What changed in this filing

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Item 1. Financial Statements

2026-05-07 compared with 2025-11-06 · 258 added, 441 removed, 643 unchanged (52% of the section changed)

2 unchanged sentences

Consolidated Balance Sheets

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Assets (in thousands, except share and per share data)

11 unchanged sentences

Right of use assets 17,335 17,988

Deferred tax assets — 836

Other long-term assets 1,907 2,281

2 unchanged sentences

Current liabilities:

Debt, short-term $ — $ 16,000

Short-term obligations of NMTC 1

Accounts payable 160,139 110,437

6 unchanged sentences

New markets tax credit obligations 1

16,233 16,113

Commitments and contingencies (Note 19)

1 unchanged sentence

Preferred stock, $ .001 par value, 5,000,000 shares authorized, no shares issued

Common stock, $ .004 par value, 200,000,000 shares authorized, 81,593,092 and 81,436,594 issued and outstanding at September 30, 2025 and December 31, 2024, respectively

Common stock, $ .004 par value, 200,000,000 shares authorized, 81,851,483 and 81,691,075 issued and outstanding at March 31, 2026 and December 31, 2025, respectively

Additional paid-in capital 71,913 64,358

6 unchanged sentences

Consolidated Statements of Income

Three Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

(in thousands, except share and per share data)

Three Months Ended March 31,

(in thousands, except per share data)

Net sales $ 496,936 $ 322,054

4 unchanged sentences

Income from operations 57,059 35,111

Interest expense, net ( 5,153 ) ( 1,091 ) ( 11,964 ) ( 1,697 )

Interest expense ( 5,055 ) ( 2,802 )

Other income, net 77 174

3 unchanged sentences

Earnings per share:

Basic $ 0.38 $ 0.65 $ 0.93 $ 1.77

Diluted $ 0.37 $ 0.63 $ 0.91 $ 1.72

Basic EPS $ 0.49 $ 0.36

Diluted EPS $ 0.48 $ 0.35

Cash dividends declared per common share:

6 unchanged sentences

Consolidated Statements of Stockholders Equity

Nine Months Ended September 30, 2025

Common Stock Paid-in Retained

Shares Amount Capital Earnings Total

Three Months Ended March 31, 2026

Shares Amount Paid-in Capital Retained Earnings Total

(in thousands)

Balances at December 31, 2025 81,691 $ 327 $ 64,358 $ 830,300 $ 894,985

81,437 $ 326 $ 68,946 $ 755,310 $ 824,582

Net income — — — 39,815 39,815

3 unchanged sentences

Dividends — — — ( 8,146 ) ( 8,146 )

Balances at September 30, 2025 81,593 $ 326 $ 56,350 $ 806,434 $ 863,110

Nine Months Ended September 30, 2024

Common Stock Paid-in Retained

Shares Amount Capital Earnings Total

Balances at March 31, 2026 81,851 $ 327 $ 71,913 $ 861,969 $ 934,209

Three Months Ended March 31, 2025

Shares Amount Paid-in Capital Retained Earnings Total

(in thousands)

2 unchanged sentences

Stock options exercised and restricted stock awards granted 365 1 4,355 — 4,356

Contingent shares issued (Note 17)

243 1 6,363 — 6,364

Share-based compensation — — 4,021 — 4,021

1 unchanged sentence

Dividends — — — ( 8,095 ) ( 8,095 )

Balances at September 30, 2024 81,247 $ 325 $ 59,398 $ 737,133 $ 796,856

Three Months Ended September 30, 2025

Common Stock Paid-in Retained

Shares Amount Capital Earnings Total

(in thousands)

Balances at June 30, 2025 81,509 $ 326 $ 48,607 $ 783,813 $ 832,746

Net income — — — 30,782 30,782

Stock options exercised and restricted stock awards granted 86 — 3,250 — 3,250

Share-based compensation — — 4,626 — 4,626

Stock repurchased and retired ( 2 ) — ( 133 ) — ( 133 )

Dividends — — — ( 8,161 ) ( 8,161 )

Balances at September 30, 2025 81,593 $ 326 $ 56,350 $ 806,434 $ 863,110

Three Months Ended September 30, 2024

Common Stock Paid-in Retained

Shares Amount Capital Earnings Total

(in thousands)

Balances at June 30, 2024 80,951 $ 324 $ 49,174 $ 691,000 $ 740,498

Net income — — — 52,625 52,625

Stock options exercised and restricted stock awards granted 342 1 9,823 — 9,824

Share-based compensation — — 4,363 — 4,363

Stock repurchased and retired ( 46 ) — ( 3,962 ) — ( 3,962 )

Dividends — — — ( 6,492 ) ( 6,492 )

Balances at September 30, 2024 81,247 $ 325 $ 59,398 $ 737,133 $ 796,856

The accompanying notes are an integral part of these consolidated financial statements.

Balances at March 31, 2025 81,348 $ 325 $ 39,020 $ 776,507 $ 815,852

and Subsidiaries

Consolidated Statements of Cash Flows

Nine Months Ended

September 30,

Three Months Ended March 31,

Operating Activities (in thousands)

$ 75,561 $ 143,869

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Net income $ 39,815 $ 29,292

Adjustments to reconcile net income to net cash provided by (used in) operating activities

Depreciation and amortization 20,903 18,943

1 unchanged sentence

Amortization of right of use assets 40 25

Provision for credit losses on accounts receivable, net of adjustments

(Recoveries of) Provision for losses on accounts receivable, net of adjustments ( 120 ) 88

Provision for excess and obsolete inventories, net of write-offs 701 57

Provision for credit losses on contract assets, net of adjustments

Share-based compensation 7,696 4,021

3 unchanged sentences

Accounts receivable 24,346 ( 17,631 )

Income taxes ( 21,393 ) ( 2,295 )

Income tax receivable 7,754 ( 3,323 )

Inventories ( 52,753 ) ( 11,489 )

5 unchanged sentences

Accrued liabilities and other long-term liabilities 4,483 ( 2,412 )

Net cash (used in) provided by operating activities

( 18,784 ) 191,687

Net cash provided by (used in) operating activities 33,994 ( 9,214 )

Investing Activities

Capital expenditures ( 45,127 ) ( 46,723 )

Grant proceeds received 1,650 —

Proceeds from sale of property, plant and equipment — 40

2 unchanged sentences

Net cash used in investing activities ( 51,285 ) ( 50,388 )

( 138,623 ) ( 113,748 )

Financing Activities

1 unchanged sentence

Payments of debt ( 226,033 ) ( 138,411 )

Proceeds from financing obligation, net of issuance costs — 4,186

Payment related to financing costs ( 1,395 ) —

Stock options exercised 3,062 4,356

Repurchases of stock - open market ( 29,992 ) ( 100,034 )

Repurchase of stock - open market — ( 31,536 )

Repurchases of stock - LTIP plans (Note 17) ( 3,203 ) ( 6,768 )

( 9,300 ) ( 7,455 )

Cash dividends paid to stockholders ( 8,146 ) ( 8,095 )

Net cash provided by (used in) financing activities

153,160 ( 80,297 )

Net (decrease) increase in cash, cash equivalents and restricted cash ( 4,247 ) ( 2,358 )

Net cash provided by financing activities 17,152 55,471

Net decrease in cash, cash equivalents, and restricted cash ( 139 ) ( 4,131 )

Cash, cash equivalents, and restricted cash, beginning of period 1,239 6,514

2 unchanged sentences

and Subsidiaries

Notes to the Consolidated Financial Statements

Notes to Consolidated Financial Statements

March 31, 2026

Basis of Presentation

26 unchanged sentences

Actual results could differ materially from those estimates.

Macroeconomic Conditions

Beginning in January 2025, the current United States (“U.S.”) Administration began enacting a series of tariffs affecting nearly all goods imported into the U.S.

In retaliation, numerous foreign countries imposed reciprocal tariffs and restricted certain exports to the U.S.

The continuous changes and uncertainty in tariff policy could impact our cost of materials, parts, or components imported into the U.S.

and could impact the availability of supply from our vendors.

We source raw materials domestically, but historically have seen those suppliers increase prices when tariffs are increased.

Additionally, while we source most components domestically, our vendors may be impacted by tariffs if they use foreign parts and materials and often pass any additional costs as a result of tariffs through to us.

We expect to continue to pass along some of these costs to our customers, but the increased price of our products could adversely affect the demand, which could have an adverse effect on our business and our earnings.

The third quarter of 2025 is the first period during which we experienced significant financial impact from tariffs.

On April 1, 2025 we instituted a 6.0% tariff surcharge on AAON branded orders which we began to see

realization of in the third quarter of 2025.

