What changed in this filing

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Item 1. Financial Statements

2024-08-08 compared with 2024-05-03 · 622 added, 208 removed, 631 unchanged (57% of the section changed)

3 unchanged sentences

(unaudited and in millions, except share amounts)

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Current Assets:

3 unchanged sentences

Other current assets 583.1 699.3

Current assets held for sale

Total current assets 6,638.7 6,340.8

4 unchanged sentences

Other assets 442.3 346.8

Noncurrent assets held for sale 448.3 —

Intangible assets, net 689.9 308.8

1 unchanged sentence

Total assets $ 13,614.8 $ 11,421.2

LIABILITIES AND STOCKHOLDERS’ EQUITY

LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND STOCKHOLDERS’ EQUITY

Current Liabilities:

3 unchanged sentences

Other current liabilities 154.2 217.5

Current liabilities held for sale

Total current liabilities 4,363.5 4,343.6

4 unchanged sentences

Other noncurrent liabilities 666.0 616.1

Noncurrent liabilities held for sale 27.9 —

Total liabilities 9,056.2 6,764.4

Commitments and contingencies (Note 17)

Redeemable noncontrolling interests 504.7 —

Stockholders’ Equity:

3 unchanged sentences

Common stock;

$ 0.01 par value, 150,000,000 shares authorized, 74,618,984 and 74,517,973 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively

$ 0.01 par value, 150,000,000 shares authorized, 74,634,538 and 74,517,973 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively

Additional paid-in capital 9.2 4.1

4 unchanged sentences

Total stockholders’ equity 4,053.9 4,656.8

Total liabilities and stockholders’ equity $ 13,459.9 $ 11,421.2

Total liabilities, redeemable noncontrolling interests and stockholders’ equity $ 13,614.8 $ 11,421.2

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

(unaudited and in millions, except per share data)

Three Months Ended March 31,

Three Months Ended June 30,

Net sales $ 3,246.6 $ 3,822.7

5 unchanged sentences

Amortization of intangibles

Impairment charges 5.1 —

Restructuring expenses

Loss on business held for sale

Income (loss) from operations

( 241.7 ) 496.4

Interest expense, net

Other expense, net

Income (loss) before income taxes and equity in net earnings of affiliates

( 336.9 ) 412.6

Income tax provision

Income (loss) before equity in net earnings of affiliates

( 378.5 ) 301.6

Equity in net earnings of affiliates

Net income (loss)

( 368.9 ) 319.2

Net loss attributable to noncontrolling interests 1.8 —

Net income (loss) attributable to AGCO Corporation and subsidiaries

$ ( 367.1 ) $ 319.2

Net income (loss) per common share attributable to AGCO Corporation and subsidiaries:

$ ( 4.92 ) $ 4.26

Cash dividends declared and paid per common share $ 2.79 $ 5.28

Weighted average number of common and common equivalent shares outstanding:

See accompanying notes to condensed consolidated financial statements.

AGCO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited and in millions, except per share data)

Six Months Ended June 30,

Net sales $ 6,175.3 $ 7,156.2

Cost of goods sold 4,568.0 5,295.6

Gross profit 1,607.3 1,860.6

Operating expenses:

Selling, general and administrative expenses 730.2 682.1

Engineering expenses

Amortization of intangibles

Impairment charges 5.1 —

Restructuring expenses

Loss on business held for sale

Income from operations 31.9 883.7

1 unchanged sentence

Other expense, net

Income before income taxes and equity in net earnings of affiliates 220.9 336.4

Income (loss) before income taxes and equity in net earnings of affiliates

( 116.0 ) 749.0

Income tax provision

Income before equity in net earnings of affiliates 151.8 216.2

Income (loss) before equity in net earnings of affiliates

( 226.7 ) 517.8

Equity in net earnings of affiliates

Net income 168.0 232.6

Net income (loss)

( 200.9 ) 551.8

Net loss attributable to noncontrolling interests 1.8 —

Net income attributable to AGCO Corporation and subsidiaries $ 168.0 $ 232.6

Net income per common share attributable to AGCO Corporation and subsidiaries:

Net income (loss) attributable to AGCO Corporation and subsidiaries

$ ( 199.1 ) $ 551.8

Net income (loss) per common share attributable to AGCO Corporation and subsidiaries:

$ ( 2.67 ) $ 7.37

$ ( 2.67 ) $ 7.36

Cash dividends declared and paid per common share $ 3.08 $ 5.52

2 unchanged sentences

AGCO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited and in millions)

Three Months Ended March 31,

Net income $ 168.0 $ 232.6

Other comprehensive (loss) income:

Three Months Ended June 30,

Net income (loss)

$ ( 368.9 ) $ 319.2

Other comprehensive income (loss):

Foreign currency translation adjustments ( 136.1 ) 74.2

1 unchanged sentence

Deferred gains and losses on derivatives, net of tax ( 2.0 ) ( 4.5 )

Other comprehensive (loss) income

Other comprehensive income (loss)

( 136.2 ) 71.6

Comprehensive income 124.6 279.3

Comprehensive income (loss)

( 505.1 ) 390.8

Comprehensive loss attributable to noncontrolling interests

Comprehensive income attributable to AGCO Corporation and subsidiaries $ 124.6 $ 279.3

Comprehensive income (loss) attributable to AGCO Corporation and subsidiaries

$ ( 502.3 ) $ 390.8

Six Months Ended June 30,

Net income (loss)

$ ( 200.9 ) $ 551.8

Other comprehensive income (loss):

Foreign currency translation adjustments ( 188.1 ) 118.6

Defined benefit pension plans, net of tax 3.6 3.7

Deferred gains and losses on derivatives, net of tax 4.9 ( 4.0 )

Other comprehensive income (loss)

( 179.6 ) 118.3

Comprehensive income (loss)

( 380.5 ) 670.1

Comprehensive loss attributable to noncontrolling interests 2.8 —

Comprehensive income (loss) attributable to AGCO Corporation and subsidiaries

$ ( 377.7 ) $ 670.1

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

(unaudited and in millions)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

Net income $ 168.0 $ 232.6

Adjustments to reconcile net income to net cash used in operating activities:

Net income (loss)

$ ( 200.9 ) $ 551.8

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

Depreciation 128.5 110.1

1 unchanged sentence

Stock compensation expense 16.1 27.3

Impairment charges 5.1 —

Loss on business held for sale 494.6 —

Equity in net earnings of affiliates, net of cash received ( 25.1 ) ( 33.3 )

16 unchanged sentences

Purchase of businesses, net of cash acquired

( 1,902.2 ) ( 0.9 )

Investments in unconsolidated affiliates, net

( 0.2 ) ( 26.2 )

Other ( 0.1 ) ( 3.9 )

6 unchanged sentences

Payment of debt issuance costs ( 15.2 ) —

Investments by noncontrolling interests, net

Net cash provided by financing activities 2,335.4 334.5

4 unchanged sentences

Cash, cash equivalents and restricted cash, end of period (1)

$ 677.3 $ 463.5

____________________________________

(1) Includes $ 20.0 million of cash and cash equivalents classified as held for sale as of June 30, 2024.

See accompanying notes to condensed consolidated financial statements.

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GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature, necessary to present fairly the Company’s financial position, results of operations, comprehensive income and cash flows at the dates and for the periods presented.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature, necessary to present fairly the Company’s financial position, results of operations, comprehensive income (loss) and cash flows at the dates and for the periods presented.

These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

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Remeasurement adjustments for financial statements in highly inflationary economies and other transactional exchange gains and losses are reported in "Other expense, net" within the Company's Condensed Consolidated Statements of Operations.

For the three months ended and as of March 31, 2024, the Company's wholly-owned subsidiary in Turkey had net sales of approximately $ 156.3 million and total assets of approximately 7.3 billion Turkish lira (or approximately $ 225.7 million).

The monetary assets and liabilities denominated in the Turkish lira were approximately 6.5 billion Turkish lira (or approximately $ 201.5 million) and approximately 5.6 billion Turkish lira (or approximately $ 172.3 million), respectively, as of March 31, 2024.

The monetary assets and liabilities were remeasured into United States dollar based on exchange rates as of March 31, 2024.

For the six months ended and as of June 30, 2024, the Company's wholly-owned subsidiary in Turkey had net sales of approximately $ 263.0 million and total assets of approximately 8.2 billion Turkish lira (or approximately $ 248.7 million).

The monetary assets and liabilities denominated in the Turkish lira were approximately 7.6 billion Turkish lira (or approximately $ 232.0 million) and approximately 4.6 billion Turkish lira (or approximately $ 140.4 million), respectively, as of June 30, 2024.

The monetary assets and liabilities were remeasured into United States dollar based on exchange rates as of June 30, 2024.

The Company has a wholly-owned subsidiary in Argentina that assembles and distributes agricultural equipment and replacement parts.

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In December 2023, the central bank of Argentina adjusted the official foreign currency exchange rate for the Argentine peso, significantly devaluing the currency relative to the United States dollar.

For the three months ended and as of March 31, 2024, the Company's wholly-owned subsidiary in Argentina had net sales of approximately $ 44.2 million and total assets of approximately 220.8 billion pesos (or approximately $ 265.0 million).

The monetary assets of the Company's operations in Argentina denominated in pesos at the official government rate were approximately 82.1 billion pesos (or approximately $ 98.5 million), inclusive of approximately 33.4 billion pesos (or approximately $ 40.1 million) in cash and cash equivalents, as of March 31, 2024.

The monetary liabilities of the Company's operations in Argentina denominated in pesos at the official government rate were approximately 16.8 billion pesos (or approximately $ 20.2 million) as of March 31, 2024.

The monetary assets and liabilities were remeasured into United States dollar based on exchange rates as of March 31, 2024.

For the six months ended and as of June 30, 2024, the Company's wholly-owned subsidiary in Argentina had net sales of approximately $ 99.5 million and total assets of approximately 238.7 billion pesos (or approximately $ 262.6 million).

The monetary assets of the Company's operations in Argentina denominated in pesos at the official government rate were approximately 87.2 billion pesos (or approximately $ 95.9 million), inclusive of approximately 34.3 billion pesos (or approximately $ 37.7 million) in cash and cash equivalents, as of June 30, 2024.

The monetary liabilities of the Company's operations in Argentina denominated in pesos at the official government rate were approximately 14.0 billion pesos (or approximately $ 15.4 million) as of June 30, 2024.

The monetary assets and liabilities were remeasured into United States dollar based on exchange rates as of June 30, 2024.

The Company's finance joint venture in Argentina, AGCO Capital Argentina S.A.

("AGCO Capital"), had net monetary assets denominated in pesos at the official government rate of approximately 11.8 billion (or approximately $ 14.1 million) as of March 31, 2024, of which a majority is cash and cash equivalents.

("AGCO Capital"), had net monetary assets denominated in pesos at the official government rate of approximately 5.1 billion (or approximately $ 5.6 million) as of June 30, 2024.

All gains and losses resulting from AGCO Capital's remeasurement of its monetary assets and liabilities are reported as part of AGCO Capital's net income, our share of which is included in “Equity in net earnings of affiliates” within our Condensed Consolidated Statements of Operations.

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Improvements to Reportable Segment Disclosures," which expands annual and interim disclosure requirements and requires entities to disclose its significant segment expense categories and amounts for each reportable segment.

The ASU is effective for public entities for fiscal years

The ASU is effective for public entities for fiscal years beginning after December 15, 2023, and interim periods in fiscal years beginning after December 15, 2024, with early adoption

Notes to Condensed Consolidated Financial Statements - Continued

beginning after December 15, 2023, and interim periods in fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures.

8 unchanged sentences

(“Trimble”) and PTx Trimble, LLC (“PTx Trimble” or the "Joint Venture"), formerly known as Trimble Solutions, LLC, which was subsequently amended and restated on March 31, 2024.

