What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-13 compared with 2026-05-14 · 162 added, 92 removed, 180 unchanged (59% of the section changed)

18 unchanged sentences

Aebi Schmidt operates in two reportable segments, which consist of (i) North America and (ii) Europe and the Rest of the World (“ROW”).

Operating results for the three months ended March 31, 2026 are not necessarily indicative of the results we may achieve for the full year ending December 31, 2026.

Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results we may achieve for the full year ending December 31, 2026 .

North America

19 unchanged sentences

Aebi Schmidt regularly reviews and may adjust its processes for calculating its internal metrics to improve their accuracy.

In addition to the key performance indicators summarized below, Aebi Schmidt also evaluates certain non-GAAP financial measures (i.e., Adjusted EBITDA and Adjusted EBITDA margin), which are further summarized in the Non-GAAP Financial Measures section below.

The following table presents a summary of Aebi Schmidt’s key performance indicators for the three months ended March 31, 2026 and March 31, 2025 .

Three Months Ended March 31,

In addition to the key performance indicators summarized below, Aebi Schmidt also evaluates certain non-GAAP financial measures (i.e.

Adjusted EBITDA and Adjusted EBITDA margin), which are further summarized in the Non-GAAP Financial Measures section below.

The following table presents a summary of Aebi Schmidt’s key performance indicators for the six months ended June 30, 2026 and June 30, 2025 .

Six Months Ended June 30,

(in thousands, except percentages) 2026 2025

Sales $ 951,953 $ 526,929

Net income 671 2,062

Net income margin 0.15 % 0.8 %

Net income (loss) 11,145 (260)

Net income (loss) margin 1.17 % (0.04 %)

Adjusted EBITDA (1)

5 unchanged sentences

GAAP financial measure.

Results of Operations

Three months ended March 31, 2026 compared with three months ended March 31, 2025

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Results for Aebi Schmidt for the three months ended March 31, 2026 , compared to results for the three months ended March 31, 2025 .

For the Three Months Ended March 31,

Results of Operations

Three months ended June 30, 2026 compared with three months ended June 30, 2025

Results for Aebi Schmidt for the three months ended June 30, 2026 , compared to results for the three months ended June 30, 2025 .

For the Three Months Ended June 30,

(in thousands, except percentages) 2026 2025 $ Change % Change

6 unchanged sentences

Amortization of purchased intangibles (8,414) (3,574) (4,840) 135 %

Other operating income 1,279 13 1,266 n.m.

Other operating income (expense) 302 (393) 695 n.m.

Total operating expenses (70,252) (42,973) (27,279) 63 %

4 unchanged sentences

Total other income (expense) (11,718) (17,071) 5,353 (31 %)

Income before income taxes 1,159 2,849 (1,690) (59) %

Income tax (expense) benefit (488) (787) 299 (38) %

Net income 671 2,062 (1,391) (67) %

Income (loss) before income taxes 15,322 (3,212) 18,534 n.m.

Income tax (expense) benefit (4,848) 890 (5,738) n.m.

Net income (loss) 10,474 (2,322) 12,796 n.m.

Net income (loss) attributable to non-controlling interest (36) (12) (24) 200 %

Net income attributable to Aebi Schmidt Holding AG $ 695 $ 2,075 $ (1,380) (67) %

Net income (loss) attributable to Aebi Schmidt Holding AG $ 10,510 $ (2,310) $ 12,820 n.m.

– not meaningful

Sales increased by $206.3 million, or 83%, to $455.5 million in the three months ended March 31, 2026 , from $249.2 million in the three months ended March 31, 2025 .

Sales increased by $218.7 million, or 79%, to $496.4 million in the three months ended June 30, 2026 , from $277.7 million in the three months ended June 30, 2025 .

The increase in sales was primarily driven by sales attributed to Shyft of $210.9 million, an increase in new business sales of $6.1 million, and an increase in after sales of $1.7 million.

Cost of products sold

Cost of products sold increased by $172.3 million, or 88%, to $368.2 million in the three months ended March 31, 2026 , from $195.9 million in the three months ended March 31, 2025 .

The increase in cost of products sold was primarily driven by $156.8 million in costs attributable to Shyft, an increase of $9.7 million in costs related to new business sales, and an increase of $5.7 million in costs related to after sales.

Cost of products sold increased by $178.2 million, or 81%, to $399.1 million in the three months ended June 30, 2026 , from $220.9 million in the three months ended June 30, 2025 .

