What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-10-27 compared with 2024-10-28 · 412 added, 403 removed, 1130 unchanged (42% of the section changed)

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Management’s Report on Internal Control over Financial Reporting

Reports of Independent Registered Public Accounting Firm

Report s of Independent Registered Public Accounting Firm

Consolidated Balance Sheets as of August 31, 2025 and 2024

Consolidated Statements of Comprehensive Income for the years ended August 31, 2025, 2024, and 20 23

Consolidated Statements of Cash Flows for the years ended August 31, 2024, 2023, and 2022

Consolidated Statements of Cash Flows for the years ended August 31, 20 2 5 , 202 4 , a nd 20 23

Consolidated Statements of Stockholders’ Equity for the years ended August 31, 202 5 , 202 4 , and 20 23

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MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

ACUITY BRANDS, INC.

The management of Acuity Brands, Inc.

The management of Acuity Inc.

is responsible for establishing and maintaining adequate internal control over financial reporting.

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Based on this assessment, management believes that, as of August 31, 2025, the Company’s internal control over financial reporting is effective.

Management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of the acquired business of QSC, LLC (“QSC”), which is included in the Company’s consolidated financial statements as of August 31, 2025 and for the period from the acquisition date of January 1, 2025 through August 31, 2025.

As of August 31, 2025, QSC assets and net assets after excluding acquired goodwill and intangible assets constituted 7% of both the Company’s consolidated total assets and net assets.

For the year ended August 31, 2025, QSC net sales and pre-tax income constituted 10% of the Company's net sales and 4% of the Company's pre-tax income, respectively.

Ernst & Young LLP, the Company’s independent registered public accounting firm, has issued an audit report on its audit of the Company’s internal control over financial reporting.

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Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Acuity Brands, Inc.

To the Shareholders and the Board of Directors of Acuity Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Acuity Brands, Inc.

We have audited the accompanying consolidated balance sheets of Acuity Inc.

(the Company) as of August 31, 2025 and 2024, the related consolidated statements of comprehensive income, cash flows and stockholders' equity for each of the three years in the period ended August 31, 2025, and the related notes (collectively referred to as the consolidated financial statements).

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(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosures to which it relates.

Product Warranty Costs

Description of the Matter As discussed in Note 8 to the financial statements, the liabilities for product warranty costs amount to $37.5 million at August 31, 2024.

The Company accrues for the estimated amount of future warranty costs when the related revenue is recognized.

Estimated costs for product warranty costs are accrued when probable and estimable.

Auditing these liabilities is complex due to the uncertainty inherent in the estimates used by management to calculate the liability balances.

Management’s cost estimates consider historical experience, including the number and costs of identified warranty claims as well as the period of time between the shipment of products and the settlement of related claims.

In addition, the liabilities are sensitive to significant management assumptions, including the expectation that historical experience will continue to be the best indicator of future warranty costs.

How We Addressed the Matter in Our Audit

We evaluated the design and tested the operating effectiveness of internal controls over the Company’s product warranty costs process.

We tested internal controls over management’s estimates for the product warranty costs.

Our audit also included the evaluation of controls that address the completeness and accuracy of the data utilized in calculating the estimates.

Our audit procedures related to product warranty costs also included, among others, evaluating the Company’s estimation methodology and the related significant assumptions, including testing the historical data used in the Company’s estimation methodology.

Furthermore, we performed sensitivity analyses on the cost estimates to evaluate the significant judgments made by management, and the impact on the liability from changes in assumptions.

Acquisition of QSC, LLC – Valuation of Developed Technology

Description of the Matter As discussed in Note 4 to the consolidated financial statements, the Company acquired QSC, LLC (QSC) on January 1, 2025, for cash consideration of approximately $1.2 billion.

The Company accounted for the acquisition of QSC as a business combination.

The acquisition date fair value of the acquired developed technology intangible assets was $434.0 million, substantially all of which was Q-SYS, an audio, video, and control platform.

Auditing the Company’s accounting for the Q-SYS developed technology intangible asset was complex due to estimation uncertainty and subjectivity involved in the Company’s determination of fair value.

The Company determined the fair value of the Q-SYS developed technology intangible asset based on a multi-period excess earnings method income approach.

The estimation uncertainty was primarily due to the sensitivity of the Q-SYS developed technology intangible asset fair value to underlying assumptions about the future performance of QSC.

The significant assumptions used to estimate the fair value of the Q-SYS developed technology intangible asset were projected revenues and the discount rate.

These significant assumptions include forward-looking considerations and were based on expectations of future economic and market conditions.

How We Addressed the Matter in Our Audit We evaluated the design and tested the operating effectiveness of internal controls over the Company’s estimation process supporting the fair value of Q-SYS developed technology intangible asset.

For example, we tested management’s review controls over the significant assumptions described above along with the completeness and accuracy of the data utilized in the fair value estimates.

Our audit procedures related to the estimated fair value of the Q-SYS developed technology intangible asset included, among others, evaluating the Company's selection of the valuation methodology, evaluating the significant assumptions described above and testing the completeness and accuracy of the underlying data supporting the significant assumptions.

We involved our valuation specialists to assist with evaluating the methodology and significant assumptions used by management to determine the fair value estimates.

We compared the significant assumptions to historical and current industry, market and economic trends, as well as historical results of QSC and guideline companies within the same industry.

/s/ Ernst & Young LLP

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Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Acuity Brands, Inc.

To the Shareholders and the Board of Directors of Acuity Inc.

Opinion on Internal Control Over Financial Reporting

We have audited Acuity Brands, Inc.’s internal control over financial reporting as of August 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, Acuity Brands, Inc.

We have audited Acuity Inc.’s internal control over financial reporting as of August 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, Acuity Inc.

(the Company) maintained, in all material respects, effective internal control over financial reporting as of August 31, 2025, based on the COSO criteria.

As indicated in the accompanying Management’s Report on Internal Control over Financial Reporting, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of QSC, LLC (QSC), which is included in the 2025 consolidated financial statements of the Company and constituted 7% of total assets and net assets, excluding the acquired value of goodwill and other intangible assets, as of August 31, 2025 and 10% and 4% of net sales and pre-tax income, respectively, for the year then ended.

Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of QSC.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of August 31, 2025 and 2024, the related consolidated statements of comprehensive income, cash flows and stockholders’ equity for each of the three years in the period ended August 31, 2025, and the related notes and our report dated October 27, 2025 expressed an unqualified opinion thereon.

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October 27, 2025

ACUITY BRANDS, INC.

CONSOLIDATED BALANCE SHEETS

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The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ACUITY BRANDS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

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Other expense:

Interest (income) expense, net ( 4.5 ) 18.9 24.9

Miscellaneous expense (income), net 9.2 7.8 ( 9.1 )

Interest expense (income), net 22.0 ( 4.5 ) 18.9

Miscellaneous expense, net 41.7 9.2 7.8

Total other expense 63.7 4.7 26.7

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Net income $ 396.6 $ 422.6 $ 346.0

Other comprehensive (loss) income items, net of tax:

Other comprehensive income (loss) items, net of tax:

Foreign currency translation adjustments 10.8 ( 5.9 ) 8.5

Defined benefit plans, net of tax 27.6 3.6 4.7

Other comprehensive (loss) income items, net of tax ( 2.3 ) 13.2 ( 27.6 )

Other comprehensive income (loss) items, net of tax 38.4 ( 2.3 ) 13.2

Comprehensive income $ 435.0 $ 420.3 $ 359.2

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The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ACUITY BRANDS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

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Depreciation and amortization 133.1 91.1 93.2

Pension settlement loss 30.9 — —

Share-based payment expense 45.1 46.6 42.0

Gain on the sale or disposal of property, plant, and equipment — — ( 2.3 )

Asset impairments 16.7 3.0 20.8

Loss on sale of a business — 11.2 —

Deferred income taxes ( 45.0 ) ( 33.6 ) ( 47.8 )

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Purchases of property, plant, and equipment ( 68.4 ) ( 64.0 ) ( 66.7 )

Proceeds from sale of property, plant, and equipment — — 8.9

Acquisitions of businesses, net of cash acquired ( 1,189.4 ) — ( 35.5 )

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Repayments on credit facility, net of borrowings — — ( 18.0 )

Borrowings from term loan 600.0 — —

Repayments of term loan borrowings ( 200.0 ) — —

Repurchases of common stock ( 118.5 ) ( 88.7 ) ( 266.6 )

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Other financing activities ( 9.3 ) — —

Net cash used for financing activities ( 104.5 ) ( 312.9 ) ( 512.4 )

Net cash provided by (used for) financing activities 255.4 ( 104.5 ) ( 312.9 )

Effect of exchange rate changes on cash and cash equivalents 0.6 ( 1.7 ) 0.2

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The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ACUITY BRANDS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In millions)

(In millions except per-share data)

Common Stock Outstanding

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Net income — — — 346.0 — — 346.0

Other comprehensive loss, net of tax — — — — ( 27.6 ) — ( 27.6 )

Other comprehensive income, net of tax — — — — 13.2 — 13.2

Share-based payment amortization, issuances, and cancellations 0.2 — 27.8 — — — 27.8

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Net income — — — 422.6 — — 422.6

Other comprehensive income, net of tax — — — — 13.2 — 13.2

Other comprehensive loss, net of tax — — — — ( 2.3 ) — ( 2.3 )

Share-based payment amortization, issuances, and cancellations 0.1 — 35.6 — — — 35.6

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Net income — — — 396.6 — — 396.6

Other comprehensive loss, net of tax — — — — ( 2.3 ) — ( 2.3 )

Other comprehensive income, net of tax — — — — 38.4 — 38.4

Share-based payment amortization, issuances, and cancellations 0.2 — 20.4 — — — 20.4

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(1) Share activity and balances above calculated using rounded numbers.

* Represents shares of less than 0.1 million.

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 — Description of Business and Basis of Presentation

Acuity Brands, Inc.

(referred to herein as “we,” “our,” “us,” the “Company,” or similar references) is a market-leading industrial technology company.

We use technology to solve problems in spaces and light.

Through our two business segments, Acuity Brands Lighting and Lighting Controls (“ABL”) and the Intelligent Spaces Group (“ISG”), we design, manufacture, and bring to market products and services that make a valuable difference in people's lives.

We achieve growth through the development of innovative new products and services, including lighting, lighting controls, building management systems, and location-aware applications.

Our ABL strategy is to increase product vitality, elevate service levels, use technology to improve and differentiate both our products and how we operate the business, and drive productivity.

ABL's portfolio of lighting solutions includes commercial, architectural, and specialty lighting in addition to lighting controls and components that can be combined to create integrated lighting controls systems.

We offer devices such as luminaires that predominantly utilize light emitting diode (“LED”) technology designed to optimize energy efficiency and comfort for various indoor and outdoor applications.

Effective March 26, 2025, we changed our corporate name from Acuity Brands, Inc.

to Acuity Inc.

We use technology to solve problems in spaces, light, and more things to come.

Through our two business segments, Acuity Brands Lighting (“ABL”) and Acuity Intelligent Spaces (“AIS”), we design, manufacture, and bring to market products and services that make a valuable difference in people’s lives.

We achieve growth through the development of innovative new products and services, including lighting, lighting controls, building management solutions, and an audio, video, and control platform.

We focus on customer outcomes and drive growth and productivity to increase market share and deliver superior returns.

We look to aggressively deploy capital to grow the business and to enter attractive new verticals.

Acuity Brands Lighting Segment

Our mission at ABL is to provide sustainable and intelligent lighting solutions that enrich communities where people live, learn, work, and play.

We bring this mission to life through our strategy, which is to increase product vitality, elevate service levels, use technology to improve and differentiate both our products and how we operate the business, and drive productivity.

