09		5.46				711		$	141.87	5.46
Granted		152			140.41						66			289.01
Exercised		(371	)		20.54						(155	)		56.98
Cancelled and expired		(55	)		100.57						(14	)		314.28
Outstanding at end of period		1,372		$	44.49		5.42	$	196,132		608		$	175.36		5.72		113,080
Exercisable at end of period		1,048		$	24.03		4.42	$	171,235		462		$	147.90	4.81			99,031
Options vested and expected to vest at end of period		1,347		$	43.85		5.37	$	193,386		608		$	175.36		5.72		113,080

Stock options ~~exercised was $46.1 million for the nine months ended December 31, 2017. The total fair value of options that vested during the nine months ended December 31, 2017 was $4.8 million.~~

generally vest and become exercisable annually, over three years. The remaining unrecognized stock-based compensation expense for unvested stock option awards atas of December 31, ~~2017~~2021, was ~~approximately $10.6~~$9.5 million and the estimated weighted-average period over which this cost ~~will~~is expected to be recognized is ~~2.4~~1.9 years.

The aggregate intrinsic value of stock options exercised was $43.4 million for the nine months ended December 31, 2021. The total cash received as a result of employee stock option exercises for the nine months ended December 31, 2021, was $8.8 million.

The Company estimates the fair value of each stock option granted at the grant date using the Black-Scholes option valuation model.

The weighted average grant-date fair values and weighted average assumptions used in the calculation of fair value of options granted ~~during the three and nine months ended December 31, 2017 and 2016~~ was as follows:

The following table summarizes activity of restricted stock units for the nine months ended December 31, ~~2017:~~2021:

Restricted stock units generally vest annually, over three years. The remaining unrecognized compensation expense for outstanding restricted stock units, including performance and market-based awards, as of December 31, ~~2017~~2021 was ~~$38.5~~$58.5 million and the estimated weighted-average period over which this cost ~~will~~is expected to be recognized is ~~2.0~~1.9 years.

~~In May 2017, performance-based awards~~The weighted average grant-date fair value for restricted stock units granted during the nine months ended December 31, 2021 was $289.73. The total fair value of restricted stock units ~~for~~vested during the ~~potential issuance of approximately 159,000 shares of common~~nine months ended December 31, 2021 was $39.2 million.

The Company grants performance-based restricted stock ~~were issued~~units to certain executive officers and employees, which vest upon achievement of prescribed service milestones by the award recipients and the achievement of prescribed performance milestones by the Company. As of December 31, ~~2017,~~2021, the Company ~~is recognizing~~recognized compensation expense based on the probable ~~outcome~~outcomes related to the prescribed performance targets on the outstanding awards.

The Company grants market-based restricted stock units to certain executive officers and employees. These restricted stock units vest upon achievement of prescribed service-based milestones, relative TSR goals by the Company and the achievement of prescribed performance milestones, as defined in the respective agreements.

The relative total shareholder return (“TSR”) is based on the Company’s common stock in relation to the TSR of 20 peer companies over a defined period, based on a comparison of average closing stock prices during the 20 trading days prior to the first day of the performance period, reinstated dividends during each performance period and the average closing stock prices during the final 20 trading days of each performance period. The actual number of market-based restricted stock units that may be earned can range from 0% to 200% of the target number of shares. The payout percentage may be further adjusted based on the Company’s performance relative to the constituents of the S&P 500 Index on the first day of the performance period that are still actively trading on the last day of each performance period, as defined in the respective agreements.

The Company used a Monte-Carlo simulation model to estimate the grant-date fair value of the market-based restricted stock units. The fair value related to these awards are recorded as compensation expense over the period from date of grant, based on the probable outcomes related to the prescribed performance targets on the outstanding awards, regardless of the actual TSR outcome reached.

The table below sets forth the assumptions used to value the awards and the estimated grant-date fair value:

On December 22, 2017, the Tax Cut and Jobs Act, or the Tax Reform Act, was signed into law. The Tax Reform Act included significant changes to existing law, including among other items, a reduction to the U.S. federal statutory corporate tax rate from 35% to 21% effective January 1, 2018. ASC 740, ~~Income Taxes (Topic 740)~~, or ASC 740, requires that the effects of changes in tax laws or rates be recognized in the period in which the law is enacted. Those effects, both current and deferred, are reported as part of the tax provision, regardless of income in which the underlying pretax income (expense) or asset (liability) was or will be reported.

T~~he Company’s estimated fiscal 2018 blended U.S. federal statutory corporate income tax rate of 31.5% was applied in the computation of~~ ~~the income tax provision for the three and nine months ended December 31, 2017~~. The blended U.S. federal statutory corporate tax rate of 31.5% represents the weighted average rate between the pre-enactment U.S. federal statutory corporate tax rate of 35% prior to the January 1, 2018 effective date and the post-enactment U.S. federal statutory corporate tax rate of 21% thereafter.

The Company’s income tax provision was ~~$32.2~~$12.1 million and ~~$36.6~~$18.9 million for the three months ended December 31, 2021 and 2020, respectively. The Company’s income tax provision was $39.6 million and $46.1 million for the nine months ended December 31, ~~2017, respectively,~~2021 and ~~$10.4 million and $24.8 million for the three and nine months ended December 31, 2016,~~2020, respectively. The Company’s effective tax rate was ~~70.6%~~21% and ~~32.7%~~23.4% for the three months ended December 31, 2021 and 2020, respectively. The Company’s effective tax rate was 34.2% and 21.4% for the nine months ended December 31, ~~2017, respectively,~~2021 and ~~40.2% and 40.0%~~2020, respectively. The effective tax rate differs from the statutory federal income tax rate of 21% for the three ~~and nine~~ months ended December 31, ~~2016, respectively.~~ Consistent with guidance issued by the SEC, which provides for a measurement period of one year from the enactment date to finalize the accounting for effects of the Tax Reform Act, the Company provisionally recorded an income tax expense of ~~$22.0~~ ~~million during the three~~2021 and ~~nine months ended December 31, 2017,~~ 2020 primarily due to ~~the re-measurement of its net deferred~~state and foreign income taxes and permanent differences offset by credits and excess tax assets due to the lower U.S. federal statutory corporate tax rate. This provisional estimate reflects estimable current year impacts of the Tax Reform Act on the Company’s estimated annual effective tax rate and discrete items resulting directly from the enactment of the Tax Reform Act based on the information available, prepared, or analyzed (including computations) in reasonable detail. Any adjustments to this provisional estimate will be recorded as adjustments to income tax expense in the period in which those adjustments become estimable and/or are finalized, if necessary.

As ~~discussed in “Note 2. Basis of Presentation and Summary of Significant Accounting Policies,” the~~benefits. The Company ~~also~~ recognized excess tax benefits associated with stock-based awards of ~~$3.2~~$0.3 million and ~~$24.5~~$1.9 million ~~as an~~for the three months ended December 31, 2021 and 2020, respectively. The effective tax rate differs from the statutory federal income tax ~~benefit~~rate of 21% for ~~three and~~the nine months ended December 31, ~~2017, respectively. These recognized~~2021, primarily due to a non-deductible charge for in-process research and development related to the preCARDIA acquisition offset by excess tax benefits ~~resulted~~related to stock-based compensation. The effective tax rate differs from ~~restricted stock units that vested or stock options that were exercised during~~ the ~~three and~~statutory federal income tax rate of 21% for the nine months ended December 31, ~~2017.~~

2020, primarily due state and foreign income taxes and permanent differences offset by credits and excess tax benefits. The ~~significant differences between the statutory income~~Company recognized excess tax ~~rate~~benefits associated with stock-based awards of $10.1 million and ~~effective income tax rate~~$10.4 million for the ~~three and~~ nine months ended December 31, ~~2017~~2021 and ~~2016 were as follows:~~

~~The recently enacted Tax Reform Act allows for a 100% deduction for the repatriation of foreign subsidiary earnings~~ ~~with minimal U.S. income tax consequences other than the one-time deemed repatriation toll charge. Since most of the Company’s cash~~

and cash equivalents are held by foreign subsidiaries which are disregarded entities for domestic tax purposes, any repatriation of such funds to the U.S. would likely have a nominal tax impact, if any.

The Company ~~and its subsidiaries are~~is subject to ~~U.S. federal~~the examination of its income tax as well as income tax of multiple state and foreign jurisdictions. Fiscal years 2012 through 2017 remain open to examination in Germany and Abiomed Europe GmbH, the Company’s main operating subsidiary in Germany, is currently being audited for fiscal years 2012 through 2015. In July 2017, the Company was notifiedreturns by the Internal Revenue Service ~~or IRS, that it has selected~~and other tax authorities. The outcome of these audits cannot be predicted with certainty. During the ~~Company’s federal tax return for fiscal 2016 for examination. In September 2017, the Company was notified by German tax authorities that our ECP subsidiary in Germany will be audited for the year~~nine months ended December 31, ~~2014 and~~2021, the ~~three months ended March 31, 2015.~~Company closed an income tax audit in Germany which covered fiscal years 2016 through 2019 with 0 material adjustments. The Company’s most recent completed income tax audit in the U.S. related to fiscal year 2016. All other tax years remain subject to examination by the ~~IRS~~federal, state and ~~state~~foreign tax authorities, because the Company has net operating loss and tax credit carryforwards which may be utilized in future years to offset taxable income, those years may also be subject to review by relevant taxing authorities if the carryforwards are utilized.authorities.

The Company’s corporate headquarters is located in Danvers, Massachusetts. This facility encompasses most of the Company’s U.S. operations, including research and development, manufacturing, sales and marketing and general and administrative departments. In October 2017, the Company entered into a purchase and sale agreement to purchase its corporate headquarters for approximately $16.5 million and terminated its existing lease arrangement (See Note 5).

In February 2017, the Company entered into a lease agreement for an additional 21,603 square feet of office space in Danvers, Massachusetts, which expires on July 31, 2022. In December 2017, the Company entered into an amendment to this lease to extend the lease term through August 31, 2025 and to add an additional 6,607 square feet of space in which rent would begin around June 1, 2018. The amendment also allows the Company a right of first offer to purchase the property from January 1, 2018 through August 31, 2035, if the lessor decides to sell the building or receives an offer to purchase the building from a third-party buyer. The annual rent expense for the lease is estimated to be $0.4 million.

In September 2016, the Company entered into a lease agreement in Berlin, Germany which commenced in May 2017 and expires in May 2024. The annual rent expense for the lease is estimated to be $0.3 million.

~~In October 2016, t~~he Company entered into a lease agreement for an office in Tokyo, Japan and expires in September 2021. The office houses administrative, regulatory, and training personnel in connection with the Company’s commercial launch in Japan. The annual rent expense for the lease is estimated to be $0.9 million.

From time to time, the Company is involved in legal and administrative proceedings and claims of various types. In some actions, the claimants seek damages, as well as other relief, which, if granted, would require significant expenditures. The Company records a liability in its consolidated financial statements for these matters when a loss is known or considered probable and the amount can be reasonably estimated. The Company reviews these estimates each accounting period as additional information is known and adjusts the loss provision when appropriate. If a matter is both probable to result in liability and the amount of loss can be reasonably estimated, the Company estimates and discloses the possible loss or range of loss. If the loss is not probable or cannot be reasonably estimated, a liability is not recorded in its consolidated financial statements.

In April 2014, the Company received an administrative subpoena from the Boston regional office of the United States Department of Health and Human Services, or HHS, Office of Inspector General requesting materials relating to the Company’s reimbursement of employee expenses and remuneration to healthcare providers from July 2012 through December 2012, in connection with a civil investigation under the False Claims Act (the “FCA Investigation”). Subsequently, the Company received Civil Investigative Demands from the U.S. Attorney’s Office for the District of Massachusetts that collectively sought additional information relating to this matter for the time period of January 1, 2011 through September 14, 2016. Maquet Matters

The Company continues to cooperate with the government in this investigation and is exploring ways to resolve this matter with the government. The Company is not able to predict what action, if any, might be taken in the future as a result of the investigation, or the potential impact on its financial position.

~~Thoratec Corporation, or Thoratec, a subsidiary of Abbott Laboratories,~~ has ~~challenged a number of Company owned~~been litigating certain patents in Europe in connection with the launch of their HeartMate PHP medical device, or PHP, in Europe. These actions relate to Thoratec’s ability to manufacture and sell their PHP product in Europe. These actions do not relate to the Company’s ability to manufacture or sell its Impella line of devices.

~~In December 2014, Thoratec filed a nullity suit in the German Federal Patent Court against a German “pigtail” patent~~ owned by the Company with a flexible extension feature, and auxiliary pigtail, basket and funnel features. The validity hearing was held in November 2016 and the Federal Patent Court found the patent invalid. The Company is appealing this decision.

In August 2015, Thoratec filed a nullity action in the German Federal Patent Court against two Company owned patents covering a “magnetic clutch” feature. These magnetic clutch patents were acquired by the Company in July 2014, in connection with its acquisition of ECP and AIS. The validity hearing for the magnetic clutch patents was held in June 2017. The Company’s patents were upheld in an amended form to focus on the structure and interaction of the magnets in the clutch. The Federal Patent Court found certain unamended claims to be invalid. The Company is appealing the decision with respect to the unamended claims.

In September 2015, the Company filed counterclaims in the magnetic clutch action in Germany asserting that the PHP product infringes the two magnetic clutch patents, a European pigtail patent, and the German pigtail patent. The infringement trial has been stayed, pending resolution of the German nullity actions.