The increase in cost of products sold was driven by $170.7 million in costs attributable to Shyft and an increase of $7.5 million in costs related to new business sales.

Research and development expense

Research and development expense increased by $2.1 million, or 45%, to $6.7 million in the three months ended March 31, 2026 , from $4.6 million in the three months ended March 31, 2025 primarily driven by an increase of $1.0 million in activity attributable to Shyft and the development of product solutions.

Research and development expense increased by $1.0 million, or 19%, to $6.4 million in the three months ended June 30, 2026 , from $5.4 million in the three months ended June 30, 2025 driven by an increase of $1.0 million in activity attributable to Shyft.

Selling, general and administrative expense

Selling, general and administrative expense increased by $27.8 million, or 91%, to $58.5 million in the three months ended March 31, 2026 , from $30.7 million in the three months ended March 31, 2025 .

The increase in selling, general and administrative expense was primarily driven by an increase of $22.3 million in costs attributable to Shyft, an increase in sales department costs of $2.2 million, an increase in finance department costs of $1.6 million, and an increase in IT costs of $1.3 million.

Selling, general and administrative expense increased by $22.1 million, or 66%, to $55.8 million in the three months ended June 30, 2026 , from $33.6 million in the three months ended June 30, 2025 .

The increase in selling, general and

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administrative expense was primarily driven by an increase of $20.7 million in costs attributable to Shyft, an increase in management costs of $0.6 million, and an increase in IT costs of $0.7 million.

Amortization of purchased intangibles

Amortization of purchased intangibles increased by $4.5 million, or 125%, to $8.1 million in the three months ended March 31, 2026 , from $3.6 million in the three months ended March 31, 2025 .

Amortization of purchased intangibles increased by $4.8 million, or 135%, to $8.4 million in the three months ended June 30, 2026 , from $3.6 million in the three months ended June 30, 2025 .

The increase is primarily attributable to amortization of $4.8 million related to the intangible assets acquired as part of the Merger with Shyft.

Other operating income (expense)

Other operating income increased by $1.3 million to $1.3 million in the three months ended March 31, 2026 , from other operating income of $0.0 million in the three months ended March 31, 2025 .

The increase in other operating income was primarily driven by an increase of net foreign exchange gains of $1.0 million and an increase in other income net of other expense of $0.3 million.

Other operating income increased by $0.7 million to $0.3 million in the three months ended June 30, 2026 , from other operating expense of $0.4 million in the three months ended June 30, 2025 .

The increase in other operating income was primarily driven by an increase of net foreign exchange gains of $0.7 million.

Interest expense

Interest expense increased by $4.9 million, or 75%, to $11.4 million in the three months ended March 31, 2026 , from $6.5 million in the three months ended March 31, 2025 .

The increase in interest expense was primarily driven by an increase in interest expense attributable to Aebi Schmidt of $3.6 million, the incurrence of $0.5 million in costs related to the debt refinancing in connection with the Merger, and an increase in interest expense attributable to Shyft of $0.8 million.

Interest expense increased by $1.8 million, or 20%, to $11.1 million in the three months ended June 30, 2026 , from $9.3 million in the three months ended June 30, 2025 .

The increase in interest expense was primarily driven by an increase in interest expense attributable to Aebi Schmidt of $3.4 million and interest expense attributable to Shyft of $0.5 million, offset by a decrease of $2.4 million in costs related to the refinancing in connection with the Merger.

Other income (expense)

Other expense decreased by $2.1 million to $2.9 million in the three months ended March 31, 2026 , from other expense of $5.0 million in the three months ended March 31, 2025 .

The decrease in other expense was primarily driven by a decrease in transaction related expense of $4.6 million and decreases in net foreign exchange losses on financial positions of $0.7 million, partially offset by the incurrence of integration costs of $2.0 million and costs of legal proceedings and settlements of $1.4 million.

Other expense decreased by $7.2 million to $0.6 million in the three months ended June 30, 2026 , from other expense of $7.8 million in the three months ended June 30, 2025 .

The decrease in other expense was driven by a decrease in transaction related expense of $6.1 million and decreases in net foreign exchange losses on financial positions of $2.6 million, partially offset by the incurrence of integration and restructuring costs of $0.6 million.

Income tax (expense) benefit

Income tax expense decreased by $0.3 million, or 38%, to $0.5 million in the three months ended March 31, 2026 , from income tax expense of $0.8 million in the three months ended March 31, 2025 .