At ABL, our offering combines luminaires with advanced electronics.

Our luminaires deliver performance and aesthetic appeal, while our electronics portfolio, featuring drivers and a leading controls platform, provides connectivity and functionality.

ABL's portfolio of products includes, but is not limited to the following brands:

A-Light TM , Aculux TM , American Electric Lighting ® , Cyclone TM , Dark to Light ® , eldoLED ® , Eureka ® , Gotham ® , Healthcare Lighting ® , Holophane ® , Hydrel ® , IOTA ® , Juno ® , Lithonia Lighting ® , Luminaire LED TM , Luminis ® , Mark Architectural Lighting TM , nLight ® , OPTOTRONIC ® , Peerless ® , RELOC ® Wiring Solutions, and SensorSwitch TM .

Principal customers of ABL include electrical distributors, retail home improvement centers, electric utilities, corporate accounts, original equipment manufacturer (“OEM”) customers, digital retailers, lighting showrooms, and energy service companies.

Our customers are located in North America and select international markets that serve new construction, renovation and retrofit, and maintenance and repair applications.

ABL's lighting and lighting controls solutions are sold primarily through a network of independent sales agencies that cover specific geographic areas and market channels, by internal sales representatives, through consumer retail channels, directly to large corporate accounts, and directly to OEM customers.

Products are delivered primarily through a network of distribution centers as well as directly from our manufacturing facilities using both common carriers and an internally-managed truck fleet.

Our ISG strategy is to make spaces smarter, safer, and greener by connecting the edge to the cloud.

ISG offers building management solutions and building management software.

Our building management solutions include products for controlling heating, ventilation, air conditioning (“HVAC”), lighting, shades, refrigeration, and building access that deliver end-to-end optimization of those building systems.

Our intelligent building management software enhances the occupant experience, improves building system management, and automates labor intensive tasks while delivering operational energy efficiency and cost reductions.

Through a connected and converged building system architecture, our software delivers different applications, allows clients to upgrade over time with natural refresh cycles, and deploys new capabilities.

Customers of ISG primarily include system integrators as well as retail stores, airports, and enterprise campuses throughout North America and select international locations.

ISG products and solutions are marketed under multiple brand names, including but not limited to, Atrius ® and Distech Controls ® .

Aculux TM , American Electric Lighting ® , Cyclone TM , Dark to Light ® , eldoLED ® , Eureka ® , Fresco TM , Gotham ® , Healthcare Lighting ® , Holophane ® , Hydrel ® , IOTA ® , Juno ® , Lithonia Lighting ® , Luminaire LED TM , Luminis ® , Mark Architectural Lighting TM , Nightingale TM , nLight ® , Peerless ® , RELOC ® Wiring Solutions, and SensorSwitch TM .

Customers of ABL are located in North America and select international markets that serve new construction, renovation and retrofit, and maintenance and repair applications.

Our lighting solutions are sold primarily through a network of independent sales agencies, by internal sales representatives, through electrical distributors and consumer retailers, directly to large corporate accounts, and directly to original equipment manufacturer (“OEM”) customers.

Products are delivered directly from our manufacturing facilities or through a network of distribution centers.

Acuity Intelligent Spaces Segment

Our mission at AIS is to make spaces smarter, safer, and greener through our strategy of connecting the edge with the cloud using disruptive technologies.

Through Atrius ® , Distech Controls ® , and QSC ® , we are driving productivity for people who own and manage a space and for the people who utilize a space.

Atrius makes data in a space accessible, usable, and actionable.

Our data platform and cloud applications for building performance and spatial intelligence aim to maximize occupant and owner experiences.

Our Distech Controls intelligent Building Management Systems (“BMS”) provide management of a space through controls, sensors, and software.

Our open technology includes products for heating, ventilation, and air conditioning (“HVAC”), refrigeration, lighting, shades, and building access that prioritize end-user outcomes.

Q-SYS, our full-stack audio, video, and control platform, unifies data, devices, and a cloud-first architecture to deliver real-time action, experiences, and insights.

QSC Audio includes audio technology that enhances experiences for live entertainers and sound reinforcement professionals.

AIS goes to market primarily through system integrators.

Key customer verticals include retail stores, airports, universities, enterprise campuses, sports venues, themed entertainment, and hospitality, among many other broad applications throughout North America, Europe, and other select international locations.

Basis of Presentation

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generally accepted accounting principles (“U.S.

GAAP”) to present the financial position, results of operations, and cash flows of Acuity Brands, Inc.

GAAP”) to present the financial position, results of operations, and cash flows of Acuity Inc.

and its wholly-owned subsidiaries.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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Principles of Consolidation

The Consolidated Financial Statements include the accounts of Acuity Brands, Inc.

The Consolidated Financial Statements include the accounts of Acuity Inc.

and its wholly-owned subsidiaries after elimination of intercompany transactions and accounts.

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Cash and Cash Equivalents

Cash in excess of daily requirements is invested in time deposits and marketable securities and is included in the accompanying balance sheets at fair value.

Cash in excess of daily requirements may be invested in time deposits and marketable securities and is included in the accompanying balance sheets at fair value.

We consider time deposits and marketable securities with an original maturity of three months or less when purchased to be cash equivalents.

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Concentrations of Credit Risk

Concentrations of credit risk with respect to receivables, which are typically unsecured, are generally limited due to the wide variety of customers and markets using our lighting, lighting controls, building management systems, and location-aware applications as well as their dispersion across many different geographic areas.

No single customer accounted for more than 10% of receivables at August 31, 2024.

One customer accounted for 10 % of receivables at August 31, 2023.

Concentrations of credit risk with respect to receivables, which are typically unsecured, are generally limited due to the wide variety of customers and markets using our products and services as well as their dispersion across many different geographic areas.

No single customer accounted for more than 10% of receivables at August 31, 2025 or August 31, 2024.

No single customer accounted for more than 10% of net sales in fiscal 2025, 2024, or 2023.

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No material reclassifications occurred during the current period.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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We cease the depreciation and amortization of the assets when all of these criteria have been met and generally reflect balances within Prepayments and other current assets on our Consolidated Balance Sheets .

We did not have any assets classified as held for sale at August 31, 2024 or August 31, 2023.

During the year ended August 31, 2022, we sold one building classified as held for sale at August 31, 2021 with a total carrying value of $ 6.6 million for a gain of approximately $ 2.3 million.

This gain is reflected in Selling, distribution, and administrative expenses within our Consolidated Statements of Comprehensive Income .

ACUITY BRANDS, INC.

As of August 31, 2025, one of our assets with a carrying value of $ 5.5 million met the criteria to be classified as held for sale.

This asset is reflected within Prepayments and other current assets on our Consolidated Balance Sheets as of August 31, 2025.

See the Fair Value Measurement footnote of the Notes to Consolidated Financial Statements for further details.

We did not have any assets classified as held for sale at August 31, 2024.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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The changes in the carrying amount of goodwill during the periods presented by segment are summarized as follows (in millions):

ABL ISG Total

ABL AIS Total

Balance as of August 31, 2023 $ 1,014.4 $ 83.5 $ 1,097.9

Additions from acquired businesses — 15.2 15.2

Adjustments to provisional amounts from acquired businesses — ( 0.2 ) ( 0.2 )

Derecognitions for divestitures ( 0.7 ) — ( 0.7 )

Foreign currency translation adjustments 0.7 0.1 0.8

Balance as of August 31, 2024 1,015.1 83.6 1,098.7

Additions from acquired businesses — 394.6 394.6

Foreign currency translation adjustments 0.9 1.3 2.2

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Through multiple acquisitions, we acquired definite-lived intangible assets that are amortized over their estimated useful lives as well as indefinite-lived intangible assets, which consist of trade names that are expected to generate cash flows indefinitely.

Significant estimates and assumptions were used to determine the initial fair value of these acquired intangible assets, including estimated future short-term and long-term net sales and profitability, customer attrition rates, royalty rates, and discount rates.

Significant estimates and assumptions were used to determine the initial fair value of these acquired intangible assets, including, but not limited to, estimated future short-term and long-term net sales and profitability, customer attrition rates, royalty rates, and discount rates.

The increase in definite-lived intangible assets in the current fiscal year was due primarily to acquisitions.

Refer to the Acquisitions and Divestitures footnote of the Notes to Consolidated Financial Statements for further information.

Certain of our intangible assets are attributable to foreign operations and are impacted by currency translation due to movements in foreign currency rates year over year.

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Definite-lived intangible assets:

Patents and patented technology $ 157.5 $ ( 133.3 ) $ 158.8 $ ( 122.3 )

Developed technology and patents $ 616.7 $ ( 170.5 ) $ 157.5 $ ( 133.3 )

Trademarks and trade names 176.9 ( 29.0 ) 45.5 ( 20.5 )

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Fiscal Year August 31, 2025

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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Our qualitative analysis considered and assessed external factors for each reporting unit such as macroeconomic, industry, cost, and market conditions as well as Company-specific factors, including but not limited to, our actual and planned financial performance.

Based on the results of our analysis, we determined there was not a more likely than not probability of impairment for each of our three reporting units.

Based on the results of our analysis, we determined there was not a more likely than not probability of impairment for each of our reporting units.

Thus, no quantitative test was required for our $ 1.5 billion of goodwill.

In fiscal 2023 and 2022, we used a quantitative analysis to calculate the fair value of our three reporting units using a combination of discounted future cash flows and relevant market multiples.

The analysis for goodwill did no t result in an impairment charge during fiscal 2023, or 2022.

In fiscal 2024, we performed a qualitative analysis to assess the fair value of our reporting units as prescribed by ASC 350.

Based on the results of our analysis, we determined there was not a more likely than not probability of impairment for each of our reporting units.

Thus, no quantitative test was required for our $ 1.1 billion of goodwill.

In fiscal 2023, we used a quantitative analysis to calculate the fair value of our reporting units using a combination of discounted future cash flows and relevant market multiples.

The analysis for goodwill did no t result in an impairment charge during fiscal 2023.

Indefinite-Lived Intangibles

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Our qualitative analysis considered and assessed external factors such as macroeconomic, industry, cost, and market conditions as well as asset-specific factors, such as each trade name's actual and planned financial performance.

Based on the results of our analysis, we determined there was not a more likely than not probability of impairment for all of the indefinite-lived intangible assets, and no quantitative test for these assets was required.

As of June 1, 2024, the current fiscal year testing date, we held eight indefinite-lived intangible assets with an aggregate carrying value of $ 135.5 million.

For fiscal 2024, we performed a qualitative analysis to assess our indefinite-lived intangible assets for impairment.

Based on the results of our analyses, we determined there was not a more likely than not probability of impairment for seven of the indefinite-lived intangible assets, and no quantitative test for these assets was required.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In the fourth quarter of fiscal 2024, management committed to a plan to rebrand certain products in ABL's portfolio.

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The impairment analyses for fiscal 2023 of the other seven indefinite-lived intangible assets indicated that their fair values exceeded their carrying values.

The impairment analyses of our indefinite-lived intangible assets indicated that their fair values exceeded their carrying values for fiscal 2022.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Other Long-Term Assets

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Investments in debt and equity securities 5.1 6.7

Pensions plans in which plan assets exceed benefit obligation 13.3 12.4

Pension plans in which plan assets exceed benefit obligation 9.7 13.3

Total other long-term assets $ 45.2 $ 32.1

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This program is frozen, and no new policies were issued in the three-year period ended August 31, 2025.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Other Current Liabilities

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(4) Refer to the Debt and Lines of Credit footnote of the Notes to Consolidated Financial Statements for additional information.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Other Long-Term Liabilities

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When a product is sold, the associated shipping and handling costs are recorded in the Consolidated Statements of Comprehensive Income based on their function.