To date, we estimate that the amount of surcharge realized has not covered the additional costs from the tariffs, but expect this to change by the end of the year as we fully realize our surcharge.

Due to our favorable liquidity position, we are well positioned to make strategic purchases of materials when we see opportunities or potential disruptions in our supply chain.

We have experienced supply chain challenges related to specific manufacturing parts, which could be exacerbated by the trade conflict.

We manage our supply chain challenges through strong vendor relationships as well as expanding our list of available vendors.

Additionally, we continue to experience challenges in a tight labor market, especially the hiring of both skilled and unskilled production labor.

We continue to implement human resource initiatives to retain and attract labor to further increase production capacity.

We have implemented the following wage increases to remain competitive and to attract and retain employees:

• In March 2024, we awarded annual merit raises for an overall 3.3 % increase to wages.

• In March 2025, we awarded annual merit raises for an overall 4.0 % increase to wages.

Despite efforts to mitigate the potential business impacts of trade conflict, supply chain challenges, and a tight labor market, future increases in the cost of materials, parts, components, or labor, in addition to supply chain disruptions, while temporary, could negatively impact our consolidated financial position, results of operations, and cash flows.

Accounting Policies

2 unchanged sentences

The carrying amounts of cash and cash equivalents, receivables, accounts payable, and accrued liabilities approximate fair value because of the short-term maturity of the items.

The carrying amount of the Company’s debt, and other payables, approximate their fair values either due to their short-term nature, the variable rates associated with the debt or based on current rates offered to the Company for debt with similar characteristics.

The carrying amount of the Company’s debt, and other payables, approximates their fair values either due to their short-term nature, the variable rates associated with the debt or based on current rates offered to the Company for debt with similar characteristics.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date.

16 unchanged sentences

Our definite-lived intangible assets include customer relationships, internal-use software and other intellectual property acquired in business combinations or asset acquisition.

We amortize our definite-lived intangible assets on a straight-line basis

over the estimated useful lives of the assets.

We amortize our definite-lived intangible assets on

a straight-line basis over the estimated useful lives of the assets.

We evaluate the carrying value of our amortizable intangible assets for potential impairment when events and circumstances warrant such a review.

4 unchanged sentences

Goodwill represents the excess of the consideration paid for the acquired businesses over the fair value of the individual assets acquired, net of liabilities assumed.

Goodwill at September 30, 2025, is expected to be tax deductible in future periods.

Goodwill at March 31, 2026, is expected to be tax deductible in future periods.

Indefinite-lived intangible assets consist of trademarks and trade names.

7 unchanged sentences

Revenue Recognition

The following tables show disaggregated net sales by reportable segment (Note 21) by major source, net of intercompany sales eliminations.

The following tables show disaggregated net sales by reportable segment (Note 21) by major product brand, net of intercompany sales eliminations.

Segment Brands Produced Brand Products

2 unchanged sentences

BASX BASX Data center cooling solutions, cleanroom products, and air handling products

Three Months Ended September 30, 2025

AAON Oklahoma AAON Coil Products BASX Total

(in thousands)

AAON Products $ 235,750 $ 23,700 $ — $ 259,450

BASX Products 2,998 46,546 75,244 124,788

Total $ 238,748 $ 70,246 $ 75,244 $ 384,238

Three Months Ended September 30, 2024

AAON Oklahoma AAON Coil Products BASX Total

(in thousands)

AAON Products $ 228,887 $ 34,633 $ — $ 263,520

BASX Products — 599 63,133 63,732

Total $ 228,887 $ 35,232 $ 63,133 $ 327,252

Nine Months Ended September 30, 2025

Three Months Ended March 31, 2026

AAON Oklahoma AAON Coil Products BASX Total

(in thousands)

AAON Products $ 582,708 $ 68,760 $ — $ 651,468

BASX Products 2,998 153,974 209,419 366,391

AAON-branded Products $ 243,967 $ 24,384 $ — $ 268,351

BASX-branded Products — 93,227 135,358 228,585

Total $ 243,967 $ 117,611 $ 135,358 $ 496,936

Nine Months Ended September 30, 2024

Three Months Ended March 31, 2025

AAON Oklahoma AAON Coil Products BASX Total

(in thousands)

AAON Products $ 664,754 $ 89,121 $ — $ 753,875

BASX Products — 1,731 147,311 149,042

AAON-branded Products $ 161,838 $ 27,655 $ — $ 189,493

BASX-branded Products — 66,368 66,193 132,561

Total $ 161,838 $ 94,023 $ 66,193 $ 322,054

Aftermarket part sales (included in the AAON Product sales above) were $ 24.9 million and $ 21.1 million for the three months ended September 30, 2025 and 2024, respectively, and $ 60.8 million and $ 55.6 million for the nine months ended September 30, 2025 and 2024, respectively.

Aftermarket part sales (included in the AAON Product sales above) were $ 17.0 million and $ 15.2 million for the three months ended March 31, 2026 and 2025, respectively.

The Company recognizes revenue, presented net of sales tax, when it satisfies the performance obligation in its contracts.

32 unchanged sentences

The Representatives’ fee and Third-Party Products amounts (“Due to Representatives”) are paid only after all amounts associated with the order are collected from the customer.

The amount of payments to our Representatives were $ 11.1 million and $ 10.7 million for the three months ended September 30, 2025 and 2024, respectively, and $ 35.8 million and $ 31.7 million for the nine months ended September 30, 2025 and 2024, respectively.

The amount of payments to our Representatives were $ 17.2 million and $ 12.7 million for the three months ended March 31, 2026 and 2025, respectively.

Contract Assets and Liabilities

Opening and closing balances of contract assets and contract liabilities are as follows:

September 30,

2025 December 31,

March 31, 2026 December 31, 2025

(in thousands)

5 unchanged sentences

Costs and estimated earnings on uncompleted contracts and related billings are as follows:

September 30,

2025 September 30,

2026 March 31,

(in thousands)

6 unchanged sentences

Total, net $ 243,139 $ 172,235

Revenue recognized in the reporting period that was included in the contract liability balance at the beginning of the period for the nine months ended September 30, 2025 and 2024 was $ 11.8 million and $ 12.4 million, respectively.

Typically, we expect to satisfy performance obligations relating to uncompleted in-process contracts within one year or less, however, timing of performance obligations can vary due to timing of payment, production scheduling and timing of customer installation requirements.

Increases in contract assets are mainly due to the increased production and increased demand of our BASX branded products.

Revenue recognized in the reporting period that was included in the contract liability balance at the beginning of the period for the three months ended March 31, 2026 and 2025 was $ 36.2 million and $ 1.6 million.

Typically, we expect to satisfy performance obligations relating to contracts within one year or less, however, timing of performance obligations can vary from timing of payment, production scheduling and timing of customer installation requirements.

Increases in contract assets are mainly due to the increased production and increased demand for our BASX-branded products.

The Company has lease arrangements for certain administrative, manufacturing and warehousing facilities and equipment.

Lease expiration dates, including expected renewal options, range from October 2025 to November 2033, with the weighted average remaining term being 6.3 years.

The discount rates used to calculate the present value of lease payment range from 1.3 % to 5.9 % as of September 30, 2025.

Lease expiration dates, including expected renewal options, range from January 2029 to April 2033, with the weighted average remaining term being 6.0 years.

The discount rates used to calculate the present value of lease payments range from 1.3 % to 6.6 % as of March 31, 2026.

All leases are classified as operating leases.

Balance Sheet Classification September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

(in thousands)

3 unchanged sentences

Since 2018, the Company has leased the manufacturing, engineering and office space used by our operations in Parkville, Missouri.

The lease’s original term was through December 2032.

The lease term is through January 2029.

In May 2025, the Company added approximately 17,000 additional square feet and extended the lease term through April 2033.

4 unchanged sentences

In January 2024, we amended the lease for an additional 157,550 square feet for operations and parts distribution.

The amended lease term will expire January 2039.

The amended lease term will expire April 2033.

In July 2023, the Company entered into a lease agreement with a start date of September 2023 for land and approximately 72,000 square feet of facilities in Redmond, Oregon to support our manufacturing operations.

The lease term will expire November 2033 with additional renewal options.

In April 2025, we amended the lease for an additional 28,000 square feet.

We also lease four properties near our Redmond location.

We also lease six properties near our Redmond location.

In the aggregate, these leases contain approximately 83,000 square feet of additional warehouse space, office space, as well as outside storage.

These leases have expiring terms from October 2025 to May 2028.

In October 2025, the Company entered into a lease agreement with a start date of November 2025, for approximately 34,000 square feet of additional warehouse and office space.

These leases have expiring terms from May 2027 to October 2030.

In October 2025, the Company entered into a lease agreement in Bend, OR with a start date of November 2025, for approximately 34,000 square feet of additional warehouse and office space.