In February 2017, Thoratec filed an opposition in the European Patent Office against a Company owned patent acquired in connection with the acquisition of ECP and AIS relating to a housing structure for an expandable pump. The Company filed an initial response to the opposition in July 2017. In December 2017, Thoratec filed an opposition in the European Patent Office against a Company owned patent acquired in connection with the acquisition of ECP and AIS relating to a pump having a shaft cap with an atraumatic ball. The Company’s due date for responding to the opposition is May 27, 2018.

~~In December 2015, the Company received a letter from~~ Maquet Cardiovascular LLC ~~or Maquet, a subsidiary of the Getinge Group, asserting that the Company’s Impella devices infringe certain claims having guidewire, lumen and sensor features, which were~~(“Maquet”) in two ~~Maquet patents and one~~separate cases pending ~~patent application~~ in the U.S. and elsewhere, and attached a draft litigation complaint and encouraged the Company to take a license from Maquet. In January 2016, the Company responded to Maquet stating that it believed that the cited claims were invalid and that its Impella devices did not infringe the cited patents. In May 2016, Maquet notified the Company that its pending U.S. patent application had been issued as a U.S. patent, repeated their earlier assertion and encouraged the Company to discuss taking a license from Maquet. The three patents expire September 2020, December 2020 and October 2021. In May 2016, the Company filed suit in U.S. District Court for the District of Massachusetts (“D. Mass” or ~~D. Mass., against Maquet seeking~~“the Court”) since 2016.

In May 2016, the Company filed a declaratory judgment action (the “2016 Action”) alleging that ~~the Company’s Impella devices do~~it does not infringe Maquet’s ~~cited patent rights.~~

~~In August 2016, Maquet sent a letter~~patent. Following the claim construction (“Markman”) order issued in November 2018, and prior to the ~~Company identifying four new U.S. continuation patent filings with claims that Maquet alleges are infringed by~~close of discovery, both parties filed series of motions. On September 30, 2021, the Court granted the Company’s ~~Impella devices. Of~~Motion for Summary Judgement (“MSJ”) for non-infringement of the ~~four U.S. continuation applications, one issued as~~two claims remaining in this case. Maquet moved for reconsideration of the MSJ order, which the Court denied on November 30, 2021. The Court has not entered a patent on January 17, 2017, one issued as a patent on February 7, 2017, one issued as a patent on March 21, 2017, and one issued as a patent on October 17, 2017. These four issued patents will expire in September 2020.final judgement; therefore, the case is not yet appealable to the Federal Circuit.

In September 2016, Maquet filed a response to the Company’s suit in D. Mass., including various counterclaims alleging that the Company’s Impella 2.5, Impella CP, Impella 5.0, and Impella RP heart pumps infringe certain claims of the three original issued U.S. patents. On June 15,November 2017, Maquet filed a motion for leave to amend its infringement counterclaims to add the first three additional U.S. continuation patents mentioned above and to file various false advertising, unfair competition claims under state law and under the Lanham Act, and a trademark cancellation in the pending case. Maquet’s amended complaint and counterclaim, like those it originally filed, seek injunctive relief and monetary damages in the form of a reasonable royalty, with three times the amount for alleged willful infringement. The amended complaint admits that Maquet’s currently commercially available products do not embody the claims of the asserted patents. On July 21, 2017, the Court granted the motion in part, allowing the three additional continuation patents to be added to the case, and denied the motion to add the false advertising claims, Lanham Act claims, and the trademark cancellation claims. On October 26, 2017, Maquet filed an amended answer, adding a new counterclaim alleging infringement of an additional seventh patent. Maquet did not seek leave to amend the pleadings and did not first consult with the Company concerning this addition. On November 11, 2017, after Maquet refused to withdraw the patent, the Company filed a motion to strike the seventh patent of Maquet’s counterclaims on the grounds that Maquet did not seek leave to add the patent and had amended its pleadings after the deadline set by the Court. On November 15, 2017, Maquet informed the Court that it would agree to voluntarily withdraw the seventh patent. In response on November 22, 2017, Maquet filed a second lawsuitaction in D. Mass alleging that the Company’s Impella 2.5^®, Impella CP^®, and Impella 5.0^® heart pumps infringe certain claims of ~~the seventh patent. In the complaint Maquet seeks injunctive relief and monetary damages~~another patent in the ~~form of a reasonable royalty, with three times the amount for alleged willful infringement. Discovery is ongoing~~same family (the seventh patent overall between both cases). The Parties submitted Markman briefs and ~~the~~argued their respective positions in November 2019. A Markman ~~Hearing on claim interpretation~~order has ~~been rescheduled for March 13, 2018.~~

~~With regard to the first six Maquet patents mentioned above, in March~~not yet issued, and April 2017 the Company filed requests for inter partes review, or IPR, at the U.S. Patent & Trademark Office’s Patent Trial and Appeals Board, or PTAB, asserting that the claims are invalid in view of prior art blood pump technology. In September and October 2017, the PTAB denied institution on these IPR requests filed by the Company. In September 2017, the Company filed additional IPRs and the institution decisions are expected in March 2018.discovery remains ongoing.

The ~~Company cannot estimate what the potential outcome of these claims will be at this time. Discovery is ongoing and the hearing~~asserted patents in both cases expired on ~~claim interpretation is scheduled for March 2018.~~ September 1, 2020.

The Company is unable to estimate the potential liability with respect to the legal matters noted above. There are numerous factors that make it difficult to meaningfully estimate possible loss or range of loss at this stage of the legal proceedings, including ~~that~~ the ~~FCA Investigation~~significant number of legal and ~~patent disputes with Thoratec and Maquet remain either in relatively early stages, or there are significant~~ factual ~~and legal~~ issues still to be resolved ~~and information obtained or rulings made during any lawsuits or investigations that could affect~~in the ~~methodology for calculation.~~Maquet patent disputes.

The Company ~~operates~~has been involved in two ongoing patent infringement actions against Thoratec Corporation (“Thoratec”), a subsidiary of Abbott Laboratories (“Abbott”) for the sales and marketing of Thoratec’s Heartmate PHP™ pump in 2016. In August 2021, the Appellate Court (the Court of 2nd Instance) in Düsseldorf affirmed that Thoratec infringes both patents. The Company can now enforce the judgment in one ~~business segment—~~case by seeking a court ordered injunction if Thoratec sells Heartmate PHP™ in Germany. Thoratec

had appealed the ~~research, development~~second case to the Federal Court of Justice (the Court of 3rd and ~~sale~~Last Instance) and in January 2022, Thoratec withdrew its appeal.

These actions relate solely to Thoratec’s ability to manufacture and sell its PHP product in Europe and have no impact on the Company's ability to manufacture or sell its Impella^® line of medical ~~devices~~devices. The actions do not expose the Company to ~~assist or replace the pumping function~~liability risk, except under local German law, which requires a losing party in a proceeding to pay a portion of the ~~failing heart.~~ other party’s legal fees.

On or about August 6, 2019, the Company received a securities class action complaint filed on behalf of a single shareholder in the U.S. District Court for the Southern District of New York (“SDNY”), on behalf of himself and persons or entities that purchased or acquired the Company’s securities between January 31, 2019 through July 31, 2019. On October 7, 2019, a similar purported class action complaint was filed by a different shareholder on behalf of himself and persons or entities that purchased or acquired the Company’s securities between November 1, 2018 and July 31, 2019. Also, on October 7, 2019, four shareholders filed applications to be appointed lead plaintiff and for their counsel to be appointed lead counsel for the class. Two of those shareholders also filed motions to consolidate the two cases and two of the shareholders have withdrawn their applications to be lead plaintiff.

The complaints alleged that the Company violated Sections 10(b) and 20(a) of and Rule 10b-5 under the Exchange Act, in connection with allegedly misleading disclosures made by the Company regarding its financial condition and results of operations.

On June 29, 2020, SDNY issued an order consolidating the two cases and appointed Local 705 International Brotherhood of Teamsters Pension Fund as the lead plaintiff and Labaton Sucharow LLP as lead counsel. On September 17, 2020, the lead plaintiff filed an amended complaint in which it proposed a new class period of May 3, 2018 to July 31, 2019. As prescribed by a scheduling order, the Company filed a motion to dismiss on November 16, 2020. On September 21, 2021, SDNY granted the Company’s motion, dismissed the amended complaint, and gave the lead plaintiff leave to move to amend the complaint by October 12, 2021. On October 12, 2021, the Company and the lead plaintiff entered into a stipulation to voluntarily dismiss the securities class action and SDNY ordered dismissal of the case with prejudice on the same day. Under the terms of the stipulation, the lead plaintiff has agreed not to move for leave to amend the complaint and not to appeal the dismissal of the action.

On November 6 and 7, 2019, two shareholders filed derivative actions in SDNY that were subsequently consolidated. On November 8, 2019, another shareholder filed a derivative action in Massachusetts Suffolk County Superior Court. On January 7, 2020, another shareholder derivative action was filed in the U.S. District Court for the District of Delaware. The complaints in these actions relied on many of the same allegations as in the securities class actions, and asserted that, between November 1, 2018 and July 31, 2019, the directors of the Company made or allowed to be made misleading public statements regarding the Company’s growth, ultimately harming the Company.

The Company agreed with the plaintiffs in all three actions to stay the cases pending resolution of a motion to dismiss in the securities class actions. As a result of the stay, the Delaware action was administratively closed.

Following dismissal of the securities class action, the Company agreed with the plaintiffs in all three actions to voluntarily dismiss the derivative actions. In all three actions, the respective courts have entered judgment dismissing the action without prejudice.

On March 3, 2020, a shareholder sent a letter to the Board of Directors asserting that the directors of the Company made or allowed to be made misleading public statements regarding the Company’s growth. The letter relied on many of the same allegations as the securities class actions and derivative actions, and demanded that the Board (i) undertake an independent investigation of the directors, (ii) bring suit against the directors on behalf of the Company, and (iii) take a number of additional affirmative actions to redress the purported wrongs. On March 30, 2020, the Company, after discussions with the Board of Directors, sent a written response to the shareholder’s counsel which they responded to on June 1, 2020. The Company then sent a further response to the shareholder’s counsel on June 15, 2020, affirming the decision to defer consideration of the litigation demand pending further developments in the securities class action suit. Following the filing of the amended complaint in the securities class action, described above, the same shareholder renewed their demand on September 29, 2020. The Company responded on October 9, 2020 and once again affirmed that it would defer consideration of the demand pending further substantive developments in the securities class action suit.

On November 5, 2020, a second shareholder sent a letter to the Board of Directors that made essentially the same demands as the September 29, 2020 letter from the first shareholder. The Company responded on November 23, 2020, noting that it would defer consideration of the demand pending further substantive developments in the securities class action suit.

On November 22, 2021, the Company sent letters to each shareholder’s counsel noting the dismissal of the securities class action suit and derivative actions and communicating the Company’s expectation that the shareholders would withdraw their demands.

Operating segments are components of an enterprise for which separate financial information is available and is evaluated regularly by the Company’s chief operating ~~decision maker~~decision-maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s CODM (determined to be the Chief Executive Officer) ~~does not manage any part of~~reviews the ~~Company separately,~~business, makes investment and ~~the~~resource allocation ~~of resources~~decisions, and ~~assessment of~~assesses operating performance ~~are~~ based on the Company’s consolidated operating results. ~~International~~The Company operates as 1 reportable segment.

Rest of world sales ~~(sales~~(meaning sales outside the U.S. ~~and~~, primarily in ~~Europe)~~Europe and Japan) accounted for ~~11%~~19% and 18% of total ~~product~~ revenue infor each of the three and nine months ended December 31, ~~2017, respectively,~~2021 and ~~9% of total product revenue in each of the three and nine months ended December 31, 2016,~~2020, respectively. ~~Most of the~~The Company’s long-lived assets are located in the U.S., except for $~~31.7~~$57.3 million and ~~$23.2~~$56.4 million at December 31, ~~2017~~2021 and March 31, ~~2017,~~2021, respectively, which are located primarily in Germany.