Costs associated with inbound freight and freight between manufacturing facilities and distribution centers are generally recorded in Cost of products sold, which may be capitalized into inventory .

Costs associated with inbound freight and freight between manufacturing facilities and distribution centers are generally recorded in Cost of products sold.

Other shipping and handling costs, which primarily include amounts incurred to transfer finished goods to a customer's desired location, are included in Selling, distribution, and administrative expenses and totaled $ 141.1 million, $ 134.2 million, and $ 141.7 million in fiscal 2025, 2024, and 2023, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Share-based Payments

We account for stock options, restricted stock, performance stock units, and stock units representing certain deferrals into the Nonemployee Director Deferred Compensation Plan (the “Director Plan”) or the Supplemental Deferred Savings Plan (“SDSP”) (both of which are discussed further in the Share-based Payments footnote) based on their grant-date fair values estimated under the provisions of ASC Topic 718, Compensation—Stock Compensation (“ASC 718”).

We account for stock options, restricted stock, performance stock units, and stock units representing certain deferrals into the Nonemployee Director Deferred Compensation Plan (referred to as the “Director Plan” and discussed further in the Share-based Payments footnote) based on their grant-date fair values estimated under the provisions of ASC Topic 718, Compensation—Stock Compensation (“ASC 718”).

We generally recognize compensation cost for share-based payment transactions on a straight-line basis over an award's requisite service period as defined by ASC 718.

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Excess tax benefits and/or expense related to share-based payment awards are reported within Income tax expense on the Consolidated Statements of Comprehensive Income .

We recognized net excess tax benefits related

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

to share-based payment cost of $ 1.5 million, $ 1.5 million, and $ 4.8 million for the years ended August 31, 2024, 2023, and 2022, respectively.

We recognized net excess tax benefits related to share-based payment cost of $ 6.0 million, $ 1.5 million, and $ 1.5 million for the years ended August 31, 2025, 2024, and 2023, respectively.

See the Share-based Payments footnote of the Notes to Consolidated Financial Statements for more information.

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R&D expense amounted to $ 140.2 million, $ 102.3 million, and $ 97.1 million during fiscal 2025, 2024 , and 2023, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Advertising costs are expensed as incurred and are included within Selling, distribution, and administrative expenses in our Consolidated Statements of Comprehensive Income .

These costs totaled $ 29.2 million, $ 20.1 million, and $ 21.9 million during fiscal 2025, 2024 , and 2023, respectively.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Other Expense

The following table summarizes the components of O ther expense during the periods presented (in millions):

The following table summarizes the components of Other expense during the periods presented (in millions):

Year Ended August 31,

2025 2024 2023

Interest (income) expense, net:

Interest expense (income), net:

Interest expense (1)

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( 20.5 ) ( 29.8 ) ( 9.0 )

Interest (income) expense, net ( 4.5 ) $ 18.9 $ 24.9

Miscellaneous expense (income), net

Interest expense (income), net 22.0 ( 4.5 ) 18.9

Miscellaneous expense, net

Non-service components of net periodic pension cost (3)

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Other items 5.7 ( 0.6 ) —

Miscellaneous expense (income), net 9.2 7.8 ( 9.1 )

Miscellaneous expense, net 41.7 9.2 7.8

Other expense $ 63.7 $ 4.7 $ 26.7

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(2) Certain cash and cash equivalents are held in interest-bearing accounts.

(3) We recorded a settlement loss charge due to pension de-risking activities in fiscal 2025.

Refer to the Pensions and Defined Contribution Plans footnote of the Notes to Consolidated Financial Statements for further details.

(4) We recorded a loss on the sale of our Sunoptics prismatic skylights business in fiscal 2023.

Refer to Acquisitions and Divestitures footnote of the Notes to Consolidated Financial Statements for further details.

Refer to the Acquisitions and Divestitures footnote of the Notes to Consolidated Financial Statements for further details.

We are taxed at statutory corporate rates after adjusting income reported for financial statement purposes for certain items that are treated differently for income tax purposes.

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Comprehensive income represents a measure of all changes in equity that result from recognized transactions and other economic events other than transactions with owners in their capacity as owners.

Other comprehensive (loss) income items includes foreign currency translation and pension adjustments.

ACUITY BRANDS, INC.

Other comprehensive income (loss) items includes foreign currency translation and pension adjustments.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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Balance as of August 31, 2023 $ ( 65.0 ) $ ( 47.6 ) $ ( 112.6 )

Other comprehensive income before reclassifications 8.5 0.4 8.9

Amounts reclassified from accumulated other comprehensive loss (1)

Net current period other comprehensive income 8.5 4.7 13.2

Balance as of August 31, 2023 ( 65.0 ) ( 47.6 ) ( 112.6 )

Other comprehensive (loss) income before reclassifications ( 5.9 ) 1.0 ( 4.9 )

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Balance as of August 31, 2024 ( 70.9 ) ( 44.0 ) ( 114.9 )

Other comprehensive income before reclassifications 10.8 2.1 12.9

Amounts reclassified from accumulated other comprehensive loss (1)

Net current period other comprehensive income 10.8 27.6 38.4

Balance as of August 31, 2025 $ ( 60.1 ) $ ( 16.4 ) $ ( 76.5 )

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Total defined benefit plans, net 36.4 ( 8.8 ) 27.6 4.8 ( 1.2 ) 3.6 6.0 ( 1.3 ) 4.7

Other comprehensive (loss) income $ ( 1.1 ) $ ( 1.2 ) $ ( 2.3 ) $ 14.5 $ ( 1.3 ) $ 13.2 $ ( 26.0 ) $ ( 1.6 ) $ ( 27.6 )

ACUITY BRANDS, INC.

Other comprehensive income (loss) $ 47.2 $ ( 8.8 ) $ 38.4 $ ( 1.1 ) $ ( 1.2 ) $ ( 2.3 ) $ 14.5 $ ( 1.3 ) $ 13.2

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — New Accounting Pronouncements

Accounting Standards Adopted in Fiscal 2025

Accounting Standards Update ( “ ASU ” ) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures ( “ ASU 2023-07 ” )

In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-07, which expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

The amendments in the ASU require that a public entity disclose, on an annual and interim basis, significant segment expenses that are regularly provided to an entity's chief operating decision maker (“CODM”), a description of other segment items by reportable segment, and any additional measures of a segment's profit or loss used by the CODM when deciding how to allocate resources.

Annual disclosures are required for fiscal years beginning after December 15, 2023 or our fiscal 2025.

Interim disclosures are required for periods within fiscal years beginning after December 15, 2024, or our fiscal 2026.

We adopted ASU 2023-07 for the year ended August 31, 2025.

We applied the enhanced disclosure requirements retrospectively to all periods presented.

Refer to the Segment Information footnote of the Notes to Consolidated Financial Statements for additional details.

Accounting Standards Yet to Be Adopted

Accounting Standards Update ( “ ASU ” ) 2023-09, Income Taxes (Topic 740):

ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Topic 220):

Disaggregation of Income Statement Expenses ( “ ASU 2024-03 ” )

In November 2024, the FASB issued ASU 2024-03, which requires public entities to disaggregate specific types of expenses, including disclosures for purchases of inventory, employee compensation, depreciation, and intangible asset amortization, as well as selling expenses.

Annual disclosures are required for fiscal years beginning after December 15, 2026, or our fiscal 2028.

Interim disclosures are required for periods within fiscal years beginning after December 15, 2027, or our fiscal 2029.

Early adoption is permitted.

Prospective application is required, and retrospective application is permitted.

We are currently assessing the impact of the requirements on our consolidated financial statements and disclosures.

ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures ( “ ASU 2023-09 ” )

In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, which expands income tax disclosure requirements to include additional information related to the rate reconciliation of our effective tax rates to statutory rates as well as additional disaggregation of taxes paid.

In December 2023, the FASB issued ASU 2023-09, which expands annual income tax disclosure requirements to include additional information related to the rate reconciliation of our effective tax rates to statutory rates as well as additional disaggregation of taxes paid.

The amendments in the ASU also remove disclosures related to certain unrecognized tax benefits and deferred taxes.

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We are currently assessing the impact of the requirements on our consolidated financial statements and disclosures.

ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures ( “ ASU 2023-07 ” )

In November 2023, the FASB issued ASU 2023-07, which expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

Annual disclosures are required for fiscal years beginning after December 15, 2023 or our fiscal 2025.

Interim disclosures are required for periods within fiscal years beginning after December 15, 2024, or our fiscal 2026.

Retrospective application is required for all prior periods presented, and early adoption is permitted.

We are currently assessing the impact of the requirements on our consolidated financial statements and disclosures.

All other newly issued accounting pronouncements not yet effective have been deemed either immaterial or not applicable.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 4 — Acquisitions and Divestitures

The following discussion relates to fiscal 2023 acquisitions.

There were no acquisitions during fiscal 2024 or 2022.

The $ 12.9 million of cash outflows reflected in the fiscal 2022 Consolidated Statements of Cash Flows relate to fiscal 2021 acquisitions primarily for working capital settlements.

The following discussion relates to fiscal 2025 and 2023 acquisitions.

There were no material acquisitions during fiscal 2024.

Fiscal 2025 Acquisitions

On January 1, 2025, we acquired all of the equity interests of QSC, LLC (“QSC”), a leader in the design, engineering, and manufacturing of audio, video, and control solutions and services, for $ 1.2 billion in cash.

This acquisition expands AIS into a cloud-manageable audio, video, and control platform that includes controls, sensors, and software with broad applications across multiple end-markets including education, commercial, hospitality, government, healthcare, and transportation.

We funded the transaction using cash on hand and proceeds from our indebtedness.

See Debt and Lines of Credit footnote of the Notes to Consolidated Financial Statements for further details on our outstanding borrowings.

We accounted for the acquisition of QSC in accordance with ASC Topic 805, Business Combinations (“ASC 805”).

Acquired assets and liabilities were recorded at their estimated acquisition-date fair values.

Acquisition-related professional fees were expensed as incurred for $ 23.8 million for the year ended August 31, 2025.

These costs were recorded in Selling, distribution, and administrative expenses on the Consolidated Statements of Comprehensive Income and were reflected in our unallocated corporate amounts.

The following table outlines the preliminary fair values of the assets and liabilities obtained in connection with the QSC acquisition as of January 1, 2025 (in millions):

Purchase Price Allocation

Consideration transferred:

Cash consideration $ 1,240.7

Identifiable assets:

Intangible assets 713.9

Inventories 101.9

Property, plant, and equipment 28.4

Operating lease right-of-use assets 24.2

Accounts receivable 55.7

Cash and cash equivalents 51.3

Other assets 45.8

Total identifiable assets 1,021.2

Liabilities assumed:

Accounts payable 32.6

Operating lease liabilities 24.2

Deferred tax liabilities 17.6

Other liabilities 100.7

Total liabilities assumed 175.1

Total identifiable net assets 846.1

Goodwill $ 394.6

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The estimated fair values and estimated useful lives of identifiable intangible assets as of January 1, 2025 are as follows:

Weighted Average Useful Life (Years) Fair Value

(in millions)

Developed technology and patents (1)

Customer relationships 19 145.0

Trademarks 18 133.0

Total identifiable intangible assets 13 $ 713.9

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(1) Substantially all of the the developed technology intangible assets relates to Q-SYS, an audio, video, and control platform.

Assets and liabilities for QSC are reflected in the Consolidated Balance Sheets as of August 31, 2025.

The preliminary goodwill is recorded in the AIS segment, and it is primarily comprised of benefits related to expanding AIS’ technology and audio, video, and control solution product portfolios.

Approximately $ 350.0 million of the preliminary goodwill is expected to be deductible for tax purposes.