The lease term will expire October 2030.

Total future lease payments as of September 30, 2025, are as follows:

Total future lease payments as of March 31, 2026, are as follows:

(in thousands)

6 unchanged sentences

Accounts receivable and the related allowance for credit losses are as follows:

September 30,

2025 December 31,

March 31, 2026 December 31, 2025

(in thousands)

1 unchanged sentence

Allowance for credit losses 1,188 1,308

$ 266,238 $ 147,434

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Total, net $ 290,161 $ 314,387

Three Months Ended March 31,

Allowance for credit losses:

1 unchanged sentence

Balance, beginning of period $ 1,308 $ 1,038

Provisions for expected credit ( 75 ) ( 354 ) 302 820

losses, net of adjustments

Accounts receivable written off, net of recoveries

97 — ( 10 ) ( 5 )

Provisions for expected credit losses, net of adjustments ( 48 ) 98

Accounts receivable recoveries (write offs) ( 72 ) ( 10 )

Balance, end of period $ 1,188 $ 1,126

2 unchanged sentences

We establish an allowance for excess and obsolete inventories based on product line changes, the feasibility of substituting parts and the need for supply and replacement parts.

The components of inventories and related changes in the allowance for excess and obsolete inventories account are as follows:

September 30,

The components of inventories and the related changes in the allowance for excess and obsolete inventories are as follows:

2026 December 31,

3 unchanged sentences

Finished goods 511 593

256,728 192,612

Total, gross 319,248 266,495

Allowance for excess and obsolete inventories 6,045 5,344

$ 250,511 $ 187,420

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Total, net $ 313,203 $ 261,151

Three Months Ended March 31,

Allowance for excess and obsolete inventories:

6 unchanged sentences

Our property, plant and equipment consist of the following:

September 30,

2026 December 31,

3 unchanged sentences

Buildings 369,366 366,919

Machinery and equipment 525,154 436,891

Machinery & equipment 581,794 555,801

Furniture and fixtures 67,041 63,909

3 unchanged sentences

Depreciation expense is as follows:

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Three Months Ended March 31,

(in thousands)

3 unchanged sentences

Our intangible assets consist of the following:

September 30,

2026 December 31,

9 unchanged sentences

Amortization expense is as follows:

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Three Months Ended March 31,

(in thousands)

Amortization expense $ 1,542 $ 2,075

The weighted-average amortization period for definite-lived intangible assets are as follows as of September 30, 2025:

The weighted-average amortization period for definite-lived intangible assets are as follows as of March 31, 2026:

Intellectual property 17.5

6 unchanged sentences

Total future amortization expense 50,943

Internal-use software projects not in service 14,895

Internal-use software projects in process 24,507

Total $ 75,450

The changes in the carrying amount of goodwill were as follows:

Nine Months Ended

September 30,

2025 September 30,

2026 December 31,

(in thousands)

1 unchanged sentence

$ 81,892 $ 81,892

Additions (decreases) during the period

Decreases due to acquisition adjustments — —

Balance, end of period $ 81,892 $ 81,892

Supplemental Cash Flow Information

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Three Months Ended March 31,

Supplemental disclosures:

1 unchanged sentence

Interest paid $ 4,929 $ 2,513

Income taxes paid, Federal $ — $ 9,694 $ 10,000 $ 31,694

Income taxes paid, State $ 9 $ 2,500 $ 2,827 $ 9,170

Operating activities - other:

Gain on disposition of assets

$ 36 $ 1 $ ( 4 ) $ ( 15 )

Foreign currency transaction (gain) loss

8 ( 5 ) ( 15 ) 10

Interest income on note receivable

( 5 ) ( 5 ) ( 13 ) ( 14 )

Gain on disposal of assets $ — $ ( 40 )

Foreign currency transaction gain — ( 1 )

Interest loss on note receivable — ( 4 )

Total, other $ — $ ( 45 )

1 unchanged sentence

Non-cash capital expenditures $ ( 673 ) $ 10,885

Contingent shares issued (Note 17)

$ — $ — $ — $ 6,364

Income taxes paid (net of refund) during the three months ended March 31, 2026 and 2025, disaggregated by jurisdiction:

Three Months Ended March 31,

(in thousands)

Federal $ ( 104 ) $ —

Minnesota 50 —

New York — 270

Pennsylvania 82 91

Virginia — 22

Other States — 155

Total $ 28 $ 538

Jurisdictions where income taxes paid were equal to or exceeded 5% of total income taxes paid are disclosed individually.

The Company has product warranties with various terms, from one year from the date of first use or 18 months for parts, data center cooling solutions, and cleanroom systems to 25 years for certain heat exchangers.

2 unchanged sentences

Changes in the warranty accrual are as follows:

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Three Months Ended March 31,

Warranty accrual:

4 unchanged sentences

Balance, end of period $ 31,447 $ 23,610

Warranty expense (benefit) by reportable segment (Note 21) is as follows:

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Warranty expense by reportable segment (Note 21) is as follows:

Three Months Ended March 31,

(in thousands)

1 unchanged sentence

AAON Coil Products 1,214 399

BASX 537 531 1,610 733

Total $ 5,913 $ 3,211

1 unchanged sentence

Accrued liabilities were comprised of the following:

September 30,

2026 December 31,

7 unchanged sentences

Customer prepayments 2,106 6,856

Donations, short-term 195 599

Donations — 57

Employee vacation time 16,586 15,408

Extended warranties, short-term 3,432 3,153

Lease liability, short-term 2,903 2,481

Property taxes 4,972 —

Extended warranties, ST 3,309 3,365

Operating lease liability ST 3,353 3,262

Property tax 1,885 143

Other 6,533 11,762

$ 120,468 $ 99,347

Total $ 136,731 $ 132,213

Other long-term liabilities were comprised of the following:

September 30,

2026 December 31,

2 unchanged sentences

Extended warranties 12,213 7,770

$ 22,205 $ 20,743

Total $ 27,038 $ 23,299

On December 16, 2024, we entered into the Third Amendment to the Amended and Restated Loan Agreement dated November 24, 2021, to include an $ 80.0 million term loan payable in equal monthly installments, plus interest, over 60 months, expiring December 16, 2029.

The agreement provided for a $ 200.0 million revolving credit facility and an option to increase the maximum borrowings to $ 300.0 million.

In April 2025, we increased our available Revolver to $ 230.0 million, an increase of $ 30.0 million, to fund our additional working capital needs.

On May 29, 2025, we entered into the Fifth Amendment to the Amended and Restated Loan Agreement dated November 24, 2021 (as amended, “Amended Loan Agreement”) whereby the remaining balance of the term loan, approximately $ 72.0 million, was rolled into the amended Revolving Loan (“Amended Revolver”), the capacity of which was increased from $ 230.0 million to $ 500.0 million.

The Amended Revolver is prepayable without penalty.

The Revolver expires on May 27, 2030.

September 30,

In April 2025, we entered into the Fourth Amendment to the Amended and Restated Loan Agreement dated November 24, 2021, to increase our available Revolver to $ 230.0 million, an increase of $ 30.0 million, to fund our additional working capital needs.

On May 29, 2025, we entered into the Fifth Amendment to the Amended and Restated Loan Agreement dated November 24, 2021, whereby the remaining balance of the term loan, approximately $ 72.0 million, was rolled into the amended Revolving Loan (“Amended Revolver”), the capacity of which was increased to $ 500.0 million from $ 230.0 million.

On December 29, 2025, we entered into the Sixth Amendment to the Amended and Restated Loan Agreement (as amended, “Amended Loan Agreement”).

The terms of the Amendment increased the amount of the borrowing capacity on the Amended Revolver to $ 600.0 million from $ 500.0 million by exercising the $ 100.0 million accordion feature.

The Amended Revolver is prepayable without penalty and expires on May 27, 2030.

2026 December 31,

2 unchanged sentences

Revolver borrowings outstanding 425,154 398,320

Standby letter of credit 654 300

Standby letters of credit 1,308 654

Borrowings available under the Revolver $ 173,538 $ 201,026

September 30,

2025 December 31,

(in thousands)

Term loan, short-term $ — $ 16,000

Term loan, long-term — 62,424

Total Term Loan $ — $ 78,424

Interest Rates

Any outstanding loans under the Amended Revolver bear interest at the daily compounded secured overnight financing rate (“SOFR”) plus the applicable margin.

The outstanding amount under the Term Loan bears interest at the SOFR plus a credit spread adjustment of 0.10 % per annum plus the Applicable Margin.

Any outstanding loans under the Revolver bear interest at the daily compounded secured overnight financing rate (“SOFR”) plus the applicable margin, with a 10-basis point credit spread adjustment.