This Report, ~~contains~~including the documents incorporated by reference in this Report, includes forward-looking statements within the meaning of ~~Section 27A of~~ the Private Securities Litigation Reform Act of ~~1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Any~~1995. All statements, other than ~~one conveying solely~~statements of historical facts, ~~is a~~may be forward-looking ~~statement.~~statements. These forward-looking statements may be accompanied by such words ~~such~~ as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “potential,” “project,” “target,” “should,” “likely,” “will” and other words and terms of similar meaning. These forward-looking statements address various matters including, among others, future actions related to ongoing investigations and litigation and expenditures related thereto; the development and commercialization of new and existing products and anticipated costs, including research and development, sales and marketing and training costs associated with product development and commercialization; the anticipated launch dates of technological improvements in existing products and studies in pipeline products; expected capital expenditures for the fiscal year ending March 31, 2018; commercial plans for our products into new markets such as Japan; expected enrollment in our prospective feasibility study; demand and expected shipments of our products; anticipated shifts in the revenue mix associated with our products; our ability to increase revenue from our Impella® line of products and the sufficiency of revenue to fund future operations; the impact of market factors such as changes in interest rates, currency exchange rates on our securities and the fair value of our financial instruments; awards of performance and market-based restricted stock units; and the impact of ASU 2016-09 on our consolidated financial statements and disclosures. Each forward-looking statement in this Report is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such ~~statement,~~statement. Factors that could cause actual results or conditions to differ from those anticipated by these and other forward-looking statements include: the impact of public health threats and epidemics, including ~~among others:~~the COVID-19 pandemic and resulting or prolonged economic downturns on our ~~inability~~operations and financial conditions; effects on our profitability if we are unable to ~~predict the outcome~~manufacture our products as a result of ~~investigations and litigation and associated expenses; possible delays~~natural or man-made disasters; fluctuations in foreign currency exchange rates; our ~~research and development programs;~~dependence on Impella^® products for most of our revenues; our ability to ~~obtain regulatory approvals~~successfully compete against our existing or potential competitors; the acceptance of our products by cardiac surgeons and interventional cardiologists, especially those with significant influence over medical device selection and purchasing decisions; the effect of long sales and training cycles associated with expansion into new hospital cardiac centers; the potential for reduced market acceptance of our products and ~~uncertainties related~~reduced revenue due to ~~regulatory processes; greater government scrutiny and regulation of the medical device industry and~~lengthy clinician training process; our ability to ~~respond~~effectively manage our growth; our ability to ~~changing laws~~anticipate demand for, and regulations affecting our industry, including any reforms to the regulatory approval process administered by the U.S Food and Drug Administration, or FDA, and changing enforcement practices related thereto; the inability to manufacture products in commercial quantities at an acceptable cost; the acceptance by physicians and hospitals ofsuccessfully commercialize, our products; the impact of ~~competitive~~unsuccessful clinical trials or procedures relating to products under development; our ability to develop additional and ~~pricing; uncertainties~~high-quality manufacturing capacity to support continued demand for our products; our dependence on third-party payers to provide reimbursement to our customers of our products; our suppliers’ failure to provide the components we require; our reliance on distributors to sell our products in international markets; our success in expanding our direct sales activities into international markets; our ability to sustain profitability at levels achieved in recent years; the unpredictability of fluctuations in our operating results; our ability to develop and commercialize new products or acquire desirable companies, products or technologies; inventory write-downs and other costs due to product quality issues; risks and liabilities associated with acquisitions of other companies or businesses, including our ability to integrate acquired businesses into our operations; the impact of consolidation in the healthcare industry on our prices; our ability to attract and retain key personnel; our ability to obtain governmental and other regulatory approvals and market and sell our products in certain jurisdictions; regulatory or enforcement actions and product liability suits relating to off-label uses of our products; the increased risk of material product liability claims and impact on our reputation and financial results; our ability to maintain compliance with regulatory requirements and continuing regulatory review; the impact of mandatory or voluntary product recalls; material impairments caused by shutdowns of the U.S. federal government; changes in healthcare reimbursement systems in the U.S. and abroad; our ability to comply with healthcare “fraud and abuse” laws and any related penalties for non-compliance; our failure to comply with the U.S. Foreign Corrupt Practices Act and other anti-corruption laws, export control laws, import and customs laws, trade and economic sanctions laws and other laws governing our operations; our or our vendors’ ability to achieve and maintain high manufacturing standards; the economic effects of “Brexit” and related impacts to relationships with our existing and future ~~capital needs~~customers; our potential “ownership change” for U.S. federal income tax purposes and our limited utilization of net operating losses from prior tax years; our ability to maintain compliance with, and the ~~risks identified under Item 1A~~impact on us of ~~Part I~~changes in, tax laws including U.S. Tax Reform legislation; our ability to comply with, and the impact of any related costs or regulatory actions with respect to, environmental, health and safety requirements; our failure to protect our intellectual property or develop or acquire additional intellectual property; compliance with laws protecting the confidentiality of patient health information; disruptions of critical information systems or material breaches in the security of our ~~Annual Report~~systems; risks relating to our shares of common stock, including market price volatility and the potential for dilution to our stockholders’ ownership interests through the sale of additional securities; changes in methods, estimates and judgments we use in applying our accounting policies; changes in accounting standards, tax laws and financial reporting requirements; and other factors discussed in “Part I, Item 1A. Risk Factors” of our annual report on Form 10-K for the year ended March 31, ~~2017, as well as~~2021 and the ~~other information we file~~filing subsequently filed with or furnished to the ~~Securities and Exchange Commission.~~SEC. Readers are cautioned not to place ~~considerable~~undue reliance on any forward-looking statements contained in this Report, which speak only as of the date of this Report. Any forward-looking statement made in this Report speaks only as of the date hereof. We undertake no obligation to update or revise these forward-looking statements whether as a result of new information, future events or otherwise, unless otherwise required by law. Our business is subject to substantial risks and uncertainties, including those referenced above. Investors, potential investors, and others should give careful consideration to these risks and uncertainties.

We are a ~~leading~~ provider of ~~temporary mechanical~~medical devices that provide circulatory support ~~devices,~~ and ~~we offer a continuum of care to heart failure patients.~~oxygenation. We develop, manufacture and market proprietary products that are designed to enable the heart to rest ~~heal~~ and recover by improving blood flow ~~to the coronary arteries and end-organs~~ and/or ~~temporarily assisting~~performing the pumping function of the ~~heart.~~heart and provide sufficient oxygenation to those in respiratory failure. Our products are used in the cardiac catheterization lab, or cath lab, by interventional cardiologists ~~the electrophysiology lab, the hybrid lab~~ and in the heart surgery suite by ~~heart surgeons. A physician may use our devices~~cardiac surgeons for patients who are in need of hemodynamic support prophylactically ~~urgently~~ or emergently before, during or after angioplasty or heart surgery procedures. We believe that heart recovery is the optimal clinical outcome for a patient experiencing heart failure because it enhances the potential for

the patient to go home with ~~the patient’s~~their own ~~native~~ heart, facilitating the restoration of quality of life. In addition, we believe that, for the care of such patients, heart recovery is often the most cost-effective solution for the healthcare system.

We are subject to additional risks and uncertainties as a result of the ongoing novel coronavirus (“COVID-19”) pandemic. The ongoing COVID-19 pandemic has adversely impacted and is likely to further adversely impact our business and markets, including our workforce and the operations of our customers, suppliers, and business partners. While the COVID-19 (including new variants of COVID-19) pandemic remains fluid and continues to evolve differently across various geographies, we believe we are likely to continue to experience variable impacts on our business, including, for example: supply shortages, particularly of our product components; and supply chain disruptions, which may limit our ability to manufacture or distribute our products. To ensure the health and safety of our global employees, we continue to offer onsite COVID-19 testing and vaccinations in order to maintain a safe working environment. Our proactive testing and vaccination programs have reduced exposure with early detection and enabled our manufacturing facilities to operate at full capacity.

The depth and extent to which the COVID-19 pandemic may directly or indirectly impact our business, results of operations, financial condition and individual markets is dependent upon various factors, including the spread of additional variants; the availability of vaccinations, personal protective equipment, intensive care unit (“ICU”) and operating room capacity, and medical staff; and government interventions to reduce the spread of the virus. When COVID-19 infection rates spike in a particular region, our patient utilization volumes have generally been negatively impacted as hospitals face capacity limitations, staffing shortages and some in-patient treatments have been deferred.

As we started the third quarter of fiscal year 2022, patient utilization of Impella heart pump devices continued to be negatively impacted by an increase in COVID-19 hospitalizations in certain geographies due to the Delta variant and ongoing shortage of hospital workers, that limited ICU capacity and contributed to some deferral of elective procedures. However, as Delta cases moderated, patient utilization of Impella heart pump devices increased during the last two months of the third quarter, despite on-going hospital labor shortages and the emergence of the Omicron variant. While we experienced improvements in overall patient utilization in the third quarter, we continue to monitor the impact of the Omicron variant and ongoing hospital labor shortages.

We continue to closely monitor the impact of COVID-19 on all aspects of our business and geographies, including any impact on our customers, employees, suppliers, vendors, business partners and distribution channels, as well as on procedures and the demand for our products by keeping apprised of local, regional, and global COVID-19 surges (including new variants of the virus). As of the date of issuance of these financial statements, the extent to which the COVID-19 pandemic may materially adversely affect our financial condition, liquidity or results of operations is uncertain.

We acquired 100% interest in preCARDIA on May 28, 2021. preCARDIA is a developer of a proprietary catheter and controller that will complement Abiomed’s product portfolio to expand options for patients with acute decompensated heart failure (“ADHF”). The preCARDIA system is uniquely designed to rapidly treat ADHF-related volume overload by effectively reducing cardiac filling pressures and promoting decongestion to improve overall cardiac and renal function. We acquired preCARDIA for a purchase price of $115.2 million, with a potential payout of $5 million payable based on achievement of a commercial milestone. During the three months ended December 31, 2021, we made a holdback payment of $0.5 million to former shareholders of preCARDIA. The acquisition was accounted for as an asset acquisition as substantially all of the fair value of the acquisition related to the acquired in-process research and development asset. Since the acquired technology platform is pre-commercial and has not reached technical feasibility, the cost of the in-process research and development asset was expensed, resulting in a charge of $116.0 million to the condensed consolidated statements of operations for the nine months ended December 31, 2021. In addition, we recognized a gain of $21.0 million related to our previously owned minority interest within the condensed consolidated statements of operations for the nine months ended December 31, 2021.

Our strategic focus and the primary driver ~~of the majority~~ of our revenue growth is the market penetration of our family of ~~Impella®~~Impella^® heart pumps. The Impella device portfolio, which includes the Impella ~~2.5® Impella CP®~~2.5^®, Impella ~~RP®~~CP^®, Impella ~~LD®~~5.0^®, Impella LD^®, Impella 5.5^® and Impella ~~5.0®~~RP^® devices, has supported ~~numerous~~thousands of patients worldwide. We expect that ~~all~~most of our product and service revenue in the near future will be from our Impella devices. ~~Revenues from~~

Below is a summary of our non-Impella devices, largely focused on the AB5000 device used in the heart surgery suite, have been decreasing over the past several years and we are no longer selling the AB5000 as we have strategically shifted our sales and marketing efforts towards our Impella devicesexisting products and the ~~cath lab.~~

~~In March 2015, we~~countries where they have received a Pre-Market Approval, or PMA,��from the FDA for use of the Impella 2.5 device during elective and urgent high-risk percutaneous coronary intervention, or PCI, procedures. In December 2016, the FDA expanded this PMA approval in the U.S. to include the Impella CP device. With these PMA indications, the Impella 2.5 and Impella CP devices provide the only minimally invasive treatment options indicated for use during high-risk PCI procedures in the U.S. In April 2016, the FDA approved a PMA supplement for our Impella 2.5, Impella CP, Impella 5.0 and Impella LD devices to provide treatment for ongoing cardiogenic shock that occurs following a heart attack or open heart surgery. The intent of our Impella system therapy is to reduce

~~ventricular work and to provide the circulatory support necessary to allow heart recovery and early assessment of residual myocardial function.~~

In September 2017, we received a PMA from the FDA for the Impella RP® heart pump. This latest approval follows the prior FDA Humanitarian Device Exemption (HDE) received in January 2015 and adds the Impella RP heart pump to our platform of PMA approved devices. The Impella RP heart pump is indicated for providing temporary right ventricular support for up to 14 days in patients with a body surface area ≥1.5 m², who develop acute right heart failure or decompensation following left ventricular assist device implantation, myocardial infarction, heart transplant, or open-heart surgery. With this approval, the Impella RP heart pump is the only percutaneous temporary ventricular support device that is FDA-approved as safe and effective for right heart failure as stated in the indication.

Our Impella 2.5, Impella 5.0, Impella LD, Impella CP and Impella RP devices also have CE Mark approval and Health Canada approval, which allows us to market these devices in the European Union and Canada.

In September 2016, we received Pharmaceuticals and Medical Devices Agency, or PMDA, approval from the Japanese Ministry of Health, Labour & Welfare, or MHLW, for our Impella 2.5 and Impella 5.0 heart pumps to provide treatment of drug-resistant acute heart failure in Japan. In July 2017, we received approval from the MHLW for reimbursement for the Impella 2.5 and 5.0 heart pumps. Reimbursement in Japan for the Impella 2.5 and 5.0 is equivalent to our average Impella sales price in the U.S. and we commenced commercialization in Japan during the three months ended September 30, 2017. The first Japanese patient was treated with the Impella device in October 2017 and we are conducting a controlled Impella device launch at a limited number of hospitals. We do not expect to have any material revenue in Japan during fiscal 2018.

In May 2017, we announced the enrollment of the first patient in the FDA approved prospective multi-center feasibility study, STEMI Door to Unloading with Impella CP system in acute myocardial infarction. The trial focuses on the feasibility and safety of unloading the left ventricle using the Impella CP heart pump prior to primary PCI in patients presenting with ST segment elevation myocardial infarction, or STEMI, without cardiogenic shock with the hypothesis that this will potentially reduce infarct size. The study, which received FDA approval in October 2016, will enroll up to 50 patients at 10 sites. We expect to complete enrollment in fiscal 2019.

regulatory approval. We expect to continue to make additional ~~PMA supplement~~regulatory submissions for our ~~Impella portfolio of devices~~products for additional ~~indications.~~indications and in additional countries.

The Impella 2.5 device is a percutaneous ~~micro~~ heart pump with an integrated motor and sensors. The ~~device~~technology is designed primarily for use by interventional cardiologists to support patients in the cath lab who may require assistance to maintain circulation. The Impella 2.5 heart pump can be quickly inserted via the femoral artery to reach the left ventricle of the heart, where it is directly deployed to draw blood out of the ventricle and deliver it to the circulatory system. This function is intended to reduce ventricular work and provide blood flow to vital organs. The Impella 2.5 heart pump is introduced with normal interventional cardiology procedures and can pump up to 2.5 liters of blood per minute.