Amounts recorded for acquired assets and liabilities are deemed to be provisional until disclosed otherwise, as we continue to gather information related to the identification and valuation of acquired assets and liabilities.

These amounts are expected to change as we finalize the allocation.

The primary areas of the preliminary acquisition accounting that are not yet finalized relate to income taxes and residual goodwill.

The final determination of acquisition-date fair values will be completed as soon as practicable, and within the measurement period of up to one year from the acquisition date as permitted under U.S.

Any adjustments to provisional amounts that are identified during the measurement period will be recorded in the reporting period in which the adjustment is determined.

We recorded measurement period adjustments to goodwill during fiscal 2025 of $ 31.1 million, primarily for updated amounts of consideration transferred for the purchase of QSC, additional information obtained related to the fair values of identified intangible assets, including the useful lives of those assets, and additional information obtained regarding acquired tax-related assets and liabilities.

We additionally recorded cumulative catch-up amortization of $ 6.9 million during our fourth quarter of fiscal 2025 related to measurement period adjustments for acquired intangible assets.

Other measurement period adjustments, including the income statement impact to prior period results, were not material.

The operating results of QSC have been included in our consolidated financial statements since the date of acquisition.

The following table provides the amount of QSC net sales and net income included within our consolidated financial statements since the acquisition date (in millions):

August 31, 2025

Net sales $ 428.6

Net income (1)

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(1) Net income for the year ended August 31, 2025 includes preliminary pre-tax nonrecurring acquisition date fair value adjustments to inventory of $ 29.6 million and amortization of acquired intangible assets of $ 42.1 million .

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

We have included unaudited pro forma financial information to show the impacts of the QSC acquisition to our consolidated results assuming the acquisition closed as of the first day of our prior fiscal year.

The unaudited pro forma information is not necessarily indicative of our results of operations had the acquisition been completed on this date, neither is it necessarily indicative of our future results.

Amounts in the table below combine our previously reported results with QSC’s results for the corresponding periods as well as adjustments for purchase accounting, accounting policy alignments, changes to our capital structure, including additional interest expense associated with borrowings to fund the acquisition, and other nonrecurring items that were incurred in connection with the acquisition, assuming they occurred as of September 1, 2023 (in millions):

Year Ended August 31,

Revenue $ 4,546.3 $ 4,376.1

Net income (1)

______________________________

(1) Pro forma net income for the year ended August 31, 2024 includes preliminary pre-tax nonrecurring acquisition date fair value adjustments to inventory of $ 29.6 million and acquisition-related costs of $ 23.8 million.

We did not have any other significant nonrecurring pro forma adjustments directly attributable to the acquisition.

M3 Innovation, LLC

On May 1, 2025, we acquired certain assets of M3 Innovation, LLC (“M3 Innovation”), a sports lighting startup that uses innovative technology to lower the overall cost of the installation and operation of sports lighting solutions.

The assets have been included in ABL's financial results since the date of acquisition and did not have a material impact to our consolidated financial condition, results of operations, or cash flows.

Fiscal 2023 Acquisitions

KE2 Therm Solutions, Inc.

On May 15, 2023, using cash on hand, we acquired all of the equity interests of KE2 Therm Solutions, Inc.

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KE2 Therm develops and provides intelligent refrigeration control solutions that deliver the precision of digital controls to promote safety, efficiency, and reliability, while delivering cost savings to the customer.

This acquisition expanded ISG's technology and controls product portfolio and reached new customers.

We accounted for the acquisition of KE2 Therm in accordance with ASC Topic 805 , Business Combinations (“ASC 805”).

This acquisition expanded AIS's technology and controls product portfolio and reached new customers.

We accounted for the acquisition of KE2 Therm in accordance with ASC 805.

We finalized the acquisition accounting for the KE2 Therm acquisition during the third quarter of fiscal 2024.

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Acquisition-related costs were expensed as incurred and were not material to our financial statements.

The aggregate purchase price of this acquisition reflects goodwill within the ISG segment of $ 15.0 million, which is not deductible for tax purposes.

The goodwill was comprised of expected benefits related to expanding ISG's technology and controls product portfolio as well as the trained workforce acquired with these businesses and expected synergies from combining KE2 Therm with our current businesses.

The aggregate purchase price of this acquisition reflects goodwill within the AIS segment of $ 15.0 million, which is not deductible for tax purposes.

The goodwill was comprised of expected benefits related to expanding AIS's technology and controls product portfolio as well as the trained workforce acquired with these businesses and expected synergies from combining KE2 Therm with our current businesses.

We additionally recorded gross intangible assets of $ 18.0 million, which reflects estimates for definite-lived intangibles with an estimated weighted average useful life of approximately 15 years.

The operating results of KE2 Therm have been included in our financial statements since the date of acquisition and

ACUITY BRANDS, INC.

The operating results of KE2 Therm have been included in our financial statements since the date of acquisition and are not material to our consolidated financial condition, results of operations, or cash flows.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

are not material to our consolidated financial condition, results of operations, or cash flows.

There were no divestitures during fiscal 2025 or 2024.

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We transferred assets with a total carrying value of $ 15.1 million, which primarily consisted of intangibles with definite lives, inventories, and allocated goodwill from the ABL segment.

We recognized a pre-tax loss on the sale of $ 11.2 million within Miscellaneous expense (income), net on the Consolidated Statements of Comprehensive Income .

We recognized a pre-tax loss on the sale of $ 11.2 million within Miscellaneous expense, net on the Consolidated Statements of Comprehensive Income .

Additionally, during fiscal 2023 we recorded impairment charges for certain retained assets as well as associate severance and other costs related to the sale.

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Cash and cash equivalents $ 422.5 $ — $ — $ 422.5 $ 845.8 $ — $ — $ 845.8

Other financial instruments — — — — — 0.4 — 0.4

Assets in fair value hierarchy 422.5 — — 422.5 845.8 — — 845.8

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(1) Includes strategic investments in privately-held entities over which we do not exercise significant influence or control without readily determinable fair values.

(1) Includes strategic investments in privately-held entities over which we do not exercise significant influence or control and without readily determinable fair values.

Amounts are recorded at cost less any impairment adjusted for observable price changes, if any.

In the fourth quarter of fiscal 2024, management committed to a plan to rebrand certain products in ABL's portfolio, which resulted in an impairment charge of $ 3.0 million for one indefinite-lived trade name asset.

This amount is recorded within Selling, distribution, and administrative expenses in the Consolidated Statements of Comprehensive

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Income and related to our ABL segment.

Refer to the Significant Accounting Policies footnote of the Notes to Consolidated Financial Statements for further details.

We had no credit losses on our investments at August 31, 2024.

During fiscal 2023, we received cash for the cancellation of a strategic investment, whose underlying company was acquired by a third party.

We also received preferred equity in the third party with a cost basis of $ 2.5 million that is accounted for under ASC 320, Investments—Debt Securities using discounted cash flows based on rates of similar instruments (Level 2).

During the year ended August 31, 2023, we recorded an allowance for credit loss for this investment for its full cost basis.

This credit loss reflected a decline in the underlying company's financial condition and long-term prospects, which included a suspension of dividend payments owed to us as well as a significant market decline in its publicly traded securities, including similar preferred equities.

This impairment charge is reflected in Miscellaneous expense (income), net for the year ended August 31, 2023 within our Consolidated Statements of Comprehensive Income.

Accrued interest related to this investment was not material to our financial statements.

Nonrecurring Fair Value Measurements

The following table summarizes information related to our nonrecurring fair value measurements as of the dates presented (in millions):

Measurement Date Fair Value Hierarchy Level Fair Value

Long-lived intangible assets May 31, 2025 Level 3 $ —

Assets held for sale

May 31, 2025 Level 3 5.5

Total assets at nonrecurring fair value $ 5.5

Long-Lived Intangible Assets

During the third quarter of fiscal 2025, we took actions to accelerate productivity efforts, including the elimination of certain brands, which triggered an impairment test for the related intangible assets.

Accordingly, we assessed the recoverability of these assets using an undiscounted cash flow model and concluded the carrying values of the assets were not fully recoverable.

Based on the significant change in expected use of these assets, we determined their fair values were de minimis at May 31, 2025, and recorded impairment charges of $ 14.7 million.

These charges are reflected within Special Charges on the Consolidated Statements of Comprehensive Income and relate to our ABL segment.

Long-lived Assets Held for Sale

During the third quarter of fiscal 2025, we determined one of our assets, included within property, plant, and equipment, with a carrying value of $ 7.5 million met the criteria to be classified as held for sale and is expected to be sold within one year.

We concluded the carrying value exceeded the fair value less cost to sell of this asset, which resulted in an impairment charge of $ 2.0 million.

This charge is reflected within Special Charges on the Consolidated Statements of Comprehensive Income and relates to our ABL segment.

Fair values and costs were measured primarily using recent sales of comparable assets.

As of August 31, 2025, the carrying value of the asset was $ 5.5 million .

Any reasonably likely change in the assumptions used in the analyses for the assets impaired during fiscal 2025 would not be material to our financial condition or results of operations.

Disclosures of Fair Value of Financial Instruments

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Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows.

Fair value for our outstanding debt obligations is estimated based on discounted future cash flows using rates currently available for debt of similar terms and maturity (Level 2).

Fair value for our senior unsecured public notes is estimated based on discounted future cash flows using rates currently available for debt of similar terms and maturity (Level 2).

Our senior unsecured public notes are carried at the outstanding balance, net of unamortized bond discount and deferred costs, as of the end of the reporting period.

The estimated fair value of our senior unsecured public notes was $ 446.7 million and $ 429.7 million as of August 31, 2025 and 2024, respectively.

We had no short-term borrowings outstanding under our revolving credit facility as of August 31, 2024 and 2023.

These borrowings are variable-rate instruments that reset on a frequent short-term basis;

We had $ 400.0 million as of August 31, 2025 and no borrowings as of August 31, 2024 outstanding under our credit agreement.

Such borrowings are variable-rate instruments that reset on a frequent short-term basis;

therefore, we estimate that any outstanding carrying values of these instruments, which are equal to their face amounts, approximate their fair values.

See Debt and Lines of Credit footnote for further details on our outstanding borrowings.

See Debt and Lines of Credit footnote of the Notes to Consolidated Financial Statements for further details on our outstanding borrowings.

ASC 825 excludes certain financial instruments and all nonfinancial instruments from its disclosure requirements.

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In many cases, the fair value estimates cannot be substantiated by comparison to independent markets, nor can the disclosed value be realized in immediate settlement of the instruments.

In evaluating our management of liquidity and other risks, the fair values of all assets and liabilities should be taken into consideration, not only those presented in this footnote.

In evaluating our management of liquidity and other risks, the fair values of all assets and liabilities should be taken into consideration, not only those presented above.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 6 — Leases

We lease property and equipment under operating lease arrangements, most of which relate to distribution centers and manufacturing facilities in the U.S., Mexico, and Canada.

We lease property and equipment under operating lease arrangements, most of which relate to distribution centers, manufacturing facilities, and offices.

We include both the contractual term as well as any renewal option that we are reasonably certain to exercise in the determination of our lease terms.

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Therefore, we discount future lease payments using our estimated incremental borrowing rate at lease commencement.

We determine this rate based

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

on a credit-adjusted risk-free rate, which approximates a secured rate over the lease term.

We determine this rate based on a credit-adjusted risk-free rate, which approximates a secured rate over the lease term.

The weighted average discount rate for operating leases was 4.3 % and 3.7 % as of August 31, 2025 and 2024, respectively.

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Present value of lease liabilities $ 107.6

The weighted average remaining lease term for our operating leases was five years as of August 31, 2024.

The weighted average remaining lease term for our operating leases was 4.96 years as of August 31, 2025.

Lease cost is recorded within Cost of products sold, and may be capitalized into inventory as manufacturing overhead, or Selling, distribution, and administrative expenses in the Consolidated Statements of Comprehensive Income based on the primary use of the related right of use (“ROU”) asset.

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ROU assets obtained in exchange for lease liabilities during the year ended August 31, 2025 and 2024 were $ 52.5 million and $ 3.4 million, respectively.

ROU assets obtained in fiscal 2025 include $ 24.2 million from the acquisition of QSC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

We have no significant leases that have not yet commenced as of August 31, 2025 that create significant rights and obligations.

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Accordingly, we assessed the recoverability of these assets using an undiscounted cash flow model and concluded that the carrying values of the assets were not fully recoverable, which triggered an impairment test for these assets.

We recorded an impairment charge of $ 4.3 million within for these assets using a discounted cash flow model to estimate their fair values in fiscal 2023.

We recorded an impairment charge of $ 4.3 million for these assets using a discounted cash flow model to estimate their fair values in fiscal 2023.

The impairments were recorded within Special charges in the Consolidated Statements of Comprehensive Income and pertained to our ABL segment.

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The recoverability and impairment tests required significant assumptions including estimated future cash flows, the identification of assets within each asset group, and the determination of an appropriate discount rate.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 7 — Debt and Lines of Credit

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Senior unsecured public notes due December 2030, unamortized discount and deferred costs ( 3.2 ) ( 3.8 )

Total debt $ 496.2 $ 495.6

Long-term borrowings under credit agreement 400.0 —

Total debt outstanding $ 896.8 $ 496.2

Long-term Debt

On November 10, 2020, Acuity Brands Lighting, Inc.

issued $ 500.0 million aggregate principal amount of 2.150 % senior unsecured notes due December 15, 2030 (the “Unsecured Notes”) at a price equal to 99.737 % of their face value.

On November 10, 2020, Acuity Brands Lighting, Inc., a wholly-owned operating subsidiary of Acuity Inc., issued $ 500.0 million aggregate principal amount of 2.150 % senior unsecured notes due December 15, 2030 (the “Unsecured Notes”) at a price equal to 99.737 % of their face value.

Interest on the Unsecured Notes is paid semi-annually in arrears on June 15 and December 15 of each year.

We recorded $ 4.8 million of deferred issuance costs related to the Unsecured Notes as a direct deduction from the face amount of the Unsecured Notes.

At issuance we recorded $ 4.8 million of deferred issuance costs related to the Unsecured Notes as a direct deduction from the face amount of the Unsecured Notes.

These issuance costs are amortized over the 10 -year term of the Unsecured Notes.

The Unsecured Notes are fully and unconditionally guaranteed on a senior unsecured basis by Acuity Brands, Inc.

and ABL IP Holding LLC, a wholly-owned subsidiary of Acuity Brands, Inc.

The Unsecured Notes are fully and unconditionally guaranteed on a senior unsecured basis by Acuity Inc.

and ABL IP Holding LLC, a wholly-owned subsidiary of Acuity Inc.

Lines of Credit

On June 30, 2022, we entered into a credit agreement (the “Credit Agreement”) with a syndicate of banks that provides us with a $ 600.0 million five-year unsecured revolving credit facility (the “Revolving Credit Facility”) with the ability to request an additional $ 400.0 million of borrowing capacity.

The Revolving Credit Facility uses the Secured Overnight Financing Rate (“SOFR”) as the applicable benchmark for U.S.

Dollar borrowings and an applicable benchmark rate for non-U.S.

Dollar borrowings as defined in the Credit Agreement.

The applicable margin pricing grid mechanics are based on the better of our public credit ratings or our net leverage ratio and range from 0.80 % to 1.20 % for base rate borrowings and from 0.00 % to 0.20 % for floating rate advances.

We are also required to pay certain fees in connection with the Credit Agreement, including administrative service fees and annual facility fees, which range from 0.075 % to 0.175 % of the aggregate $ 600.0 million remaining commitment of the lenders under the Credit Agreement.

The Credit Agreement contains a leverage ratio covenant (“Maximum Leverage Ratio”) of total indebtedness to earnings before interest, tax, depreciation, and amortization (“EBITDA”), as such terms are defined in the Credit Agreement.

These ratios are computed at the end of each fiscal quarter for the most recent 12-month period.

The Credit Agreement generally allows for a Maximum Leverage Ratio of 3.75 (subject to temporary increase to 4.25 in the event of a significant acquisition) and allows netting of all unrestricted cash and cash equivalents against debt.

We had no short-term borrowings outstanding under the Revolving Credit Facility at August 31, 2025 and 2024, respectively.

On November 25, 2024, we entered into an amendment to the Credit Agreement that, among other things, provided for a delayed draw term loan facility of up to $ 600.0 million (the “Term Loan Facility”), which could be drawn in a single borrowing at any time, subject to certain conditions.

In connection with the acquisition of QSC, we incurred an aggregate $ 600.0 million in indebtedness under the Term Loan Facility.

In fiscal 2025, we voluntarily repaid $ 200.0 million of the outstanding obligation.

We had $ 400.0 million in borrowings outstanding under the Term Loan Facility at August 31, 2025.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Term Loan Facility will mature on June 30, 2027, which is the maturity date of the revolving loans and commitments under the existing Credit Agreement.

Borrowings under the Term Loan Facility bear interest at an adjusted term Secured Overnight Financing Rate (“SOFR”), adjusted daily simple SOFR rate, or base rate, at the Company’s option, plus an applicable margin.

The applicable margin is based on, at our option, the Company’s leverage ratio or ratings level, each as defined in the Credit Agreement, and ranges from 0.875 % to 1.375 % (for SOFR-based loans) and from 0 % to 0.375 % (for base rate loans).

The covenants and events of default that apply to the revolving loans and commitments under the Credit Agreement also apply to the Term Loan Facility, and borrowings under the Term Loan Facility are guaranteed by the Company and the subsidiaries of the Company that guarantee the revolving loans and commitments.

We were in compliance with all financial covenants under the Credit Agreement as of August 31, 2025.

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Borrowings and repayments on our Revolving Credit Facility with terms of three months or less are reported on a net basis on our Consolidated Statements of Cash Flows .

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 — Commitments and Contingencies

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We are fully self-insured for certain other types of liabilities, including environmental, product recall, warranty, and patent infringement.

The actuarial estimates are subject to uncertainty from various sources including, among others, changes in claim reporting patterns, claim settlement patterns, actual claims, judicial decisions, legislation, and economic conditions.

Actuarial estimates used are subject to uncertainty from various sources including, among others, changes in claim reporting patterns, claim settlement patterns, actual claims, judicial decisions, legislation, and economic conditions.

Although we believe that the actuarial estimates are reasonable, significant differences related to the items noted above could materially affect our self-insurance obligations, future expense, and cash flows.

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Collective bargaining agreements representing approximately 48 % of our work force will expire within one year, primarily due to annual negotiations of union contracts in Mexico.

We are subject to various other legal claims arising in the normal course of business, including without limitation, patent infringement, contract disputes, employment matters, and product liability claims.

Based on information currently available, it is the opinion of management that the ultimate resolution of pending and threatened legal proceedings will not have a material adverse effect on our financial condition, results of operations, or cash flows.

We are subject to various legal claims arising in the normal course of business, including without limitation, patent infringement, contract disputes, employment matters, and product liability claims.

Based on information currently

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

available, it is the opinion of management that the ultimate resolution of pending and threatened legal proceedings will not have a material adverse effect on our financial condition, results of operations, or cash flows.

However, in the event of unexpected future developments, it is possible that the ultimate resolution of any such matters, if unfavorable, could have a material adverse effect on our financial condition, results of operations, or cash flows in future periods.

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However, we cannot make a meaningful estimate of actual costs to be incurred that could possibly be higher or lower than the accrued amounts.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Environmental Matters

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If actual future warranty costs exceed recorded amounts, or recoveries are no longer collectible, adjustments to our accruals and/or receivables may be warranted, which could have a material adverse impact on our results of operations and cash flows.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Estimated liabilities for product warranty costs are included in Other accrued liabilities or Other long-term liabilities on the Consolidated Balance Sheets based upon when we expect to settle the incurred warranty.

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( 37.7 ) ( 43.5 ) ( 42.7 )

Acquired warranty and recall liabilities 7.8 — —

Ending balance $ 44.1 $ 37.5 $ 31.6

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Note 9 — Segment Information

We present our financial results of operations for our two reportable segments, ABL and ISG, consistent with how our chief operating decision maker evaluates operating results, assesses performance, and allocates resources within the Company.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The accounting policies of our reportable segments are the same as those described in the Significant Accounting Policies footnote of the Notes to Consolidated Financial Statements .

Corporate expenses that are primarily administrative in function and benefit the Company on an entity-wide basis are not allocated to segments.

These include expenses related to governance, policy setting, compliance, and certain other shared services functions.

Additionally, net interest (income) expense, net miscellaneous expense (income), and income tax expense are not allocated to segments.

We recorded no special charges during the years ended August 31, 2024 and August 31, 2022.

We allocated $ 25.0 million of the $ 26.9 million in special charges incurred during the year ended August 31, 2023 to the ABL segment;

the remaining amounts of the fiscal 2023 charge were not allocated to a segment.

We present our financial results of operations for our two reportable segments, ABL and AIS, consistent with how our CODM, Neil Ashe, Chairman, President and Chief Executive Officer, evaluates operating results, assesses performance, and allocates resources within the Company.

See Description of Business and Basis of Presentation footnote of the Notes to Consolidated Financial Statements for further details on how we identify our reportable segments.

For both segments, our CODM uses segment operating profit as the measurement of segment profit to allocate resources and assess performance.

Our CODM considers target-to-actual differences in operating profit when making decisions on how to allocate capital and resources.

Additionally, he considers segment operating profit when evaluating employee compensation and personnel allocations.

We allocate certain working capital assets and capital expenditures to our segments primarily to assess each segment's contribution to our consolidated operating cash flows and capital expenditures.

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Unallocated assets are presented in corporate as a reconciling item to our total consolidated assets.

The accounting policies of our reportable segments are the same as those described in the Significant Accounting Policies footnote of the Notes to Consolidated Financial Statements .

Corporate expenses that are primarily administrative in function and benefit the Company on an entity-wide basis are not allocated to segments.

These include expenses related to governance, policy setting, compliance, and certain other shared services functions.

Additionally, net interest expense (income), net miscellaneous expense, and income tax expense are not allocated to segments.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table presents financial information by operating segment for the periods presented (in millions):

Year Ended August 31, 2025

2024 2023 2022

ABL $ 3,573.4 $ 3,722.8 $ 3,810.1

ISG 291.9 252.7 216.1

Eliminations (1)

( 24.3 ) ( 23.3 ) ( 20.1 )

Total $ 3,841.0 $ 3,952.2 $ 4,006.1

Operating profit (loss):

ABL $ 582.8 $ 509.5 $ 545.6

ISG 43.6 32.1 22.7

Unallocated corporate amounts ( 73.1 ) ( 68.2 ) ( 58.6 )

Total $ 553.3 $ 473.4 $ 509.7

ABL AIS Corporate Eliminations Total

Net sales $ 3,612.2 $ 764.3 $ — $ ( 30.9 ) $ 4,345.6

Cost of goods sold 1,957.7 340.3 — ( 30.9 ) 2,267.1

Selling, distribution, and administrative expenses 1,034.2 347.9 102.8 — 1,484.9

Special charges 29.7 — — — 29.7

Operating profit $ 590.6 $ 76.1 $ ( 102.8 ) $ — 563.9

Interest expense, net 22.0

Miscellaneous expense, net 41.7

Income before income taxes $ 500.2

Supplemental Information:

Depreciation and amortization $ 71.0 $ 59.7 $ 2.4 $ — $ 133.1

ABL $ 74.7 $ 77.4 $ 79.3

ISG 15.3 14.4 14.4

Unallocated corporate amounts 1.1 1.4 1.1

Total $ 91.1 $ 93.2 $ 94.8

Segment assets 906.1 214.5 3,634.6 — 4,755.2

ABL $ 883.0 $ 870.1 $ 1,097.8

ISG 67.6 53.7 53.8

Unallocated corporate amounts 2,864.0 2,484.7 2,328.6

Total $ 3,814.6 $ 3,408.5 $ 3,480.2

Capital expenditures 55.1 10.4 2.9 — 68.4

ABL $ 55.1 $ 59.3 $ 51.7

ISG 3.6 3.5 2.6

Unallocated corporate amounts 5.3 3.9 2.2

Total $ 64.0 $ 66.7 $ 56.5

____________________________

(1) These amounts represent intersegment sales.

Profit on these sales eliminates within gross profit on a consolidated basis.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table reconciles operating profit by segment to income before income taxes (in millions):

Year Ended August 31, 2024

2024 2023 2022

Operating profit - ABL $ 582.8 $ 509.5 $ 545.6

Operating profit - ISG 43.6 32.1 22.7

Unallocated corporate amounts ( 73.1 ) ( 68.2 ) ( 58.6 )

ABL AIS Corporate Eliminations Total

Net sales $ 3,573.4 $ 291.9 $ — $ ( 24.3 ) $ 3,841.0

Cost of goods sold 1,960.9 122.7 — ( 24.3 ) 2,059.3

Selling, distribution, and administrative expenses 1,029.7 125.6 73.1 — 1,228.4

Operating profit $ 582.8 $ 43.6 $ ( 73.1 ) $ — 553.3

Interest (income) expense, net ( 4.5 ) 18.9 24.9

Miscellaneous expense (income), net 9.2 7.8 ( 9.1 )

Interest income, net ( 4.5 )

Miscellaneous expense, net 9.2

Income before income taxes $ 548.6

During the fourth quarter of fiscal 2023, we recognized charges within our ABL segment of $ 14.0 million for trade name impairments, $ 13.0 million for the collectability of a supplier warranty obligation owed to us for components we used in products manufactured and sold between 2017 and 2019, and $ 4.1 million for employee severance costs .

Supplemental Information:

Depreciation and amortization $ 74.7 $ 15.3 $ 1.1 $ — $ 91.1

Segment assets 883.9 67.6 2,863.1 — 3,814.6

Capital expenditures 55.1 3.6 5.3 — 64.0

Year Ended August 31, 2023

ABL AIS Corporate Eliminations Total

Net sales $ 3,722.8 $ 252.7 $ — $ ( 23.3 ) $ 3,952.2

Cost of goods sold 2,152.5 109.8 — ( 23.3 ) 2,239.0

Selling, distribution, and administrative expenses 1,035.8 110.8 66.3 — 1,212.9

Special charges 25.0 — 1.9 — 26.9

Operating profit $ 509.5 $ 32.1 $ ( 68.2 ) $ — 473.4

Interest expense, net 18.9

Miscellaneous expense, net 7.8

Income before income taxes $ 446.7

Supplemental Information:

Depreciation and amortization $ 77.4 $ 14.4 $ 1.4 $ — $ 93.2

Segment assets 870.4 53.7 2,484.4 — 3,408.5

Capital expenditures 60.2 3.5 3.0 — 66.7

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 10 — Revenue Recognition

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Such assets totaled $ 3.4 million and $ 4.5 million as of August 31, 2025 and 2024, respectively.

We also maintain one-time and ongoing promotions with our customers, which may include rebate, sales incentive, marketing, and trade-promotion programs with certain customers that require us to estimate and accrue the expected costs of such programs.

We also maintain one-time and ongoing promotions with certain customers, which may include rebate, sales incentive, marketing, and trade-promotion programs with customers that require us to estimate and accrue the expected costs of such programs.

These arrangements may include volume rebate incentives, cooperative marketing programs, merchandising of our products, introductory marketing funds for new products, and other trade-promotion activities conducted by the customer.

Costs associated with these programs are generally estimated based on the most likely amount expected to be settled based on the context of the individual contract and are reflected within the Consolidated Statements of Comprehensive Income in accordance with ASC 606, which in most instances requires such costs to be recorded as reductions of revenue.

Amounts due to our customers

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

associated with these programs totaled $ 35.3 million and $ 31.6 million as of August 31, 2024 and 2023, respectively, and are reflected within Other accrued liabilities on the Consolidated Balance Sheets .

Amounts due to our customers associated with these programs totaled $ 46.5 million and $ 35.3 million as of August 31, 2025 and 2024, respectively, and are reflected within Other accrued liabilities on the Consolidated Balance Sheets .

Costs to obtain and fulfill contracts, such as sales commissions, are generally short-term in nature and are generally expensed as incurred.

Nature of Goods and Services

Substantially all of the revenues for the periods presented were generated from short-term contracts with our customers to deliver only tangible goods such as luminaires, lighting controls, and controls for various building systems.

We record revenue from these contracts when the customer obtains control of those goods.

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For sales designated free on board destination, customers take control and revenue is recognized when a product is delivered to the customer’s delivery site.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Professional Services

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Contracts with Multiple Performance Obligations

A small portion of our revenue was derived from the combination of any or all of our products, professional services, and software licenses.

A small portion of our revenue was derived from the combination of any or all of our products, professional services, and software.

Significant judgment may be required to determine which performance obligations are distinct and should be accounted for separately.

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Shipping and Handling Activities

We account for all shipping and handling activities for customers as activities to fulfill the promise to transfer products to our customers.

We account for shipping and handling activities for customers as activities to fulfill the promise to transfer products to our customers.

As such, we do not consider shipping and handling activities to be separate performance obligations, and we expense these costs as incurred.

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Contract liabilities arise when we receive cash or an unconditional right to collect cash prior to the transfer of control of goods or services.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The amount of transaction price from contracts with customers allocated to our contract liabilities consist of the following as of the dates presented (in millions):

The amount of transaction price from contracts with customers allocated to our contract liabilities consists of the following as of the dates presented (in millions):

Current deferred revenues $ 21.4 $ 17.4

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Unsatisfied performance obligations that do not represent contract liabilities are expected to be satisfied within one year from August 31, 2025 and consist primarily of orders for physical goods that have not yet been shipped.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Disaggregated Revenues

Our ABL segment's lighting and lighting controls are sold primarily through independent sales agents who cover specific geographic areas and market channels, by internal sales representatives, through consumer retail channels, directly to large corporate accounts, and through other distribution methods, including directly to OEM customers.

ISG sells predominantly to system integrators.

Our ABL segment's luminaires and electronics are sold primarily through independent sales agents who cover specific geographic areas and market channels, by internal sales representatives, through consumer retail channels, directly to large corporate accounts, and through other distribution methods, including directly to OEM customers.

AIS sells predominantly to system integrators.

The following table shows revenue from contracts with customers by sales channel and reconciles to our segment information for the periods presented (in millions):

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Total ABL 3,612.2 3,573.4 3,722.8

ISG 291.9 252.7 216.1

AIS 764.3 291.9 252.7

Eliminations ( 30.9 ) ( 24.3 ) ( 23.3 )

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Omnibus Stock Compensation Incentive and Directors’ Equity Plans

In January 2022, our stockholders approved the Amended and Restated Acuity Brands, Inc.

In January 2022, our stockholders approved the Amended and Restated Acuity Inc.

2012 Omnibus Stock Compensation Incentive Plan (the “Stock Incentive Plan”), which, among other things, increased the total number of shares authorized for issuance pursuant to the Stock Incentive Plan from 2.7 million to 3.6 million, with a corresponding increase to shares available for grant.

The Compensation and Management Development Committee of the Board of Directors (the “Compensation Committee”) is authorized to issue awards consisting of incentive and non-qualified stock options, stock appreciation rights, restricted stock awards, restricted stock units, performance stock awards, performance stock units, stock bonus awards, and cash-based awards to eligible employees, non-employee directors, and outside consultants.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Shares available for grant under the Stock Incentive Plan were approximately 0.6 million, 0.7 million, and 1.0 million at August 31, 2025, 2024, and 2023, respectively.

5 unchanged sentences

For awards subject to a market condition, we consider both actual and derived service periods, as well as the expected performance period, to determine the appropriate compensation recognition method.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Compensation expense recognized related to our share-based payment awards during the periods presented is summarized as follows (in millions):

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* Represents shares of less than 0.1 million.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of August 31, 2025, there was $ 34.9 million of total unrecognized compensation cost related to unvested restricted stock, which is expected to be recognized over a weighted-average period of 1.4 years.

2 unchanged sentences

As of August 31, 2025, we had approximately 0.3 million performance stock units outstanding to officers and other key employees under the Stock Incentive Plan.

Our performance stock units vest primarily over a three-year period.

Our performance stock units vest over a three-year period.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For most of these grants, the actual number of performance stock units earned for these awards will be determined at the end of the related performance period based on the level of achievement of established performance thresholds.

1 unchanged sentence

We recognize compensation expense for these grants proportionately over the requisite service period for each employee when it becomes probable that the performance metric will be satisfied.

A small subset of our performance stock units granted in fiscal 2024 and fiscal 2023 have a payout based on a total shareholder return relative to a peer group index over a three-year period.

A small subset of our performance stock units granted in fiscal 2025, 2024, and 2023 have a payout based on a total shareholder return relative to a peer group index over a three-year period.

These awards are valued using a Monte-Carlo simulation and are expensed over the longer of the requisite service period and the derived service period.

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Treasury yield consistent with the derived performance period.

2025 2024 2023

Dividend yield — % — % — %

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Granted 0.1 $ 186.78

Vested ( 0.1 ) $ 124.29

Forfeited — * $ 195.67

2 unchanged sentences

Vested ( 0.1 ) $ 91.36

Forfeited — * $ 195.67

Outstanding at August 31, 2024 0.3 $ 186.66

1 unchanged sentence

Vested ( 0.1 ) $ 207.02

Forfeited — * $ 178.82

Outstanding at August 31, 2025 0.3 $ 214.89

1 unchanged sentence

* Represents shares of less than 0.1 million.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of August 31, 2025 there was $ 13.6 million of total unrecognized compensation cost related to unvested performance stock units.

This cost is expected to be recognized over a weighted-average period of approximately 1.4 years.

The total fair value of performance units vested during the years ended August 31, 2024 and 2023 was $ 5.0 million and $ 11.5 million, respectively.

No awards vested during the year ended August 31, 2022.

The total fair value of performance units vested during the years ended August 31, 2025, 2024, and 2023 was $ 14.9 million, $ 5.0 million, and $ 11.5 million, respectively.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Stock Options

1 unchanged sentence

Of these options, 0.3 million were granted in fiscal 2021 and become exercisable over a four-year period.

These options are also subject to a market condition (the “Market Options”).

Options issued under the Stock Incentive Plan are generally granted with an exercise price equal to the fair market value of our stock on the date of grant, but never less than the fair market value on the grant date, and expire 10 years from the date of grant.

The fair value of each Market Option was estimated on the date of grant using the Monte Carlo simulation model.

The dividend yield was calculated based on annual dividends paid and the trailing 12-month average closing stock price at the time of grant.

Expected volatility was based on historical volatility of our stock, calculated using the most recent time period equal to the expected life of the options.

The risk-free interest rate was based on the U.S.

Treasury yield for a term equal to the contractual term for the Market Options.

The expected life of the Market Options is based on projected exercise dates resulting from the Monte Carlo simulation for each award tranche.

All inputs noted above are estimates made at the time of grant.

Actual realized value of each option grant could materially differ from these estimates, without impact to future reported net income.

The following weighted average assumptions were used to estimate the fair value of the stock options granted in the fiscal year presented:

Market Options

Dividend yield 0.5 %

Expected volatility 36.5 %

Risk-free interest rate 0.7 %

Expected life of options 8 years

Weighted-average fair value of options $ 40.45

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Stock option activity during the periods presented was as follows:

6 unchanged sentences

Exercised — * $ 126.92

Forfeited ( 0.1 ) $ 227.15

Outstanding at August 31, 2023 1.0 $ 131.81 0.9 $ 135.91

Exercised ( 0.1 ) $ 143.92

Forfeitures ( 0.1 ) $ 227.15

Outstanding at August 31, 2024 0.9 $ 130.74 0.9 $ 132.48

6 unchanged sentences

— * $ 239.76 — * $ 239.76

$ 210.01 - $ 239.76 (average life - 2.1 years)

___________________________

* Represents amounts of less than 0.1 million.

The total intrinsic value of options exercised during the years ended August 31, 2025, 2024, and 2023 was approximately $ 13.9 million, $ 6.6 million, and $ 0.5 million, respectively.

As of August 31, 2024, the total intrinsic value of options outstanding was $ 116.5 million, the total intrinsic value of options expected to vest was $ 10.1 million, and the total intrinsic value of options exercisable was $ 106.4 million.

As of August 31, 2024, there was $ 0.7 million of total unrecognized compensation cost related to unvested options.

We expect to recognize this cost over the next fiscal year.

Employee Deferred Stock Units

We previously allowed employees to defer a portion of restricted stock awards granted in fiscal 2003 and fiscal 2004 into the SDSP as stock units.

The stock units are payable in shares of stock at the time of distribution from the SDSP.

As of August 31, 2024, approximately 4,000 fully vested stock units remain deferred, but undistributed, under the Stock Incentive Plan.

There was no compensation expense related to these stock units during fiscal years 2024, 2023, and 2022.

As of August 31, 2025, the total intrinsic value of options outstanding and exercisable was $ 166.1 million.

As of August 31, 2025, there was no intrinsic value of options expected to vest.

As of August 31, 2025, there was no unrecognized compensation cost related to unvested options.

Director Deferred Stock Units

5 unchanged sentences

Employees may participate at their discretion.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 12 — Pension and Defined Contribution Plans

4 unchanged sentences

Plan assets are invested primarily in fixed income and equity securities.

The following tables reflect the status of our domestic (U.S.-based) and international pension plans as of the dates presented (in millions):

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In the fourth quarter of fiscal 2025, we completed full and partial settlements of our domestic qualified defined benefit plans through the purchases of nonparticipating annuities and lump sum elections.

Additionally, we terminated one of our international pension plans.

As a result of these transactions, we recognized one-time, non-cash pension settlement charges totaling $ 30.9 million in the fourth quarter of fiscal 2025.

These pension settlement charges are primarily related to the accelerated recognition of actuarial losses included within Miscellaneous expense, net in the C onsolidated Statements of Comprehensive Income .

The combined financial impact of the settlements and de-risking activities taken overall are reflected in the accompanying tables and disclosures within this note.

The following tables reflect the status of our domestic (U.S.

based) and international pension plans as of the dates presented (in millions):

Domestic Plans International Plans

5 unchanged sentences

Interest cost 7.8 7.8 1.9 2.0

Actuarial losses (gains) 3.7 ( 16.2 ) ( 0.1 ) ( 1.2 )

Actuarial (gains) losses ( 12.1 ) 3.7 ( 2.2 ) ( 0.1 )

Settlements ( 95.2 ) — ( 1.4 ) —

Benefits paid ( 12.2 ) ( 11.1 ) ( 2.4 ) ( 1.9 )

3 unchanged sentences

Fair value of plan assets at beginning of year 134.5 132.7 34.6 32.1

Actual return (loss) on plan assets 9.5 ( 1.3 ) 3.2 ( 5.2 )

Actual (loss) return on plan assets ( 1.6 ) 9.5 ( 3.2 ) 3.2

Employer contributions 0.9 3.4 1.0 —

Benefits paid ( 12.2 ) ( 11.1 ) ( 1.6 ) ( 1.3 )

Settlements ( 95.2 ) — ( 2.6 ) —

Other — — 0.7 0.6

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Accumulated benefit obligation 34.6 36.4 4.4 2.9

Plan assets — — — 0.8

Pensions plans in which plan assets exceed benefit obligation:

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Plan assets 26.4 134.5 28.9 34.6

Service cost of net periodic pension cost is allocated between Cost of products sold, and may be capitalized into inventory as labor costs, and Selling, distribution, and administrative expenses in the Consolidated Statements of Comprehensive Income based on the function of the employee's services.

All other components of net periodic pension cost are included within Miscellaneous expense (income), net in the Consolidated Statements of

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Comprehensive Income .

All other components of net periodic pension cost are included within Miscellaneous expense, net in the Consolidated Statements of Comprehensive Income .

We utilize a corridor approach to amortize cumulative unrecognized actuarial gains or losses over either the average expected future service of active participants or average life expectancy of plan participants based on each plan’s composition.

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Amortization of prior service cost — 0.1 2.6 0.1 — —

Settlement — — 0.4 — — —

Recognized actuarial loss 1.6 1.7 2.4 1.0 1.6 0.6

Settlement loss (gain) 33.2 — — ( 2.3 ) — —

Net periodic pension cost $ 40.5 $ 6.5 $ 8.7 $ ( 0.2 ) $ 2.5 $ 0.9

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We use published yield curves to assist in the development of our discount rates.

We estimate that a 100 basis point increase in the discount rate would reduce net periodic pension cost approximately $ 0.4 million for the domestic plans and $ 0.5 million for the international plans.

The expected return on plan assets is derived primarily from a periodic study of long-term historical rates of return on the various asset classes included in our targeted pension plan asset allocation as well as future expectations.

We estimate that a 100 basis point increase in the discount rate would reduce net periodic pension cost for fiscal 2025 approximately $ 0.3 million for the domestic plans and $ 0.7 million for the international plans.

The expected return on plan assets is derived primarily from a periodic study of long-term historical rates of return on the fair value of our various asset classes included in our targeted pension plan asset allocation as well as future expectations.

We estimate that each 100 basis point reduction in the expected return on plan assets would result in additional net periodic pension cost of $ 0.8 million and $ 0.3 million for domestic plans and international plans, respectively.

We also evaluate the rate of compensation increase annually and adjust if necessary.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Our investment objective for domestic plan assets is to earn a rate of return sufficient to exceed the long-term growth of the plans’ liabilities without subjecting plan assets to undue risk.

The plan assets are invested primarily in high quality debt and equity securities.

The plan assets are invested primarily in fixed income securities.

We conduct a periodic strategic asset allocation study to form a basis for the allocation of pension assets between various asset categories.

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At August 31, 2025, the U.S.

targeted asset allocation approximated 95 % fixed income securities and 5 % equity securities.

Our investment objective for the international plan assets is also to add value by exceeding the long-term growth of the plans’ liabilities.

At August 31, 2024, the international asset target allocation approximated 93 % fixed income securities and 7 % multi-strategy investments.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

targeted asset allocation approximated 70 % fixed income securities, 15 % real estate securities, and 15 % equity securities.

Our investment objective for the international plan assets is to cover the value of the plans’ liabilities.

At August 31, 2025, the international asset target allocation approximated 100 % guaranteed insurance policies.

Our pension plan asset allocation by asset category as of the dates presented is as follows:

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Real estate 14.4 % 5.5 % — % — %

Guaranteed insurance policies — % — % 99.6 % — %

Total 100.0 % 100.0 % 100.0 % 100.0 %

1 unchanged sentence

Our pension plan assets are stated at fair value based on quoted market prices in an active market, quoted redemption values, or estimates based on reasonable assumptions as of the most recent measurement period.

See the Fair Value Measurements footnote for a description of the fair value guidance.

See the Fair Value Measurements footnote for a description of the fair value guidance under U.S.

No transfers between the levels of the fair value hierarchy occurred during the current fiscal period.

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Treasury securities that are valued based on discounted future cash flows using rates currently available for debt of similar terms and maturity.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Real Estate Fund (NAV) :

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All decisions regarding whether to honor redemption requests are made by the fund’s board of directors.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following tables present the fair value of the domestic pension plan assets by major category as of the dates presented (in millions):

Fair Value Measurements

as of Quoted Market

Prices in Active

Identical Assets Significant

Inputs Significant

as of Fair Value Measurements

August 31, 2025 (Level 1) (Level 2) (Level 3)

1 unchanged sentence

Fixed-income investments $ 10.9 $ — $ 10.9 $ —

US Treasury investments 34.4 — 34.4 —

Treasury investments 5.2 — 5.2 —

Mutual funds:

9 unchanged sentences

Total assets at fair value $ 26.4

Fair Value Measurements

as of Quoted Market

Prices in Active

Identical Assets Significant

Inputs Significant

as of Fair Value Measurements

August 31, 2024 (Level 1) (Level 2) (Level 3)

13 unchanged sentences

Total assets at fair value $ 134.5

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

International Plans' Investments

The international plans' assets consist primarily of funds invested in equity securities, multi-strategy investments, and fixed income investments.

These securities are calculated using the values of the underlying holdings (i.e.

significant observable inputs) but do not have quoted prices in active markets (Level 2).

The short-term fixed income investments represents cash and cash equivalents held by the funds at fiscal year end (Level 1).

During the second quarter of fiscal 2025, we entered into a buy-in insurance policy to transfer our U.K.

pension assets to a third-party insurance company.

As of August 31, 2025, the remaining plan assets consist primarily of the buy-in insurance policy.

The fair value of the related insurance assets are set equal to the insured liabilities, which are comprised of the projected benefit obligations associated with the plan (Level 3).

The unobservable inputs for the fair value of the insurance policy include the discount rate and rate of compensation increases utilized in the actuarial valuation of the related projected benefit obligation.

In the fourth fiscal quarter of fiscal 2025, we terminated one of our pension plans in Mexico.

As a part of this termination, no plan assets remain.

The following tables present the fair value of the international pension plan assets by major category as of the dates presented (in millions):

Fair Value Measurements

as of Quoted Market

Prices in Active

Identical Assets Significant

Inputs Significant

as of Fair Value Measurements

August 31, 2025 (Level 1) (Level 2) (Level 3)

Assets included in the fair value hierarchy:

Short-term fixed income investments $ 0.1 $ 0.1 $ — $ —

Multi-strategy investments 2.3 — 2.3 —

Fixed-income investments 32.1 — 32.1 —

Insurance policy 28.8 — — 28.8

Total assets at fair value $ 28.9

Fair Value Measurements

as of Quoted Market

Prices in Active

Identical Assets Significant

Inputs Significant

as of Fair Value Measurements

August 31, 2024 (Level 1) (Level 2) (Level 3)

Assets included in the fair value hierarchy:

Equity securities $ 5.2 $ — $ 5.2 $ —

Short-term fixed income investments $ 0.2 $ 0.2 $ — $ —

2 unchanged sentences

Total assets at fair value $ 34.6

We do not expect to contribute to the domestic qualified plans in fiscal 2025 based on the funded status of the plans as well as current legal minimum funding requirements.

We expect to contribute approximately $ 0.1 million during fiscal 2025 to our international defined benefit plans.

These amounts are based on the total contributions required during fiscal 2025 to satisfy current legal minimum funding requirements for qualified plans and estimated benefit payments for non-qualified plans.

The following table presents a reconciliation of the beginning and ending balances of the fair value measurements using significant unobservable inputs (Level 3) (in millions):

Year Ended August 31,

Beginning balance $ —

Purchases 32.0

Unrealized loss ( 3.2 )

Ending balance $ 28.8

We do not expect to contribute to the remaining plans in fiscal 2026 based on the funded status of the plans as well as current legal minimum funding requirements.

Benefit payments are made primarily from funded benefit plan trusts.

3 unchanged sentences

2031-2035 25.6 16.8

2027 12.0 1.9

2028 14.8 2.1

2029 13.8 2.2

2030-2034 62.6 14.6

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Domestic Plan Termination Approval

On March 28, 2024, the Board of Directors approved a resolution to terminate one of the qualified domestic pension plans, which is frozen and no longer accrues benefits.

As of August 31, 2024, the fair value of this plan's assets exceeded its benefit obligation.

The termination of the plan is effective August 31, 2024, is subject to the appropriate regulatory approvals, and is expected to be completed in fiscal 2025.

The Company's ultimate settlement obligation will depend upon both the nature and timing of participant settlements and prevailing market conditions.

Multi-employer Pension Plans

We have contributed to two multi-employer defined benefit pension plans under the terms of collective-bargaining agreements that cover certain of our union-represented employees.

The risks of participating in these multi-employer plans are different from single-employer plans in the following aspects:

• Assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of other participating employers.

• If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be shared by the remaining participating employers.

• If a participating employer chooses to stop participating in some of its multi-employer plans, the employer may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability.

Our contributions to these plans were $ 0.5 million for the years ended August 31, 2024, 2023, and 2022.

Defined Contribution Plans

We have defined contribution plans to which both employees and we make contributions.

We have defined contribution plans to which both employees and the Company make contributions.

Employer matching amounts are allocated in accordance with the participants’ investment elections for elective deferrals and totaled $ 14.9 million, $ 11.7 million, and $ 11.1 million for the years ended August 31, 2025, 2024, and 2023, respectively.

At August 31, 2024, assets of the domestic defined contribution plans included shares of our common stock with a market value of approximately $ 10.3 million, which represented approximately 1.9 % of the total fair market value of the assets in our domestic defined contribution plans.

At August 31, 2025, assets of certain domestic defined contribution plans included shares of our common stock with a market value of approximately $ 12.8 million, which represented approximately 2.2 % of the total fair market value of the assets in those defined contribution plans.

Note 13 — Special Charges

During the year ended August 31, 2024, we recognized no pre-tax special charges.

During the year ended August 31, 2025, we recognized $ 29.7 million of pre-tax special charges, which consisted primarily of impairments of long-lived assets as well as employee severance costs related to productivity initiatives.

We recognized no pre-tax special charges during the year ended August 31, 2024.

During the year ended August 31, 2023, we recognized $ 26.9 million of pre-tax special charges, which primarily included impairment charges of indefinite-lived intangible assets;

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Year Ended August 31,

Trade name impairment charges $ 14.0

Impairment charges $ 16.7 $ 18.3

Severance and employee-related costs 7.2 7.7

Operating lease asset group impairment charge 4.3

Other restructuring costs 0.9

Other items 5.8 0.9

Total special charges $ 29.7 $ 26.9

As of August 31, 2024, we had no remaining accruals related to special charges.

As of August 31, 2023, remaining accruals related to special charges totaled $ 5.2 million and are included in Accrued compensation in the Consolidated Balance Sheets .

These amounts related to unpaid severance and employee-related costs from our fourth quarter fiscal 2023 actions.

ACUITY BRANDS, INC.

As of August 31, 2025, we had $ 0.4 million of remaining accruals related to special charges, which are included in Accrued compensation in the Consolidated Balance Sheets .

These amounts related to unpaid severance and employee-related costs from our third quarter fiscal 2025 actions.

As of August 31, 2024, there were no remaining accruals related to special charges.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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No shares of preferred stock were issued in fiscal 2025 or 2024, and no shares of preferred stock are outstanding.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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Amounts in the table may not recalculate exactly due to rounding.

The following table presents stock options, restricted stock awards, and performance stock units that were excluded from the diluted earnings per share calculation for the periods presented as the effect of inclusion would have been antidilutive (in millions):

Year Ended August 31,

2024 2023 2022

Stock options — * 0.1 0.1

Restricted stock awards — * 0.1 0.1

Performance stock units — * — * —

_______________________

* Represents shares of less than 0.1 million.

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Stock options, performance stock awards, and restricted stock awards that were excluded from the diluted earnings per share calculation as the effect of inclusion would have been antidilutive were immaterial for the years ended August 31, 2025, 2024, and 2023.

Note 15 — Income Taxes

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The Organization for Economic Co-operation and Development (“OECD”) released the Global Anti-base Erosion (“GloBE”) Model Rules for Pillar Two on December 20, 2021, which defined a 15% global minimum tax.

Since the model rules have been released, many countries have enacted or continue to consider changes in their tax laws and regulations based on the Pillar Two proposals, some of which become effective for us in fiscal 2025.

Since the model rules have been released, many countries have enacted or continue to consider changes in their tax laws and regulations based on the Pillar Two proposals, of which some are effective for us in fiscal 2025.

We are continuing to evaluate the impact of these proposed and enacted legislative changes as new guidance becomes available.

We do not expect Pillar Two to have a material impact on our financial statements as most jurisdictions in which we operate have an effective tax rate above the 15% threshold.

On August 16, 2022, the Inflation Reduction Act (“IRA”) was signed into law in the United States.

Among other provisions, the IRA includes a 15% corporate alternative minimum tax rate applicable for our fiscal 2024 taxable year as well as a 1% federal excise tax on corporate stock repurchases made after December 31, 2022, which we account for as an increase to the cost basis of our share repurchases.

The IRA did not have a material impact on our financial condition, results of operations, or cash flows.

Internal Revenue Code (“IRC”) Section 174 was enacted as part of the Tax Cuts and Jobs Act of 2017 (“TCJA”).

IRC Section 174, which became effective for us during fiscal 2023, requires us to capitalize research and development expenditures and amortize them on our U.S.

tax return over five or fifteen years, depending on where research is conducted.

The fiscal 2023 year over year change in both our provision for current federal taxes and (benefit from) provision for deferred taxes relates principally to the application of IRC Section 174.

Pillar Two as currently enacted did not have a material impact on our financial statements as most jurisdictions in which we operate have an effective tax rate above the 15% threshold.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law, introducing significant changes to corporate income tax rates and deductions.

For fiscal year 2025, OBBA did not have a material impact on our financial statements.

We continue to evaluate the future impact of the OBBBA for those provisions that are effective after fiscal year 2025.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The provision for income taxes consists of the following components during the periods presented (in millions):

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Provision for current foreign taxes 21.6 19.4 27.0

(Benefit from) provision for deferred taxes ( 33.6 ) ( 47.8 ) 0.6

Benefit from deferred taxes ( 45.0 ) ( 33.6 ) ( 47.8 )

Total provision for income taxes $ 103.6 $ 126.0 $ 100.7

The following table presents income before income taxes for our domestic and foreign operations for the periods presented:

(in millions):

The following table presents income before income taxes for our domestic and foreign operations for the periods presented (in millions):

Year Ended August 31,

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Income before income taxes $ 500.2 $ 548.6 $ 446.7

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table reconciles the provision at the federal statutory rate to the total provision for income taxes during the periods presented (in millions):

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Total provision for income taxes $ 103.6 $ 126.0 $ 100.7

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Components of the net deferred income tax liabilities as of the dates presented include (in millions):

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At August 31, 2025, we had federal tax credit carryforwards of approximately $ 11.2 million that begin to expire in 2029, and state tax credit carryforwards of approximately $ 0.5 million that begin to expire in 2027.

Approximately $ 9.7 million of the total $ 10.5 million in federal tax credit carryforwards are subject to a full valuation allowance as we do not expect to realize any future tax benefit for these items.

At August 31, 2024, we had federal net operating

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

loss carryforwards of $ 10.5 million that begin to expire in 2029, state net operating loss carryforwards of $ 28.8 million that begin to expire in 2025, and foreign net operating loss carryforwards of $ 14.6 million that begin to expire in 2028.

Approximately $ 11.2 million in federal tax credit carryforwards are subject to a full valuation allowance as we do not expect to realize any future tax benefit.

At August 31, 2025, we had federal net operating loss carryforwards of $ 9.1 million that begin to expire in 2029, state net operating loss carryforwards of $ 27.4 million that begin to expire in 2026, and foreign net operating loss carryforwards of $ 15.2 million that begin to expire in 2028.

The gross amount of unrecognized tax benefits as of August 31, 2025 and 2024 totaled $ 18.5 million and $ 21.1 million, respectively.

The amount of unrecognized tax benefits the would affect the company's effective income tax rate was $ 21.1 million and $ 20.1 million as of August 31, 2024 and 2023, respectively.

The amount of unrecognized tax benefits that would affect the Company's effective income tax rate was $ 18.5 million and $ 21.1 million as of August 31, 2025 and 2024, respectively.

We recognize potential interest and penalties related to unrecognized tax benefits as a component of income tax expense;

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We anticipate that unrecognized tax benefits may decrease within the next 12 months by $ 5.6 million, of which $ 1.3 million is interest, due to the expiring of the statute of limitations.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table reconciles the change in the unrecognized income tax benefit (reported in Other long-term liabilities on the Consolidated Balance Sheets ) during the periods presented (in millions):

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Total accrued interest was $ 2.4 million, $ 4.6 million, and $ 3.3 million as of August 31, 2025, 2024, and 2023, respectively.

There were no accruals related to income tax penalties during fiscal 2024.

Income tax penalties of $ 0.8 million were accrued during fiscal 2025.

Interest, net of tax benefits, and penalties are included in Income tax expense within the Consolidated Statements of Comprehensive Income .

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Note 16 — Supplemental Disaggregated Information

Sales of lighting, lighting controls, and building technology solutions, excluding services accounted for approximately 99 % of total consolidated net sales in fiscal 2024, 2023, and 2022.

Sales of lighting, lighting controls, building management solutions, and audio, video, and control solutions, excluding services accounted for approximately 99 % of total consolidated net sales in fiscal 2025, 2024, and 2023.

Our geographic distribution of net sales, operating profit, income before income taxes, and long-lived assets is summarized in the following table during and as of the periods presented (in millions):

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(3) Long-lived assets include net property, plant, and equipment, operating lease right-of-use assets, and other long-term assets as reflected in the Consolidated Balance Sheets .

ACUITY BRANDS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 17 — Subsequent Event

On October 24, 2024, Acuity Brands Technology Services, Inc., a wholly owned subsidiary of Acuity Brands, Inc.

entered into an equity purchase agreement (the “Purchase Agreement”) to acquire QSC, LLC (“QSC”)), a leader in the design, engineering, and manufacturing of audio, video, and control solutions and services.

The terms of the Purchase Agreement reflect a purchase price totaling approximately $ 1.215 billion, subject to customary purchase price adjustments.

We anticipate funding the transaction with cash on hand as well as adding a $ 600 million term loan under our Revolving Credit Facility.

We currently expect the transaction to close during the second quarter of our fiscal 2025, subject to customary closing conditions set forth in the Purchase Agreement, including, among others:

(i) the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; (ii) the absence of any governmental order or law prohibiting the transaction; (iii) no “Material Adverse Effect” (as defined in the Purchase Agreement) having occurred since the signing of the Purchase Agreement; and (iv) certain other customary conditions relating to the accuracy of the parties’ representations and warranties in the Purchase Agreement (subject, with specified exceptions, to customary materiality standards) and the performance of their respective obligations under the Purchase Agreement in all material respects.

On October 8, 2025, we voluntarily repaid an additional $ 100.0 million of our outstanding Term Loan Facility obligation.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

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-K

Item 8. Financial Statements and Supplementary Data