On April 1, 2024, pursuant to the terms of an Amended and Restated Sale and Contribution Agreement (the “Agreement”), AGCO and Trimble completed (i) the contribution by Trimble to the Joint Venture of Trimble’s OneAg business, which is Trimble’s agricultural business, excluding certain Global Navigation Satellite System and guidance technologies, and an amount of cash, (ii) the contribution by AGCO to the Joint Venture of its interest in JCA Industries, LLC d/b/a JCA Technologies and an amount of cash, and (iii) the purchase by AGCO from Trimble of membership interests in the Joint Venture in exchange for the payment by AGCO to Trimble of $ 1,954.0 million in cash, subject to customary working capital and other adjustments.

On April 1, 2024, pursuant to the terms of an Amended and Restated Sale and Contribution Agreement (the “Agreement”), AGCO and Trimble completed (i) the contribution by Trimble to the Joint Venture of Trimble’s OneAg business (“OneAg”), which is Trimble’s agricultural business, excluding certain Global Navigation Satellite System and guidance technologies, and $ 8.1 million of cash, (ii) the contribution by AGCO to the Joint Venture of its interest in JCA Industries, LLC d/b/a JCA Technologies and $ 46.0 million of cash, and (iii) the purchase by AGCO from Trimble of membership interests in the Joint Venture in exchange for the payment by AGCO to Trimble of $ 1,954.0 million in cash, subject to customary working capital and other adjustments.

Immediately following the closing and as a result of the transaction, AGCO directly and indirectly owns an 85 % interest in the Joint Venture and Trimble owns a 15 % interest in the Joint Venture.

AGCO will consolidate PTx Trimble within its consolidated financial statements.

The Company has not presented a purchase price allocation related to the fair values of assets acquired, liabilities assumed and noncontrolling interests because the initial accounting for the acquisition was incomplete as of the issuance date of the financial statements.

The purchase price was funded using net proceeds from the issuance of Senior Notes due 2027 and 2034, a term loan facility and the remainder through other borrowings and cash on hand.

Refer to Note 9 for further information.

AGCO began consolidating PTx Trimble within its consolidated financial statements on April 1, 2024.

The Company is accounting for the Joint Venture transaction as a business combination using the acquisition method of accounting which requires assets acquired and liabilities assumed to be recorded at their acquisition date fair value.

The Company preliminarily allocated the purchase price of the acquisition to identified assets acquired, liabilities assumed, and noncontrolling interests based on their estimated fair values as of the acquisition date.

The excess of the purchase price over the aggregate fair values was recorded as goodwill.

The Company calculated the fair value of the assets acquired using the income, market or cost approach (or a combination thereof).

Fair values of certain assets were determined based on Level 3 inputs, including estimated future cash flows, discount rates, royalty rates, growth rates and sales projections, all of which require significant management judgment and are susceptible to change.

The purchase price allocation was based upon preliminary information and is subject to change if additional information about the facts and circumstances that existed at the acquisition date becomes available.

The Company continues to evaluate the valuation of the assets acquired and liabilities assumed related to the acquisition, including inventories, developed technologies, trade names, favorable contracts, customer relationships, deferred taxes and redeemable noncontrolling interests.

The final fair value of the net assets acquired may result in adjustments to these assets and liabilities, including goodwill.

Any subsequent measurement period adjustments are not expected to have a material impact on the Company's results of operations.

The goodwill consists of expected future economic benefits that will arise from expected future product sales, operating efficiencies and sales channel synergies that may result from the Joint Venture.

The Company expects that the portion of the goodwill balance allocated to the US business will be deductible for tax purposes, and the goodwill allocated to the Joint Venture’s investments in foreign subsidiaries, primarily in Germany and France, will not be deductible for tax purposes.

At this time, the assignment of goodwill to reporting units has not yet been completed.

The estimated purchase consideration transferred consisted of the following (in millions):

Purchase Consideration

Total cash consideration for OneAg $ 1,954.0

Estimated working capital and other adjustments ( 45.6 )

Equity transaction associated with JCA noncontrolling interest (a) 3.1

Total purchase consideration $ 1,911.5

Notes to Condensed Consolidated Financial Statements - Continued

(a) Equity transaction associated with JCA noncontrolling interest

The transfer of the 15 % interest in AGCO's JCA business is accounted for as an equity transaction.

The adjustment to additional paid-in-capital represents the excess of the fair value of the JCA business transferred over its historical carrying amount.

The fair value of the JCA business was determined using a discounted cash flow model.

The preliminary fair values of the assets acquired, liabilities assumed and noncontrolling interests as of the acquisition date are presented in the following table (in millions):

As of April 1, 2024

Accounts receivable 12.3

Inventories 58.9

Other current assets 3.5

Property, plant and equipment 21.6

Deferred tax assets 0.1

Right-of-use lease assets 2.4

Other assets (non-current) 0.1

Intangible assets 545.0

Goodwill 1,803.3

Total assets acquired $ 2,453.5

Accounts payable $ ( 2.1 )

Accrued expenses ( 11.3 )

Other current liabilities ( 14.0 )

Operating lease liabilities ( 1.6 )

Deferred tax liabilities ( 4.0 )

Other noncurrent liabilities ( 9.6 )

Total liabilities assumed $ ( 42.6 )

Redeemable noncontrolling interests (b) ( 499.4 )

Net assets acquired $ 1,911.5

(b) Redeemable noncontrolling interests

Trimble has a put option to sell its noncontrolling interests to the Company, and the Company has a call option to redeem Trimble's noncontrolling interests.

The first exercisable date of both the put and call options is April 1, 2027.

The put and call options prices are based on multiples of EBITDA, subject to the terms of the Agreement.

We estimated the preliminary fair value of the put and call options using a Monte Carlo simulation along with a Black Scholes model assuming an exercise date of three years from the close of the transaction, the first allowable exercise date.

We evaluated the put and call options for the redeemable noncontrolling interests under ASC 480, Distinguishing Liabilities from Equity, and classified the redeemable noncontrolling interests as mezzanine equity based on its redemption features.

The amount of the net income or loss attributable to the redeemable noncontrolling interests is recorded in “Net loss attributable to noncontrolling interests” within the Company's Condensed Consolidated Statements of Operations.

To the extent the redemption value exceeds the initial fair value recorded, the Company will recognize the entire change in the redemption amount each reporting period in retained earnings.

Notes to Condensed Consolidated Financial Statements - Continued

The acquired identifiable intangible assets of OneAg as of the date of the acquisition are summarized in the following table (in millions):

Fair Value Useful Life (1)

Developed Technology $ 453.0 7 - 10 years

Customer Relationships 39.4 20 years

Tradename 10.7 5 years

Favorable contracts 41.9 2 - 7 years

____________________________________

(1) Based on available information and certain assumptions that we believe are reasonable.

The following unaudited pro forma financial information presents the consolidated results of operations as if the OneAg acquisition had occurred on January 1, 2023.

OneAg's pre-acquisition results have been added to the Company's historical results.

The pro forma results contained in the table below include adjustments for (i) the elimination of sales between the Company and OneAg, (ii) amortization of acquired intangible assets (iii) interest expense and amortization of debt issuance costs related to borrowings under the Senior Notes due 2027 and 2034 and term loan facility and (iv) transaction-related costs as if these had been incurred on January 1, 2023 for the periods ending June 30, 2023 and 2024, respectively.

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Unaudited Consolidated Pro Forma Results

Net sales $ 3,246.6 $ 3,948.4 $ 6,258.7 $ 7,419.5

Net income (loss) attributable to AGCO Corporation and subsidiaries

( 354.4 ) 314.3 ( 188.7 ) 515.5

These pro forma results have been prepared for comparative purposes only and are not necessarily indicative of the results of operations as they would have been had the acquisitions occurred on the assumed dates, nor are they necessarily an indication of future operating results.

The amounts of PTx Trimble's net sales and net loss attributable to AGCO Corporation and subsidiaries consolidated by the Company since the acquisition date were $ 69.0 million and $ 10.0 million, respectively.

During the six months ended June 30, 2024, transaction-related costs of approximately $ 23.3 million were expensed as incurred to “Selling, general and administrative expenses” in the Company's Condensed Consolidated Statements of Operations.

BUSINESS HELD FOR SALE

On July 25, 2024, the Company announced it had entered into a definitive agreement to sell the majority of its Grain & Protein (“G&P”) business for a purchase price of $ 700.0 million, subject to customary working capital and other adjustments.

As of June 30, 2024, the business met the criteria to be classified as held for sale.

The Company recognizes assets and liabilities held for sale at the lower of carrying value or fair market value less costs to sell.

The Company determined the intended sale of the G&P business does not represent a strategic shift that will have a major effect on the consolidated results of operations, and therefore results of this business were not classified as discontinued operations.

The results of the G&P business are included within our North America, South America, Europe/Middle East and Asia/Pacific/Africa segments.

Upon classification as held for sale, the Company recognized a loss on business held for sale of $ 494.6 million, which represents the estimated loss on the business held for sale, and is included within “Loss on business held for sale” in the Company's Condensed Consolidated Statements of Operations.

The estimated loss includes $ 84.6 million of cumulative translation adjustment losses related to the assets expected to be divested and an estimate of costs to sell the business.

The closing of the transaction is subject to customary closing conditions and is expected to be completed in the second half of 2024.

Notes to Condensed Consolidated Financial Statements - Continued

The major categories of assets and liabilities of the business classified as held for sale as of June 30, 2024 were as follows:

June 30, 2024

Current assets held for sale:

Cash and cash equivalents $ 20.0

Accounts and notes receivable, net 203.8

Inventories, net 186.7

Other current assets 22.5

Total current assets held for sale 433.0

Property, plant and equipment, net 98.6

Right-of-use lease assets 15.7

Other assets 8.1

Intangible assets, net 112.3

Goodwill 213.6

Total assets held for sale $ 881.3

Current liabilities held for sale:

Accounts payable $ 117.7

Accrued expenses 105.9

Other current liabilities 46.7

Total current liabilities held for sale 270.3

Long-term debt, less current portion and debt issuance costs 0.8

Deferred tax liabilities 11.4

Pension and postretirement health care benefits 0.3

Operating lease liabilities 10.9

Other noncurrent liabilities 4.5

Total liabilities held for sale $ 298.2

Disposal group, net $ 583.1

ACCOUNTS RECEIVABLE SALES AGREEMENTS

The Company has accounts receivable sales agreements that permit the sale, on an ongoing basis, of a majority of its wholesale receivables in North America, Europe and Brazil to its U.S., Canadian, European and Brazilian finance joint ventures.

For the three months ended March 31, 2024 and 2023, the cash received from receivables sold under the U.S., Canadian, European and Brazilian accounts receivable sales agreements was approximately $ 2.4 billion and $ 1.7 billion, respectively.

The cash received from receivables sold under the U.S., Canadian, European and Brazilian accounts receivable sales agreements that remain outstanding as of June 30, 2024 and December 31, 2023 was approximately $ 2.4 billion and $ 2.5 billion, respectively.

Under the terms of the accounts receivable sales agreements in the U.S., Canada, Europe and Brazil, the Company pays an annual fee related to the servicing of the receivables sold.

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In addition, the Company sells certain trade receivables under factoring arrangements to other financial institutions around the world.

For the three months ended March 31, 2024 and 2023, the cash received from these arrangements was approximately $ 213.3 million and $ 233.3 million, respectively.

The cash received from trade receivables sold under factoring arrangements that remain outstanding as of

Notes to Condensed Consolidated Financial Statements - Continued

June 30, 2024 and December 31, 2023 was approximately $ 221.4 million and $ 254.1 million, respectively.

Under these arrangements, the Company is required to continue to service the sold receivables at market rates.

The Company does not maintain any direct retained interest in the receivables.

The Company reviewed its accounting for the accounts receivable sales agreements and determined that

receivables sold under these agreements should be accounted for as off-balance sheet transactions.