The decrease in income tax expense was primarily driven by lower taxable income in the three months ended March 31, 2026.

Income tax expense increased by $5.7 million to $4.8 million in the three months ended June 30, 2026 , from income tax benefit of $0.9 million in the three months ended June 30, 2025 .

The increase in income tax expense was primarily driven by higher taxable income in the three months ended June 30, 2026.

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Six months ended June 30, 2026 compared with six months ended June 30, 2025

Results for Aebi Schmidt for the six months ended June 30, 2026 , compared to results for the six months ended June 30, 2025 .

For the Six Months Ended

(in thousands, except percentages)

2026 2025 $ Change % Change

Sales $ 951,953 $ 526,929 $ 425,024 81 %

Cost of products sold (767,272) (416,791) (350,481) 84 %

Gross profit 184,681 110,138 74,543 68 %

Operating expenses:

Research and development (13,139) (10,059) (3,080) 31 %

Selling, general and administrative (114,249) (64,298) (49,951) 78 %

Amortization of purchased intangibles (16,466) (7,148) (9,318) 130 %

Other operating income (expense) 1,581 (380) 1,961 n.m.

Total operating expenses (142,273) (81,885) (60,388) 74 %

Operating income 42,408 28,253 14,155 50 %

Other income (expense):

Interest expense (22,476) (15,806) (6,670) 42 %

Other income (expense) (3,451) (12,810) 9,359 (73 %)

Total other income (expense) (25,927) (28,616) 2,689 (9 %)

Income (loss) before income taxes 16,481 (363) 16,844 n.m.

Income tax (expense) benefit (5,336) 103 (5,439) n.m.

Net income (loss) 11,145 (260) 11,405 n.m.

Net income (loss) attributable to non-controlling interest (60) (25) (35) 140 %

Net income (loss) attributable to Aebi Schmidt Holding AG $ 11,205 $ (235) $ 11,440 n.m.

– not meaningful

Sales increased by $425.0 million, or 81%, to $952.0 million in the six months ended June 30, 2026 , from $526.9 million in the six months ended June 30, 2025 .

The increase in sales was primarily driven by $397.2 million in sales attributable to Shyft, an increase in new business sales of $16.2 million, and an increase in after sales of $11.6 million.

Cost of products sold

Cost of products sold increased by $350.5 million, or 84%, to $767.3 million in the six months ended June 30, 2026 , from $416.8 million in the six months ended June 30, 2025 .

The increase in cost of products sold was driven by $327.5 million in costs of products sold attributable to Shyft, an increase of $17.3 million in costs related to new business sales, and an increase of $5.7 million in costs related to after sales.

Research and development expense

Research and development expense increased by $3.0 million, or 31%, to $13.1 million in the six months ended June 30, 2026 , from $10.1 million in the six months ended June 30, 2025 .

The increase in research and development expense was primarily driven by $2.1 million in costs attributable to Shyft and the development of product solutions.

Selling, general and administrative expense

Selling, general and administrative expense increased by $50.0 million, or 78%, to $114.2 million in the six months ended June 30, 2026 , from $64.3 million in the six months ended June 30, 2025 .

The increase in selling, general and

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administrative expense was primarily driven by $43.0 million in costs attributable to Shyft, along with an increase in finance department expenses of $1.4 million, an increase in sales department costs of $2.1 million, and an increase in IT costs of $2.0 million.

Amortization of purchased intangibles

Amortization of purchased intangibles increased by $9.3 million, or 130%, to $16.5 million in the six months ended June 30, 2026 , from $7.1 million in the six months ended June 30, 2025 .

The increase is primarily attributable to amortization of $9.3 million related to intangible assets acquired as part of the Merger with Shyft.

Other operating income (expense)

Other operating income increased by $2.0 million to $1.6 million in the six months ended June 30, 2026 , from other operating expense of $0.4 million in the six months ended June 30, 2025 .

The increase in other operating income was primarily driven by an increase of net foreign exchange gains of $1.6 million.

Interest expense

Interest expense increased by $6.7 million, or 42%, to $22.5 million in the six months ended June 30, 2026 , from $15.8 million in the six months ended June 30, 2025 .

The increase in interest expense was primarily driven by an increase in interest expense attributable to Aebi Schmidt of $7.1 million and interest expense attributable to Shyft of $1.3 million, offset by a decrease of $2.0 million in costs related to the refinancing in connection with the Merger.