Applicable margin, ranging from 1.25 % - 1.75 %, is determined quarterly based on the Company’s leverage ratio.

1 unchanged sentence

The applicable fee percentage is determined quarterly based on the Company’s leverage ratio.

Fees associated with the unused portion of the committed amount are included in interest expense on our consolidated statements of income and were not material for the three and nine months ended September 30, 2025 and 2024, respectively.

Weighted average interest rate of our borrowings outstanding are as follows:

Three months ended Nine months ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Fees associated with the unused portion of the committed amount are included in interest expense on our consolidated statements of income and were not material for the three months ended March 31, 2026 and 2025, respectively.

Weighted average interest rate of our borrowings outstanding is as follows:

Three Months Ended March 31,

Revolver 5.3 % 5.6 %

Term loan — % * 1

1 Funds were borrowed on December 16, 2024.

No borrowings outstanding during the nine months ended September 30, 2024.

If SOFR cannot be determined pursuant to the definition, as defined by the Amended Loan Agreement, any outstanding effected loans will be deemed to have been converted into alternative base rate (“ABR”) loans.

1 unchanged sentence

As of December 16, 2024, as defined by the Amended Loan Agreement, if the SOFR cannot be determined any outstanding balance will bear interest at the Prime Rate in effect on such day.

At September 30, 2025, we were in compliance with our covenants, as defined by the Amended Loan Agreement.

Our financial covenants require that we meet certain parameters related to our leverage ratio.

At September 30, 2025, our leverage ratio was 1.73 to 1.0, which meets the requirement of not being above 3 to 1.

Debt Covenants

At March 31, 2026, we were in compliance with our financial covenants as defined by the Amended Loan Agreement.

These covenants included a financial covenant that we meet certain parameters related to our leverage ratio.

At March 31, 2026, our leverage ratio was 1.71 to 1.0, which meets the requirement of not being above 3 to 1.

Income Tax Provision (Benefit)

The provision for income taxes consists of the following:

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Three Months Ended March 31,

(in thousands)

Current $ ( 17,798 ) $ 16,038 $ ( 8,166 ) $ 38,568

Deferred 25,458 ( 4,153 ) 23,035 ( 4,112 )

Current Federal $ 5,234 $ ( 2,032 )

Current State 2,446 ( 753 )

Deferred Federal 5,983 4,610

Deferred State ( 1,397 ) $ 1,366

Income tax provision $ 12,266 $ 3,191

The provision for income taxes differs from the amount computed by applying the Federal statutory income tax rate before the provision for income taxes.

The reconciliation of the Federal statutory income tax rate to the effective income tax rate is as follows:

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

The provision for income taxes differs from the amount computed by applying the statutory Federal income tax rate before the provision for income taxes.

Rate Reconciliation

The following table reconciles the U.S federal statutory income tax rate to the Company’s effective income tax rate for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

Amount % Amount %

(in thousands) (in thousands)

Federal statutory rate $ 10,962 21.0 % $ 6,821 21.0 %

State income taxes, net of Federal benefit 2,461 4.7 % 1,759 5.4 %

Excess tax benefits related to share-based compensation (Note 14)

( 2.2 ) ( 7.9 ) ( 10.9 ) ( 6.6 )

Return to provision ( 0.5 ) ( 0.3 ) 0.3 ( 0.2 )

State tax credits ( 499 ) ( 1.0 ) % ( 236 ) ( 0.7 ) %

Changes in tax laws in current period 88 0.2 % — — %

Excess tax benefits related to

share-based compensation (Note 15) ( 803 ) ( 1.5 ) % ( 7,164 ) ( 22.1 ) %

Work opportunity tax credit — — ( 53 ) ( 0.2 ) %

Non-deductible executive compensation 791 1.5 % 2,313 7.1 %

Research and development credits ( 0.9 ) ( 1.1 ) ( 2.1 ) ( 1.2 )

Research and development tax credits ( 525 ) ( 1.0 ) % ( 775 ) ( 2.4 ) %

Other ( 209 ) ( 0.3 ) % 526 1.7 %

Effective tax rate 12,266 23.6 % 3,191 9.8 %

The Company recorded an excess tax benefit of $ 0.9 million and $ 5.1 million for the three months ended September 30, 2025 and 2024, respectively, and $ 9.9 million and $ 11.7 million for the nine months ended September 30, 2025 and 2024, respectively.

The excess tax benefit is related to the timing of stock option exercises and the vesting of restricted stock as well as performance stock units along with our high stock price during the nine months ended September 30, 2025 and 2024.

In accordance with the 2017 Tax Cuts & Jobs Act, under Internal Revenue Code Section 162(m), the tax deduction for covered executives of public companies is limited to $1.0 million per individual.

Because of the increase in our stock price and timing of executive stock option exercises this resulted in a nominal change to the income tax provision for the three months ended September 30, 2025 and $ 1.2 million for the three months ended September 30, 2024.

For the nine months ended September 30, 2025 and 2024, the tax provision increased $ 3.0 million and $ 2.6 million, respectively.

We also earn research and development tax credits as defined under Section 41 of the Internal Revenue Code.

To qualify for the research and development tax credits, we perform annual studies that identify, document, and support eligible expenses related to qualified research and development activities.

Eligible expenses include but are not limited to supplies, materials, contractor expenses and internal employee wages.

In accordance with the 2017 Tax Cuts & Jobs Act, under Internal Revenue Code Section 174, foreign research and development expenses (“R&D”), including software development, incurred after December 31, 2021, are required to be capitalized and amortized over fifteen years.

The amortization requirements for tax purposes is a mid-year convention, resulting in tax amortization of 3.33% in the year of acquisition, 6.67% in each of the following fourteen years, and 3.33% in the final year.

See the OBBBA section below for more information regarding the change for domestic R&D and software development costs.

The amount of income tax that we pay annually is dependent on various factors, including the timing of certain deductions.

These deductions can vary from year to year and, consequently, the amount of income taxes paid in future years will vary from the amounts paid in prior years.

The Company’s effective tax rate differs from the statutory rate primarily due to the excess tax benefits of stock transactions and state taxes.

Pretax income is all domestic and there are no foreign income effects.

No state jurisdictions individually meet the 5% disaggregation threshold.

State taxes in Oregon, Oklahoma, Virginia, and Pennsylvania for the three months ended March 31, 2026, and state taxes in Oregon, Indiana, and Pennsylvania for the three months ended March 31, 2025, contributed to the majority (greater than 50%) of the tax effect in the state and local income tax category.

The Company’s estimated annual 2026 effective tax rate, excluding discrete events, is approximately 25.0 %.

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Impact of Tax Law Changes

The Company measured the effects of the tax law change using the beginning-of-year approach, with no remeasurement of its deferred tax assets (“DTAs”) or deferred tax liabilities (“DTLs”) required because the tax law changes are effective as of January 1, 2025 and do not affect prior years.

The measurement resulted in an increase in DTLs (credit) of $ 30.9 million, a decrease in current income tax payable (debit) of $ 30.6 million, and an increase in provision expense (debit) of $ 0.4 million due to the bonus depreciation change effect on Texas Franchise tax and the reduced R&D Tax Credit allowed with the §174A change.

The Company measured the effects of the tax law change using the enactment date approach, with a measurement date of June 30, 2025, from the Q2 2025 tax provision calculation as the closest date of measurement for deferred and current values.

The measurement resulted in an increase in DTLs of $ 35.4 million, a decrease in current income tax payable of $ 36.2 million, and an increase in provision expense of $ 0.8 million due to the bonus depreciation change effect on Texas Franchise tax and the reduced R&D Tax Credit allowed with the §174A change.

Significant provisions of OBBBA affecting the Company include:

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Effective for qualified property acquired after January 19, 2025, including manufacturing equipment, which reverses the previously scheduled phase-down of the bonus depreciation deduction to 40% for 2025 under prior law.

This provision increased DTLs by $ 11.9 million, decreased current payable by $ 11.8 million, and increased provision expense due to the accelerated tax deductions for capital expenditures made in 2025 and the small provision effect from the change in Texas Franchise Tax.

This adjustment also affected the state bonus depreciation (increased the DTA) and UNICAP (increased the DTL) calculations by $ 1.5 million and $ 0.6 million, respectively, with offsetting entries to current income tax payable.

This provision increased DTLs by $ 7.0 million, decreased current payable by $ 7.0 million, and increased provision expense due to the accelerated tax deductions for capital expenditures made in 2025 and the small provision effect from the change in Texas Franchise Tax and state bonus depreciation.

This adjustment also decreased the DTL for the UNICAP inventory calculation by $ 0.6 million, offset against current income tax payable.