Losses on sales of receivables associated with the accounts receivable sales agreements discussed above, reflected within “Other expense, net” in the Company’s Condensed Consolidated Statements of Operations, were approximately $ 27.9 million and $ 28.5 million during the three months ended March 31, 2024 and 2023, respectively.

Notes to Condensed Consolidated Financial Statements - Continued

The Company reviewed its accounting for the accounts receivable sales agreements and determined that receivables sold under these agreements should be accounted for as off-balance sheet transactions.

Losses on sales of receivables associated with the accounts receivable sales agreements discussed above, reflected within “Other expense, net” in the Company’s Condensed Consolidated Statements of Operations, were approximately $ 35.9 million and $ 63.8 million during the three and six months ended June 30, 2024, respectively.

Losses on sales of receivables associated with the accounts receivable sales agreements discussed above, reflected within “Other expense, net” in the Company’s Condensed Consolidated Statements of Operations, were approximately and $ 30.3 million and $ 58.8 million during the three and six months ended June 30, 2023, respectively.

The Company’s finance joint ventures in Europe, Brazil and Australia also provide wholesale financing directly to the Company’s dealers.

As of March 31, 2024 and December 31, 2023, these finance joint ventures had approximately $ 218.6 million and $ 211.3 million, respectively, of outstanding accounts receivable associated with these arrangements.

As of June 30, 2024 and December 31, 2023, these finance joint ventures had approximately $ 187.7 million and $ 211.3 million, respectively, of outstanding accounts receivable associated with these arrangements.

In certain foreign countries, the Company invoices its finance joint ventures directly and the finance joint ventures retain a form of title to the goods delivered to dealers until the dealer makes payment so that the finance joint ventures can recover the goods in the event of dealer or end customer default on payment.

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GOODWILL AND OTHER INTANGIBLE ASSETS

Changes in the carrying amount of goodwill during the three months ended March 31, 2024 are summarized as follows (in millions):

North America South America Europe/Middle East Asia/Pacific/Africa Consolidated

Changes in the carrying amount of goodwill during the six months ended June 30, 2024 are summarized as follows (in millions):

North America South America Europe/Middle East Asia/Pacific/Africa Unallocated (1)

Balance as of December 31, 2023 $ 668.2 $ 93.5 $ 458.5 $ 113.2 $ — $ 1,333.4

Acquisitions — — 8.7 — 1,803.3 1,812.0

Reclassified to held for sale (2)

( 524.0 ) ( 12.8 ) ( 61.1 ) ( 110.3 ) — ( 708.2 )

Foreign currency translation ( 1.4 ) ( 11.8 ) ( 13.0 ) ( 2.9 ) ( 0.3 ) ( 29.4 )

Balance as of March 31, 2024 $ 667.3 $ 90.5 $ 457.2 $ 110.8 $ 1,325.8

Balance as of June 30, 2024 $ 142.8 $ 68.9 $ 393.1 $ — $ 1,803.0 $ 2,407.8

____________________________________

(1) Unallocated goodwill relates to the PTx Trimble joint venture transaction.

Refer to Note 2 for additional information.

(2) Reclassification resulting from the Company's classification of the G&P business as held for sale, $ 494.6 million is included within “Loss on business held for sale” in the Company’s Condensed Consolidated Statements of Operations and $ 213.6 million is included within “Assets held for sale” in the Company’s Condensed Consolidated Balance Sheets.

Refer to Note 3 for additional information.

Goodwill is tested for impairment on an annual basis and more often if indications of impairment exist.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements - Continued

Changes in the carrying amount of acquired intangible assets during the three months ended March 31, 2024 are summarized as follows (in millions):

Changes in the carrying amount of acquired intangible assets during the six months ended June 30, 2024 are summarized as follows (in millions):

Gross carrying amounts:

Trademarks and Trade Names Customer Relationships Patents and Technology Land Use Rights Total

Trademarks and Trade Names Customer Relationships Patents and Technology Other

Balance as of December 31, 2023 $ 194.3 $ 580.7 $ 148.2 $ 6.3 $ 929.5

Acquisitions 10.7 39.4 453.0 41.9 545.0

Reclassified to held for sale (1)

( 122.0 ) ( 417.3 ) ( 58.7 ) — ( 598.0 )

Foreign currency translation ( 3.5 ) ( 11.6 ) ( 6.6 ) ( 0.1 ) ( 21.8 )

Balance as of March 31, 2024 $ 192.5 $ 576.2 $ 146.1 $ 6.2 $ 921.0

Balance as of June 30, 2024 $ 79.5 $ 191.2 $ 535.9 $ 48.1 $ 854.7

Accumulated amortization:

Trademarks and Trade Names Customer Relationships Patents and Technology Land Use Rights Total

Trademarks and Trade Names Customer Relationships Patents and Technology Other

Balance as of December 31, 2023 $ 114.5 $ 483.4 $ 113.3 $ 1.7 $ 712.9

Amortization expense 5.5 31.6 5.0 3.5 45.6

Reclassified to held for sale (1)

( 73.9 ) ( 367.4 ) ( 48.9 ) — ( 490.2 )

Foreign currency translation ( 2.2 ) ( 23.1 ) 7.6 ( 0.1 ) ( 17.8 )

Balance as of March 31, 2024 $ 116.1 $ 488.8 $ 113.7 $ 1.6 $ 720.2

Balance as of June 30, 2024 $ 43.9 $ 124.5 $ 77.0 $ 5.1 $ 250.5

Indefinite-lived intangible assets:

2 unchanged sentences

Foreign currency translation ( 1.1 )

Balance as of March 31, 2024 $ 85.0

The Company amortizes certain acquired identifiable intangible assets primarily on a straight-line basis over their estimated useful lives, which range from four to 50 years.

Amortization expense related to acquired intangible assets was $ 13.9 million and $ 14.8 million for the three months ended March 31, 2024 and 2023, respectively.

Inventories, net at March 31, 2024 and December 31, 2023 were as follows (in millions):

March 31, 2024 December 31, 2023

Balance as of June 30, 2024 $ 84.8

____________________________________

(1) Reclassification resulting from the Company's classification of the G&P business as held for sale.

Refer to Note 3 for additional information.

The Company amortizes certain acquired identifiable intangible assets primarily on a straight-line basis over their estimated useful lives, which range from one to 50 years.

External-use software, net, developed by the Company and marketed externally, was approximately $ 0.9 million and $ 6.3 million as of June 30, 2024 and December 31, 2023, respectively, and classified within “Intangible assets, net.” As of June 30, 2024, $ 4.5 million of external-use software, net was reclassified to held for sale.

Inventories, net at June 30, 2024 and December 31, 2023, excluding amounts classified as held for sale, were as follows (in millions):

June 30, 2024 December 31, 2023

Finished goods $ 1,605.1 $ 1,460.7

3 unchanged sentences

Inventories, net $ 3,499.4 $ 3,440.7

At March 31, 2024 and December 31, 2023, the Company had recorded $ 247.7 million and $ 238.9 million respectively, as a reserve for surplus and obsolete inventories.

At June 30, 2024 and December 31, 2023, the Company had recorded $ 261.0 million and $ 238.9 million respectively, as a reserve for surplus and obsolete inventories.

These reserves are reflected within "Inventories, net" within the Company's Condensed Consolidated Balance Sheets.

1 unchanged sentence

PRODUCT WARRANTY

The warranty reserve activity for the three months ended March 31, 2024 and 2023, including deferred revenue associated with the Company's extended warranties that have been sold, was as follows (in millions):

Three Months Ended March 31,

The warranty reserve activity for the three and six months ended June 30, 2024 and 2023, including deferred revenue associated with the Company's extended warranties that have been sold, was as follows (in millions):

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Balance at beginning of period $ 793.1 $ 677.0 $ 800.8 $ 640.0

Accruals for warranties issued

93.8 107.8 185.9 197.5

Settlements made and deferred revenue recognized

( 93.6 ) ( 63.4 ) ( 175.6 ) ( 127.9 )

Reclassified to held for sale (1)

( 11.6 ) — ( 11.6 ) —

Foreign currency translation ( 11.2 ) 5.8 ( 29.0 ) 17.6

Balance at March 31 $ 793.1 $ 677.0

Balance at June 30 $ 774.6 $ 727.2 $ 774.6 $ 727.2

____________________________________

(1) Reclassification resulting from the Company's classification of the G&P business as held for sale.

Refer to Note 3 for additional information.

The Company’s agricultural equipment products generally are warranted against defects in material and workmanship for a period of one to four years .

2 unchanged sentences

Revenue is recognized for the extended warranty contracts on a straight-line basis, which the Company believes approximates the cost expected to be incurred in satisfying the obligations, over the extended warranty period.

Approximately $ 661.9 million, $ 679.9 million and $ 572.1 million of warranty reserves are included in “Accrued expenses” in the Company’s Condensed Consolidated Balance Sheets as of March 31, 2024, December 31, 2023 and March 31, 2023, respectively.

Approximately $ 131.2 million, $ 120.9 million and $ 104.9 million of warranty reserves are included in “Other noncurrent liabilities” in the Company’s Condensed Consolidated Balance Sheets as of March 31, 2024, December 31, 2023, and March 31, 2023, respectively.

Approximately $ 635.6 million, $ 679.9 million and $ 613.6 million of warranty reserves are included in “Accrued expenses” in the Company’s Condensed Consolidated Balance Sheets as of June 30, 2024, December 31, 2023 and June 30, 2023, respectively.

Approximately $ 139.0 million, $ 120.9 million and $ 113.6 million of warranty reserves are included in “Other noncurrent liabilities” in the Company’s Condensed Consolidated Balance Sheets as of June 30, 2024, December 31, 2023, and June 30, 2023, respectively.

The Company recognizes potential recoveries of the costs associated with warranties it provides when the collection is probable.

When specifics of the recovery have been agreed upon with the Company’s suppliers through the confirmation of liability for the recovery, the Company records the recovery within “Accounts and notes receivable, net.” Estimates of the amount of warranty claim recoveries to be received from the Company’s suppliers based upon contractual supplier arrangements are recorded within “Other current assets.”

Estimates of the amount of warranty claim recoveries to be received from the Company’s suppliers based upon contractual supplier arrangements are recorded within “Other current assets” in the Company's Condensed Consolidated Balance Sheets.

SUPPLIER FINANCE PROGRAMS

6 unchanged sentences

The Company has no economic interest in a supplier’s decision to participate in the programs, and the Company has no direct financial relationship with the banks or other intermediaries as it relates to the supplier finance programs.

As of March 31, 2024, payment terms with the majority of the Company’s suppliers are generally 30 to 180 days, which correspond to the contractual terms, with rates that are based on market rates (such as SOFR) plus a credit spread.

As of June 30, 2024, payment terms with the majority of the Company’s suppliers are generally 30 to 180 days, which correspond to the contractual terms, with rates that are based on market rates (such as SOFR) plus a credit spread.

There are no assets pledged as security under the programs.

As of March 31, 2024 and December 31, 2023, the amounts outstanding that remain unpaid to the banks or other intermediaries totaled $ 87.5 million and $ 82.7 million, respectively, and are reflected in “Accounts payable” in the Company’s Condensed Consolidated Balance Sheets.

As of June 30, 2024 and December 31, 2023, the amounts outstanding that remain unpaid to the banks or other intermediaries totaled $ 92.9 million and $ 82.7 million, respectively, and are reflected in “Accounts payable” in the Company’s Condensed Consolidated Balance Sheets.

Notes to Condensed Consolidated Financial Statements - Continued

Long-term debt consisted of the following at March 31, 2024 and December 31, 2023 (in millions):

March 31, 2024 December 31, 2023

Long-term debt, excluding amounts classified as held for sale, consisted of the following at June 30, 2024 and December 31, 2023 (in millions):

June 30, 2024 December 31, 2023

Credit facility, expires 2027 $ 760.0 $ —

Term Loan Facility borrowings

5.450 % Senior notes due 2027

5.800 % Senior notes due 2034

0.800 % Senior notes due 2028

1.002 % EIB Senior term loan due 2025

2 unchanged sentences

Senior term loans due between 2025 and 2028

0.800 % Senior notes due 2028

5.450 % Senior notes due 2027

5.800 % Senior notes due 2034

Term Loan Facility borrowings

Other long-term debt 1.0 3.1

13 unchanged sentences

Interest accrues on amounts outstanding for any borrowings denominated in Euros at the Euro Interbank Offered Rate (“EURIBOR”) plus a margin ranging from 0.875 % to 1.875 % based on the Company’s credit rating.

As of March 31, 2024, the Company had $ 580.0 million in outstanding borrowings under the revolving credit facility and had the ability to borrow $ 670.0 million.

As of June 30, 2024, the Company had $ 760.0 million in outstanding borrowings under the revolving credit facility and had the ability to borrow $ 489.9 million.

In December 2023, the Company amended the Credit Facility to allow for incremental borrowings in the form of a delayed draw term loan facility in an aggregate principal amount of $ 250.0 million.

In March 2024, the Company further amended the Credit Facility to increase this amount by $ 250.0 million, for an aggregate amount of $ 500.0 million (“Term Loan Facility”).

The Company drew down the facility on March 28, 2024.

The Company drew down the Term Loan Facility on March 28, 2024.

Borrowings under the Term Loan Facility bear interest at the same rate and margin as the Credit Facility.

The Term Loan Facility matures on December 19, 2027.

As of March 31, 2024, the Company had $ 500.0 million outstanding under the Term Loan Facility.

As of June 30, 2024, the Company had $ 500.0 million outstanding under the Term Loan Facility.

Notes to Condensed Consolidated Financial Statements - Continued

Uncommitted Credit Facility

In June 2022, the Company entered into an uncommitted revolving credit facility that allows the Company to borrow up to € 100.0 million (or approximately $ 107.9 million as of March 31, 2024).

In June 2022, the Company entered into an uncommitted revolving credit facility that allows the Company to borrow up to € 100.0 million (or approximately $ 107.0 million as of June 30, 2024).

The credit facility expires on December 31, 2026.

Notes to Condensed Consolidated Financial Statements - Continued

Any loans will bear interest at the EURIBOR plus a credit spread.

As of March 31, 2024 and December 31, 2023, the Company had no outstanding borrowings under the revolving credit facility and had the ability to borrow € 100.0 million (or approximately $ 107.9 million).

As of June 30, 2024 and December 31, 2023, the Company had no outstanding borrowings under the revolving credit facility and had the ability to borrow € 100.0 million (or approximately $ 107.0 million).

5.450 % Senior Notes due 2027 and 5.800 % Senior Notes due 2034

8 unchanged sentences

0.800 % Senior Notes due 2028

On October 6, 2021, the Company issued € 600.0 million (or approximately $ 647.2 million as of March 31, 2024) of senior notes at an issue price of 99.993 %.

On October 6, 2021, the Company issued € 600.0 million (or approximately $ 642.0 million as of June 30, 2024) of senior notes at an issue price of 99.993 %.

The notes mature on October 6, 2028, and interest is payable annually, in arrears, at 0.800 %.

2 unchanged sentences

1.002 % European Investment Bank ("EIB") Senior Term Loan due 2025

On January 25, 2019, the Company borrowed € 250.0 million (or approximately $ 269.7 million as of March 31, 2024) from the EIB.

On January 25, 2019, the Company borrowed € 250.0 million (or approximately $ 267.5 million as of June 30, 2024) from the EIB.

The loan matures on January 24, 2025.

3 unchanged sentences

On September 29, 2023, the Company entered into a multi-currency Finance Contract with the EIB permitting the Company to borrow up to € 250.0 million to fund up to 50 % of certain investments in research, development and innovation primarily in Germany, France and Finland during the period from 2023 through 2026.

On October 26, 2023, the Company borrowed € 250.0 million (or approximately $ 269.7 million as of March 31, 2024) under the arrangement.

On October 26, 2023, the Company borrowed € 250.0 million (or approximately $ 267.5 million as of June 30, 2024) under the arrangement.

The loan matures on October 26, 2029.

4 unchanged sentences

On January 25, 2024, the Company entered into an additional multi-currency Finance Contract with the EIB permitting the Company to borrow up to € 170.0 million, for which the proceeds will be used in a similar manner as described for the EIB Senior Term Loan due 2029 above.

On February 15, 2024, the Company borrowed € 170.0 million (or approximately $ 183.4 million as of March 31, 2024) under the arrangement.

On February 15, 2024, the Company borrowed € 170.0 million (or approximately $ 181.9 million as of June 30, 2024) under the arrangement.

The loan matures on February 15, 2030.

6 unchanged sentences

Of the 2018 senior term loans, the Company repaid an aggregate amount of € 244.0 million in August 2021, February 2022 and August 2023.

In aggregate, as of March 31, 2024, the Company had indebtedness of € 146.5 million (or approximately $ 158.0 million as of March 31, 2024) through a group of four remaining related term loan agreements.

In aggregate, as of June 30, 2024, the Company had indebtedness of € 146.5 million (or approximately $ 156.8 million as of June 30, 2024) through a group of four remaining related term loan agreements.

The provisions of the term loan agreements are substantially identical, with the exception of interest rate terms and maturities.

As of March 31, 2024, for the term loans with a fixed interest rate, interest is payable in arrears on an annual basis, with interest rates ranging from 1.67 % to 2.26 % and maturity dates between August 2025 and August 2028.

As of June 30, 2024, for the term loans with a fixed interest rate, interest is payable in arrears on an annual basis, with interest rates ranging from 1.67 % to 2.26 % and maturity dates between August 2025 and August 2028.

For the term loan with a floating interest rate, interest is payable in arrears on a semi-annual basis, with an interest rate based on the EURIBOR plus a margin of 1.10 % and a maturity date of August 2025.

Bridge Facility

As discussed in Note 2, on September 28, 2023, the Company entered into a bridge facility commitment letter with Morgan Stanley pursuant to which Morgan Stanley committed to provide a $ 2.0 billion senior unsecured 364-day bridge facility (the "Bridge Facility").

On September 28, 2023, the Company entered into a bridge facility commitment letter with Morgan Stanley pursuant to which Morgan Stanley committed to provide a $ 2.0 billion senior unsecured 364-day bridge facility (the "Bridge Facility").

The availability under the Bridge Facility was reduced to zero by certain permanent financing transactions including the net proceeds from the issuance of the Notes, the Company's entry into the Term Loan Facility and by amounts based on the Company's cash flow, and the Company terminated the Bridge Facility on March 25, 2024.

Other Short-Term Borrowings

As of March 31, 2024 and December 31, 2023, the Company had short-term borrowings due within one year, excluding the current portion of long-term debt, of approximately $ 28.7 million and $ 12.7 million, respectively.

As of June 30, 2024 and December 31, 2023, the Company had short-term borrowings due within one year, excluding the current portion of long-term debt, of approximately $ 51.7 million and $ 12.7 million, respectively.

Standby Letters of Credit and Similar Instruments

The Company has arrangements with various banks to issue standby letters of credit or similar instruments, which guarantee the Company’s obligations for the purchase or sale of certain inventories and for potential claims exposure for insurance coverage.

At March 31, 2024 and December 31, 2023, outstanding letters of credit totaled approximately $ 14.7 million and $ 14.7 million, respectively.

RECOVERABLE INDIRECT TAXES

The Company’s Brazilian operations incur value added taxes (“VAT”) on certain purchases of raw materials, components and services.

These taxes are accumulated as tax credits and create assets that are reduced by the VAT collected from the Company’s sales in the Brazilian market.

The Company regularly assesses the recoverability of these tax credits and establishes reserves when necessary against them, through analyses that include, amongst others, the history of realization, the transfer of tax credits to third parties as authorized by the government, anticipated changes in the supply chain and the future expectation of tax debits from the Company’s ongoing operations.

The Company believes that these tax credits, net of established reserves, are realizable.

The Company had recorded approximately $ 93.9 million and $ 93.5 million, respectively, of VAT tax credits, net of reserves, as of March 31, 2024 and December 31, 2023.

At June 30, 2024 and December 31, 2023, outstanding letters of credit totaled approximately $ 14.7 million and $ 14.7 million, respectively.

RESTRUCTURING EXPENSES

On June 24, 2024, the Company announced a restructuring program (the “Program”) in response to increased weakening demand in the agriculture industry.

The initial phase of the Program is focused on further reducing structural costs, streamlining the Company’s workforce and enhancing global efficiencies related to changing the Company’s operating model for certain corporate and back-office functions and better leveraging technology and global centers of excellence.

The Company estimates that it will incur charges for one-time termination benefits of approximately $ 150.0 million to $ 200.0 million in connection with this phase of the Program, primarily consisting of cash charges related to severance payments, employees benefits and related costs.

The Company expects the majority of these cash charges will be incurred in 2024 and the first half of 2025.

Notes to Condensed Consolidated Financial Statements - Continued

Additionally, in recent years, the Company announced and initiated several actions to rationalize employee headcount in various manufacturing facilities and administrative offices located in the U.S., Europe, South America, Africa and Asia, in order to reduce costs in response to fluctuating global market demand.

Restructuring expenses activity, which relates to severance and other related costs, during the three and six months ended June 30, 2024 is summarized as follows (in millions):

Balance as of December 31, 2023 $ 7.8

First quarter 2024 provision 1.1

First quarter 2024 cash activity ( 3.4 )

Foreign currency translation ( 0.2 )

Balance as of March 31, 2024 $ 5.3

Second quarter 2024 provision 30.5

Second quarter 2024 provision reversal ( 0.4 )

Second quarter 2024 cash activity ( 2.1 )

Reclassified to held for sale (1)

Foreign currency translation ( 0.3 )

Balance as of June 30, 2024 $ 32.6

____________________________________

(1) Reclassification resulting from the Company's classification of the G&P business as held for sale.

Refer to Note 3 for additional information.

Notes to Condensed Consolidated Financial Statements - Continued

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

6 unchanged sentences

The Company designates certain foreign currency contracts as cash flow hedges of expected future sales and purchases.

The total notional value of derivatives that were designated as cash flow hedges was approximately $ 494.5 million and $ 262.2 million as of March 31, 2024 and December 31, 2023, respectively.

The total notional value of derivatives that were designated as cash flow hedges was approximately $ 386.6 million and $ 262.2 million as of June 30, 2024 and December 31, 2023, respectively.

Steel Commodity Contracts

The Company designates certain steel commodity contracts as cash flow hedges of expected future purchases of steel.

The total notional value of derivatives that were designated as cash flow hedges was approximately $ 1.6 million and $ 2.5 million as of March 31, 2024 and December 31, 2023, respectively.

The total notional value of derivatives that were designated as cash flow hedges was approximately $ 0.1 million and $ 2.5 million as of June 30, 2024 and December 31, 2023, respectively.

Interest Rate Risk

4 unchanged sentences

Notes to Condensed Consolidated Financial Statements - Continued

The following tables summarize the after-tax impact that changes in the fair value of derivatives designated as cash flow hedges had on accumulated other comprehensive loss and net income during the three months ended March 31, 2024 and 2023 (in millions):

Recognized in Net Income

Three Months Ended March 31, Gain (Loss) Recognized in Accumulated

The following tables summarize the after-tax impact that changes in the fair value of derivatives designated as cash flow hedges had on accumulated other comprehensive loss and net income (loss) during the three and six months ended June 30, 2024 and 2023 (in millions):

Recognized in Net Income (Loss)

Three Months Ended June 30, Gain (Loss) Recognized in Accumulated

Other Comprehensive Loss

12 unchanged sentences

Total $ ( 5.7 ) $ ( 1.2 )

Recognized in Net Income (Loss)

Six Months Ended June 30, Gain (Loss) Recognized in Accumulated

Other Comprehensive Loss Classification of Gain (Loss) Gain (Loss) Reclassified from Accumulated

Other Comprehensive Loss into Income

Total Amount of the Line Item in the Condensed Consolidated Statements of Operations Containing Hedge Gains (Losses)

Foreign currency contracts (1)

$ ( 4.7 ) Cost of goods sold $ ( 3.8 ) $ 4,568.0

Commodity contracts (2)

( 0.3 ) Cost of goods sold ( 0.2 ) $ 4,568.0

Treasury rate locks 6.1 Interest expense, net 0.2 $ 31.8

Total $ 1.1 $ ( 3.8 )

Foreign currency contracts $ ( 6.9 ) Cost of goods sold $ ( 2.6 ) $ 5,295.6

Commodity contracts 0.2 Cost of goods sold ( 0.1 ) $ 5,295.6

Total $ ( 6.7 ) $ ( 2.7 )

____________________________________

(1) The outstanding contracts as of March 31, 2024 range in maturity through December 2024.

(2) The outstanding contracts as of March 31, 2024 range in maturity through June 2024.

The following table summarizes the activity in accumulated other comprehensive loss related to the derivatives held by the Company during the three months ended March 31, 2024 (in millions):

(1) The outstanding contracts as of June 30, 2024 range in maturity through December 2024.

(2) As of June 30, 2024, there were no outstanding contracts with future maturity dates.

Notes to Condensed Consolidated Financial Statements - Continued

The following table summarizes the activity in accumulated other comprehensive loss related to the derivatives held by the Company during the three months ended June 30, 2024 (in millions):

Before-Tax Amount Income Tax Expense (Benefit) After-Tax Amount

Accumulated derivative net gains as of March 31, 2024 $ 8.1 $ 2.0 $ 6.1

Net changes in fair value of derivatives ( 2.8 ) 0.7 ( 3.5 )

Net losses reclassified from accumulated other comprehensive loss into income 1.5 — 1.5

Accumulated derivative net gains as of June 30, 2024 $ 6.8 $ 2.7 $ 4.1

The following table summarizes the activity in accumulated other comprehensive loss related to the derivatives held by the Company during the six months ended June 30, 2024 (in millions):

Before-Tax Amount Income Tax Expense (Benefit) After-Tax Amount

Accumulated derivative net losses as of December 31, 2023 $ ( 1.3 ) $ ( 0.5 ) $ ( 0.8 )

$ ( 1.3 ) $ ( 0.5 ) $ ( 0.8 )

Net changes in fair value of derivatives 4.0 2.9 1.1

Net losses reclassified from accumulated other comprehensive loss into income 4.1 0.3 3.8

Accumulated derivative net gains as of March 31, 2024

$ 8.1 $ 2.0 $ 6.1

As of March 31, 2024, approximately $ 0.6 million and $ 0.1 million of derivative realized net losses, before taxes, remain in accumulated other comprehensive loss related to foreign currency contracts and commodity contracts, respectively, associated with inventory that had not yet been sold.

Accumulated derivative net gains as of June 30, 2024 $ 6.8 $ 2.7 $ 4.1

As of June 30, 2024, approximately $ 0.9 million gain and $ 0.1 million loss of realized derivatives, before taxes, remain in accumulated other comprehensive loss related to foreign currency contracts and commodity contracts, respectively, associated with inventory that had not yet been sold.

Net Investment Hedges

3 unchanged sentences

To the extent foreign currency denominated debt is de-designated from a net investment hedge relationship, changes in the value of the foreign currency denominated debt are recorded in earnings through the maturity date.

Notes to Condensed Consolidated Financial Statements - Continued

On January 29, 2021, the Company entered into a cross currency swap contract as a hedge of its net investment in foreign operations to offset foreign currency translation gains or losses on the net investment.

The cross currency swap has an expiration date of January 29, 2028.

At maturity of the cross currency swap contract, the Company will deliver the notional amount of approximately € 247.9 million (or approximately $ 267.4 million as of March 31, 2024) and will receive $ 300.0 million from the counterparties.

At maturity of the cross currency swap contract, the Company will deliver the notional amount of approximately € 247.9 million (or approximately $ 265.3 million as of June 30, 2024) and will receive $ 300.0 million from the counterparties.

The Company will receive quarterly interest payments from the counterparties based on a fixed interest rate until the maturity of the cross currency swap.

During the three months ended March 31, 2023, the Company designated € 150.0 million of its multi-currency revolving credit facility maturing December 2027 as a hedge of its net investment in foreign operations to offset foreign currency translation gains or losses on the net investment.

During the six months ended June 30, 2023, the Company designated € 150.0 million of its multi-currency revolving credit facility maturing December 2027 as a hedge of its net investment in foreign operations to offset foreign currency translation gains or losses on the net investment.

This portion of the multi-currency revolving credit facility was repaid in December 2023.

The Company recognized the change in fair value of the foreign currency denominated debt designated as a net investment hedge, a gain of $ 0.9 million, net of tax, in accumulated other comprehensive loss during the three months ended March 31, 2023.

The Company recognized the change in fair value of the foreign currency denominated debt designated as a net investment hedge, a gain of $ 0.1 million and $ 1.0 million, net of tax, in accumulated other comprehensive loss during the three and six months ended June 30, 2023, respectively.

Notes to Condensed Consolidated Financial Statements - Continued

The following table summarizes the notional values of the instrument designated as a net investment hedge (in millions):

Notional Amount as of

March 31, 2024 December 31, 2023

Cross currency swap contract $ 300.0 $ 300.0

The following table summarizes the changes in the fair value of the cross currency swap contract designated as a net investment hedge during the three months ended March 31, 2024 and 2023 (in millions):

June 30, 2024 December 31, 2023

Cross currency swap contract $ 300.0 $ 300.0

Gain (Loss) Recognized in Accumulated Other Comprehensive Loss for the Three Months Ended

The following table summarizes the changes in the fair value of the cross currency swap contract designated as a net investment hedge during the three and six months ended June 30, 2024 and 2023 (in millions):

Gain (Loss) Recognized in Accumulated Other Comprehensive Loss for the

Three Months Ended Gain (Loss) Recognized in Accumulated

Other Comprehensive Loss for the Six Months Ended

Before-Tax Amount Income Tax Expense (Benefit)

After-Tax Amount Before-Tax Amount Income Tax Expense (Benefit)

After-Tax Amount

March 31, 2024 $ 4.7 $ 1.2 $ 3.5

March 31, 2023 ( 1.0 ) ( 0.2 ) ( 0.8 )

June 30, 2024 $ 3.4 $ 0.8 $ 2.6 $ 8.1 $ 2.0 $ 6.1

June 30, 2023 ( 5.7 ) ( 1.5 ) ( 4.2 ) ( 6.7 ) ( 1.7 ) ( 5.0 )

Derivative Transactions Not Designated as Hedging Instruments

2 unchanged sentences

Gains and losses on such contracts are substantially offset by losses and gains on the remeasurement of the underlying asset or liability being hedged and are immediately recognized into earnings.

As of March 31, 2024 and December 31, 2023, the Company had outstanding foreign currency contracts with a notional amount of approximately $ 2,545.2 million and $ 3,125.1 million, respectively.

As of June 30, 2024 and December 31, 2023, the Company had outstanding foreign currency contracts with a notional amount of approximately $ 2,645.5 million and $ 3,125.1 million, respectively.

The following table summarizes the results on net income of derivatives not designated as hedging instruments (in millions):

Gain (Loss) Recognized in Net Income for the Three Months Ended

Gain (Loss) Recognized in Net Income for the Six Months Ended

Classification of Gain (Loss)

March 31, 2024 March 31, 2023

June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Foreign currency contracts Other expense, net $ ( 33.5 ) $ 37.9 $ ( 41.8 ) $ 49.1

Notes to Condensed Consolidated Financial Statements - Continued

The table below sets forth the fair value of derivative instruments as of March 31, 2024 (in millions):

The table below sets forth the fair value of derivative instruments as of June 30, 2024 (in millions):

Asset Derivatives as of

March 31, 2024 Liability Derivatives as of

March 31, 2024

June 30, 2024 Liability Derivatives as of

June 30, 2024

Balance Sheet Location Fair Value Balance Sheet Location Fair Value

1 unchanged sentence

Foreign currency contracts Other current assets $ 4.4 Other current liabilities $ 6.2

Commodity contracts Other current assets — Other current liabilities 0.2

Cross currency swap contract Other noncurrent assets 28.4 Other noncurrent liabilities —

2 unchanged sentences

Other current assets 2.1 Other current liabilities 10.8

Foreign currency contracts Current assets held for sale 0.2 Current liabilities held for sale 0.1

Total derivative instruments $ 35.1 $ 17.1

__________________________________

(1) The outstanding contracts as of March 31, 2024 range in maturity through August 2024.

(1) The outstanding contracts as of June 30, 2024 range in maturity through August 2024.

The table below sets forth the fair value of derivative instruments as of December 31, 2023 (in millions):

5 unchanged sentences

Foreign currency contracts Other current assets $ 1.3 Other current liabilities $ 1.2

Commodity contracts Other current assets — Other current liabilities —

Cross currency swap contract Other noncurrent assets 20.3 Other noncurrent liabilities —

7 unchanged sentences

STOCKHOLDERS’ EQUITY

The following tables set forth changes in stockholders’ equity attributed to AGCO Corporation and its subsidiaries and to noncontrolling interests for the three months ended March 31, 2024 and 2023 (in millions):

The following tables set forth changes in stockholders’ equity attributed to AGCO Corporation and its subsidiaries and to noncontrolling interests for the three and six months ended June 30, 2024 and 2023 (in millions):

Redeemable Noncontrolling Interests

Stock Additional

3 unchanged sentences

Interests Total Stockholders’

Balance, March 31, 2024 $ — $ 0.7 $ — $ 6,505.9 $ ( 1,751.5 ) $ 0.1 $ 4,755.2

Stock compensation — — 6.4 — — — 6.4

Issuance of stock awards

— — ( 0.3 ) 0.1 — — ( 0.2 )

Comprehensive income:

( 1.8 ) — — ( 367.1 ) — — ( 367.1 )

Other comprehensive income (loss):

Foreign currency translation adjustments

( 1.0 ) — — — ( 135.1 ) — ( 135.1 )

Defined benefit pension plans, net of tax — — — — 1.9 — 1.9

Deferred gains and losses on derivatives, net of tax

— — — — ( 2.0 ) — ( 2.0 )

Payment of dividends to stockholders — — — ( 208.3 ) — — ( 208.3 )

Equity transaction associated with

JCA noncontrolling interest (Note 2)

— — 3.1 — — — 3.1

Initial fair value of redeemable noncontrolling interests (Note 2)

499.4 — — — — — —

Investment by redeemable noncontrolling interest (Note 2)

8.1 — — — — — —

Balance, June 30, 2024 $ 504.7 $ 0.7 $ 9.2 $ 5,930.6 $ ( 1,886.7 ) $ 0.1 $ 4,053.9

Notes to Condensed Consolidated Financial Statements - Continued

Redeemable Noncontrolling Interests

Paid-in Capital

Accumulated Other

Comprehensive Loss

Noncontrolling

Total Stockholders’

Balance, December 31, 2023 $ — $ 0.7 $ 4.1 $ 6,360.0 $ ( 1,708.1 ) $ 0.1 $ 4,656.8

1 unchanged sentence

Issuance of stock awards — — ( 12.7 ) ( 0.4 ) — — ( 13.1 )

SSARs exercised — — ( 0.1 ) — — — ( 0.1 )

Comprehensive income:

( 1.8 ) — — ( 199.1 ) — — ( 199.1 )

Other comprehensive income (loss):