The Impella 2.5 device received 510(k) clearance from the FDA in June 2008 for partial circulatory support for up to six hours. In March 2015, we received a PMA from the FDA for the use of the Impella 2.5 device during elective and urgent high-risk PCI procedures. With this PMA indication, the Impella 2.5 device became the first FDA approved hemodynamic support device for use during high-risk PCI procedures. Under this first PMA, the Impella 2.5 is a temporary (up to six hours) ventricular support device indicated for use during high-risk PCI performed in elective or urgent hemodynamically stable patients with severe coronary artery disease and depressed left ventricular ejection fraction, when a heart team, including a cardiac surgeon, that has determined high-risk PCI is the appropriate therapeutic option. Use of the Impella 2.5 device in these patients may prevent hemodynamic instability that may occur during planned temporary coronary occlusions and may reduce periprocedural and post-procedural adverse events. The product labeling allows for the clinical decision by physicians to leave the Impella 2.5 device in place beyond the intended duration of up to six hours should unforeseen circumstances arise.

In April 2016, the FDA approved a supplement to our March 2015 PMA approval for the use of our Impella 2.5, Impella CP, Impella 5.0 and Impella LD devices to provide treatment for ongoing cardiogenic shock. This PMA supplement covers a set of indications related to the use of the Impella devices in patients suffering cardiogenic shock following acute myocardial infarction or cardiac surgery and allows for a longer duration of support.

Pursuant to the April 2016 PMA approval, the Impella 2.5, Impella CP, Impella 5.0 and Impella LD catheters, in conjunction with the Automated Impella Controller, or AIC, were approved as temporary ventricular support devices intended for short term use (≤ 4 days for the Impella 2.5 and Impella CP, and ≤ 6 days for the Impella 5.0 and LD) and indicated for the treatment of ongoing cardiogenic shock that occurs immediately (< 48 hours) following acute myocardial infarction or open heart surgery as a result of isolated left ventricular failure that is not responsive to optimal medical management and conventional treatment measures. The intent of the Impella system therapy is to reduce ventricular work and to provide the circulatory support necessary to allow heart recovery and early assessment of residual myocardial function. Optimal medical management and convention treatment measures include volume loading and use of pressors and inotropes, with or without an intraortic balloon pump, or IABP.

~~The~~Our Impella 2.5 device has received FDA, CE Mark ~~approval in Europe for up to five days of use~~ and ~~is approved for use in up to 40 countries. The Impella 2.5 device also has Health Canada approval~~PMDA approvals which allows us to market ~~the device in Canada.~~

In September 2016, we received PMDA approval from the Japanese MHLW for our Impella 2.5 and Impella 5.0 heart pumps to provide treatment of drug-resistant acute heart failure in Japan. In July 2017, we received approval from the MHLW for reimbursement for the Impella 2.5 and 5.0 heart pumps. Reimbursement in Japan for the Impella 2.5 and 5.0 is equivalent to our average Impella sales priceit in the U.S., European Union and ~~we commenced commercialization~~Japan, respectively. The technology is also approved for use in Japan during the three months ended September 30, 2017. The first Japanese patient was treated with the Impella device in October 2017 and we are conducting a controlled Impella device launch at a limited number of hospitals. We do not expect to have any significant revenue in Japan during fiscal 2018.multiple other countries.

~~In September 2012, we announced that the Impella CP device received 510(k) clearance from the FDA.~~ The Impella CP device provides blood flow of ~~approximately one liter more~~up to 4.3 liters of blood per minute ~~than the Impella 2.5 device~~ and is primarily used by either interventional cardiologists to support patients in the cath lab or by cardiac surgeons in the heart surgery suite.

~~In April 2016, the FDA approved the PMA supplement for certain of our devices, including our Impella CP device to provide treatment for ongoing cardiogenic shock.~~

In December 2016, we received PMA approval from the FDA for the use of the Impella CP device during elective and urgent high-risk PCI procedures, identical to the indication for use for the Impella 2.5 device. This approval allows the Impella CP to be used as a temporary (≤ 6 hours) ventricular support system indicated for use during high risk PCI procedures performed in elective or urgent hemodynamically stable patients with severe coronary artery disease and depressed left ventricular ejection fraction, when a heart team, including a cardiac surgeon, has determined that high risk PCI is the appropriate therapeutic option. The product labeling allows for the clinical decision by physicians to leave the Impella CP device in place beyond the intended duration of up to six hours should unforeseen circumstances arise.

The primary endpoints of the feasibility study will focus on safety, including Adverse Cardiovascular and Cerebrovascular Events, or MACCE, at 30 days. All patients will undergo cardiac magnetic resonance imaging to assess infarct size as a percent of left ventricular mass at 30 days post-PCI. Patients will be randomized to Impella CP placement with immediate primary PCI, or to Impella CP placement with 30 minutes of unloading prior to primary PCI. The hypothesis of this novel approach to treating STEMI patients, based on extensive mechanistic research, is that unloading the left ventricle prior to PCI reduces myocardial work load, oxygen demand and also initiates a cardio-protective effect at the myocardial cell level, which may alleviate myocardial damage caused by reperfusion injury at the time of revascularization. This feasibility study will help refine the protocol and lay the groundwork for a future pivotal study with more sites and patients and will be designed for statistical significance.

We are currently developing optical sensor technology which is intended to provide enhanced monitoring capability, reduce setup time and improve ease of use for physicians. The optical sensor technology is approved under CE Mark in Europe and we anticipate beginning to incorporate the technology into our Impella CP devices in fiscal 2019.

~~The~~Our Impella CP device has received FDA, CE Mark, ~~approval~~PMDA approvals which allows us to market it in ~~Europe for up to five days of use~~the U.S., European Union and Japan, respectively. The technology is also approved for use in ~~up to 40~~multiple other countries.

The Impella 5.0 and Impella LD devices are percutaneous ~~micro~~ heart pumps with integrated motors and sensors for use primarily in the heart surgery suite. These devices are designed to support patients who require higher levels of circulatory support as compared to the Impella ~~2.5.~~

The Impella 5.0 device can be inserted into the left ventricle via femoral cut down or through the axillary artery. The Impella 5.0 device is passed into the ascending aorta, across the valve and into the left ventricle. The Impella LD device is similar to the Impella 5.0 device, but it is implanted directly into the ascending aorta through an aortic graft. Both of these procedures are normally performed with the assistance of heart surgeons in the surgery suite. The Impella 5.02.5 and Impella ~~LD devices can pump up to five liters of blood per minute, potentially providing full circulatory support.~~CP devices.

The Impella 5.0 and Impella LD devices originally received 510(k) clearance in April 2009, for circulatory support for up to six hours. In April 2016, the FDA approved the PMA supplement for certain of our devices, including the Impella 5.0 and Impella LD devices to provide treatment for ongoing cardiogenic shock following a heart attack or open heart surgery.

~~The~~Our Impella 5.0 and Impella LD devices have received FDA, CE Mark, PMDA approvals which allow us to market them in the U.S., European Union and Japan, respectively. The technology is also approved for use in multiple other countries.

The Impella 5.5 device is designed to be a percutaneous heart pump with integrated motors and sensors. The Impella 5.5 device delivers peak flows of greater than six liters per minute. The Impella 5.5 device has a motor housing that is thinner and 45% shorter than the Impella 5.0 device and it improves ease of pump insertion through the vasculature.

In September 2019, the Impella 5.5 device received PMA approval from the FDA for safety and efficacy in the therapy of cardiogenic shock for up to 14 days in the U.S. The Impella 5.5 device was introduced in the U.S. through a controlled rollout at hospitals with established heart recovery protocols beginning in fiscal year 2020. In April 2018, the Impella 5.5 device received CE Mark approval in Europe ~~for up~~and was introduced in Europe through a controlled rollout, similar to ~~ten days’ duration and are approved for use in over 40 countries.~~

the U.S. In ~~July 2017, we received approval from the MHLW for reimbursement for~~November 2021, the Impella ~~2.5 and 5.0 heart pumps. Reimbursement~~5.5 device received PMDA approval in Japan for the Impella 2.5 and 5.0 is equivalent to our average Impella sales price in the U.S. and we commenced commercialization in Japan during the three months ended September 30, 2017. The first Japanese patient was treated with the Impella device in October 2017 and we are conducting a controlled Impella launch at a limited number of hospitals. We do not expect to have any material revenue in Japan during fiscal 2018.Japan.

The Impella RP device is a percutaneous catheter-based axial flow pump that is designed to allow for greater than four liters of blood flow per minute and is intended to provide the flow and pressure needed to compensate for right side heart failure. Our Impella RP device has received FDA and CE Mark approval which allows us to market this technology in the U.S. and European Union. The Impella RP device is the first percutaneous ~~single access~~ heart pump designed for right heart support to receive FDA approval. The Impella RP device is approved to provide support of the right heart during times of acute failure for certain patients who have received a left ventricle assist device or have suffered heart failure due to ~~acute myocardial infarction, or~~ AMI, a failed heart transplant, or following open heart surgery.

~~In November 2012,~~ Additionally, we have adapted the Impella RP device received U.S. investigational device exemption, or IDE, approval from the FDA for use in RECOVER RIGHT, a pivotal clinical study in the U.S. This was a study of 30 patients who presented signs of right side heart failure, required hemodynamic support, and were capable of being treated in the catheterization lab or cardiac surgery suite. The study was completed in March 2014 and collected safety and effectiveness data on the percutaneous usedesign of the Impella RP device to be implanted through the internal jugular vein in the neck; this approach is the preferred method for heart surgeons as it allows for patient ambulation. We anticipate making a regulatory submission for this technology by early fiscal 2023.

The Impella SmartAssist platform includes optical sensor technology for improved pump positioning and ~~was submitted~~the use of algorithms that enable improved native heart assessment during the weaning process. The Impella SmartAssist platform is currently available for our Impella CP, Impella 5.5 and Impella RP heart pumps. The Impella SmartAssist platform received FDA, CE Mark and PMDA approvals which allows us to market it in the U.S., European Union and Japan, respectively. The technology is also approved for use in multiple other countries.

Impella Connect is a cloud-based technology that enables secure, remote viewing of the Automated Impella Controller, or AIC, for physicians and hospital staff. We began a controlled rollout of Impella Connect at certain hospital sites during fiscal year 2020 and have transitioned most of our customers to this technology. We continue to introduce this technology to hospitals outside the U.S.

The Breethe OXY-1 System is a portable external respiratory assistance device that we acquired as part of our acquisition of Breethe, in April 2020 in connections with our efforts to expand our product portfolio to support the needs of patients, such as those suffering from cardiogenic shock or respiratory failure, whose lungs can no longer provide sufficient oxygenation. The Breethe OXY-1 System takes venous blood from the patient, removes carbon dioxide and adds oxygen much like a human lung, and returns the oxygenated blood safely back to the patient. In October 2020, the Breethe OXY-1 System received 510(k) clearance from the FDA ~~in support~~for an all-in-one, compact cardiopulmonary bypass system. We have conducted a controlled launch of ~~an HDE submission. An HDE is similar to~~the Breethe OXY-1 System at a ~~PMA application but is intended for patient populations~~limited number of ~~8,000 or less per year~~hospitals in the U.S. and have seen positive results regarding survival, blood compatibility, durability of the Pump Lung Unit (“PLU”), hemodynamic flow rates and ease of patient ambulation. Based on our early patient study, we have identified areas of improvement around the electronics of the console and have implemented a voluntary recall at the seven hospitals where the Breethe OXY-1 Systems have been placed. The console upgrades may require a 510(k) clearance from the FDA. Therefore, until the corrective action is ~~subject~~completed, we are not expanding the number of patients or centers under the controlled launch.

The Impella ECP device is designed for blood flow of greater than three and a half liters per minute. It is intended to ~~certain profit~~be delivered on a standard sized (9 French) catheter and will include an expandable inflow in the left ventricle. The Impella ECP device has achieved initial FDA safety milestones, including completion of the first stage in its FDA early feasibility study (“EFS”). The prospective, multi-center, non-randomized EFS is designed to allow us, study investigators, and the FDA to make qualitative assessments about the safety and feasibility of the use ~~restrictions.~~of the Impella ECP device in high-risk percutaneous coronary intervention (“PCI”) patients. In ~~January 2015,~~fiscal year 2021, we received ~~HDE~~ approval from the FDA to expand the EFS for the Impella RPECP device ~~from the FDA.~~

and we continue to enroll patients in this study. In ~~September 2017,~~August 2021, we received ~~a PMA from~~Breakthrough Device designation by the FDA for the Impella ~~RP heart pump. This latest approval follows~~ECP device, which is provided pursuant to the ~~prior FDA HDE received in January 2015~~FDA’s Breakthrough Device Program, a program intended to help patients receive more timely access to certain medical technologies by providing a speedier development, assessment and ~~adds~~review process for such technologies. Concurrently, we are finalizing the protocol of a single arm pivotal high-risk PCI study for the Impella ~~RP heart pump~~ECP device as part of an investigational device exemption (“IDE”) submission with the FDA. To date, we have supported over 25 patients in our early feasibility study and expect to ~~our platform of PMA approved devices.~~begin patient enrollment under a pivotal-like protocol by early fiscal year 2023. The Impella RP heart pump is indicated for providing temporary right ventricular support for up to 14 days in patients with a body surface area ≥1.5 m², who develop acute right heart failure or decompensation following left ventricular assistECP device implantation, myocardial infarction, heart transplant, or open-heart surgery. With this approval, the Impella RP heart pump is the only percutaneous temporary ventricular support device that is FDA-approved as safe and effective for right heart failure as stated in the indication.

In April 2014, the Impella RP device received CE Mark approval which allows for commercial sales of the Impella RP device in the European Union and other countries that require a CE Mark approval for commercial sales.