Other income (expense)

Other expense decreased by $9.3 million, or 73%, to $3.5 million in the six months ended June 30, 2026 , from other expense of $12.8 million in the six months ended June 30, 2025 .

The decrease in other expense was driven primarily by a decrease in transaction related expense of $10.7 million and decreases in net foreign exchange losses on financial positions of $3.3 million, partially offset by the incurrence of integration and restructuring costs of $2.6 million and costs of legal proceedings and settlements of $0.8 million.

Income tax (expense) benefit

Income tax expense increased by $5.4 million to an expense of $5.3 million in the six months ended June 30, 2026 , from a benefit of $0.1 million in the six months ended June 30, 2025 .

The increase in income tax expense was primarily driven by higher taxable income in the six months ended June 30, 2026 .

Segment Results of Operations

3 unchanged sentences

The information below includes Sales and Adjusted EBITDA by reportable segment, consistent with information presented for financial reporting purposes in Note 13 to Aebi Schmidt’s unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report.

Three Months Ended March 31, 2026 compared with three months ended March 31, 2025

For the Three Months Ended March 31, 2026

(in thousands) North

America Europe and the

Rest of the World Total

Three months ended June 30, 2026 compared with three months ended June 30, 2025

For the Three Months Ended June 30, 2026

(in thousands) North America Europe and ROW Total

Segment sales $ 356,263 $ 140,145 $ 496,408

Segment Adjusted EBITDA $ 35,502 $ 6,611 $ 42,113

For the Three Months Ended March 31, 2025

America Europe and the

Rest of the World Total

For the Three Months Ended June 30, 2025

North America Europe and ROW Total

Segment sales $ 146,244 $ 131,499 $ 277,743

Segment Adjusted EBITDA $ 16,024 $ 5,269 $ 21,293

North America

Sales for Aebi Schmidt’s North America segment increased by $190.0 million, or 129.0%, to $337.3 million in the three months ended March 31, 2026 , from $147.3 million in the three months ended March 31, 2025 .

The increase in sales

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was primarily driven by sales attributable to Shyft of $186.3 million, an increase in sales of new products of $1.8 million, and an increase in after sales of $1.9 million.

Adjusted EBITDA for Aebi Schmidt’s North America segment increased by $7.3 million, or 38.5%, to $26.4 million for the three months ended March 31, 2026 , from $19.0 million for the three months ended March 31, 2025 .

The increase in Adjusted EBITDA was primarily driven by the addition of $10.6 million in activity attributable to Shyft, along with an increase in segment gross margin of $1.4 million, partially offset by an increase in selling, general and administrative expenses of $4.5 million, and a decrease in other segment items of $0.2 million.

North America

Sales for Aebi Schmidt’s North America segment increased by $210.1 million, or 143.6%, to $356.3 million in the three months ended June 30, 2026 , from $146.2 million in the three months ended June 30, 2025 .

The increase in sales was primarily driven by sales attributable to Shyft of $210.9 million and an increase in after sales of $0.2 million, partially offset by a decrease in sales of new products of $1.0 million.

Adjusted EBITDA for Aebi Schmidt’s North America segment increased by $19.5 million, or 121.6%, to $35.5 million for the three months ended June 30, 2026 , from $16.0 million for the three months ended June 30, 2025 .

The increase in Adjusted EBITDA was primarily driven by the addition of $21.3 million in activity attributable to Shyft, along with an increase in other segment items of $3.1 million, partially offset by a decrease in segment gross margin of $2.0 million and an increase in selling, general and administrative expenses of $2.8 million.

Europe and ROW

Sales for Aebi Schmidt’s Europe and ROW segment increased by $16.3 million, or 16.0%, to $118.2 million in the three months ended March 31, 2026 , from $101.9 million in the three months ended March 31, 2025 .

Sales for Aebi Schmidt’s Europe and ROW segment increased by $8.6 million, or 6.6%, to $140.1 million in the three months ended June 30, 2026 , from $131.5 million in the three months ended June 30, 2025 .

The increase in sales was driven by an increase in sales of new products of $7.1 million and an increase in after sales of $1.5 million.

Adjusted EBITDA for Aebi Schmidt’s Europe and ROW segment increased by $4.5 million, or 201.4%, to $6.8 million in the three months ended March 31, 2026 , from $2.2 million in the three months ended March 31, 2025 .