Foreign currency translation adjustments ( 1.0 ) — — — ( 187.1 ) — ( 187.1 )

Defined benefit pension plans, net of tax — — — — 3.6 — 3.6

Deferred gains and losses on derivatives, net of tax — — — — 4.9 — 4.9

Payment of dividends to stockholders — — — ( 229.9 ) — — ( 229.9 )

Equity transaction associated with JCA noncontrolling interest (Note 2)

— — 3.1 — — — 3.1

Initial fair value of redeemable noncontrolling interests (Note 2)

499.4 — — — — — —

Investment by redeemable noncontrolling interest (Note 2)

8.1 — — — — — —

Balance, June 30, 2024 $ 504.7 $ 0.7 $ 9.2 $ 5,930.6 $ ( 1,886.7 ) $ 0.1 $ 4,053.9

Notes to Condensed Consolidated Financial Statements - Continued

Stock Additional

Paid-in Capital Retained

Earnings Accumulated Other

Comprehensive Loss Noncontrolling

Interests Total Stockholders’

Balance, March 31, 2023 $ 0.7 $ 24.7 $ 5,863.7 $ ( 1,756.4 ) $ 0.2 $ 4,132.9

Stock compensation — 13.3 — — — 13.3

Issuance of stock awards

— ( 1.8 ) — — — ( 1.8 )

SSARs exercised — ( 0.1 ) — — — ( 0.1 )

1 unchanged sentence

— — 319.2 — — 319.2

Other comprehensive (loss) income:

Other comprehensive income (loss):

Foreign currency translation adjustments

1 unchanged sentence

Defined benefit pension plans, net of tax

— — — 1.9 — 1.9

Deferred gains and losses on derivatives, net of tax

1 unchanged sentence

Payment of dividends to stockholders

Balance, March 31, 2024 $ 0.7 $ — $ 6,505.9 $ ( 1,751.5 ) $ 0.1 $ 4,755.2

— — ( 396.1 ) — — ( 396.1 )

Balance, June 30, 2023 $ 0.7 $ 36.1 $ 5,786.8 $ ( 1,684.8 ) $ 0.2 $ 4,139.0

Stock Additional

9 unchanged sentences

Comprehensive income:

— — 232.6 — — 232.6

Other comprehensive income:

Net income — — 551.8 — — 551.8

Other comprehensive income (loss):

Foreign currency translation adjustments

7 unchanged sentences

Adoption of ASU 2016-13 by finance joint ventures — — ( 5.5 ) — — ( 5.5 )

— — ( 5.5 ) — — ( 5.5 )

Balance, March 31, 2023 $ 0.7 $ 24.7 $ 5,863.7 $ ( 1,756.4 ) $ 0.2 $ 4,132.9

Balance, June 30, 2023 $ 0.7 $ 36.1 $ 5,786.8 $ ( 1,684.8 ) $ 0.2 $ 4,139.0

Notes to Condensed Consolidated Financial Statements - Continued

The Company had no comprehensive loss attributable to noncontrolling interests recorded for the three months ended March 31, 2024 and 2023.

The following table sets forth changes in accumulated other comprehensive loss by component, net of tax, attributed to AGCO Corporation and its subsidiaries for the three months ended March 31, 2024 (in millions):

The following table sets forth changes in accumulated other comprehensive loss by component, net of tax, attributed to AGCO Corporation and its subsidiaries for the six months ended June 30, 2024 (in millions):

Defined Benefit Pension Plans Deferred Net (Losses) Gains on Derivatives Cumulative Translation Adjustment Total

6 unchanged sentences

3.6 4.9 ( 187.1 ) ( 178.6 )

Accumulated other comprehensive loss,

March 31, 2024

Accumulated other comprehensive loss, June 30, 2024

$ ( 235.0 ) $ 4.1 $ ( 1,655.8 ) $ ( 1,886.7 )

The following table sets forth reclassification adjustments out of accumulated other comprehensive loss by component attributed to AGCO Corporation and its subsidiaries for the three months ended March 31, 2024 and 2023 (in millions):

The following table sets forth reclassification adjustments out of accumulated other comprehensive loss by component attributed to AGCO Corporation and its subsidiaries for the three and six months ended June 30, 2024 and 2023 (in millions):

Amount Reclassified from Accumulated Other Comprehensive Loss Affected Line Item within the Condensed Consolidated

Statements of Operations

Details about Accumulated Other Comprehensive Loss Components Three Months Ended March 31, 2024 (1)

Three Months Ended March 31, 2023 (1)

Details about Accumulated Other Comprehensive Loss Components Three Months Ended June 30, 2024 (1)

Three Months Ended June 30, 2023 (1)

Net losses on foreign currency contracts $ 1.6 $ 1.3 Cost of goods sold

Net gains on commodity contracts

— ( 0.4 ) Cost of goods sold

Net losses on commodity contracts 0.2 0.5 Cost of goods sold

Net gains on treasury rate locks

( 0.3 ) — Interest expense, net

Reclassification before tax 1.5 1.8

11 unchanged sentences

__________________________________

(1) Losses included within the Condensed Consolidated Statements of Operations for the three months ended March 31, 2024 and 2023, respectively.

(1) Losses included within the Condensed Consolidated Statements of Operations for the three months ended June 30, 2024 and 2023, respectively.

(2) These accumulated other comprehensive loss components are included in the computation of net periodic pension and postretirement benefit cost.

See Note 15 for additional information.

Notes to Condensed Consolidated Financial Statements - Continued

Amount Reclassified from Accumulated Other Comprehensive Loss Affected Line Item within the Condensed Consolidated

Statements of Operations

Details about Accumulated Other Comprehensive Loss Components Six Months Ended June 30, 2024 (1)

Six Months Ended June 30, 2023 (1)

Net losses on foreign currency contracts $ 4.2 $ 3.5 Cost of goods sold

Net losses on commodity contracts 0.2 0.1 Cost of goods sold

Net gains on treasury rate locks

( 0.3 ) — Interest expense, net

Reclassification before tax 4.1 3.6

Income tax benefit

( 0.3 ) ( 0.9 ) Income tax provision

Reclassification net of tax $ 3.8 $ 2.7

Defined benefit pension plans:

Amortization of net actuarial losses $ 4.4 $ 4.2 Other expense, net (2)

Amortization of prior service cost 0.8 0.8 Other expense, net (2)

Reclassification before tax 5.2 5.0

Income tax benefit

( 1.6 ) ( 1.3 ) Income tax provision

Reclassification net of tax $ 3.6 $ 3.7

Net losses reclassified from accumulated other comprehensive loss $ 7.4 $ 6.4

__________________________________

(1) Losses included within the Condensed Consolidated Statements of Operations for the six months ended June 30, 2024 and 2023, respectively.

(2) These accumulated other comprehensive loss components are included in the computation of net periodic pension and postretirement benefit cost.

See Note 15 for additional information.

Share Repurchase Program

3 unchanged sentences

All shares received under the ASR agreement were retired upon receipt, and the excess of the purchase price over par value per share was recorded to a combination of “Additional paid-in capital” and “Retained earnings” within the Company’s Condensed Consolidated Balance Sheets.

During the three months

During the three and six months ended June 30, 2024, the Company did no t purchase any shares directly or enter into any accelerated share repurchase agreements.

As of June 30, 2024, the remaining amount authorized to be repurchased under board-approved share repurchase authorizations was approximately $ 57.0 million, which has no expiration date.

On April 25, 2024, the Company's Board of Directors declared a special variable dividend of $ 2.50 per common share that was paid during the second quarter of 2024.

During the three months ended June 30, 2024 and June 30, 2023, the Company declared and paid cash dividends of $ 2.79 and $ 5.28 per common share, respectively.

During the six months ended June 30, 2024 and June 30, 2023, the Company declared and paid cash dividends of $ 3.08 and $ 5.52 per common share, respectively.

On July 11, 2024, the Company's Board of Directors declared a regular quarterly dividend of $ 0.29 per common share to be paid on September 16, 2024, to all stockholders of record as of the close of business on August 15, 2024.

Notes to Condensed Consolidated Financial Statements - Continued

ended March 31, 2024, the Company did no t purchase any shares directly or enter into any accelerated share repurchase agreements.

As of March 31, 2024, the remaining amount authorized to be repurchased under board-approved share repurchase authorizations was approximately $ 57.0 million, which has no expiration date.

During the three months ended March 31, 2024 and March 31, 2023, the Company declared and paid cash dividends of $ 0.29 and $ 0.24 per common share, respectively.

On April 25, 2024, the Company's Board of Directors declared a regular quarterly dividend of $ 0.29 per common share to be paid on June 14, 2024, to all stockholders of record as of the close of business on May 15, 2024.

In addition, on April 25, 2024, the Company's Board of Directors declared a special variable dividend of $ 2.50 per common share that will be paid on June 20, 2024, to all stockholders of record as of the close of business on May 20, 2024.

NET INCOME PER COMMON SHARE

Basic net income per common share is computed by dividing net income by the weighted average number of common shares outstanding during each period.

Diluted net income per common share assumes the exercise of outstanding stock-settled stock appreciation rights ("SSARs") and the vesting of restricted stock unit awards ("RSUs") using the treasury stock method when there is no other circumstance other than the passage of time under which they would not be issued, and the effects of such assumptions are dilutive.

A reconciliation of net income attributable to AGCO Corporation and subsidiaries and weighted average common shares outstanding for purposes of calculating basic and diluted net income per share for the three months ended March 31, 2024 and 2023 is as follows (in millions, except per share data):

Three Months Ended March 31,

Basic net income per share:

Net income attributable to AGCO Corporation and subsidiaries $ 168.0 $ 232.6

NET INCOME (LOSS) PER COMMON SHARE

Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during each period.

Diluted net income (loss) per common share assumes the exercise of outstanding stock-settled stock appreciation rights ("SSARs") and the vesting of restricted stock unit awards ("RSUs") using the treasury stock method when there is no other circumstance other than the passage of time under which they would not be issued, and the effects of such assumptions are dilutive.

A reconciliation of net income attributable to AGCO Corporation and subsidiaries and weighted average common shares outstanding for purposes of calculating basic and diluted net income (loss) per share for the three and six months ended June 30, 2024 and 2023 is as follows (in millions, except per share data):

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Basic net income (loss) per share:

Net income (loss) attributable to AGCO Corporation and subsidiaries

$ ( 367.1 ) $ 319.2 $ ( 199.1 ) $ 551.8

Weighted average number of common shares outstanding 74.6 74.9 74.6 74.9

Basic net income per share attributable to AGCO Corporation and subsidiaries $ 2.25 $ 3.11

Diluted net income per share:

Net income attributable to AGCO Corporation and subsidiaries $ 168.0 $ 232.6

Basic net income (loss) per share attributable to AGCO Corporation and subsidiaries

$ ( 4.92 ) $ 4.26 $ ( 2.67 ) $ 7.37

Diluted net income (loss) per share:

Net income (loss) attributable to AGCO Corporation and subsidiaries

$ ( 367.1 ) $ 319.2 $ ( 199.1 ) $ 551.8

Weighted average number of common shares outstanding 74.6 74.9 74.6 74.9

Dilutive SSARs and RSUs

0.1 0.1 0.1 0.1

Weighted average number of common shares and common share equivalents outstanding for purposes of computing diluted net income per share 74.7 75.0 74.7 75.0

Diluted net income per share attributable to AGCO Corporation and subsidiaries $ 2.25 $ 3.10

At March 31, 2024 and December 31, 2023, the Company had approximately $ 369.7 million and $ 351.2 million, respectively, of gross unrecognized income tax benefits, all of which would affect the Company’s effective tax rate if recognized.

Gross unrecognized income tax benefits as of March 31, 2024 and December 31, 2023 exclude certain indirect favorable effects that relate to other tax jurisdictions of approximately $ 115.8 million and $ 103.9 million, respectively.

In addition, the gross unrecognized income tax benefits as of March 31, 2024 and December 31, 2023 exclude certain deposits made in a foreign jurisdiction of approximately $ 26.2 million, net of $ 19.3 million refunds received, and $ 26.9 million, net of $ 19.7 million refunds received, respectively, associated with an ongoing audit.

At March 31, 2024 and December 31, 2023, the Company had approximately $ 11.2 million and $ 9.9 million, respectively, of accrued or deferred taxes related to uncertain income tax positions connected with ongoing income tax audits in various jurisdictions that it expects to settle or pay in the next 12 months, reflected in “Other current liabilities” in the

Notes to Condensed Consolidated Financial Statements - Continued

Company’s Condensed Consolidated Balance Sheets.

At March 31, 2024 and December 31, 2023, the Company had approximately $ 361.2 million and $ 344.2 million, respectively, of accrued taxes reflected in “Other noncurrent liabilities”, and approximately $ 2.7 million and $ 2.9 million, respectively, of deferred tax assets related to uncertain tax positions that it expects to settle or pay beyond 12 months, reflected in “Deferred tax assets” in the Company’s Condensed Consolidated Balance Sheets.

Diluted net income (loss) per share attributable to AGCO Corporation and subsidiaries

$ ( 4.92 ) $ 4.26 $ ( 2.67 ) $ 7.36

At June 30, 2024 and December 31, 2023, the Company had approximately $ 387.1 million and $ 351.2 million, respectively, of gross unrecognized income tax benefits, all of which would affect the Company’s effective tax rate if recognized.

Gross unrecognized income tax benefits as of June 30, 2024 and December 31, 2023 exclude certain indirect favorable effects that relate to other tax jurisdictions of approximately $ 123.7 million and $ 103.9 million, respectively.

In addition, the gross unrecognized income tax benefits as of June 30, 2024 and December 31, 2023 exclude certain deposits made in a foreign jurisdiction of approximately $ 26.0 million, net of $ 19.1 million refunds received, and $ 26.9 million, net of $ 19.7 million refunds received, respectively, associated with an ongoing audit.

At June 30, 2024 and December 31, 2023, the Company had approximately $ 11.3 million and $ 9.9 million, respectively, of accrued or deferred taxes related to uncertain income tax positions connected with ongoing income tax audits in various jurisdictions that it expects to settle or pay in the next 12 months, reflected in “Other current liabilities” in the Company’s Condensed Consolidated Balance Sheets.

At June 30, 2024 and December 31, 2023, the Company had approximately $ 378.3 million and $ 344.2 million, respectively, of accrued taxes reflected in “Other noncurrent liabilities” in the Company’s Condensed Consolidated Balance Sheets.

The Company accrues interest and penalties related to unrecognized tax benefits in its provision for income taxes.

At March 31, 2024 and December 31, 2023, the Company had accrued interest and penalties related to unrecognized tax benefits of approximately $ 28.8 million and $ 27.9 million, respectively.

At June 30, 2024 and December 31, 2023, the Company had accrued interest and penalties related to unrecognized tax benefits of approximately $ 29.7 million and $ 27.9 million, respectively.

Generally, tax years 2019 through 2023 remain open to examination by taxing authorities in the United States and certain other foreign tax jurisdictions.

The Company and its subsidiaries are routinely examined by tax authorities in the United States and in various state, local and foreign jurisdictions.

As of March 31, 2024, a number of income tax examinations in foreign jurisdictions are ongoing.

As of June 30, 2024, a number of income tax examinations in foreign jurisdictions are ongoing.

The Company maintains a valuation allowance to reserve against its net deferred tax assets in certain foreign jurisdictions.

A valuation allowance is established when it is more likely than not that some portion or all of the deferred tax assets will not be realized.

A valuation allowance is established when it is more likely than not that some portion or all of the deferred tax

Notes to Condensed Consolidated Financial Statements - Continued

assets will not be realized.

The Company regularly assesses the likelihood that its deferred tax assets will be recovered from estimated future taxable income and available tax planning strategies and has determined that all adjustments to the valuation allowances have been appropriate.

1 unchanged sentence

The Company believes it is more likely than not that the Company will realize its remaining net deferred tax assets, net of the valuation allowance, in future years.

In recent decisions, the Brazilian courts have confirmed a favorable tax ruling regarding the taxability of certain state value added tax incentive benefits, which allowed the Company to record a $ 31.7 million reduction in the provision for income taxes during the three months ended June 30, 2024.

In 2008 and 2012, as part of routine audits, the Brazilian taxing authorities disallowed deductions relating to the amortization of certain goodwill recognized in connection with a reorganization of the Company’s Brazilian operations and the related transfer of certain assets to the Company’s Brazilian subsidiaries.

7 unchanged sentences

PENSION AND POSTRETIREMENT BENEFIT PLANS

Net periodic pension and postretirement benefit cost for the Company’s defined pension and postretirement benefit plans for the three months ended March 31, 2024 and 2023 are set forth below (in millions):

Three Months Ended March 31,

Net periodic pension and postretirement benefit cost for the Company’s defined pension and postretirement benefit plans for the three and six months ended June 30, 2024 and 2023 are set forth below (in millions):

Three Months Ended June 30, Six Months Ended June 30,

Pension benefits 2024 2023 2024 2023

5 unchanged sentences

Net periodic pension cost $ 3.9 $ 4.9 $ 7.8 $ 9.6

Notes to Condensed Consolidated Financial Statements - Continued

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

Postretirement benefits 2024 2023 2024 2023

4 unchanged sentences

The components of net periodic pension and postretirement benefits cost, other than the service cost component, are included in “Other expense, net” in the Company’s Condensed Consolidated Statements of Operations.

During the three months ended March 31, 2024, the Company made approximately $ 10.8 million of contributions to its defined pension benefit plans.

The Company currently estimates its minimum contributions for 2024 to its defined pension benefit plans will aggregate approximately $ 29.2 million.

During the three months ended March 31, 2024, the Company made approximately $ 0.4 million of contributions to its postretirement health care and life insurance benefit plans.

The Company currently estimates that it will make approximately $ 1.7 million of contributions to its postretirement health care and life insurance benefit plans during 2024.

Notes to Condensed Consolidated Financial Statements - Continued

During the six months ended June 30, 2024, the Company made approximately $ 18.4 million of contributions to its defined pension benefit plans.

The Company currently estimates its minimum contributions for 2024 to its defined pension benefit plans will aggregate to approximately $ 25.9 million.

During the six months ended June 30, 2024, the Company made approximately $ 0.8 million of contributions to its postretirement health care and life insurance benefit plans.

The Company currently estimates that it will make approximately $ 1.7 million of contributions to its postretirement health care and life insurance benefit plans during 2024.

FAIR VALUE OF FINANCIAL INSTRUMENTS

8 unchanged sentences

• Level 3 - Model-derived valuations in which one or more significant inputs are unobservable.

The Company categorizes its pension plan assets into one of the three levels of the fair value hierarchy.

The Company categorizes its pension plan assets into one of the three levels of the fair value hierarchy, except for those measured using the net asset value per share (or its equivalent) practical expedient.

The Company enters into foreign currency, commodity and interest rate swap contracts.

4 unchanged sentences

See Note 11 for additional information on the Company’s derivative instruments and hedging activities.

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 are summarized below (in millions):

As of March 31, 2024

Assets and liabilities measured at fair value on a recurring basis as of June 30, 2024 and December 31, 2023 are summarized below (in millions):

As of June 30, 2024

Level 1 Level 2 Level 3 Total

6 unchanged sentences

The carrying amounts of long-term debt under the Company’s 1.002 % EIB senior term loan due 2025, EIB senior term loans due 2029 and 2030 and senior term loans due between 2025 and 2028 approximate fair value based on the borrowing rates currently available to the Company for loans with similar terms and average maturities.

At March 31, 2024, the estimated fair value of the Company's 0.800 % senior notes due 2028, based on listed market values, was approximately € 529.1 million (or approximately $ 570.7 million), compared to the carrying value of € 600.0 million (or approximately $ 647.2 million).

At March 31, 2024, the estimated fair value of the Company's 5.450 % senior notes due 2027, based on listed market values, was approximately $ 402.0 million, compared to the carrying value of $ 400.0 million.

At March 31, 2024, the estimated fair value of the Company's 5.800 % senior notes due 2034, based on listed market values, was approximately $ 708.4 million, compared to the carrying value of $ 700.0 million.

At June 30, 2024, the estimated fair value of the Company's 0.800 % senior notes due 2028, based on listed market values, was approximately € 527.3 million (or approximately $ 564.2 million), compared to the carrying value of € 600.0 million (or approximately $ 642.0 million).

At June 30, 2024, the estimated fair value of the Company's 5.450 % senior notes due 2027, based on listed market values, was approximately $ 400.8 million, compared to the carrying value of $ 400.0 million.

At June 30, 2024, the estimated fair value of the Company's 5.800 % senior notes due 2034, based on listed market values, was approximately $ 697.0 million, compared to the carrying value of $ 700.0 million.

See Note 9 for additional information on the Company’s long-term debt.

1 unchanged sentence

COMMITMENTS AND CONTINGENCIES

Lease payment amounts for operating and finance leases with remaining terms greater than one year as of March 31, 2024 and December 31, 2023 were as follows (in millions):

March 31, 2024 December 31, 2023

Lease payment amounts for operating and finance leases with remaining terms greater than one year, including leases classified as held for sale, as of June 30, 2024 and December 31, 2023 were as follows (in millions):

June 30, 2024 December 31, 2023

Operating Leases (1)

15 unchanged sentences

Off-Balance Sheet Arrangements

At March 31, 2024, the Company had outstanding guarantees issued to its Argentine finance joint venture, AGCO Capital Argentina S.A.

At June 30, 2024, the Company had outstanding guarantees issued to its Argentine finance joint venture, AGCO Capital Argentina S.A.

(“AGCO Capital”), of approximately $ 54.1 million.

3 unchanged sentences

The Company believes the credit risk associated with these guarantees is not material.

In addition, at March 31, 2024, the Company had accrued approximately $ 12.6 million of outstanding guarantees of residual values that may be owed to its finance joint ventures in the United States and Canada due upon expiration of certain eligible operating leases between the finance joint ventures and end users.

In addition, at June 30, 2024, the Company had accrued approximately $ 12.6 million of outstanding guarantees of residual values that may be owed to its finance joint ventures in the United States and Canada due upon expiration of certain eligible operating leases between the finance joint ventures and end users.

The maximum potential amount of future payments under these guarantees is approximately $ 185.1 million.

At March 31, 2024, the Company had outstanding designated and non-designated foreign exchange contracts with a gross notional amount of approximately $ 3,039.7 million.

The outstanding contracts as of March 31, 2024 range in maturity through December 2024.

The Company also had outstanding designated steel commodity contracts with a gross notional amount of approximately $ 1.6 million that range in maturity through June 2024.

At June 30, 2024, the Company had outstanding designated and non-designated foreign exchange contracts with a gross notional amount of approximately $ 3,032.1 million.

The outstanding contracts as of June 30, 2024 range in maturity through December 2024.

The Company also had outstanding designated steel commodity contracts with a gross notional amount of approximately $ 0.1 million that have matured and will settle in July 2024.

As of June 30, 2024, there were no designated steel commodity contracts outstanding with future maturity dates.

The Company sells a majority of its wholesale receivables in North America, Europe and Brazil to its U.S., Canadian, European and Brazilian finance joint ventures.

10 unchanged sentences

In July 2022, the case was tried before a jury, which determined that the Company and Precision Planting had not infringed the Deere patents.

Following customary post-trial procedures, the Court entered a judgement in the Company’s favor, and Deere appealed the judgment to the U.S.

Following customary post-trial procedures, the Court entered a judgment in the Company’s favor, and Deere appealed the judgment to the U.S.

Court of Appeals for the Federal Circuit.

4 unchanged sentences

The Company believes that none of these claims or actions, either individually or in the aggregate, are material to its business or financial statements as a whole, including its results of operations and financial condition.

Notes to Condensed Consolidated Financial Statements - Continued

Contract Liabilities

Contract liabilities relate to the following:

(1) unrecognized revenues where payment of consideration precedes the Company’s performance with respect to extended warranty and maintenance contracts and where the performance obligation is satisfied over time, (2) unrecognized revenues where payment of consideration precedes the Company’s performance with respect to certain grain storage and protein production systems and where the performance obligation is satisfied over time and (3) unrecognized revenues where payment of consideration precedes the Company’s performance with respect to precision technology services and where the performance obligation is satisfied over time.

Significant changes in the balance of contract liabilities for the three months ended March 31, 2024 and 2023 were as follows (in millions):

Three Months Ended March 31,

(1) unrecognized revenues where payment of consideration precedes the Company’s performance with respect to extended warranty and maintenance contracts and where the performance obligation is satisfied over time, (2) unrecognized revenues where payment of consideration precedes the Company’s performance with respect to certain grain storage and protein production systems and where the performance obligation is satisfied over time and (3) unrecognized revenues where payment of consideration precedes the Company’s performance with respect to precision agriculture technology services and where the performance obligation is satisfied over time.

Notes to Condensed Consolidated Financial Statements - Continued

Significant changes in the balance of contract liabilities for the three and six months ended June 30, 2024 and 2023 were as follows (in millions):

Three Months Ended June 30,

Balance at beginning of period $ 321.5 $ 259.6

2 unchanged sentences

Revenue recognized during the period related to grain storage and protein production systems ( 7.5 ) ( 17.9 )

Reclassified to held for sale (1)

Foreign currency translation ( 1.3 ) 1.7

Balance at March 31 $ 321.5 $ 259.6

Balance at June 30 $ 331.7 $ 274.6

Six Months Ended June 30,

Balance at beginning of period $ 310.7 $ 239.0

Advance consideration received 106.0 116.5

Revenue recognized during the period for extended warranty contracts, maintenance services and technology services ( 77.2 ) ( 51.7 )

Revenue recognized during the period related to grain storage and protein production systems ( 12.2 ) ( 33.9 )

Reclassified to held for sale (1)

Foreign currency translation ( 6.1 ) 4.7

Balance at June 30 $ 331.7 $ 274.6

____________________________________

(1) Reclassification resulting from the Company's classification of the G&P business as held for sale.

Refer to Note 3 for additional information.

The contract liabilities are classified as either “Accrued expenses” or “Other current liabilities” and “Other noncurrent liabilities” in the Company’s Condensed Consolidated Balance Sheets.

During the three months ended March 31, 2024, the Company recognized approximately $ 33.2 million of revenue that was recorded as a contract liability at the beginning of 2024.

During the three months ended March 31, 2023, the Company recognized approximately $ 35.7 million of revenue that was recorded as a contract liability at the beginning of 2023.

During the three and six months ended June 30, 2024, the Company recognized approximately $ 38.1 million and $ 71.3 million of revenue that was recorded as a contract liability at the beginning of 2024.

During the three and six months ended June 30, 2023, the Company recognized approximately $ 34.3 million and $ 70.0 million of revenue that was recorded as a contract liability at the beginning of 2023.

Remaining Performance Obligations

The estimated revenues expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of March 31, 2024 are $ 91.3 million for the remainder of 2024, $ 101.9 million in 2025, $ 63.2 million in 2026, $ 32.6 million in 2027 and $ 14.7 million thereafter, and relate primarily to extended warranty contracts.

The estimated revenues expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of June 30, 2024 are $ 65.5 million for the remainder of 2024, $ 116.2 million in 2025, $ 79.3 million in 2026, $ 41.1 million in 2027 and $ 19.9 million thereafter, and relate primarily to extended warranty contracts.

The Company applied the practical expedient in ASU 2014-09 and has not disclosed information about remaining performance obligations that have original expected durations of 12 months or less.

1 unchanged sentence

Disaggregated Revenue

Net sales for the three months ended March 31, 2024 disaggregated by primary geographical markets and major products consisted of the following (in millions):

North America South America

Europe/Middle East Asia/Pacific/Africa Consolidated

Net sales for the three months ended June 30, 2024 disaggregated by primary geographical markets and major products consisted of the following (in millions):

North America (1)

South America Europe/Middle East (1)

Asia/Pacific/Africa (1)

Primary geographical markets:

21 unchanged sentences

$ 837.8 $ 348.9 $ 1,902.9 $ 157.0 $ 3,246.6

____________________________________

(1) Rounding may impact the summation of amounts.

Notes to Condensed Consolidated Financial Statements - Continued

Net sales for the three months ended March 31, 2023 disaggregated by primary geographical markets and major products consisted of the following (in millions):

Net sales for the three months ended June 30, 2023 disaggregated by primary geographical markets and major products consisted of the following (in millions):

North America

South America (1)

Europe/Middle East (1)

Europe/Middle East Asia/Pacific/Africa

Consolidated (1)

Primary geographical markets:

United States $ 771.7 $ — $ — $ — $ 771.7

Canada 184.7 — — — 184.7

Brazil — 512.0 — — 512.0

Other South America — 83.4 — — 83.4

Germany — — 453.2 — 453.2

France — — 373.7 — 373.7

United Kingdom and Ireland — — 172.9 — 172.9

Finland and Scandinavia — — 225.9 — 225.9

Italy — — 141.6 — 141.6

Other Europe — — 512.7 — 512.7

Middle East and Algeria — — 110.8 — 110.8

Africa — — — 35.1 35.1

Asia — — — 102.1 102.1

Australia and New Zealand — — — 99.3 99.3

Mexico, Central America and Caribbean 40.4 3.1 — — 43.5

$ 996.8 $ 598.6 $ 1,990.8 $ 236.5 $ 3,822.7

Major products:

Tractors $ 335.4 $ 371.7 $ 1,393.3 $ 131.9 $ 2,232.3

Replacement parts 130.2 38.9 299.1 23.5 491.7

Grain storage and protein production systems 189.2 38.9 49.7 35.2 313.0

Combines, application equipment and other machinery 342.0 149.1 248.7 45.9 785.7

$ 996.8 $ 598.6 $ 1,990.8 $ 236.5 $ 3,822.7

____________________________________

(1) Rounding may impact the summation of amounts.

Notes to Condensed Consolidated Financial Statements - Continued

Net sales for the six months ended June 30, 2024 disaggregated by primary geographical markets and major products consisted of the following (in millions):

North America (1)

South America Europe/Middle East (1)

Asia/Pacific/Africa (1)

25 unchanged sentences

Notes to Condensed Consolidated Financial Statements - Continued

Net sales for the six months ended June 30, 2023 disaggregated by primary geographical markets and major products consisted of the following (in millions):

North America South America Europe/Middle East Asia/Pacific/Africa Consolidated

Primary geographical markets:

United States $ 1,531.8 $ — $ — $ — $ 1,531.8

Canada 312.6 — — — 312.6

Brazil — 937.5 — — 937.5

Other South America — 157.1 — — 157.1

Germany — — 848.6 — 848.6

France — — 675.1 — 675.1

United Kingdom and Ireland — — 347.8 — 347.8

Finland and Scandinavia — — 405.9 — 405.9

Italy — — 233.8 — 233.8

Other Europe — — 957.0 — 957.0

Middle East and Algeria — — 226.4 — 226.4

Africa — — — 65.5 65.5

Asia — — — 188.8 188.8

Australia and New Zealand — — — 185.0 185.0

Mexico, Central America and Caribbean 75.5 7.8 — — 83.3

$ 1,919.9 $ 1,102.4 $ 3,694.6 $ 439.3 $ 7,156.2

Major products:

Tractors $ 647.5 $ 654.6 $ 2,599.0 $ 239.1 $ 4,140.2

Replacement parts 232.0 82.3 582.3 50.8 947.4

Grain storage and protein production systems 336.3 79.6 83.8 69.2 568.9

Combines, application equipment and other machinery 704.1 285.9 429.5 80.2 1,499.7

$ 1,919.9 $ 1,102.4 $ 3,694.6 $ 439.3 $ 7,156.2

Notes to Condensed Consolidated Financial Statements - Continued

SEGMENT REPORTING

5 unchanged sentences

As a result, the components of income from operations for one segment may not be comparable to another segment.

Segment results for the three months ended March 31, 2024 and 2023 and assets as of March 31, 2024 and December 31, 2023 based on the Company’s reportable segments are as follows (in millions):

Three Months Ended March 31, North America South America Europe/Middle East Asia/Pacific/Africa Total Segments

Segment results for the three and six months ended June 30, 2024 and 2023 and assets as of June 30, 2024 and December 31, 2023 based on the Company’s reportable segments are as follows (in millions):

Three Months Ended June 30, North America South America Europe/Middle East Asia/Pacific/Africa Total Segments

Net sales $ 837.8 $ 348.9 $ 1,902.9 $ 157.0 $ 3,246.6

6 unchanged sentences

Capital expenditures 34.4 13.5 62.8 1.0 111.7

As of March 31, 2024 $ 1,946.7 $ 1,369.7 $ 3,214.7 $ 868.9 $ 7,400.0

Six Months Ended June 30, North America South America Europe/Middle East Asia/Pacific/Africa Total Segments

Net sales $ 1,567.4 $ 652.3 $ 3,631.9 $ 323.7 $ 6,175.3

Income from operations 119.1 28.8 571.4 20.4 739.7

Depreciation 34.6 19.0 66.1 8.8 128.5

Capital expenditures 35.9 23.5 131.6 2.0 193.0

Net sales $ 1,919.9 $ 1,102.4 $ 3,694.6 $ 439.3 $ 7,156.2

Income from operations 239.0 220.9 534.6 39.0 1,033.5

Depreciation 30.1 16.7 54.5 8.8 110.1

Capital expenditures 71.7 33.8 129.8 1.7 237.0

As of June 30, 2024 $ 1,973.2 $ 1,266.9 $ 3,314.5 $ 903.5 $ 7,458.1

As of December 31, 2023 1,883.2 1,394.9 3,017.4 875.2 7,170.7

A reconciliation from the segment information to the consolidated balances for income from operations and total assets is set forth below (in millions):

Three Months Ended March 31,

Notes to Condensed Consolidated Financial Statements - Continued

A reconciliation from the segment information to the consolidated balances for income (loss) from operations and total assets is set forth below (in millions):

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Segment income from operations $ 390.2 $ 574.4 $ 739.7 $ 1,033.5

Impairment charges ( 5.1 ) — ( 5.1 ) —

Loss on business held for sale

( 494.6 ) — ( 494.6 ) —

Corporate expenses ( 62.9 ) ( 45.0 ) ( 115.9 ) ( 87.1 )

2 unchanged sentences

Restructuring expenses ( 30.2 ) ( 6.1 ) ( 31.2 ) ( 7.5 )

Consolidated income from operations $ 273.6 $ 387.3

Notes to Condensed Consolidated Financial Statements - Continued

March 31, 2024 December 31, 2023

Consolidated income (loss) from operations

$ ( 241.7 ) $ 496.4 $ 31.9 $ 883.7

June 30, 2024 December 31, 2023

Segment assets $ 7,458.1 $ 7,170.7

Cash and cash equivalents

2,455.8 595.5

Investments in affiliates 518.3 512.7

Deferred tax assets, other current and noncurrent assets 1,506.9 1,500.1

Assets held for sale (1)

Intangible assets, net 689.9 308.8

1 unchanged sentence

Consolidated total assets $ 13,614.8 $ 11,421.2

____________________________________

(1) Represents non-segment assets related to the Company's G&P business, which the Company has classified as held for sale as of June 30, 2024.

Segment assets include the G&P assets held for sale.

Refer to Note 3 for additional information.

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