~~The Impella 5.5~~^TM ~~device is designed to be a percutaneous micro heart pump with integrated motors and sensors. The Impella 5.5~~^TM device is designed to be smaller, provide months of hemodynamic support and is expected to allow for greater than five liters of blood flow per minute. We anticipate conducting a first-in-man trial outside of the U.S. in calendar year 2018. The Impella 5.5^TM ~~pump~~ is still in development and has not been approved for commercial use or sale.

The Impella ~~ECP~~^TM ~~pump~~XR Sheath is ~~designed~~a low-profile sheath that expands and recoils, allowing for ~~blood flow of greater than three liters per minute.~~small bore access and closure with certain Impella heart pumps. It inserts at 10 French and the flexible, nitinol braids momentarily expand during insertion, then recoil, simplifying access for complex interventions. The Impella XR Sheath is intended to ~~be delivered on a standard sized catheter and will include an expandable inflow in~~produce less trauma at the ~~left ventricle. We anticipate conducting a first-in-man trial outside of~~arterial access site compared to large bore sheaths. In December 2020, we received 510(k) clearance from the ~~U.S. in calendar year 2018.~~FDA for the Impella XR Sheath for the Impella 2.5 device. The Impella ~~ECP~~^TM ~~pump~~XR Sheath for our Impella CP device is still in development and has not been ~~approved~~cleared for commercial use or sale.

In July 2014, we acquired all of the issued shares of ECP Entwicklungsgesellschaft mbH, or ECP, a German limited liability company based in Berlin, Germany, for $13.0 million in cash, with additional potential payments up to a maximum of $15.0 million based on the achievement of certain technical, regulatory and commercial milestones. In connection with our acquisition of ECP, ECP acquired all of the issued shares of AIS GmbH Aachen Innovative Solutions, or AIS, a German limited liability company, for $2.8 million in cash which was provided by us. AIS, based in Aachen, Germany, holds certain intellectual property useful to ECP’s business, and, prior to being acquired by ECP, had licensed such intellectual property to ECP.

The Impella BTR^TM device is designed to be a percutaneous, ~~micro~~weanable, smart heart pump with integrated motors and sensors. The Impella BTR^TM device is designed to ~~be smaller,~~allow for greater than six liters of blood flow per minute, provide up to one year of hemodynamic support and ~~is expected to allow for greater than five liters of blood flow per minute. The Impella BTR~~^TM ~~device also includes~~include a wearable driver designed for hospital discharge. The Impella BTR^TM ~~pump~~ device is expected to and intended to allow for heart recovery or heart remodeling with adjunctive therapies for class III and class IV heart-failure patients. In December 2021, we received conditional approval for an IDE early feasibility study for the Impella BTR device and we expect to begin patient enrollment by early fiscal year 2023. The Impella BTR device is still in development and has not been approved for commercial use or sale.

The preCARDIA system is a minimally invasive, catheter-mounted superior vena cava therapy system designed to rapidly treat acutely decompensated heart failure (“ADHF”) related volume overload by effectively reducing cardiac filling pressures and promoting decongestion to improve overall cardiac and renal function. The preCARDIA system allows for straightforward placement in the ICU by physicians and hemodynamic monitoring by medical staff. Prior to the acquisition of preCARDIA, the preCARDIA system received Breakthrough Device Designation by the FDA. In January 2022, we announced results of the first-in-human early feasibility study of the preCARDIA system. The multicenter, prospective, single-arm VENUS-HF early feasibility study examined 30 patients with ADHF who were assigned preCARDIA therapy for 12 or 24 hours. The primary endpoint was a composite of major adverse events through 30 days. The results support additional study of the preCARDIA system. In the third quarter of fiscal year 2022, the FDA authorized the preCARDIA early feasibility study to be expanded by 30 additional patients. The preCARDIA system is still in development and has not been approved for commercial use or sale

~~There~~Other than the accounting policy changes discussed in “Note 2. Basis of Preparation and Summary of Significant Accounting Policies” to our condensed consolidated financial statements, which is incorporated herein by reference, there have been no significant changes in our critical accounting policies during the three and nine months ended December 31, ~~2017,~~2021, as compared to the critical accounting policies disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended March 31, ~~2017.~~2021.

Information regarding recent accounting pronouncements is included in “Note 2. Basis of Preparation and Summary of Significant Accounting Policies” to our condensed consolidated financial statements and is incorporated herein by reference.

Results of Operations for the Three and Nine Months Ended December 31, 2021 compared with the Three and Nine Months Ended December 31, 2020

The following table sets forth certain condensed consolidated statements of operations data for the periods indicated as a percentage of total revenue:

For the Three Months Ended December 31,

For the Nine Months Ended December 31,

2017

2016

2017

2016

Revenue:

Product revenue

100.0

%

100.0

%

100.0

%

100.0

%

Costs and expenses as a percentage of total revenue:

Cost of product revenue

16.2

16.6

16.3

16.0

Research and development

11.5

14.3

12.9

15.6

Selling, general and administrative

43.2

46.9

44.7

49.3

Total costs and expenses

70.9

77.8

73.9

80.9

Income from operations

29.1

22.2

26.1

19.1

Income tax provision and other

20.4

8.7

8.1

7.5

Net income as a percentage of total revenue

8.7

%

13.5

%

18.0

%

11.6

%

	For the Three Months Ended December 31,								For the Nine Months Ended December 31,
	2021				2020				2021			2020
Revenue		100.0		%		100.0		%		100.0	%		100.0	%
Costs and expenses:
Cost of revenue		18.2				17.7				17.9			19.1
Research and development		15.6				14.2				15.7			14.8
Selling, general and administrative		41.2				37.2				41.2			38.6
Acquired in-process research and development		0.2				—				15.2			—
Total costs and expenses		75.3				69.2				90.1			72.5
Operating income		24.7				30.8				9.9			27.5
Other (loss) income and income tax provision, net		(7.2	)			(4.0	)			0.1			0.3
Net income		17.5		%		26.7		%		10.0	%		27.8	%

The following table disaggregates revenue by products and ~~nine months ended December 31, 2017 compared with the three and nine months ended December 31, 2016~~

~~Impella product~~The following table disaggregates revenue by geographical location:

Product revenue encompasses Impella 2.5, Impella CP, Impella 5.0, Impella LD, Impella 5.5, Impella RP and Impella ~~RP device sales.~~AIC product sales and related accessories. Service and other revenue represents revenue earned on service maintenance contracts and ~~preventive~~preventative maintenance calls. ~~Other product revenue primarily includes sales of the AB5000 that we no longer actively market.~~

Total revenue for the three months ended December 31, ~~2017~~2021 increased ~~$39.3~~by $29.5 million, or ~~34%~~13%, to ~~$154.0~~$261.2 million from ~~$114.7~~$231.7 million for the three months ended December 31, ~~2016.~~2020. Total revenue for the nine months ended December 31, ~~2017~~2021 increased ~~$98.7~~$155.6 million, or ~~31%~~26%, to ~~$419.3~~$761.9 million from ~~$320.6~~$606.3 million for the nine months ended December 31, ~~2016.~~2020. The increase in total revenue from the three and nine months ended December 31, 2020 to the three and nine months ended December 31, 2021 was ~~primarily due to higher~~driven by both Impella product revenue ~~from increased utilization in the U.S~~ and ~~Europe.~~service and other revenue, as further described below.

Product revenue for the three months ended December 31, ~~2017~~2021 increased by ~~$38.8~~$28.2 million, or ~~36%~~13%, to ~~$148.0~~$249.1 million from ~~$109.2~~$220.9 million for the three months ended December 31, ~~2016. Impella product~~2020. Product revenue for the nine months ended December 31, ~~2017~~2021 increased by ~~$97.8~~$150.3 million, or ~~32%~~26%, to ~~$402.6~~$726.3 million from ~~$304.8~~$576.0 million for the nine months ended December 31, ~~2016. Most of~~2020. Product revenue increased in the ~~increase in Impella product revenue was from increased device~~three and nine months ended December 31, 2021, primarily due to sales mix and higher patient utilization in the U.S., Germany and Japan as compared to the three and nine months ended December 31, 2020 as we ~~focus~~experienced varying levels of recovery across our product lines and geographic locations from the challenges caused by the COVID-19 pandemic. Despite these improvements, the timing and impact of COVID-19 on ~~increasing~~patient utilization volume continues to vary widely by country, region, and type. As we started the third quarter of fiscal year 2022, patient utilization of ~~our disposable catheter products through~~Impella heart pump devices continued ~~investment~~to be negatively impacted by an increase in ~~our field organization~~COVID-19 hospitalizations in certain geographies due to the Delta variant and ~~physician training programs.~~ongoing shortage of hospital workers, that limited ICU capacity and contributed to some deferral of elective procedures. However, as Delta cases moderated, patient utilization of Impella ~~product revenue outside~~heart pump devices increased during the last two months of the ~~U.S. also increased primarily due to increased utilization in Germany. We expect product revenue from our Impella devices to continue to increase due to our recent PMAs in~~third quarter, despite on-going hospital labor shortages and the U.S. for our Impella devices, including the PMA approval on the Impella RP device received in September 2017, continued utilization for high risk PCI procedures and ongoing cardiogenic shock, our continued controlled launch of Impella devices outsideemergence of the ~~U.S. with a focus on Germany~~Omicron variant.

Service and other revenue for the three months ended December 31, ~~2017~~2021 increased by ~~$1.2~~$1.3 million, or ~~25%~~12%, to ~~$6.0~~$12.1 million from ~~$4.8~~$10.8 million for the three months ended December 31, ~~2016.~~2020. Service and other revenue for the nine months ended December 31,

~~2017~~ 2021 increased ~~by $2.7~~$5.3 million, or ~~19%~~17%, to ~~$16.6~~$35.6 million from ~~$13.9~~$30.3 million for the nine months ended December 31, ~~2016.~~ 2020.

The increase in total service and other revenue from the three and nine months ended December 31, 2020 to the three and nine months ended December 31, 2021 was primarily due to an increase in ~~preventative maintenance~~ service ~~contracts.~~contracts sold. We have expanded the number of Impella AIC consoles at many of our existing higher volume customer sites and continue to sell additional consoles to new customer sites. We expect revenue growth for service revenue to be ~~slower than our product revenue growth in the near future~~consistent with recent history as most of ~~these using~~customer sites in the U.S. have service contracts ~~that normally~~which typically have ~~three year~~three-year terms.

~~The decrease in other revenue was due to a decline in AB5000 disposable sales. We are no longer actively marketing the AB5000 revenue~~ ~~device and we do not expect to have any other product revenue in the near future. We have transitioned our sales focus in the surgical suite from the AB5000 to~~ ~~Impella 5.0, Impella LD and Impella RP~~ ~~devices~~.

Cost of ~~product~~ revenue for the three months ended December 31, ~~2017~~2021 increased by ~~$6.0~~$6.5 million, or ~~32%~~16%, to ~~$25.0~~$47.6 million from ~~$19.0~~$41.1 million for the three months ended December 31, ~~2016.~~2020. Gross margin was ~~84%~~81.8% for the three months ended December 31, ~~2017~~2021 and ~~83%~~82.3% for the three months ended December 31, ~~2016.~~2020.

Cost of ~~product~~ revenue for the nine months ended December 31, ~~2017~~2021 increased by ~~$17.1~~$20.9 million, or ~~33%~~18%, to ~~$68.5~~$136.7 million from ~~$51.4~~$115.8 million for the nine months ended December 31, ~~2016.~~2020. Gross margin was ~~84%~~82.1% for ~~each of~~ the nine months ended December 31, ~~2017~~2021 and ~~2016, respectively.~~80.9% for the nine months ended December 31, 2020.

The increase in cost of product revenue ~~was related to higher demand for our Impella devices~~from the three and ~~higher production volume and costs to support growing demand for our Impella devices. The increase in gross margin for the three~~nine months ended December 31, ~~2017~~2020 to the three and nine months ended December 31, 2021 was primarily due investment in direct labor and overhead as we expanded our manufacturing capacity of our facilities in the U.S. and Germany and increased production volume. The decrease in gross margin from the three and nine months ended December 31, 2020 to the three and nine months ended December 31, 2021 was primarily due to ~~the shipment of more Impella pumps~~higher direct labor and ~~higher~~overhead costs as we expand manufacturing ~~production during the quarter as compared to the prior year.~~capacity in preparation for future sales demand, partially offset by increased sales volume and favorable pricing mix on products sold.

Research and development expenses for the three months ended December 31, ~~2017~~2021 increased by ~~$1.4~~$7.9 million, or 9%24%, to ~~$17.7~~$40.9 million from ~~$16.3~~$33.0 million for three months ended December 31, ~~2016.~~ 2020.

Research and development ~~expenses~~expense for the nine months ended December 31, ~~2017~~2021 increased ~~$3.9~~by $29.7 million, or 8%33%, to ~~$54.0~~$119.6 million from ~~$50.1~~$89.9 million for the nine months ended December 31, ~~2016.~~ 2020.

The increase in research and development expenses ~~was~~from the three and nine months ended December 31, 2020 to the three and nine months ended December 31, 2021 is primarily due to our increases in regulatory and quality hiring, ongoing product development initiatives onrelating to our existing and pipeline products, ~~and new technologies in~~the development ~~such as~~of the Impella ~~ECP~~ECP™, preCARDIA, Impella BTR^TM, ~~Impella 5.5~~^TMBreethe OXY-1 System™ and Impella ~~BTR~~^TM ~~as we expanded~~XR Sheath™ devices, the expansion of our engineering organization, ~~increased~~continued investment in our clinical ~~spending primarily related to our~~trials, most notably the STEMI ~~trial~~DTU and ~~continued~~PROTECT IV studies, and our focus on clinical, technological and quality initiatives for our ~~existing Impella devices.~~products.