• Permanent Expensing of Domestic R&E Costs (Section 174A):

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The Company has elected to deduct the unamortized amounts of Section 174 Costs as of December 31, 2024, fully in tax year 2025, which decreased DTAs and current payables by $ 25.5 million.

The impact of OBBBA enactment increased the Company’s effective tax rate by 0.7% for the year ended December 31, 2025.

Effective January 1, 2026, the OBBBA enacted a 1% charitable contribution floor.

The Company has included this permanent difference in the Q1 tax provision calculation, and the change increased the Company’s effective tax rate by 0.1% for the three months ended March 31, 2026.

Net Operating Loss

Due to the favorable changes in tax law related to the OBBBA, as of September 30, 2025, the Company generated Federal and State net operating loss (NOL) carryforwards of approximately $48.6 million.

Due to the favorable changes in tax law related to the OBBBA, as of December 31, 2025, the Company generated Federal and State net operating loss (“NOL”) carryforwards of approximately $ 57.0 million and $ 22.5 million, respectively.

The Federal NOLs have an indefinite carryforward period but are limited to offsetting 80% of taxable income in any given year under current tax law.

The State NOLs have varying expiration dates.

The Company has recorded deferred tax assets of $10.2 million (Federal) and $2.3 million (State) related to these NOL carryforwards.

Management has evaluated the positive and negative evidence in assessing the need for a valuation allowance (historical operating results, cumulative losses in recent years, and projected future taxable income) and we believe it is more likely than not that we will recognize the DTA reversals in tax year 2026, if not in Q4 of 2025.

The Company recorded deferred tax assets of $ 12.0 million (Federal) and $ 1.1 million (State) related to these NOL carryforwards as of December 31, 2025.

As of March 31, 2026, the deferred tax asset balances are $ 3.6 million (Federal) and $ 0.5 million (State), considering usage of the NOL’s in the first quarter of 2026.

Share-Based Compensation

On May 22, 2007, our stockholders adopted a Long-Term Incentive Plan (“LTIP”) which provided 5.0 million shares that could be granted in the form of stock options, stock appreciation rights, restricted stock awards, performance units and performance awards.

Under the LTIP, the exercise price of shares granted could not be less than 100 % of the fair market value at the date of the grant.

On May 24, 2016, our stockholders adopted the 2016 Long-Term Incentive Plan (“2016 Plan”) which provides for

approximately 13.4 million shares, comprised of 5.1 million new shares provided for under the 2016 Plan, approximately 0.6 million shares that were available for issuance under the previous LTIP that were then authorized for issuance under the 2016 Plan, approximately 3.9 million shares that were approved by the stockholders on May 15, 2018, and an additional 3.8 million shares that were approved by the stockholders on May 12, 2020.

On May 22, 2007, our stockholders adopted a Long-Term Incentive Plan (as amended, “2007 Plan”) which provided an additional 5.0 million shares that could be granted in the form of stock options, stock appreciation rights, restricted stock awards, performance units, and performance awards.

Under the 2007 Plan, the exercise price of shares granted may not be less than 100 % of the fair market value at the date of the grant.

On May 24, 2016, our stockholders adopted the 2016 Long-Term Incentive Plan (“2016 Plan”) which provides for approximately 13.4 million shares, comprised of 5.1 million new shares provided for under the 2016 Plan, approximately 0.6 million shares that were available for issuance under the previous 2007 Plan that are now authorized for issuance under the 2016 Plan, approximately 3.9 million shares that were approved by the stockholders on May 15, 2018, and an additional 3.8 million shares that were approved by the stockholders on May 12, 2020.

On May 21, 2024, our stockholders adopted the 2024 Long-Term Incentive Plan (“2024 Plan”) which provides for approximately 2.7 million new shares and approximately 3.7 million shares that were issued and outstanding under the 2016 Plan (as of May 21, 2024) that are now authorized for issuance under the 2024 Plan.

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The Committee may delegate certain duties to one or more officers of the Company as provided in the LTIP Plans.

The Committee determines the persons to whom awards are to be made, determines the type, size and terms of awards, interprets the LTIP Plans, establishes and revises rules and regulations relating to the LTIP Plans and makes any other determinations that it believes necessary for the administration of the LTIP Plans.

The following weighted average assumptions were used to determine the fair value of the stock options granted on the original grant date for expense recognition purposes for options granted during the nine months ended September 30, 2025 and 2024, using a Black Scholes-Merton Model:

Nine months ended

September 30,

2025 September 30,

The Committee determines the persons to whom awards are to be made, determines the type, size and terms of awards, interprets the LTIP Plans, establishes and revises rules and regulations relating to the LTIP Plans and makes any other determinations that it is necessary for the administration of the LTIP Plans.

The following weighted average assumptions were used to determine the fair value of the stock options granted on the original grant date for expense recognition purposes for options granted during the three months ended March 31, 2026 and 2025 using a Black Scholes-Merton Model:

Three Months Ended March 31,

Senior Leadership 1 :

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Expected life (in years) 3.0 3.0

1 Senior Leadership consists of officers and key members of management.

1 Senior Leadership Team (“SLT”) consists of officers and key members of management.

The expected term of the options is based on evaluations of historical and expected future employee exercise behavior.

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Volatility is based on historical volatility of our stock over time periods equal to the expected life at grant date.

The following is a summary of stock options vested and exercisable as of September 30, 2025:

The following is a summary of stock options vested and exercisable as of March 31, 2026:

Prices Number

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Total 2,308,239 4.45 $ 40.22 $ 98,229

A summary of stock option activity under the plans is as follows:

A summary of option activity under the plans is as follows:

Stock Options Shares Weighted

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( 68,551 ) 44.67

( 406,063 ) 32.69

Forfeited or Expired

( 20,417 ) 82.27

Outstanding at September 30, 2025

2,957,422 $ 46.49

Exercisable at September 30, 2025

2,163,171 $ 35.15

The total pre-tax compensation cost related to unvested stock options not yet recognized as of September 30, 2025, is $ 13.8 million and is expected to be recognized over a weighted average period of approximately 2.1 years.

The total intrinsic value of options exercised during the nine months ended September 30, 2025 and 2024, was $ 26.2 million and $ 45.7 million, respectively.

The cash received from options exercised during the nine months ended September 30, 2025 and 2024, was $ 13.3 million and $ 25.6 million, respectively.

Outstanding at March 31, 2026 3,489,703 $ 56.43

Exercisable at March 31, 2026 2,308,239 $ 40.22

The total pre-tax compensation cost related to unvested stock options not yet recognized as of March 31, 2026, is $ 31.3 million and is expected to be recognized over a weighted average period of 2.6 years.

The total intrinsic value of options exercised during the three months ended March 31, 2026 and 2025, was $ 3.5 million and $ 13.1 million, respectively.

The cash received from options exercised during the three months ended March 31, 2026 and 2025, was $ 3.1 million and $ 4.4 million, respectively.

The impact of these cash receipts is included in financing activities in the accompanying consolidated statements of cash flows.

Restricted Stock

The fair value of restricted stock awards is based on the fair market value of AAON, Inc.

common stock on the respective grant dates, reduced for the present value of dividends.

At September 30, 2025, unrecognized compensation cost related to unvested restricted stock awards was approximately $ 7.6 million, which is expected to be recognized over a weighted average period of approximately 1.9 years.

The fair value of restricted stock awards is based on the fair market value of AAON common stock on the respective grant dates, reduced for the present value of dividends.

At March 31, 2026, unrecognized compensation cost related to unvested restricted stock awards was approximately $ 11.6 million which is expected to be recognized over a weighted average period of 2.5 years.

A summary of the unvested restricted stock awards is as follows:

3 unchanged sentences

( 2,224 ) 81.29

( 6,896 ) 75.85

Unvested at September 30, 2025

143,154 $ 79.66

We have awarded performance restricted stock units (“PSUs”) to certain officers and employees under our LTIP Plans.

Unvested at March 31, 2026 173,155 $ 86.94

We have awarded PSUs to certain officers and employees under our LTIP Plans.

Unlike our restricted stock awards, these PSUs are not considered legally outstanding and do not accrue dividends during the vesting period.

These PSUs vest based on the level of achievement with respect to the Company's total shareholder return (“TSR”) benchmarked against similar companies included in the capital goods sector of the S&P SmallCap 600 Index (S&P 400 and S&P 600 within the building products industry group for awards granted after March 1, 2025).

The TSR measurement period is three years .

At the end of the measurement period, each award will be converted into common stock at 0 % to 200 % of the PSUs held, depending on overall TSR as compared to the benchmark companies.

The total pre-tax compensation cost related to unvested PSUs not yet recognized as of September 30, 2025, is $ 4.6 million and is expected to be recognized over a weighted average period of approximately 1.6 years.