The increase in Adjusted EBITDA was driven by an increase in segment gross margin of $3.2 million and an increase in other segment items of $3.4 million, partially offset by an increase in research and development expense of $1.0 million and an increase in selling, general and administrative expenses of $1.0 million.

Adjusted EBITDA for Aebi Schmidt’s Europe and ROW segment increased by $1.3 million, or 24.5%, to $6.6 million in the three months ended June 30, 2026 , from $5.3 million in the three months ended June 30, 2025 .

The increase in Adjusted EBITDA was driven by an increase in gross margin of $2.3 million and a decrease in selling, general and administrative expenses of $1.4 million, partially offset by a decrease in other segment items of $2.4 million.

Six months ended June 30, 2026 compared with six months ended June 30, 2025

For the Six Months Ended June 30, 2026

(in thousands) North America Europe and ROW Total

Segment sales $ 693,585 $ 258,368 $ 951,953

Segment Adjusted EBITDA $ 61,865 $ 13,365 $ 75,230

For the Six Months Ended June 30, 2025

North America Europe and ROW Total

Segment sales $ 293,535 $ 233,394 $ 526,929

Segment Adjusted EBITDA $ 35,060 $ 7,510 $ 42,570

North America

Sales for Aebi Schmidt’s North America segment increased by $400.1 million, or 136.3%, to $693.6 million in the six months ended June 30, 2026 , from $293.5 million in the six months ended June 30, 2025 .

The increase in sales was primarily driven by sales attributable to Shyft of $397.2 million, an increase in sales of new products of $0.7 million and an increase in after sales of $2.1 million.

Adjusted EBITDA for Aebi Schmidt’s North America segment increased by $26.8 million, or 76.4%, to $61.9 million for the six months ended June 30, 2026 , from $35.1 million for the six months ended June 30, 2025 .

The increase in Adjusted EBITDA was primarily driven by the addition of $31.9 million in activity attributable to Shyft, partially offset by a decrease of $0.6 million in gross margin, a decrease of other segment items of $0,6 million, and an increase in selling, general and administrative expenses of $3.9 million.

Europe and ROW

Sales for Aebi Schmidt’s Europe and ROW segment increased by $25.0 million, or 10.7%, to $258.4 million in the six months ended June 30, 2026 , from $233.4 million in the six months ended June 30, 2025 .

The increase in sales was driven by an increase in sales of new products of $15.5 million and an increase in after sales of $9.5 million.

Adjusted EBITDA for Aebi Schmidt’s Europe and ROW segment increased by $5.9 million, or 78.7%, to $13.4 million in the six months ended June 30, 2026 , from $7.5 million in the six months ended June 30, 2025 .

The increase in Adjusted EBITDA was primarily driven by an increase in gross margin of $5.5 million and an increase in other segment items of $1.0 million, partially offset by an increase in research and development expense of $0.9 million.

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Non-GAAP Financial Measures

2 unchanged sentences

There can be no assurance that Aebi Schmidt will not modify the presentation of its non-GAAP financial measures in the future, and any such modification may be material.

Aebi Schmidt defines Adjusted EBITDA as net income before interest, taxes, depreciation, and amortization, further adjusted for foreign exchange gains and losses on external debt, restructuring and other related expenses, transaction related expenses, integration costs, bargain purchase gains on acquisitions, changes in repurchase liabilities for Aebi Schmidt’s employee share plan, non-service cost related pension expenses, legacy legal matters, sales executive transition costs, changes in provisions for contingencies, and other non-recurring items.

Aebi Schmidt defines Adjusted EBITDA as net income before interest, taxes, depreciation, and amortization, further adjusted for foreign exchange gains and losses on external debt, restructuring and other related expenses, transaction related expenses, integration costs, settlement of acquisition, changes in repurchase liabilities for Aebi Schmidt’s employee share plan, pension related income, legal matters, changes in provisions for contingencies, non-cash stock-based compensation expenses, and other non-operating one-off items.

Aebi Schmidt defines Adjusted EBITDA margin as a ratio of Adjusted EBITDA as a percentage of sales.

4 unchanged sentences

Adjusted EBITDA and Adjusted EBITDA margin may be defined differently by other companies in its industry and may not be comparable to similarly titled measures of other companies, thereby diminishing their utility.