We expect research and development expenses to continue to increase ~~for the remainder of fiscal 2018~~ as we continue to increase engineering, product development and clinical spending related to our ~~cVAD Registry™, STEMI trial and incur additional costs as we continue to focus on engineering~~ initiatives to improve our existing products and develop new ~~technologies.~~technologies and conduct clinical studies. Research and development expenses can fluctuate with project timing.

Selling, general and administrative expenses for the three months ended December 31, ~~2017~~2021 increased by ~~$12.7~~$21.4 million, or ~~24%~~25%, to ~~$66.6~~$107.6 million from ~~$53.9~~$86.2 million for the three months ended December 31, ~~2016.~~ 2020.

Selling, general, and administrative expenses for the nine months ended December 31, ~~2017~~2021 increased by ~~$29.1~~$80.1 million, or ~~18%~~34%, to ~~$187.2~~$313.9 million from ~~$158.1~~$233.8 million for the nine months ended December 31, ~~2016. The increase in selling,~~2020.

Selling, general and administrative expenses ~~was primarily due to the hiring of additional field sales and clinical personnel in the U.S. and Germany,~~ increased spending on sales and marketing initiatives as we continue to educate physicians on the benefits of hemodynamic support after receiving PMAs in the U.S. for Impella 2.5, Impella CP, Impella 5.0, Impella LD and Impella RP devices, higher stock-based compensation expense, higher legal expenses related to the FCA Investigation, ongoing patent litigation and other legal matters discussed in “Note 10. Commitments and Contingencies—Litigation,” to our condensed consolidated financial statements and higher professional fees to support the growth of our business.

We expect to continue to increase our expenditures on sales and marketing activities, with particular investments in field sales and clinical personnel with cath lab expertise to drive recovery awareness for acute heart failure patients. We also plan to increase our marketing, service and training investments as a result of recent PMA approvals in the U.S. for our Impella devices and as we continue our expansion in Japan and other new markets outside of the U.S. We also expect to continue to incur significant legal expenses for the foreseeable future related to the FCA Investigation and patent related matters.

~~Our income tax provision was $32.2 million and $36.6 million for~~from the three and nine months ended December 31, ~~2017, respectively, and $10.4 million and $24.8 million for~~2020 to the three and nine months ended December 31, ~~2016,~~2021 primarily due to increases in commercial hiring, marketing, clinical training and education initiatives and higher stock compensation expense.

We aim to continue to invest strategically in hiring and sales and marketing activities, with a particular focus on training and education to drive utilization of our Impella devices and recovery awareness for acute heart failure patients.

Operating income for the three months ended December 31, 2021 decreased by $6.8 million, to $64.6 million, compared to $71.4 million operating income for the three months ended December 31, 2020. Operating margin was 24.7% for the three months ended December 31, 2021 compared to 30.8% for the three months ended December 31, 2020. The decrease in operating income and margin was primarily due to strategic investments in clinical, engineering, commercial, training and marketing initiatives which increased operating expenses as described above, partially offset by increased sales volume and favorable pricing mix on products sold.

Operating income for the nine months ended December 31, 2021 decreased by $91.1 million, to $75.7 million, compared to $166.8 million operating income for the nine months ended December 31, 2020. Operating margin was 9.9% for the nine months ended December 31, 2021 compared to 27.5% for the nine months ended December 31, 2020. The decrease in operating income and margin was primarily due to the preCARDIA acquisition in May 2021. The acquisition was accounted for as an asset acquisition as substantially all of the fair value of the acquisition related to the acquired in-process research and development asset. Since the acquired technology platform is pre-commercial and has not reached technical feasibility, the cost of the in-process research and development asset was expensed, resulting in a charge of $116.0 million to the condensed consolidated statements of operations for the nine months ended December 31, 2021.

Other (loss) income decreased by $2.7 million, to other loss of $6.7 million for the three months ended December 31, 2021, compared to other income of $9.4 million for the three months ended December 31, 2020. The decrease was primarily due to the recognition of a $8.2 million loss from our investment in Shockwave Medical for the three months ended December 31, 2021, compared to a $8.3 million gain from our investment in Shockwave Medical for the three months ended December 31, 2020.

Other (loss) income decreased by $7.9 million, to other income of $40.1 million for the nine months ended December 31, 2021, compared to other income of $48.0 million for the nine months ended December 31, 2020. This decrease was primarily due to a $21.0 million gain related to our previously owned minority interest in preCARDIA recognized upon the acquisition of preCARDIA in May 2021 and a $14.3 million gain from our investment in Shockwave Medical for the nine months ended December 31, 2021, compared to a $34.7 million gain from our investment in Shockwave Medical and higher investment income in marketable securities for the nine months ended December 31, 2020.

Our income tax provision was $12.1 million and $18.9 million for the three months ended December 31, 2021 and 2020, respectively. Our effective tax rate was ~~70.6%~~21% and ~~32.7%~~23.4% for the three months ended December 31, 2021 and 2020, respectively. Our

income tax provision was $39.6 million and $46.1 million for the nine months ended December 31, ~~2017, respectively,~~2021 and ~~40.2%~~2020, respectively. Our effective tax rate was 34.2% and ~~40.0%~~21.4% for the ~~three and~~ nine months ended December 31, ~~2016,~~2021 and 2020, respectively. The ~~increase~~change in the effective tax rate for the ~~three and~~ nine months ended December 31, ~~2017 was~~2021 is primarily due to ~~the~~ ~~$22.0 million provisional income tax expense estimate from the re-measurement of our net deferred tax assets due~~a non-deductible charge for in-process research and development related to the ~~Tax Reform Act, as discussed~~preCARDIA acquisition offset by an increase in ~~“Note 9. Income Taxes.” As discussed in “Note 2. Basis of Presentation and Summary of Significant Accounting Policies,” we also recognized~~ excess tax benefits associated with stock-based awards of $3.2 million and $24.5 million as an income tax benefit for three and nine months ended December 31, 2017, respectively. These recognized excess tax benefits resulted from restricted stock units that vested or stock options that were exercised during the three and nine months ended December 31, 2017, respectively. These recognized excess tax benefits resulted from restricted stock units that vested or stock options that were exercised during the three and nine months ended December 31, 2017.related to share-based compensation.

~~For~~Net income for the three months ended December 31, ~~2017, net income~~2021 was ~~$13.4~~$45.8 million, or ~~$0.30~~$1.01 per basic share and ~~$0.29 per~~$1.00 diluted share, compared to ~~$15.4~~net income of $61.9 million, or ~~$0.36~~$1.37 per basic share and ~~$0.34~~$1.35 per diluted share, for three months ended December 31, ~~2016. For~~2020.

Net income for the nine months ended December 31, ~~2017, net income~~2021, was ~~$75.3 million,~~$76.2 million, or ~~$1.71~~$1.68 per basic share and ~~$1.65~~$1.66 per diluted share, compared to ~~$37.2~~net income of $168.7 million, or ~~$0.86~~$3.74 per basic share and ~~$0.83~~$3.69 per diluted share for the nine months ended December 31, 2016. As discussed above, the enactment of the Tax Reform Act resulted in a decrease in net income of $22.0 million, or $0.50 per basic and $0.48 per diluted share for the three and nine months ended December 31, 2017. As discussed above, the adoption of ASU 2016-09 resulted in an increase in net income of $0.07 per basic and diluted share for the three months ended December 31, 2017 and $0.56 per basic share and $0.54 per diluted share for the nine months ended December 31, 2017.

~~Our net income for fiscal 2018 was also driven by higher Impella product revenue due to greater utilization of our Impella devices in the U.S. and Germany.~~2020.

AtAs of December 31, ~~2017,~~2021, our ~~total~~ cash, cash equivalents and marketable securities totaled ~~$350.7~~$931.9 million, an increase of ~~$73.6~~$84.1 million compared to ~~$277.1~~$847.8 million at March 31, ~~2017.~~2021. The increase in our cash, cash equivalents and marketable securities during the nine months ended December 31, 2021 was primarily due ~~primarily~~ to positive cash flows from operations ~~in the nine months ended December 31, 2017.~~offset by our investing activities.

For the nine months ended December 31, ~~2017,~~2021, net cash provided by operating activities consisted of net income of ~~$75.3~~$76.2 million, ~~adjustments for~~plus non-cash items of ~~$76.5~~$162.4 million ~~and~~offset by cash used in working capital of ~~$15.7~~$32.2 million. ~~The increase~~As discussed above, the change in net income was primarily due to ~~higher~~an increase in operating expenses partially offset by an increase in revenue ~~from increased utilization of our Impella devices.~~in fiscal year 2022 compared to fiscal year 2021. Adjustments for non-cash items consisted primarily of ~~$29.2~~$116.0 million for acquired preCARDIA in-process research and development, $40.7 million of stock-based compensation expense, a ~~$34.7~~$21.0 million gain related to our previously owned minority interest in preCARDIA recognized upon the acquisition of preCARDIA in May 2021, $20.8 million of depreciation and amortization expense, a $14.3 million change in ~~deferred tax provision due to the revaluation~~fair value of our ~~net deferred tax assets related to the Tax Reform Act, $8.1 million of depreciation expense on property~~investments in Shockwave Medical and ~~equipment and $3.2~~other private medical technology companies,$8.9 million in inventory and other ~~asset write-downs.~~write-downs, $7.0 million in deferred tax provision, and $2.7 million in accretion on marketable securities. The change in cash from working capital included a ~~$10.3~~$7.7 million ~~increase~~decrease in accounts receivable ~~associated with higher revenue, $12.0~~due to timing of collections, a $9.1 million decrease in accounts payable, accrued expenses and other liabilities offset by a $11.9 increase in prepaid expenses and other assets and a $19.6 increase in inventory due to ~~support growing~~the mix of customer demand ~~for our Impella devices, a $6.5 million increase in accounts payable~~ and ~~accrued expenses and a $1.2 increase in deferred revenue.~~production.

For the nine months ended December 31, ~~2016,~~2020, net cash provided by operating activities consisted of net income of ~~$37.2~~$168.7 million, adjustments for non-cash items of ~~$45.9~~$43.1 million and cash used in working capital of ~~$5.2~~$23.6 million. ~~The increase~~As discussed above, the change in net income was primarily due to ~~higher~~lower fiscal year 2021 revenue compared to fiscal year 2020, with some offset of lower operating expenses and gains from ~~increased utilization of~~ our ~~Impella devices.~~investment in Shockwave Medical. Adjustments for non-cash items consisted primarily

of ~~$24.5~~$33.7 million of stock-based compensation expense, ~~an $18.8~~$22.9 million ~~change~~ in deferred tax provision, ~~$4.6 million in excess tax benefits on stock-based awards, $4.5~~$17.3 million of depreciation and amortization expense, ~~on property, plant and equipment and $2.1~~$5.1 million in inventory ~~write-downs.~~and other write-downs, $3.0 million change in fair value of contingent consideration and $1.2 million in accretion on marketable securities. The change in cash from working capital included a ~~$7.6~~$6.9 million increase in accounts receivable ~~associated with our higher revenue, an $8.6~~due to timing of collections, a $6.6 million ~~increase~~decrease in inventory due to ~~support growing demand for our Impella devices, $14.6~~lower production volumes, an $18.1 million ~~increase~~decrease in accounts payable and accrued expenses due to lower operating expenses and a ~~$0.3~~$1.9 million increase in deferred revenue.

For the nine months ended December 31, ~~2017,~~2021, net cash used for investing activities primarily consisted of ~~$61.7~~$177.7 million in purchases ~~(net of maturities)~~ of marketable securities ~~and $44.2~~(net of sales), $82.8 million for our acquisition of preCARDIA, $20.9 million for the purchase of property and equipment primarily related to ~~the purchase~~continued expansion of ~~our corporate headquarters building~~manufacturing capacity, office space and research development facilities in Danvers ~~Massachusetts during~~and Aachen, Germany and $7.1 million for our investment in private medical technology companies.

For the ~~three~~nine months ended December 31, ~~2017~~2020, net cash used for investing activities primarily consisted of $149.4 million in purchases from the sale of marketable securities (net of maturities), $52.2 million for our acquisition of Breethe and $27.3 million used in the purchase of property and equipment primarily related to continued expansion of manufacturing capacity, office space and research development facilities in Danvers and Aachen, Germany. We also ~~have~~ made ~~$6.4~~an additional $26.1 million ~~of investments~~investment in a private medical technology companies during fiscal ~~2018.~~

~~For the nine months ended December 31, 2016, net cash used for investing activities primarily consisted of $32.9~~year 2021. These amounts were partially offset by $67.9 million in ~~purchases (net~~proceeds from the sale of maturities) of marketable securities and $24.0 million for the purchase of property and equipment mostly related to expansion of manufacturing capacity and office space in Danvers, Massachusetts and Aachen, Germany.Shockwave Medical securities.

Capital expenditures for fiscal ~~2018~~year 2022 are estimated to range from ~~$50~~$27 million to ~~$60 million. Most~~$35 million to support the long-term development of ~~the significant capital expenditures were for software development projects and expanding research facilities,~~our business, including manufacturing capacity, ~~and~~ building ~~improvements~~expansions in our Danvers ~~Massachusetts,~~and Aachen ~~Germany, Berlin, Germany~~facilities and ~~Tokyo, Japan locations.~~information systems development projects.

For the nine months ended December 31, ~~2017,~~2021, net cash used for financing activities included ~~$19.9~~$16.4 million in payments in lieu of issuance of common stock for payroll withholding taxes upon vesting of certain equity awards and ~~$0.5~~$2.3 million ~~in principal payments on capital lease obligation. The capital lease obligation previously recorded was removed as a result~~related to payment of ~~the acquisition~~contingent consideration due to achievement of ~~our headquarters in October 2017.~~related milestone. These amounts were offset by ~~$7.6~~$8.8 million in proceeds from the exercise of stock options and ~~$1.1~~$3.0 million in proceeds from the issuance of stock under the employee stock purchase plan.