The following weighted average assumptions were used to determine the fair value of the PSUs granted on the original grant date for expense recognition purposes for PSUs granted during the nine months ended September 30, 2025 and 2024, using a Monte Carlo Model:

Nine months ended

September 30,

2025 September 30,

At the end of the measurement period, each award will be converted into AAON common stock at 0 % to 200 % of the PSUs held, depending on overall TSR as compared to the S&P 400 and S&P 600 building products industry.

The total pre-tax compensation cost related to unvested PSUs not yet recognized as of March 31, 2026, is $ 8.7 million and is expected to be recognized over a weighted average period of approximately 2.3 years.

The following weighted average assumptions were used to determine the fair value of the PSUs granted on the original grant date for expense recognition purposes for PSUs granted during the three months ended March 31, 2026 and 2025, using a Monte Carlo Model:

Three Months Ended March 31,

Expected (annual) dividend rate $ 0.40 $ 0.40

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51,457 132.00

Additional payout 1

Payout adjustment 1

( 8,998 ) 84.42

( 44,471 ) 84.42

Unvested at September 30, 2025 2

( 2,034 ) 92.17

1 The additional number of PSUs earned based on a 196.4% achievement at December 31, 2024 for awards vesting in 2025.

2 Consists of 53,657 PSUs cliff vesting December 31, 2025, 44,163 PSUs cliff vesting December 31, 2026, and 45,482 PSUs cliff vesting December 31, 2027.

Key Employee Awards

As part of the December 2021 acquisition of BASX, the Company granted 39,899 awards to key employees of BASX (“Key Employee Awards”).

Unlike our restricted stock awards under the LTIP Plans, the Key Employee Awards are not considered legally outstanding and do not accrue dividends during the vesting period.

The issuance of the Key Employee Awards was contingent upon BASX meeting certain post-closing earn-out milestones during each of the years ending 2021, 2022 and 2023 as defined by the BASX acquisition membership interest purchase agreement (“MIPA Agreement”) and continued employment with the Company.

At the end of the earn-out period, ending December 31, 2023, each eligible Key Employee Award vested and was converted into common stock.

The fair value of Key Employee Awards is based on the fair market value of AAON common stock on the grant date.

The weighted average grant date fair value of the key awards was $ 53.45 .

All pre-tax compensation cost has been recognized as of December 31, 2023, and all 39,899 awards vested in March 2024.

Share-Based Compensation

Unvested at March 31, 2026 2

140,714 $ 105.71

1 PSU payout adjustment based on a 83.2 % achievement at December 31, 2025 for awards vesting in 2026.

2 Consists of 43,732 PSUs cliff vesting in 2027, 45,846 PSUs cliff vesting in 2028, and 51,136 PSUs cliff vesting in 2029.

Summary of Share-based Compensation

A summary of share-based compensation is as follows:

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Three Months Ended March 31,

Grant date fair value of awards during the period:

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Total $ 38,907 $ 18,382

Share-based compensation expense:

Three Months Ended March 31,

Stock-based compensation expense:

(in thousands)

Options $ 4,250 $ 1,879

2 unchanged sentences

Total $ 7,696 $ 4,021

Income tax benefit (deficiency) related to share-based compensation:

Three Months Ended March 31,

Income tax benefit related to share-based compensation (in thousands)

Options $ 674 $ 3,157

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Restricted stock 195 535

Key Employee Awards — — — 282

Total $ 803 $ 7,164

Share-based compensation expense is recognized on a straight-line basis over the service period of the related share-based compensation award.

Stock options and restricted stock awards, granted to employees, vested at a rate of 33.3 % per year.

Restricted stock awards granted to directors historically vest over the shorter of directors' remaining elected term or one-third each year.

Forfeitures are accounted for as they occur.

All share-based compensation awards granted contain a one-year employment requirement (minimum service period) or the entire award is forfeited.

If the employee or director is retirement eligible (as defined by the Long Term Incentive Plans) or becomes retirement eligible during service period of the related share-based compensation award, the service period is the lesser of 1) the grant date (plus one year), if retirement eligible on grant date, or 2) the period between grant date (plus one year) and retirement eligible date.

Forfeitures are accounted for as they occur.

The PSUs cliff vest at the end of their respective service period.

Share-based compensation expense is recognized on a straight-line basis over the service period of PSUs.

The PSUs are subject to several service and market conditions, as defined by the PSU agreement, which allows the holder to retain a pro-rata amount of awards as a result of certain termination conditions, retirement, change in common control, or death.

Forfeitures are accounted for as they occur.

Employee Benefits

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The Plan provides for automatic enrollment and for an automatic increase to the deferral percentage at January 1st of each year and each year thereafter.

Eligible employees are automatically enrolled in the Plan at a 6.0 % deferral rate and currently contributing employees deferral rates will be increased to 6.0 % unless their current rate is at or above 6.0 % or the employee elects to decline the automatic enrollment or increase.

Eligible employees are automatically enrolled in the Plan at a 6.0 % deferral rate and currently contributing employees’ deferral rates will be increased to 6.0 % unless their current rate is above 6.0 % or the employee elects to decline the automatic enrollment or increase.

Administrative expenses are paid for by Plan participants.

The Company paid no administrative expenses during the nine months ended September 30, 2025 and 2024.

The Company paid no administrative expenses during the three months ended March 31, 2026 and 2025.

The Company matches 175.0 % up to 6.0 % of employee contributions of eligible compensation.

Additionally, Plan participant forfeitures are used to reduce the cost of the Company contributions.

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Three Months Ended March 31,

(in thousands)

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Eligible employees are regular full-time non-exempt employees of the Company who are actively employed and working on the first and last day of the calendar quarter.

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Three Months Ended March 31,

(in thousands)

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In addition, the Company matches 175.0 % of a participating employee's allowed contributions to a qualified health saving account to assist employees with health insurance plan deductibles.

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

Three Months Ended March 31,

(in thousands)

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Dilutive common shares consist primarily of stock options and restricted stock awards.

The following table sets forth the computation of basic and diluted earnings per share for the nine months ended September 30, 2025 and 2024:

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

The following table sets forth the computation of basic and diluted earnings per share:

Three Months Ended March 31,

(in thousands, except share and per share data)

4 unchanged sentences

1,423,350 1,879,185

Effect of dilutive shares related to contingent consideration 2

Diluted weighted average shares

5 unchanged sentences

648,657 108,254

1 Dilutive shares related to stock options, restricted stock, PSUs and Key Employee Awards (Note 14)

2 Dilutive shares related to contingent shares issued to the former owners of BASX (Note 17)

1 Dilutive shares related to stock options, restricted stock, and PSUs (Note 14)

Stockholders' Equity

Stock Repurchases

The Board authorizes the stock repurchase programs for the Company.

The Company may purchase shares on the open market from time to time at current market prices.

The Board has authorized one active stock repurchase program for the Company.

The Company may purchase shares on the open market from time to time.

The Board must authorize the timing and amount of these purchases and all repurchases are in accordance with the rules and regulations of the SEC allowing the Company to repurchase shares from the open market.

Our authorized open market repurchase programs during the periods presented are as follows:

Effective Date Authorized Repurchase $ Expiration Date

November 3, 2022 $ 50 million 1

February 27, 2024

February 27, 2024 $ 50 million 1

June 4, 2024 $ 50 million 2

June 14, 2024

Our authorized open market repurchase programs during the periods are as follows:

Agreement Execution Date Authorized Repurchase $ Expiration Date

February 25, 2025 $ 100 million ** 1

1 Repurchases made in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934, as amended.

2 Repurchases made in accordance with Rule 10b-18 of the Securities Exchange Act of 1934, as amended.

1 Expiration Date is at Board's discretion.

The Company is authorized to effectuate repurchases of the Company's common stock on terms and conditions approved in advance by the Board.

As of September 30, 2025, approximately $ 30.0 million of shares have been repurchased, and approximately $ 70.0 million remains under the current board authorization.

The Company also repurchases shares of AAON, Inc.

stock related to our LTIP plans (Note 14) at current market prices.

As of March 31, 2026, approximately $ 30 million of shares have been repurchased, and approximately $70.0 million remains under the current board authorization.

The Company repurchases shares of AAON, Inc.

stock related to the LTIP Plans (Note 14) at current market prices.

Our repurchase activity is as follows:

Nine Months Ended

September 30, 2025 September 30, 2024

Three Months Ended March 31,

(in thousands, except share and per share data)

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LTIP Shares 34,568 3,203 92.66 82,664 8,312 100.55

93,176 9,300 99.81 87,981 7,455 84.73

464,315 $ 39,292 $ 84.62 1,441,545 $ 107,489 $ 74.57

Total 34,568 $ 3,203 $ 92.66 453,803 $ 38,304 $ 84.41

1 Includes stock repurchased for payment of statutory tax withholding and/or stock repurchased to cover the strike price of stock options.