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For the Three Months Ended March 31,

For the Six Months Ended June 30,

(in thousands, except percentages) 2026 2025

Net income $ 671 $ 2,062

Net income (loss) $ 11,145 $ (260)

Adjusted for:

Income tax (benefit) expense 488 787

Income tax expense (benefit) 5,336 (103)

Interest expense 22,476 15,806

6 unchanged sentences

Pension related income, net (1,515) (1,954)

Legal matters 1,427 —

Legacy legal matters 1,394 586

Change in provision for contingencies (763) (539)

3 unchanged sentences

Sales $ 951,953 $ 526,929

Net Income Margin 0.15 % 0.8 %

Net Income (Loss) Margin 1.17 % (0.04 %)

Adjusted EBITDA Margin 7.9 % 8.1 %

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Liquidity and Capital Resources

Aebi Schmidt’s primary liquidity needs are to fund general business requirements, including working capital, capital expenditures, restructuring costs and debt service requirements.

Aebi Schmidt’s principal sources of liquidity are cash flows from operating activities, its revolving credit facility (the “Revolving Credit Facility”) and other debt issuances, and existing cash balances of $115.9 million as of March 31, 2026 .

Aebi Schmidt actively manages its working capital and associated cash requirements and continually seeks more effective uses of cash.

As of March 31, 2026 , Aebi Schmidt had $441.9 million of net working capital (i.e., current assets minus current liabilities) compared to $416.5 million of net working capital as of December 31, 2025 .

Aebi Schmidt believes that its available liquidity will be sufficient to meet its current obligations for a period of at least 12 months from the date of the filing of this Quarterly Report and the foreseeable future thereafter, and its liquidity will be sufficient to finance its operating and capital needs, including day to day operations, capital expenditures, research and development, investments in information technology systems, dividends and potential future acquisitions.

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As of June 30, 2026 , Aebi Schmidt had $444.4 million of net working capital (i.e., current assets minus current liabilities) compared to $416.5 million of net working capital as of December 31, 2025 .

Aebi Schmidt believes that its available liquidity will be sufficient to meet its current obligations for a period of at least 12 months from the date of the filing of this Quarterly Report and foreseeable future thereafter, and its liquidity will be sufficient to finance its operating and capital needs, including day to day operations, capital expenditures, research and development, investments in information technology systems, dividends and potential future acquisitions.

Aebi Schmidt’s cash flows from operating, investing and financing activities, as reflected in the Aebi Schmidt Condensed Consolidated Statements of Cash Flows are summarized in the following table:

For the Three Months Ended March 31,

For the Six Months Ended June 30,

(in thousands) 2026 2025 $

3 unchanged sentences

Effect of exchange rate changes on cash and cash equivalents (36) 2,555 (2,591) (101 %)

Net increase (decrease) in cash and cash equivalents 17,374 (17,355) 34,729 (200 %)

Net increase (decrease) in cash and cash equivalents 11,222 (1,594) 12,816 n.m.

Cash and cash equivalents at beginning of the period 98,512 65,173 33,339 51 %

1 unchanged sentence

Net cash used in operating activities

Net cash used in operating activities decreased by $8.8 million, or 33%, to $17.7 million in the three months ended March 31, 2026 , from cash used in operating activities of $26.6 million in the three months ended March 31, 2025 .

The decrease in net cash used in operating activities was primarily driven by a decrease in net income of $1.4 million, an increase of $12.4 million in inventory levels, a decrease in accounts payable of $29.6 million due to efficient liquidity management while increasing purchases of raw materials, a decrease in income tax payable and receivable of $1.6 million and a decrease in accrued compensation and related taxes of $3.2 million.

These decreases were primarily offset by an increase in collection of accounts receivable and contract assets of $34.7 million, an increase in depreciation and amortization expense of $7.2 million, an increase in other assets and liabilities of $7.7 million, an increase in contract liabilities of $5.9 million, and an increase in deferred taxes of $0.9 million.

Net cash used in operating activities decreased by $10.6 million, or 50%, to $10.6 million in the six months ended June 30, 2026 , from cash used in operating activities of $21.2 million in the six months ended June 30, 2025 .

The decrease in net cash used in operating activities was primarily driven by an increase of $29.0 million related to net income adjusted for non-cash charges, a favorable change in accounts receivable and contract assets of $23.2 million, a favorable change in inventory of $2.0 million, and a favorable change in contract liabilities of $11.2 million.