For the nine months ended December 31, ~~2016,~~2020, net cash used for financing activities included ~~$19.9~~$11.3 million for the repurchase of our common stock and $11.2 million in payments in lieu of issuance of common stock for payroll withholding taxes upon vesting of certain equity ~~awards and $0.3 million in principal payments on capital lease obligation.~~awards. These amounts were offset by ~~$8.3~~$7.1 million in proceeds from the exercise of stock options ~~$4.6 million in excess tax benefits on stock-based awards~~ and ~~$0.8~~$2.0 million in proceeds from the issuance of stock under the employee stock purchase plan.

Our sources of cash liquidity are primarily from existing cash and cash equivalents, marketable securities and cash flows from operations. As of December 31, 2021, our total cash, cash equivalents, and short and long-term marketable securities totaled $931.9 million, an increase of $84.1 million compared to $847.8 million as of March 31, 2021. Marketable securities as of December 31, 2021 consisted of $787.6 million held in funds that invest in U.S. Treasury securities, government-backed securities, corporate debt securities and commercial paper.We generated operating cash flows of $206.4 million and $188.1 million for the nine months ended December 31, 2021 and 2020, respectively. At December 31, 2021, we had no debt outstanding. We believe that our ~~revenue from product sales together with existing resources will be~~sources of liquidity are sufficient to fund the current requirements of working capital, capital expenditures, and other financial commitments for the foreseeable future.

We primarily fund our operations ~~for at least the next twelve months, exclusive of activities involving any future acquisitions of products or companies that complement or augment our existing line of products.~~

from product sales. Our primary liquidity requirements are to fund the following: expansion of our commercial and operational ~~infrastructure, increase~~infrastructures; expansion of our manufacturing capacity ~~incur additional capital expenditures as we expand our~~and office ~~space~~space; the procurement and ~~manufacturing capacity in Danvers and Aachen, increase our~~production of inventory ~~levels in order~~ to meet ~~growing~~ customer demand for our Impella ~~devices, fund~~devices; funding of new product and business development initiatives, ~~continue our~~such as the recent acquisitions of preCARDIA and Breethe; ongoing commercial launch in Japan and ~~expand to~~expansion into potential new ~~markets, increase~~markets; increased clinical ~~spending,~~spending; legal expenses related to ~~the FCA Investigation and~~ ongoing patent litigation and other legal matters and payments in lieu of issuance of common stock for payroll withholding taxes upon vesting of certain equity awards and to provide for general working capital needs. ~~To date, we have primarily funded~~

We believe that our ~~operations through product sales~~sources of liquidity are sufficient to fund the current requirements of working capital, capital expenditures, and other financial commitments for at least the ~~sale of equity securities.~~

next twelve months. Our liquidity is influenced by our ability to sell our products in a competitive industry and our customers’ ability to pay for our products. Factors that may affect liquidity primarily include our ability to penetrate the market for our products, our ability to maintain or reduce the length of the selling cycle for our products, our capital expenditures, ~~investments in collaborative arrangements with other partners,~~ and our ability to collect cash from customers after our products are sold. We ~~also expect to continue to incur legal expenses for the foreseeable future related to the FCA Investigation, ongoing patent litigation and other legal matters. We~~ continue to review our short-term and long-term cash needs on a regular basis. ~~At December 31, 2017 we~~

We had no ~~long-term debt outstanding.~~off-balance sheet arrangements or guarantees of third-party obligations during the periods presented. An “off-balance sheet arrangement” generally entails a transaction, agreement or other contractual arrangement to which an entity unconsolidated with us, is a party under which we have any obligation arising under a guarantee contract, derivative instrument or

~~Marketable securities at December 31, 2017~~variable interest or a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.

We have various contractual obligations, which are recorded as liabilities in our condensed consolidated financial statements. Other items are not recognized as liabilities in our condensed consolidated financial statements but are required to be disclosed. There have been no material changes, outside of the ordinary course of business, to our contractual obligations as previously disclosed in our Annual Report on Form 10-K for the fiscal year ended March 31, 2017 consisted of $300.2 million and $238.1 million held in investment funds that invest in U.S. Treasury, government-backed and corporate debt securities, respectively. We are not a party to any interest rate swaps, currency hedges or derivative contracts of any type and have no exposure to commercial paper or auction rate securities markets.

Cash and cash equivalents held by our foreign subsidiaries totaled $13.7 million and $8.2 million at December 31, 2017 and March 31, 2017, respectively. Our operating income outside the U.S. is deemed to be permanently reinvested in foreign jurisdictions. The recently enacted Tax Reform Act allows for a 100% deduction for the repatriation of foreign subsidiary earnings ~~with minimal U.S. income tax consequences other than the one-time deemed repatriation toll charge~~. Since most of our cash and cash equivalents are held by foreign subsidiaries which are disregarded entities for domestic tax purposes, any repatriation of such funds to the U.S. would likely have a nominal tax impact, if any.2021.

~~Our cash, cash equivalents~~There have been no material changes to our quantitative and ~~marketable securities are subject to interest rate~~qualitative disclosures about market risk and will fall in value if market interest rates increase. If market interest rates were to increase immediately and uniformly by 10% from levels at December 31, 2017, we believe the decline in fair market value of our investment portfolio would be immaterial.

~~We have foreign currency exposure to exchange rate fluctuations and particularly with respect~~as compared to the ~~Euro, British pound sterling~~quantitative and ~~Japanese yen. Therefore, our investment~~qualitative disclosures about market risk described in our ~~subsidiaries is sensitive to fluctuations in currency exchange rates. The effect of a change in currency exchange rates~~Annual Report on ~~our net investment in international subsidiaries is reflected in the accumulated other comprehensive (loss) income component of stockholders’ equity. If rates of exchange~~Form 10-K for the ~~Euro, British pound and Japanese yen were to have depreciated immediately and uniformly by 10% relative to the U.S. dollar from levels at December~~fiscal year ended March 31, ~~2017, the result would have been a reduction of stockholders’ equity of approximately $9.7 million.~~

At December 31, 2017, our financial instruments consist primarily of cash and cash equivalents, marketable securities, accounts receivable, accounts payable and contingent consideration. The carrying amounts of accounts receivable and accounts payable are considered reasonable estimates of their fair value, due to the short maturity of these instruments. The estimated fair values of the financial instruments have been determined by us using available market information and appropriate valuation techniques. Considerable judgment is required, however, to interpret market data to develop the estimates of fair value. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.

Our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the ~~Securities~~ Exchange Act, ~~of 1934, as amended, or the Exchange Act),~~ as of December 31, ~~2017.~~2021. Based on this evaluation, our principal executive officer and principal financial officer concluded that, as of December 31, ~~2017,~~2021, these disclosure controls and procedures ~~are~~were effective to provide reasonable assurance that material information required to be disclosed by us, including our consolidated subsidiaries, in reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in ~~the Securities and Exchange Commission~~SEC rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

During the third quarter of our fiscal year ending March 31, ~~2018,~~2022, there were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act), that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We are from time to time involved in various legal actions, the outcomes of which are not within our complete control and may not be known for prolonged periods of time. In some actions, the claimants seek damages, as well as other relief, which, if granted, would require significant ~~expenditures. We record a liability in~~expenditures and could impair our ~~condensed consolidated financial statements for these actions when a loss is known or considered probable~~business and the amount can be reasonably estimated. We review these estimates each accounting period as additional information is known and adjust the loss provision when appropriate. If the loss is not probable or cannot be reasonably estimated, a liability is not recorded in the condensed consolidated financial statements.results of operations. Material legal proceedings are discussed in ~~“Note 10.~~“Note 16. Commitments and ~~Contingencies—~~Contingencies” to our condensed consolidated financial statements and ~~are~~such information is incorporated herein by reference.

Investing in our common stock involves a high degree of risk. In addition to the other information set forth in this Report, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended March 31, ~~2017,~~2021, which could materially affect our business, financial condition or future results. ~~As of the date of this Report there has been no material change in any of~~The risk factors set forth below update, and should be read together with, the risk factors described in our Annual Report on Form 10-K for the fiscal year ended March 31, ~~2017,~~2021.

Government orders and regulations directing employers to require their employees to be vaccinated could lead to labor disruptions, which could have a material adverse effect on our business and results of operations.

On September 9, 2021, President Biden issued an executive order obligating parties that contract with the federal government to require their employees to be fully vaccinated against COVID-19, with limited exceptions for certain accommodations. That executive order was struck down by the U.S. Supreme Court on January 13, 2022. However, the Biden Administration may seek to impose alternative vaccine mandates and other governmental authorities have imposed more targeted vaccine and testing orders and regulations, and may do so in the future.

Given current information, it is not possible to predict with certainty the impact that any vaccine or testing orders or regulations could have on us. Mandates may result in increased costs, labor disruptions or employee attrition, which could be material. If we lose employees, it may be difficult in the current competitive labor market to find replacement employees, and this could have an adverse effect on future revenues and costs, which could be material. Additional uncertainty could be caused by competing and potentially conflicting laws and regulations, such as ~~supplemented~~an executive order issued by the governor of Texas prohibiting vaccine mandates. Accordingly, vaccine or testing orders and regulations could have a material adverse effect on our ~~Quarterly Report on Form 10-Q for the quarter ended June 30, 2017.~~business and results of operations.

Exhibit No.

Description

Filed with
This
Form 10-Q

Incorporated by Reference

Description

Filed with

This Form 10-Q

Incorporated by Reference

Form

Filing Date

Exhibit No.

Form

Filing Date

Exhibit No.

2.1

Agreement on the Sale and Transfer of all shares in ECP Entwicklungsgellschaft mbH

8-K

July 7, 2014

(File No. 001-09585)

2.1

2.2

Agreement on the Sale and Transfer of all shares in AIS GmbH Aachen Innovation Solutions

8-K

July 7, 2014

(File No. 001-09585)

2.2

3.1

Restated Certificate of Incorporation.

S-3

September 29, 1997

3.1

Restated Certificate of Incorporation

S-3

September 29, 1997

3.1

3.2

Restated By-Laws, as amended.

10-K

May 27, 2004
(File No. 001-09585)

3.2

Amended & Restated By-Laws, as Amended and Restated February 4, 2020

10-K

May 21, 2020
(File No. 001-09585)

3.2

3.3

Certificate of Designations of Series A Junior Participating Preferred Stock.

S-3

September 29, 1997

3.3

Amendment to the Company’s Restated Certificate of Incorporation to increase the authorized shares of common stock from 25,000,000 to 100,000,000

8-K

March 21, 2007
(File No. 001-09585)

3.4

Amendment to the Company’s Restated Certificate of Incorporation to increase the authorized shares of common stock from 25,000,000 to 100,000,000.

8-K

March 21, 2007
(File No. 001-09585)

3.4

10.1

Lease agreement for additional space in Danvers, Massachusetts dated February 2, 2017

10.2

Lease agreement amendment for additional space in Danvers, Massachusetts dated December 14, 2017

10.1*

Form of Indemnification Agreement by and between the Company and its directors and officers

8-K

August 13, 2021

(File No. 001-09585)

10.1

31.1

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

Rule 13a—14(a)/15d—14(a) certification of principal executive officer

31.2

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

Rule 13a—14(a)/15d—14(a) certification of principal accounting officer

32.1

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

Section 1350 certification

101

The following financial information from the ABIOMED, Inc. Quarterly Report on Form 10-Q for the quarter ended December 31, 2017, formatted in Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance Sheets as of December 31, 2017 and March 31, 2017; (ii) Condensed Consolidated Statements of Operations for the three and nine months ended December 31, 2017 and 2016; (iii) Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended December 31, 2017 and 2016; (iv) Condensed Consolidated Statements of Cash Flows for the nine months ended December 31, 2017 and 2016; and (v) Notes to Condensed Consolidated Financial Statements.

The following financial information from the ABIOMED, Inc. Quarterly Report on Form 10-Q for the quarter ended December 31, 2021, formatted in inline Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance Sheets (Unaudited) as of December 31, 2021 and March 31, 2021; (ii) Condensed Consolidated Statements of Operations (Unaudited) for the three and nine months ended December 31, 2021 and 2020; (iii) Condensed Consolidated Statements of Comprehensive Income (Unaudited) for the three and nine months ended December 31, 2021 and 2020; (iv) Condensed Consolidated Statements of Stockholders’ Equity (Unaudited) for the three and nine months ended December 31, 2021 and 2020 (v) Condensed Consolidated Statements of Cash Flows (Unaudited) for the nine months ended December 31, 2021 and 2020; and (vi) Notes to Condensed Consolidated Financial Statements (Unaudited).

104

Cover page from the ABIOMED, Inc. Quarterly Report on Form 10-Q for the quarter ended December 31, 2021 formatted in iXBRL and contained in Exhibit 101

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.

Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, $0.01 par value	ABMD	The NASDAQ Stock Market LLC

Large accelerated filer	☒		Accelerated filer	☐
Non-accelerated filer	☐	~~(Do not check if a smaller reporting company)~~	Smaller reporting company	☐
Emerging growth company	☐

				PART I - FINANCIAL INFORMATION:	Page
~~PART I - FINANCIAL INFORMATION:~~

Item 1.	Condensed Consolidated Financial Statements (unaudited)		3

	Condensed Consolidated Balance Sheets as of December 31, ~~2017~~2021 and March 31, ~~2017~~2021		3

	Condensed Consolidated Statements of Operations for the three and nine months ended December 31, ~~2017~~2021 and ~~2016~~2020		4

	Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended December 31, ~~2017~~2021 and ~~2016~~2020		5

	Condensed Consolidated Statements of Stockholders’ Equity for the three and nine months ended December 31, 2021 and 2020	6

	Condensed Consolidated Statements of Cash Flows for the nine months ended December 31, ~~2017~~2021 and ~~2016~~2020			68

	Notes to Condensed Consolidated Financial Statements (unaudited)			79

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations			2128

Item 3.	Quantitative and Qualitative Disclosures About Market Risk			3138

Item 4.	Controls and Procedures			3138

PART II - OTHER INFORMATION:

Item 1.	Legal Proceedings			3239

Item 1A.	Risk Factors			3239

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds			3239

Item 3.	Defaults Upon Senior Securities			3239

Item 4.	Mine Safety Disclosures			3239

Item 5.	Other Information			3239

Item 6.	Exhibits			3340

~~SIGNATURES~~Signatures				3441

	For the Three Months Ended December 31,						For the Nine Months Ended December 31,
	2021			2020			2021			2020
Net income	$	45,752		$	61,868		$	76,180		$	168,669
Other comprehensive (loss) income:
Foreign currency translation (losses) gains		(3,083	)		4,823			(5,693	)		8,599
Unrealized losses on derivative instrument		(1,094	)		(1,268	)		(766	)		(1,994	)
Net unrealized (losses) gains on marketable securities		(1,756	)		(525	)		(2,585	)		415
Other comprehensive (loss) income		(5,933	)		3,030			(9,044	)		7,020

Comprehensive income	$	39,819		$	64,898		$	67,136		$	175,689

~~Description of Change:~~	~~Impact of Change Upon Adoption on April 1, 2017 and for the~~ ~~Three and Nine Months Ended December 31, 2017:~~	~~Adoption Method:~~
~~The new standard eliminates the requirement that excess tax benefits be realized through a reduction in income taxes payable before a company can recognize them in the statement of operations.~~	As a result, on April 1, 2017, the Company recorded a cumulative-effect adjustment to increase retained earnings and deferred tax assets by $76.4 million for excess tax benefits not previously recognized.	~~Modified-retrospective (required)~~

~~Excess tax benefits related to restricted stock unit vestings or stock option exercises are recorded through the statement of operations.~~	The income tax benefit for the three and nine months ended December 31, 2017, included excess tax benefits of $3.2 million and $24.5 million, respectively. These recognized excess tax benefits resulted from restricted stock units that vested or stock options that were exercised during the three and nine months ended December 31, 2017.	~~Prospective (required)~~

~~Excess tax benefits related to restricted stock unit vestings or stock option exercises are classified as operating cash flows instead of financing cash flows.~~	Increase in cash flow from operating activities and decrease in cash flow from financing activities by approximately $24.5 million for the nine months ended December 31, 2017. The statement of cash flows for the prior period has not been adjusted.	~~Prospective (elected)~~

~~Calculation of diluted weighted average shares outstanding under the treasury method no longer assume that tax benefits related to stock-based awards are used to repurchase common stock.~~	~~The Company excluded the related tax benefits when applying the treasury stock method for computing diluted shares outstanding on a prospective basis as required by ASU 2016-09.~~	~~Prospective (required)~~

~~An accounting policy election can be made to reduce stock-based compensation expense for forfeitures as they occur instead of estimating forfeitures that are expected to occur.~~	The Company made an accounting policy election to account for forfeitures as they occur with the change applied on a modified retrospective basis with a cumulative effect adjustment on April 1, 2017 to increase additional paid-in capital by $1.8 million, increase deferred tax assets by $0.7 million and decrease retained earnings by $1.1 million. The Company elected to make this accounting policy change to simplify the accounting for stock-based compensation and believes this method provides a more accurate reflection of periodic stock based compensation cost. Prior to the adoption of this accounting standard, the Company estimated at grant the likelihood that the award would ultimately vest, and revised the estimate, if necessary, in future periods if the actual forfeiture rate differed.	~~Modified-retrospective (elected)~~

~~Cash payments to tax authorities for shares withheld to meet employee tax withholding requirements on restricted stock units are classified as financing cash flow instead of operating cash flow.~~	No change since the Company has historically presented these amounts as a financing activity. Prior to ASU 2016-09, U.S. GAAP has not specified how these types of transactions should be classified in the statement of cash flows.	~~N/A~~

	December 31, 2017			March 31, 2017
ASSETS
Current assets:
Cash and cash equivalents	$	50,502		$	39,040
Short-term marketable securities		250,751			190,908
Accounts receivable, net		64,862			54,055
Inventories		46,891			34,931
Prepaid expenses and other current assets		9,192			8,024
Total current assets		422,198			326,958
Long-term marketable securities		49,485			47,143
Property and equipment, net		107,977			87,777
Goodwill		34,814			31,045
In-process research and development		16,241			14,482
Long-term deferred tax assets, net		75,201			34,723
Other assets		13,686			8,286
Total assets	$	719,602		$	550,414
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	21,991		$	20,620
Accrued expenses		41,565			37,703
Deferred revenue		11,797			10,495
Current portion of capital lease obligation		—			799
Total current liabilities		75,353			69,617
Other long-term liabilities		466			3,251
Contingent consideration		10,423			9,153
Long-term deferred tax liabilities		878			783
Capital lease obligation, net of current portion		—			15,539
Total liabilities		87,120			98,343
Commitments and contingencies (Note 10)
Stockholders' equity:
Class B Preferred Stock, $.01 par value		—			—
Authorized - 1,000,000 shares; Issued and outstanding - none
Common stock, $.01 par value		443			437
Authorized - 100,000,000 shares; Issued - 45,995,445 shares at December 31, 2017 and 45,249,281 shares at March 31, 2017
Outstanding - 44,271,905 shares at December 31, 2017 and 43,673,286 shares at March 31, 2017
Additional paid in capital		605,697			565,962
Retained earnings (accumulated deficit)		103,610			(46,959	)
Treasury stock at cost - 1,723,540 shares at December 31, 2017 and 1,575,995 shares at March 31, 2017		(66,622	)		(46,763	)
Accumulated other comprehensive loss		(10,646	)		(20,606	)
Total stockholders' equity		632,482			452,071
Total liabilities and stockholders' equity	$	719,602		$	550,414

	For the Three Months Ended December 31,						For the Nine Months Ended December 31,
	2017			2016			2017			2016
Revenue:
Product revenue	$	153,989		$	114,624		$	419,202		$	320,541
Funded research and development		33			50			111			83
		154,022			114,674			419,313			320,624
Costs and expenses:
Cost of product revenue		24,994			18,987			68,483			51,366
Research and development		17,706			16,349			54,027			50,061
Selling, general and administrative		66,556			53,935			187,233			158,053
		109,256			89,271			309,743			259,480
Income from operations		44,766			25,403			109,570			61,144
Other income (expense):
Investment income, net		969			457			2,385			1,068
Other expense, net		(81	)		(34	)		(25	)		(225	)
		888			423			2,360			843
Income before income taxes		45,654			25,826			111,930			61,987
Income tax provision		32,208			10,394			36,607			24,770
Net income	$	13,446		$	15,432		$	75,323		$	37,217

Basic net income per share	$	0.30		$	0.36		$	1.71		$	0.86
Basic weighted average shares outstanding		44,247			43,431			44,095			43,125

Diluted net income per share	$	0.29		$	0.34		$	1.65		$	0.83
Diluted weighted average shares outstanding		45,869			44,770			45,731			44,597

	Common Stock					Treasury Stock
	Number of shares			Par value		Number of shares			Amount				Additional Paid in Capital			Accumulated Deficit				Accumulated Other Comprehensive Income (Loss)				Total Stockholders' Equity

Balance, March 31, 2017		43,673,286	$		437		1,575,995	$		(46,763	)	$		565,962	$		(46,959	)	$		(20,606	)	$		452,071
Cumulative effect of adoption of new accounting standard														1,835			75,246								77,081
Balance, April 1, 2017		43,673,286	$		437		1,575,995	$		(46,763	)	$		567,797	$		28,287		$		(20,606	)	$		529,152

	Total Acquisition Date Fair Value (in thousands)
Cash and other considerations	$	57,850
Contingent consideration		13,300
Total consideration transferred	$	71,150

Acquired assets:
Cash and cash equivalents	$	3,404
Property and equipment		744
Goodwill		44,485
In-process research and development		27,000
Other assets acquired		895
Total assets acquired		76,528
Liabilities assumed:
Accounts payable and other liabilities		1,562
Deferred tax liabilities		3,816
Net assets acquired	$	71,150

	Amortized		Gross Unrealized		Gross Unrealized			Fair Market
	Cost		Gains		Losses			Value
December 31, 2021	(in thousands)
Money market funds	$	61,245	$	—	$	(2	)	$	61,243
Repurchase agreements		10,000		—		—			10,000
Total cash equivalents		71,245		—		(2	)		71,243
Short-term U.S. Treasury mutual fund securities		143,488		1		(101	)		143,388
Short-term government-backed securities		126,586		1		(88	)		126,499
Short-term corporate debt securities		63,549		233		(21	)		63,761
Short-term commercial paper		191,373		4		(59	)		191,318
Total short-term marketable securities		524,996		239		(269	)		524,966
Long-term U.S. Treasury mutual fund securities		128,705		—		(357	)		128,348
Long-term government-backed securities		114,681		1		(725	)		113,957
Long-term corporate debt securities		20,435		—		(105	)		20,330
Total long-term marketable securities		263,821		1		(1,187	)		262,635
Total cash equivalents and marketable securities	$	860,062	$	240	$	(1,458	)	$	858,844


	Effective Date	Maturity	Fixed Rate	Aggregate Notional Amount
Pay EUR	October 15, 2019	October 15, 2024	2.75%		EUR 85,000
Receive U.S.$	October 15, 2019	October 15, 2024	4.64%		USD 93,457

Derivatives designated as hedging instruments under ASC 815		Balance Sheet classification		December 31, 2021				March 31, 2021
Cross-currency swap		Other long-term liabilities		$	2,131			$	4,298


	(in thousands)
Balance, March 31, 2021	$	62,995
Additions		7,067
Change in investment upon acquisition (Note 3)		(11,443	)
Balance, December 31, 2021	$	58,619

	(in $000's)
Balance at March 31, 2017	$	31,045
Foreign currency translation impact		3,769
Balance at December 31, 2017	$	34,814

					December 31, 2021					March 31, 2021
	Weighted Average Useful Life (in years)		Cost		Accumulated Amortization			Net Carrying Value		Accumulated Amortization			Net Carrying Value
			(in thousands)
Finite-lived intangible assets
Developed technology		13.9	$	27,000	$	(2,100	)	$	24,900		(750	)	$	26,250

Indefinite-lived intangible assets
In-process research and development				15,378		—			15,378		—			15,900
Total			$	42,378	$	(2,100	)	$	40,278		(750	)	$	42,150

(in thousands, except lease term and discount rate)

Fiscal Years Ending March 31,
2022 (excluding the 9 months ended December 31, 2021)	$	731
2023		2,617
2024		2,375
2025		1,610
2026		1,020
Thereafter		1,026
Total future minimum lease payments		9,379
Less: present value adjustment		(345	)
Total operating lease liabilities		9,034
Less: operating lease liabilities in other current liabilities		(2,587	)
Operating lease liabilities in other long-term liabilities	$	6,447

Weighted average remaining lease term		4.61

Weighted average discount rate		1.60	%

	Three and Nine Months Ended December 31, 2021
	Foreign Currency Translation Adjustments			Unrealized Gains (Losses) on Marketable Securities			Gains (Losses) on Derivative Instruments			Total
Balance, March 31, 2021	$	(14,718	)	$	1,369		$	1,904		$	(11,445	)
Other comprehensive income (loss)		83			(632	)		(217	)		(766	)
Balance, June 30, 2021		(14,635	)		737			1,687			(12,211	)
Other comprehensive (loss) income		(2,693	)		(197	)		545			(2,345	)
Balance, September 30, 2021		(17,328	)		540			2,232			(14,556	)
Other comprehensive (loss) income		(3,083	)		(1,756	)		(1,094	)		(5,933	)
Balance, December 31, 2021	$	(20,411	)	$	(1,216	)	$	1,138		$	(20,489	)

									Weighted
									Average
						Number of			Grant Date
	Number of Shares			Weighted Average Grant Date Fair Value		Shares			Fair Value
	(in thousands)			(per share)		(in thousands)			(per share)
Restricted stock units at beginning of period		1,056		$	80.50		301		$	273.57
Granted		295		$	136.80
Granted (1)							171			289.73
Vested		(363	)	$	53.16		(132	)		297.00
Forfeited		(94	)	$	98.08		(30	)		275.27
Restricted stock units at end of period		894		$	108.35		310		$	274.15

	May 2021			May 2020
Risk-free interest rate		0.3	%		0.2	%
Expected volatility		44.8	%		35.5	%
Dividend yield		—			—
Remaining performance period (years)		2.8		1.9 - 2.9
Estimated fair value per share	$	292.40		$347.05 - $349.28
Target performance (number of shares)		25,172			30,881

		ABIOMED, Inc.

Date: February ~~6, 2018~~3, 2022		/s/ ~~IAN W. MCLEOD~~TODD A. TRAPP
		~~Ian W. McLeod~~Todd A. Trapp
		Vice President and ~~Corporate Controller~~Chief Financial Officer
		(Interim Principal Financial and Accounting Officer)Authorized Signatory)