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Our recent cash dividends are as follows:

Declaration Date Record Date Payment Date Dividend

per Share Annualized Dividend

Dividend Annualized Dividend

Declaration Date Record Date Payment Date per Share per Share

March 5, 2025 March 18, 2025 March 28, 2025 $ 0.10 $ 0.40

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March 5, 2026 March 18, 2026 March 30, 2026 $ 0.10 $ 0.40

May 13, 2025 June 6, 2025 June 27, 2025 $ 0.10 $ 0.40

August 14, 2025 September 5, 2025 September 26, 2025 $ 0.10 $ 0.40

Contingent Shares Issued in BASX Acquisition

In December 2021, we closed on the acquisition of BASX.

Under the MIPA Agreement, we committed to $ 78.0 million in the aggregate of contingent consideration to the former owners of BASX, which is payable in approximately 1.6 million shares of the Company's common stock, par value $ 0.004 per share.

The shares do not accrue dividends.

Under the MIPA Agreement, the issuance of shares to the former owners of BASX was contingent upon BASX meeting certain post-closing earn-out milestones during each of the years ended 2021, 2022, and 2023.

In March 2024, we issued the remaining 0.2 million shares related to the earn-out milestone for the year ended 2023.

As a result of the shares issued in March 2024, the tax basis exceeded the book basis for consideration paid resulting in a deferred tax asset and an increase to additional paid-in capital of $ 6.4 million, respectively, on our consolidated balance sheet.

The deferred tax asset is expected to be amortized over 15 years.

All shares have been issued as private placements exempt from registration with the SEC under Rule 506(b) and are included in common stock on the consolidated statements of stockholders' equity.

New Markets Tax Credit

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Upon closing of the 2019 NMTC transaction, the Company provided an aggregate of approximately $ 15.9 million to the 2019 Investor, in the form of a loan receivable, with a term of 25 years, bearing an interest rate of 1.0 %.

This $ 15.9 million in proceeds plus capital contributed from the 2019 Investor was used to make an aggregate $ 22.5 million loan to a subsidiary of

This $ 15.9 million in proceeds plus capital contributed from the 2019 Investor was used to make an aggregate $ 22.5 million loan to a subsidiary of the Company.

This financing arrangement is secured by equipment at the Company’s Longview, Texas facilities and a guarantee from the Company, including an unconditional guarantee of the NMTCs.

The Company’s seven-year compliance period ends in 2026, at which time the Company expects the put/call feature of the transaction to be exercised, forgiving a portion of the debt.

This transaction also includes a put/call feature either of which can be exercised at the end of the seven-year compliance period.

The 2019 Investor may exercise its put option or the Company can exercise the call, both of which could serve to trigger forgiveness of a portion of the debt.

The 2019 Investor’s interest of $ 6.6 million is recorded in New markets tax credit obligations on the consolidated balance sheets.

The 2019 Investor’s interest of $ 7.5 million is recorded as short-term debt on the consolidated balance sheets.

The Company incurred approximately $ 0.3 million of debt issuance costs related to the above transactions, which are being amortized over the life of the transaction.

2023 New Markets Tax Credit

On April 25, 2023, the Company entered into a transaction with a subsidiary of an unrelated third-party financial institution (the “2023 Investor”) and a certified Community Development Entity under a qualified New Markets Tax Credit (“2023 NMTC”) program pursuant to Section 45D of the Internal Revenue Code of 1986, as amended, related to an investment in plant and equipment to facilitate the second expansion of our Longview, Texas manufacturing operations (the “2023 Project”).

On April 25, 2023, the Company entered into a transaction with a subsidiary of an unrelated third-party financial institution (the “2023 Investor”) and a certified Community Development Entity under a qualified New Markets Tax Credit (“2023 NMTC”) program pursuant to Section 45D of the Internal Revenue Code of 1986, as amended, related to an investment in plant and equipment to facilitate the expansion of our Longview, Texas manufacturing operations (the “2023 Project”).

In connection with the 2023 NMTC transaction, the Company received a $ 23.0 million NMTC allocation for the 2023 Project and secured low-interest financing and the potential for future debt forgiveness related to the expansion of its Longview, Texas facilities.

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The 2023 Investor's interest of $ 5.8 million is recorded in new markets tax credit obligations on the consolidated balance sheets.

The Company incurred approximately $ 0.4 million of debt issuance costs related to the above transactions, which are being amortized over the life of the transaction.

The Company incurred

approximately $ 0.4 million of debt issuance costs related to the above transactions, which are being amortized over the life of the transaction.

2024 New Markets Tax Credit

On February 27, 2024, the Company entered into a transaction with a subsidiary of an unrelated third-party financial institution (the “2024 Investor”) and a certified Community Development Entity under a qualified New Markets Tax Credit (“2024 NMTC”) program pursuant to Section 45D of the Internal Revenue Code of 1986, as amended, related to an investment in real estate to facilitate the 2023 Project.

In connection with the 2024 NMTC transaction, the Company received a $ 15.5 million NMTC allocation for the 2024 Project and secured low interest financing and the potential for future debt forgiveness related to the expansion of its Longview, Texas facilities.

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The Company incurred approximately $ 0.4 million of debt issuance costs related to the above transactions, which are being amortized over the life of the transaction.

The 2019 Investor, 2023 Investor, and 2024 Investor are each subject to 100 percent recapture of the 2019, 2023, and 2024 NMTC, respectively, it receives for a period of seven years , as provided in the Internal Revenue Code and applicable U.S.

Treasury regulations in the event that the financing facility of the Borrower under the transaction (AAON Coil Products, Inc.) becomes ineligible for NMTC treatment per the Internal Revenue Code requirements.

The Company is required to be in compliance with various regulations and contractual provisions that apply to the 2019 NMTC arrangements, 2023 NMTC arrangements, and 2024 NMTC arrangements, respectively.

Noncompliance with applicable requirements could result in the 2019 and/or 2023 and/or 2024 Investors’ projected tax benefits not being realized and, therefore, require the Company to indemnify the 2019 Investor, 2023 Investor, and 2024 Investor for any loss or recapture of the 2019 NMTC, 2023 NMTC, and 2024 NMTC, respectively, related to the financing until such time as the recapture provisions have expired under the applicable

statute of limitations.

2026 New Markets Tax Credit

On April 16, 2026 the Company entered into a transaction with a subsidiary of an unrelated third-party financial institution (the “2026 Investor”) and a certified Community Development Entity under a qualified New Markets Tax Credit (“2026 NMTC”) program pursuant to Section 45D of the Internal Revenue Code of 1986, as amended, related to an investment in our Memphis, TN facility.

In connection with the 2026 NMTC transaction, the Company received a $ 50.5 million NMTC allocation for the 2026 Project and secured low interest financing and the potential for future debt forgiveness related to the 2026 Project.

Upon closing of the 2026 NMTC transaction, the Company provided an aggregate of approximately $ 35.2 million to the 2026 Investor, in the form of a loan receivable, with a term of 27 years, bearing an interest rate of 1.2 %.

This $ 35.2 million in proceeds plus capital contributed from the 2026 Investor was used to make an aggregate $ 48.2 million loan to a subsidiary of the Company.

This financing arrangement is secured by a guarantee from the Company, including an unconditional guarantee of the NMTCs.

The net proceeds from the closing of the 2026 NMTC were $ 12.9 million.

This transaction also includes a put/call feature that either of which can be exercised at the end of the seven-year compliance period.

The Investor may exercise its put option or the Company can exercise the call, both of which could serve to trigger forgiveness of a portion of the debt.

The 2019 Investor, 2023 Investor, 2024 Investor and 2026 Investor are each subject to 100 percent recapture of the 2019, 2023, 2024 and 2026 NMTC, respectively, it receives for a period of seven years , as provided in the Internal Revenue Code and applicable U.S.

Treasury regulations in the event that the financing facility of the Borrower under the transaction (AAON Coil Products for the 2019, 2023 and 2024 transaction and a portion of the business of AAON Oklahoma for the 2026 transaction) becomes ineligible for NMTC treatment per the Internal Revenue Code requirements.

The Company is required to be in compliance with various regulations and contractual provisions that apply to the NMTC arrangements.

Noncompliance with applicable requirements could result in the Investors' projected tax benefits not being realized and, therefore, require the Company to indemnify the Investor for any loss or recapture of the NMTC related to the financing until such time as the recapture provisions have expired under the applicable statute of limitations.

The Company does not anticipate any credit recapture will be required in connection with any of these financing arrangements.