These favorable changes were primarily offset by an unfavorable change in accounts payable of $53.4 million due to increased purchases of raw materials, and an unfavorable change in remaining balance sheet items of $1.5 million.

Net cash used in investing activities

Net cash used in investing activities decreased by $2.0 million, or 66%, to $1.1 million in the three months ended March 31, 2026 , from cash used in investing activities of $3.1 million in the three months ended March 31, 2025 .

The decrease was primarily driven by a decrease in cash spent on purchases of property, plant and equipment of $1.2 million and an increase on proceeds from sale of property, plant and equipment of $0.9 million.

Net cash used in investing activities decreased by $1.1 million, or 23%, to $3.5 million in the six months ended June 30, 2026 , from cash used in investing activities of $4.5 million in the six months ended June 30, 2025 .

The decrease was primarily driven by a decrease in cash spent on purchases of property, plant and equipment of $0.6 million and increase in proceeds from sale of property, plant and equipment of $0.4 million.

Net cash provided by financing activities

Net cash provided by financing activities increased by $25.4 million, or 222%, to $36.8 million in the three months ended March 31, 2026 , from $11.4 million in the three months ended March 31, 2025 .

The increase was primarily driven by an increase of proceeds, net of payments, of $23.9 million from long-term debt and a decrease in deferred payments made related to historical transactions of $4.8 million.

The increase was partially offset by an increase in dividend payments of $2.0 million and the exercise and vesting of stock incentive awards of $1.2 million.

Net cash provided by financing activities increased by $3.8 million to $25.4 million in the six months ended June 30, 2026 , from net cash provided by $21.6 million in the six months ended June 30, 2025 .

The increase was primarily driven by higher borrowings of $4.4 million, lower dividend payments of $5.6 million, and lower deferred payments related to historical transactions of $4.8 million.

The increase was partially offset by higher payments on debt of $9.5 million and higher payments related to exercising and vesting of stock incentive awards of $1.2 million.

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In thousands March 31, 2026

In thousands June 30, 2026

December 31, 2025

9 unchanged sentences

The interest rate is variable defined based on the applicable reference rate (SOFR, SARON, EURIBOR), plus a margin determined by the Company’s leverage ratio.

The average interest rate for the three months ended March 31, 2026 was 6.307% .

As of March 31, 2026, debt issuance costs of $4.5 million are deferred and amortized based on the effective interest method and $0.3 million have been written off for the three months ended March 31, 2026 due to the debt modification accounting.

The average interest rate for the three months ended June 30, 2026 was 5.987% .

As of June 30, 2026, debt issuance costs of $4.3 million are deferred and amortized based on the effective interest method.

The Company is subject to certain customary covenants that prohibit the Company from incurring additional indebtedness, limit certain acquisitions, investments, advances or loans and restrict substantial asset sales (all subject to certain exceptions and baskets).

In addition, credit facilities agreement governing Facility A (the “New Credit Facilities Agreement”) also requires the Company to maintain certain financial ratios.

In addition, the credit facilities agreement governing Facility A (the “ New Credit Facilities Agreement ”) also requires the Company to maintain certain financial ratios.

For the current reporting period, the Company was required to maintain a leverage ratio that did not exceed 3.75x.

The Company was in compliance with all covenants as of March 31, 2026 and December 31, 2025.

The Company was in compliance with all covenants as of June 30, 2026 and December 31, 2025.

Revolving Credit Facility, due 2030

The New Credit Facilities Agreement also provides for the Revolving Facility, which is a multicurrency senior secured revolving loan facility with a total commitment amount of up to $250.0 million.

The interest rate is variable and based on the applicable a reference rate (SOFR, SARON, EURIBOR), plus a margin determined by the Company’s leverage ratio.

The average interest rate for the three months ended March 31, 2026 was 6.253%.

As of March 31, 2026, debt issuance costs of $3.2 million are deferred and amortized based on a straight-line basis over the term of the debt and $0.2 million have been written off for the three months ended March 31, 2026 due to the debt modification accounting.

The Revolving Facility is a multicurrency senior secured revolving loan facility with a total commitment amount of up to $250.0 million.

The interest rate is variable and based on the applicable reference rate (SOFR, SARON, EURIBOR), plus a margin determined by the Company’s leverage ratio.

The average interest rate for the three months ended June 30, 2026 was 5.829%.

As of June 30, 2026, debt issuance costs of $3.0 million are deferred and amortized based on a straight-line basis over the term of the debt.

1 unchanged sentence

For the current reporting period, the Company was required to maintain a leverage ratio that did not exceed 3.75x.

The Company was in compliance with all covenants as of March 31, 2026 and December 31, 2025.

The Company was in compliance with all covenants as of June 30, 2026 and December 31, 2025.

Shareholder loans

As of March 31, 2026 and December 31, 2025 , there were subordinated shareholder loans totaling CHF13.6 million ( 2026 :

As of June 30, 2026 and December 31, 2025 , there were subordinated shareholder loans totaling CHF13.6 million ( 2026 :

$16.8 million, 2025 :

6 unchanged sentences

$11.8 million) from Gebuka AG.

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The loans are originally granted for a fixed term, but the term will be extended if the loan agreement is not terminated 90 days prior to the end date or if an extension agreement is signed.

The change in the loan balance as of March 31, 2026 and December 31, 2025 , is solely due to foreign exchange rate fluctuations.

The change in the loan balance as of June 30, 2026 and December 31, 2025 is solely due to foreign exchange rate fluctuations.

These shareholder loans were renewed and amended in connection with the New Credit Facilities Agreement.

In the first quarter of 2026, the Company entered into an uncommitted revolving credit facility with a maximum availability of $20.0 million and maturity date February 9, 2027.

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In the first quarter of 2026, the Company entered into an uncommitted revolving credit facility with a maximum availability of $20.0 million and a maturity date of February 9, 2027.

The facility bears interest at variable rates based on applicable reference rates (e.g., SOFR, SARON or EURIBOR) plus a margin.

The average interest rate for the three months ended March 31, 2026 was 5.923%.

The average interest rate for the three months ended June 30, 2026 was 5.896%.

The agreement includes customary terms and conditions, including representations and warranties, events of default and covenants typical for facilities of this nature.

The lender may cancel the facility any time on short notice.

As of March 31, 2026, there was $20.0 million outstanding under the facility.

As of June 30, 2026, there was $20.0 million outstanding under the facility.

This debt is included in “Other debt” in the table above.

Contingent Liabilities

Changes in Aebi Schmidt’s warranty liability during the three-month periods ended March 31, 2026 and 2025 were as follows:

Three Months Ended March 31,

Changes in Aebi Schmidt’s warranty liability during the periods ended June 30, 2026 and 2025 were as follows:

Six Months Ended June 30,

(in thousands) 2026

5 unchanged sentences

Balance of warranty liability, end of period $ 18,881 $ 12,976

Aebi Schmidt’s long-term warranty provisions amounting to $2.6 million and $1.8 million for the three-month periods ended March 31, 2026 and 2025 , respectively, are included within other non-current liabilities on its Condensed Consolidated Balance Sheet.

Aebi Schmidt’s long-term warranty provisions amounting to $2.6 million and $2.0 million at June 30, 2026 and 2025 , respectively, are included within other non-current liabilities on its Condensed Consolidated Balance Sheet.

Contractual and Other Obligations

4 unchanged sentences

Off-Balance Sheet Arrangements

The contingent liabilities include guarantees amounting to $19.2 million and $20.2 million as of March 31, 2026 and December 31, 2025 , respectively.

The contingent liabilities include guarantees amounting to $20.3 million and $20.2 million as of June 30, 2026 and December 31, 2025 , respectively.

Through the normal course of bidding for and executing certain projects, Aebi Schmidt has entered into bid/performance bonds and surety bonds (collectively “performance bonds”) with various financial institutions.

Customers can draw on such performance bonds if Aebi Schmidt does not fulfil its contractual obligations.

Customers can draw on such performance bonds if Aebi Schmidt does not fulfill its contractual obligations.

If a performance bond is drawn, Aebi Schmidt would have an obligation to reimburse the financial institution for amounts paid.

There have been no significant amounts reimbursed to financial institutions under these types of arrangements for the three months ended March 31, 2026 and 2025 .

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There have been no significant amounts reimbursed to financial institutions under these types of arrangements for the six months ended June 30, 2026 and 2025 .

Critical Accounting Policies and Estimates

There have been no changes to our critical accounting policies during the three months ended March 31, 2026.

There have been no changes to our critical accounting policies during the six months ended June 30, 2026 .

Refer to the Company's Form 10-K for a summary of our policies.

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 2. Management’s Discussion and Analysis