The 2019 Investor, 2023 Investor, and 2024 Investor and its majority owned community development entity are considered VIEs and the Company is the primary beneficiary of the VIEs.

The Investors and their majority-owned community development entity are considered VIEs and the Company is the primary beneficiary of the VIEs.

Because the Company is the primary beneficiary of the VIEs, they have been included in the consolidated financial statements.

There are no other assets, liabilities or transactions in these VIEs outside of the financing transactions executed as part of the 2019 NMTC, 2023 NMTC, or 2024 NMTC arrangements, respectively.

There are no other assets, liabilities or transactions in these VIEs

outside of the financing transactions executed as part of the 2019 NMTC, 2023 NMTC, 2024 NMTC arrangements or 2026 NMTC arrangements, respectively.

Commitments and Contingencies

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We do not believe these matters will have a material adverse effect on our business, financial position, results of operations or cash flows.

We are occasionally party to short-term and long-term, cancellable and occasionally non-cancellable, contracts with major suppliers for the purchase of raw material and component parts.

We expect to receive delivery of raw material and component parts for use in our manufacturing operations.

We are occasionally party to cancellable and occasionally non-cancellable, fixed-price contracts with major suppliers for the purchase of raw material and component parts.

We expect to receive delivery of raw materials for use in our manufacturing operations.

These contracts are not accounted for as derivative instruments because they meet the normal purchase and normal sales exemption.

We had no material contractual purchase obligations as of September 30, 2025, except as noted below.

We had no material contractual purchase obligations as of March 31, 2026, except as noted below.

In 2023, the Company executed a five-year purchase commitment for refrigerants.

Payments made in satisfaction of the purchase commitment were approximately $ 1.6 million and $ 3.8 million the three and nine months ended September 30, 2025, respectively, as compared to $ 3.1 million and $ 9.7 million for the three and nine months ended September 30, 2024, respectively.

Estimated minimum future payments are $ 5.3 million, $ 10.5 million, and $ 11.2 million for 2025, 2026, and 2027, respectively.

For the three months ended March 31, 2026 and 2025, the Company made payments of $ 3.2 million and $ 0.6 million on this contract, respectively.

Estimated minimum future payments are $ 7.3 million, and $ 11.2 million for 2026 and 2027, respectively.

In 2025, the Company executed three, one-year purchase commitments for raw materials.

Estimated minimum future payments are $ 23.3 million for 2026.

We had no other material contractual purchase obligations as of March 31, 2026.

Related Parties

The following is a summary of transactions and balances with related parties:

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

The following is a summary of transactions and balances with affiliates:

Three Months Ended March 31,

(in thousands)

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Payments to affiliates 164 509

September 30,

2025 December 31,

March 31, 2026 December 31, 2025

(in thousands)

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The nature of our related party transactions is as follows:

• The Company sells units to an entity operated by a member of the board’s immediate family.

• The Company sells units to an entity managed by a board member’s immediate family.

This entity is also one of the Company’s Representatives and as such, the Company makes payments to the entity for third party products.

• The Company purchases some supplies from entities controlled by two of the Company’s board members and a member of the Company's executive management team.

• The Company periodically makes part sales and makes payments to a board member related to a consulting agreement.

The consulting agreement expired in May 2024.

• The Company periodically rents space partially owned by a member of the board for various Company meetings.

• The Company leases flight time of an aircraft partially owned by our President and CEO and another member of our senior leadership .

• The Company periodically makes part sales to a board member.

• The Company periodically rents space partially owned by a board member for various Company meetings.

These transactions ceased in the fourth quarter of 2025.

• The Company leases flight time of an aircraft partially owned by our President and CEO.

The Company has determined that it has three reportable segments for financial reporting purposes.

AAON Oklahoma:

AAON Oklahoma engineers, manufactures and sells semi-custom and custom HVAC systems, designs and manufactures controls solutions, and sells aftermarket parts to customers through retail part stores and online.

AAON Oklahoma includes the operations of our Tulsa, Oklahoma, Memphis, Tennessee and Parkville, Missouri manufacturing facilities, two retail locations, and the Norman Asbjornson Innovation Center (“NAIC”) research and development laboratory accredited by the Air Movement and Control Association International, Inc.

With the NAIC, a world-class research and development (“R&D”) laboratory in Tulsa, Oklahoma, our products are continuously tested under a variety of extreme environmental conditions to ensure they deliver the ultimate performance, efficiency, and value.

Also located in Tulsa, Oklahoma, our cutting-edge Exploration Center showcases the engineering, design attributes, and premium build quality of our equipment side-by-side the market alternatives.

AAON Oklahoma engineers, manufactures, and sells highly configurable HVAC systems, designs and manufactures controls solutions, and sells aftermarket parts to customers through retail part stores and online.

AAON Oklahoma includes operations at the Company’s manufacturing facilities in Tulsa, Oklahoma;

Memphis, Tennessee;

and Parkville, Missouri, as well as two retail locations, the Norman Asbjornson Innovation Center (“NAIC”), and the Gary D.

Fields Customer Exploration Center.

The NAIC is a world-class research and development laboratory accredited by the Air Movement and Control Association International, Inc.

("AMCA"), where our products are continuously tested under extreme environmental conditions to ensure optimal performance, efficiency, and value.

Fields Customer Exploration Center showcases the engineering, design attributes, and premium build quality of our equipment alongside market alternatives.

AAON Coil Products:

AAON Coil Products engineers and manufactures a selection of our semi-custom, and custom HVAC systems as well as a variety of heating and cooling coils to be used in HVAC systems, mostly for the benefit of AAON Oklahoma, AAON Coil Products, and BASX.

AAON Coil Products consists of operations at our Longview, Texas manufacturing facilities.

BASX branded products are also manufactured in Longview.

BASX engineers, manufactures, and sells an array of custom, high-performance cooling solutions for the rapidly growing hyperscale data center market, ventilation solutions for cleanroom environments in the bio-pharmaceutical, semiconductor, medical and agriculture markets, and highly custom, air handlers and modular solutions for a vast array of markets.

BASX consists of operations at our Redmond, Oregon manufacturing facilities.

The Company’s chief operating decision maker (“CODM”), our CEO, allocates resources and assesses the performance of each operating segment using information about the operating segment’s net sales, cost of sales, and gross profit directly attributable to our segments.

AAON Coil Products engineers and manufactures and sells semi-custom and custom HVAC systems as well as heating and cooling coils for use in HVAC systems, primarily for AAON Oklahoma, AAON Coil Products, and BASX.

AAON Coil Products operates from our Longview, Texas manufacturing facilities, which also produce BASX-branded products.

BASX engineers, manufactures, and sells a wide range of custom, high-performance cooling solutions for the rapidly growing hyperscale data center market;

ventilation solutions for cleanroom environments in the biopharmaceutical, semiconductor, medical, and agricultural sectors;

and highly customized air handlers and modular solutions for a variety of markets.

BASX operates from our manufacturing facilities in Redmond, Oregon, with additional support from facilities in Memphis, Tennessee, and Longview, Texas.

The Company’s chief decision maker (“CODM”), our CEO, allocates resources and assesses the performance of each operating segment using information about the operating segment’s net sales, cost of sales, and gross profit directly attributable to our segments.

The CODM does not evaluate operating segments using asset or liability information.

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The following table summarizes certain financial data related to our segments and significant segment expenses and other segment items regularly reviewed by our CODM.

Transactions between segments are recorded based on prices negotiated between the segments.

During the fourth quarter of 2025, the Company modified the reporting of sales of coils from AAON Coil Products to AAON Oklahoma to report at cost to be consistent with our other intercompany sales between segments.

The revised methodology is intended to better reflect the manner in which the CODM evaluates segment performance and makes resource allocation decisions.

As a result of this change, prior period segment results have been recast to conform to the current period presentation.

The change did not affect consolidated net sales, cost of sales or gross profit.

The cost of sales and gross profit amounts shown below are presented after elimination entries.

Three Months Ended Nine Months Ended

September 30,

2025 September 30,

2024 September 30,

2025 September 30,

(in thousands) (in thousands)

Three Months Ended March 31,

(in thousands)

AAON Oklahoma

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The following table presents long-lived assets by reportable segment, which includes property and equipment, net and operating lease assets:

September 30,

2025 December 31,

March 31, 2026 December 31, 2025

Long-lived assets (in thousands)

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The following table presents intangible assets and goodwill, net, by reportable segment:

Intangible assets, net and goodwill

March 31, 2026 December 31, 2025

Intangible assets and goodwill (in thousands)

AAON Oklahoma $ 32,610 $ 25,600

1 unchanged sentence

BASX 135,144 135,964

Total intangible assets, net and goodwill $ 163,886 $ 160,152

Total intangible assets and goodwill $ 171,913 $ 165,799

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements