What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-07-27 compared with 2026-04-27 · 276 added, 108 removed, 356 unchanged (52% of the section changed)

1 unchanged sentence

The following discussion updates the Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and the two discussions should be read together.

Company Overview — First Quarter of 2026

Company Overview — Second Quarter of 2026

The following discussion should be read in conjunction with our Condensed Consolidated Financial Statements and the related Notes to those Financial Statements included elsewhere in this Quarterly Report on Form 10-Q, which are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”).

21 unchanged sentences

These commissions, which are included in our commissions and fees in the Consolidated Statements of Income, are estimated and accrued throughout the year based on actual premiums written and knowledge, to the extent it is available, of losses incurred.

Payments are primarily received in the first and second quarters of each subsequent underwriting year, based upon the prior year(s) underwriting results, but may differ from the amount estimated and accrued due to the lack of complete visibility regarding loss information until it is received.

Over the last three years, annual Contingents have averaged approximately 4.4% of total commissions and fee revenues.

Payments are primarily received in the first and second quarters of each subsequent underwriting year, based upon prior year(s) underwriting results, but may differ from the amount estimated and accrued due to the lack of complete visibility regarding loss information until they are received.

Over the last three years, Contingents have averaged approximately 4.4% of total commissions and fee revenues.

Fee revenues primarily relate to services other than securing coverage for our customers, and for fees negotiated in lieu of commissions.

2 unchanged sentences

Annual fee revenues as a percentage of our total commissions and fees, represented 22.2% in 2025 and 21.1% in 2024.

For the three months ended March 31, 2026, our total commissions and fees growth rate was 35.7%.

Our consolidated Organic Revenue growth rate was flat and our Organic Revenue with Contingents growth rate was 2.2%.

For the three months ended June 30, 2026, our total commissions and fees growth rate was 32.4%.

Our consolidated Organic Revenue decreased by 0.7% and our Organic Revenue with Contingents growth rate was 0.7%.

Historically, investment and other income has consisted primarily of interest earnings on operating cash and where permitted, on premiums collected and held in a fiduciary capacity before being remitted to insurance companies.

2 unchanged sentences

Other income primarily reflects other miscellaneous revenues.

Income before income taxes for the three months ended March 31, 2026 increased from the first quarter of 2025 by $106 million or 24.8%, driven by increased Contingents, leveraging our expense base, acquisitions completed in the past twelve months and the change in mark-to-market of escrow liability.

This growth was partially offset by Acquisition/Integration Costs and the change in estimated acquisition earn-out payables.

Income before income taxes for the three months ended June 30, 2026 increased from the second quarter of 2025 by $72 million or 23.2%, driven by increased Contingents, leveraging our expense base, synergies realized from the acquisition of Accession, acquisitions completed in the past twelve months and the change in estimated acquisition earn-out payables.

This growth was partially offset by Acquisition/Integration Costs.

Information Regarding Non-GAAP Financial Measures

34 unchanged sentences

• “ Mark-to-market of escrow liability ” is a caption on our consolidated statements of income which reflects the non-cash change in the fair value associated with certain shares of the Company’s common stock held in escrow.

The change is driven by fluctuations in our stock price between the beginning of the quarter and the end of the quarter.

The change is driven by fluctuations in our stock price between the beginning of the period and the end of the period.

These escrowed shares represent a portion of the merger consideration payable in connection with our acquisition of Accession.

6 unchanged sentences

Part of our business strategy is to attract high-quality insurance intermediaries and service organizations to join our operations.

From 1993 through the first quarter of 2026, we acquired 725 insurance intermediary operations.

From 1993 through the second quarter of 2026, we acquired 732 insurance intermediary operations.

Critical Accounting Policies

4 unchanged sentences

Refer to Note 1 in the “Notes to Consolidated Financial Statements” in our Annual Report on Form 10-K for the year ended December 31, 2025 for details regarding our critical and significant accounting policies.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025

RESULTS OF OPERATIONS FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2026 AND 2025

The following discussion and analysis regarding results of operations and liquidity and capital resources should be considered in conjunction with the accompanying Condensed Consolidated Financial Statements and related Notes.

Financial information relating to our condensed consolidated financial results is as follows:

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

(in millions, except percentages)

27 unchanged sentences

Commissions and Fees

Commissions and fees, including Contingents and earned premiums, for the three months ended March 31, 2026 increased $495 million to $1,880 million, or 35.7%, over the same period in 2025.

Core commissions and fees revenue for the first quarter of 2026 increased $441 million or 32.9%, composed of:

Commissions and fees, including Contingents and earned premiums, for the three months ended June 30, 2026 increased $405 million to $1,654 million, or 32.4%, over the same period in 2025.

Core commissions and fees revenue for the second quarter of 2026 increased $365 million or 30.3%, composed of:

(i) $393 million from acquisitions that had no comparable revenues in the same period of 2025;

(ii) an increase from the impact of Foreign Currency Translation of $19 million and an offsetting decrease from (iii) $3 million related to commissions and fees revenue from businesses or books of business divested in the preceding twelve months and (iv) $10 million related to the Litigation-Related Impact.

Contingents for the first quarter of 2026 increased by $54 million, or 126%, compared to the same period in 2025.

This increase was driven primarily by (i) improved underwriting results for our carrier partners, growth in premium volume and qualifying for certain Contingents that we did not qualify for in the prior year and (ii) recent acquisitions.

The Organic Revenue with Contingents growth rate was 2.2% driven by the increase in Organic Contingents.

(ii) an increase from the impact of Foreign Currency Translation of $2 million and an offsetting decrease from (iii) $4 million related to commissions and fees revenue from businesses or books of business divested in the preceding twelve months;

(iv) $18 million related to the Litigation-Related Impact and (v) $8 million of net new and renewal business, which combined reflected an overall Organic Revenue decrease of 0.7%.

Contingents for the second quarter of 2026 increased by $40 million, or 88.9%, compared to the same period in 2025.

The Organic Revenue with Contingents growth rate was 0.7%.

Commissions and fees, including Contingents and earned premiums, for the six months ended June 30, 2026, increased $900 million to $3,534 million, or 34.2%, over the same period in 2025.

Core commissions and fees revenue for the six months ended June 30, 2026 increased $806 million or 31.7%, composed of:

(i) $829 million from acquisitions that had no comparable revenues in the same period of 2025;

(ii) an increase from the impact of Foreign Currency Translation of $20 million and an offsetting decrease from (iii) $8 million related to commissions and fees revenue from businesses or books of business divested in the preceding twelve months;

(iv) $28 million related to the Litigation-Related Impact and (v) $7 million of net new and renewal business, which combined reflected an overall Organic Revenue growth decrease of 0.3%.

Contingents for the six months ended June 30, 2026 increased by $94 million, or 106.8%, compared to the same period in 2025.

This increase was driven primarily by (i) improved underwriting results for our carrier partners, (ii) growth in premium volume and qualifying for certain Contingents that we did not qualify for in the prior year, (iii) recent acquisitions and (iv) our enhanced carrier engagement model.

The Organic Revenue with Contingents growth rate was 1.6%.

Investment and Other Income

Investment and other income for the three months ended March 31, 2026 increased $2 million from the same period in 2025.

The increase was driven primarily by acquisitions that had no comparable investment and other income in the same period of 2025, substantially offset by lower average interest rates as compared to the prior year.

Investment and other income for the three months ended June 30, 2026 decreased $14 million from the same period in 2025.

Investment and other income for the six months ended June 30, 2026 decreased $12 million, from the same period in 2025.

These decreases were driven substantially by $13 million of interest income generated by the proceeds of the Company's follow-on common stock offering and senior notes issuance in June 2025, held in preparation for the closing of the Company's acquisition of Accession, and to a lesser extent lower average interest rates, each partially offset by acquisitions that had no comparable investment and other income in the same period of 2025.

Employee Compensation and Benefits

Employee compensation and benefits expense as a percentage of total revenues was 47.7% for the three months ended March 31, 2026 as compared to 48.6% for the three months ended March 31, 2025, an increase of 32.8%, or $224 million.

Employee compensation and benefits expense as a percentage of total revenues was 50.0% for the three months ended June 30, 2026 as compared to 49.8% for the three months ended June 30, 2025, an increase of 30.9%, or $198 million.

This increase included $203 million of compensation costs related to acquisitions that had no comparable costs in the same period of 2025.

3 unchanged sentences

(ii) a decrease in claims costs within our self-insured health plan;

(iii) a decrease in commissions, base compensation and bonuses driven by the Litigation-Related Impact;

(iii) a decrease in commissions, base compensation and bonuses resulting from the Litigation-Related Impact;

partially offset by (iv) an increase in staff costs attributable to new hires and annual compensation increases.

Employee compensation and benefits expense as a percentage of total revenues was 48.8% for the six months ended June 30, 2026 as compared to 49.2% for the six months ended June 30, 2025, an increase of 31.9%, or $422 million.

This increase included $444 million of compensation costs related to acquisitions that had no comparable costs in the same period of 2025.

Therefore, employee compensation and benefits expense attributable to those offices that existed in the same time periods of 2026 and 2025 decreased by $22 million.

This underlying employee compensation and benefits expense decrease was primarily related to:

(i) lower non-cash stock-based compensation expense driven by the Company's performance;

(ii) a decrease in claims costs within our self-insured health plan;

(iii) a decrease in commissions, base compensation and bonuses resulting from the Litigation-Related Impact;

partially offset by (iv) an increase in staff costs attributable to new hires and annual compensation increases.

Other Operating Expenses

Other operating expenses represented 15.2% of total revenues for the first quarter of 2026, as compared to 13.2% for the first quarter of 2025.

Other operating expenses for the first quarter of 2026 increased $103 million, or 55.4%, from the same period of 2025.

Other operating expenses represented 16.2% of total revenues for the second quarter of 2026, as compared to 16.4% for the second quarter of 2025.

Other operating expenses for the second quarter of 2026 increased $60 million, or 28.4%, from the same period of 2025.

This change includes:

(i) $72 million of other operating expenses related to acquisitions that had no comparable costs in the same period of 2025;

(ii) $26 million of Acquisition/Integration Costs associated with the Transaction, $20 million of which is included in the $95 million related to acquisitions that had no comparable costs in the same period of 2025;

and (iii) increased information technology-related costs.

and (ii) increased information technology-related costs.

Other operating expenses represented 15.7% of total revenues for the six months ended June 30, 2026, as compared to 14.8% for the six months ended June 30, 2025.

Other operating expenses for the first six months of 2026 increased $162 million, or 40.7%, from the same period of 2025.

This change includes:

(i) $150 million of other operating expenses related to acquisitions that had no comparable costs in the same period of 2025;

and (ii) increased information technology-related costs.

(Gain)/Loss on Disposal

Gain on disposal for the first quarter of 2026 increased $3 million from the first quarter of 2025.

Gain on disposal for the second quarter of 2026 decreased $1 million from the second quarter of 2025.

Gain on disposal for the six months ended June 30, 2026 increased $1 million from the six months ended June 30, 2025.

Although we do not routinely sell businesses or customer accounts, we periodically sell an office or a book of business (one or more customer accounts) that we believe does not produce reasonable margins or demonstrate a potential for adequate growth, or because doing so is in the Company’s best interest.

Amortization expense for the first quarter of 2026 increased $63 million, or 118.9%, compared to the first quarter of 2025.

Amortization expense for the second quarter of 2026 increased $60 million, or 120.0%, compared to the second quarter of 2025.

Amortization expense for the six months ended June 30, 2026 increased $123 million, or 119.4%, compared to the six months ended June 30, 2025.

This change reflects the amortization of new intangibles from businesses acquired within the past twelve months, net of certain intangible assets becoming fully amortized or written off in the (Gain)/Loss on disposal.

Depreciation expense for the first quarter of 2026 increased $6 million, or 54.5%, compared to the first quarter of 2025.

Depreciation expense for the second quarter of 2026 increased $7 million, or 63.6%, compared to the second quarter of 2025.

Depreciation expense for the six months ended June 30, 2026 increased $12 million, or 52.2%, compared to the six months ended June 30, 2025.

Changes in depreciation expense reflect net additions of fixed assets resulting from businesses acquired in the past twelve months and the addition of fixed assets resulting from business initiatives, partially offset by the impact of fixed assets that became fully depreciated or written off in the gain or loss on disposal.

Interest Expense

Interest expense for the first quarter of 2026 increased $53 million, or 115.2%, compared to the first quarter of 2025.

The increase is due to higher debt balances resulting from debt issuance in the second quarter of 2025 to fund the Transaction, which was partially offset by decreases in the floating rate benchmark used on our adjustable-rate debt.

Interest expense for the second quarter of 2026 increased $49 million, or 96.1%, compared to the second quarter of 2025.

Interest expense for the six months ended June 30, 2026 increased $103 million, or 107.3%, compared to the first six months of 2025.

The increase is due to higher debt resulting from a debt issuance in the second quarter of 2025 to fund the Transaction, which was partially offset by decreases in the floating rate benchmark used on our adjustable-rate debt.

Change in Estimated Acquisition Earn-Out Payables

Accounting Standards Codification (“ASC”) Topic 805 - Business Combinations is the authoritative guidance requiring an acquirer to recognize 100% of the fair value of acquired assets, including goodwill, and assumed liabilities (with only limited exceptions) upon initially obtaining control of an acquired entity.

ASC 805 - Business Combinations is the authoritative guidance requiring an acquirer to recognize 100% of the fair value of acquired assets, including goodwill, and assumed liabilities (with only limited exceptions) upon initially obtaining control of an acquired entity.

Additionally, the fair value of contingent consideration arrangements (such as earn-out purchase price arrangements) at the acquisition date must be included in the purchase price consideration.

2 unchanged sentences

Estimations of potential earn-out obligations are typically based upon future earnings of the acquired operations or entities, usually for periods ranging from one to three years.

The net charge or credit to the Consolidated Statements of Income for the period is the combination of the net change in the estimated acquisition earn-out payables liability, and the accretion of the present value discount on those liabilities.

As of March 31, 2026 and 2025, the fair values of the estimated acquisition earn-out payables were re-evaluated based upon projected operating results and measured at fair value on a recurring basis using unobservable inputs (Level 3) as defined in ASC 820- Fair Value Measurement .

The net charge or credit to the Condensed Consolidated Statements of Income for the period is the combination of the net change in the estimated acquisition earn-out payables liability, and the accretion of the present value discount on those liabilities.

As of June 30, 2026 and 2025, the fair values of the estimated acquisition earn-out payables were re-evaluated based upon projected operating results and measured at fair value on a recurring basis using unobservable inputs (Level 3) as defined in ASC 820 - Fair Value Measurement.

The resulting net changes, as well as the interest expense accretion on the estimated acquisition earn-out payables were as follows:

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

(in millions)

2 unchanged sentences

Net change in earnings from estimated acquisition earn-out payables

For the three months and three months ended March 31, 2026, the fair value of estimated earn-out payables was re-evaluated and resulted in decreases of $1 million and $6 million, respectively, which resulted in credits to the Condensed Consolidated Statements of Income.

As of March 31, 2026, estimated acquisition earn-out payables totaled $393 million, of which $193 million was recorded as accounts payable and $200 million was recorded as other non-current liabilities.

The effective tax rate on income from operations for the three months ended March 31, 2026 and 2025 was 19.9% and 21.8%, respectively.

The decrease for the three months ended March 31, 2026 was primarily driven by the non-taxable treatment of the mark-to-market of escrow liability.

For the three months and six months ended June 30, 2026, the fair value of estimated earn-out payables was re-evaluated and resulted in decreases of $44 million and $45 million, respectively, which resulted in credits to the Condensed Consolidated Statements of Income.

These adjustments were primarily related to revised estimates for companies acquired in the Transaction.

As of June 30, 2026, estimated acquisition earn-out payables totaled $310 million, of which $136 million was recorded as accounts payable and $174 million was recorded as other non-current liabilities.

The effective tax rate on income from operations for the three months ended June 30, 2026 and 2025 was 24.5% and 24.8%, respectively.

The effective tax rate on income from operations for the six months ended June 30, 2026 and 2025 was 21.7% and 22.9%, respectively.

The decrease for the six months ended June 30, 2026 was driven by the non-taxable treatment of the mark-to-market of escrow liability.

RESULTS OF OPERATIONS — SEGMENT INFORMATION

5 unchanged sentences

As such, management primarily focuses on Organic Revenue growth, the growth in Contingents and EBITDAC Margin when evaluating the operational efficiency of a segment.

The reconciliation of commissions and fees included in the Condensed Consolidated Statements of Income to Organic Revenue and Organic Revenue with Contingents, both non-GAAP financial measures, for the three months ended March 31, 2026 and 2025, and the growth rates for Organic Revenue and Organic Revenue with Contingents for the three months ended March 31, 2026, including by segment, are as follows:

The reconciliation of commissions and fees included in the Condensed Consolidated Statements of Income to Organic Revenue and Organic Revenue with Contingents, both non-GAAP financial measures, for the three months ended June 30, 2026 and 2025, and the growth rates for Organic Revenue and Organic Revenue with Contingents for the three months ended June 30, 2026 and 2025, including by segment, are as follows:

Specialty Distribution

14 unchanged sentences

(2) A non-GAAP financial measure.

The reconciliation of commissions and fees included in the Condensed Consolidated Statements of Income to Organic Revenue and Organic Revenue with Contingents, both non-GAAP financial measures, for the three months ended March 31, 2025 and 2024, including by segment, and the growth rates for Organic Revenue and Organic Revenue with Contingents for the three months ended March 31, 2025, including by segment, are as follows:

The reconciliation of commissions and fees included in the Condensed Consolidated Statements of Income to Organic Revenue and Organic Revenue with Contingents, both non-GAAP financial measures, for the three months ended June 30, 2025 and 2024, including by segment, and the growth rates for Organic Revenue and Organic Revenue with Contingents for the three months ended June 30, 2025 and 2024, including by segment, are as follows:

Specialty Distribution

12 unchanged sentences

Organic Revenue with Contingents growth rate (2)

(1) The Retail segment includes commissions and fees reported as “Other” in the Segment Information table in Note 12 the Notes to the Condensed Consolidated Financial Statements, which includes corporate and consolidation items.

(1) The Retail segment includes commissions and fees reported as “Other” in the Segment Information table in Note 12 of the Notes to the Condensed Consolidated Financial Statements, which includes corporate and consolidation items.

(2) A non-GAAP financial measure.

The reconciliation of income before income taxes, included in the Condensed Consolidated Statements of Income, to EBITDAC, a non-GAAP measure, and EBITDAC - Adjusted, a non-GAAP measure, and Income Before Income Taxes Margin to EBITDAC Margin, a non-GAAP measure, and EBITDAC Margin - Adjusted, a non-GAAP measure, for the three months ended March 31, 2026, including by segment, is as follows:

The reconciliation of commissions and fees included in the Condensed Consolidated Statements of Income to Organic Revenue and Organic Revenue with Contingents, both non-GAAP financial measures, for the six months ended June 30, 2026 and 2025, and the growth rates for Organic Revenue and Organic Revenue with Contingents for the six months ended June 30, 2026 and 2025, including by segment, are as follows:

Specialty Distribution

(in millions)

Commissions and fees

Total growth %

Core commissions and fees

Foreign Currency Translation

Litigation-Related Impact

Organic Revenue (2)

Organic Revenue growth (2)

Organic Revenue growth rate (2)

Organic Contingents

Organic Revenue with Contingents (2)

Organic Revenue with Contingents growth (2)

Organic Revenue with Contingents growth rate (2)

(2) A non-GAAP financial measure.

The reconciliation of commissions and fees included in the Condensed Consolidated Statements of Income to Organic Revenue and Organic Revenue with Contingents, both non-GAAP financial measure, for the six months ended June 30, 2025 and 2024, and the growth rates for Organic Revenue and Organic Revenue with Contingents for the six months ended June 30, 2025 and 2024, including by segment, are as follows:

Specialty Distribution

(in millions)

Commissions and fees

Total growth %

Core commissions and fees

Foreign Currency Translation

Litigation-Related Impact

Organic Revenue (2)

Organic Revenue growth (2)

Organic Revenue growth rate (2)

Organic Contingents

Organic Revenue with Contingents (2)

Organic Revenue with Contingents growth (2)

Organic Revenue with Contingents growth rate (2)

(2) A non-GAAP financial measure.

The reconciliation of income before income taxes, included in the Condensed Consolidated Statements of Income, to EBITDAC, a non-GAAP measure, and EBITDAC - Adjusted, a non-GAAP measure, and Income Before Income Taxes Margin to EBITDAC Margin, a non-GAAP measure, and EBITDAC Margin - Adjusted, a non-GAAP measure, for the three months ended June 30, 2026, including by segment, is as follows:

(in millions)

Specialty Distribution

Total Revenues

12 unchanged sentences

NMF = Not a meaningful figure

The reconciliation of income before income taxes, included in the Condensed Consolidated Statements of Income, to EBITDAC, a non-GAAP measure, and EBITDAC - Adjusted, a non-GAAP measure, and Income Before Income Taxes Margin to EBITDAC Margin, a non-GAAP measure, and EBITDAC Margin - Adjusted, a non-GAAP measure, for the three months ended June 30, 2025, including by segment, is as follows:

(in millions)

11 unchanged sentences

EBITDAC Margin - Adjusted (3)

(1) Amount reflects the positive impact of approximately $13 million of interest income earned from the proceeds of the Company’s follow-on common stock offering and senior notes issuance in June 2025, held in preparation for the closing of the Company’s acquisition of Accession.

(2) “Income Before Income Taxes Margin” is defined as income before income taxes divided by total revenues.

1 unchanged sentence

NMF = Not a meaningful figure

The reconciliation of income before income taxes, included in the Condensed Consolidated Statements of Income, to EBITDAC, a non-GAAP measure, and EBITDAC - Adjusted, a non-GAAP measure, and Income Before Income Taxes Margin to EBITDAC Margin, a non-GAAP measure, and EBITDAC Margin - Adjusted, a non-GAAP measure, for the six months ended June 30, 2026, including by segment, is as follows:

(in millions)

Specialty Distribution

Total Revenues

Income before income taxes

Income Before Income Taxes Margin (1)

Change in estimated acquisition

earn-out payables

EBITDAC Margin (2)

(Gain)/loss on disposal

Acquisition/Integration Costs

Mark-to-market of escrow liability

EBITDAC - Adjusted (2)

EBITDAC Margin - Adjusted (2)

(1) “Income Before Income Taxes Margin” is defined as income before income taxes divided by total revenues.

(2) A non-GAAP financial measure.

NMF = Not a meaningful figure

The reconciliation of income before income taxes, included in the Condensed Consolidated Statements of Income, to EBITDAC, a non-GAAP measure, and EBITDAC - Adjusted, a non-GAAP measure, and Income Before Income Taxes Margin to EBITDAC Margin, a non-GAAP measure, and EBITDAC Margin - Adjusted, a non-GAAP measure, for the six months ended June 30, 2025, including by segment, is as follows:

(in millions)

Specialty Distribution

Total Revenues

Income before income taxes

Income Before Income Taxes Margin (2)

Change in estimated acquisition

earn-out payables

EBITDAC Margin (3)

(Gain)/loss on disposal

Acquisition/Integration Costs

Mark-to-market of escrow liability

EBITDAC - Adjusted (3)

EBITDAC Margin - Adjusted (3)

(2) “Income Before Income Taxes Margin” is defined as income before income taxes divided by total revenues.

(3) A non-GAAP financial measure.

NMF = Not a meaningful figure

Retail Segment

2 unchanged sentences

Financial information relating to our Retail segment is as follows:

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

(in millions, except percentages)

22 unchanged sentences

NMF = Not a meaningful figure

The Retail segment’s total revenues for the three months ended March 31, 2026 increased 33.4%, or $303 million, as compared to the same period in 2025, to $1,210 million.

The Retail segment’s total revenues for the three months ended June 30, 2026 increased 35.9%, or $250 million, as compared to the same period in 2025, to $947 million.

The $227 million increase in core commissions and fees revenue was driven by:

4 unchanged sentences

and (v) an offsetting decrease of $18 million related to the Litigation-Related Impact.

Contingents for the first quarter of 2026 increased $16 million to $30 million, as compared to the same period in 2025.

This increase was due to acquisitions completed within the last twelve months.

Contingents for the second quarter of 2026 increased $19 million to $26 million, as compared to the same period in 2025.

This increase was due to acquisitions completed within the last twelve months and more favorable terms for certain carrier contracts resulting from our enhanced carrier engagement model.

The Retail segment’s total commissions and fees increased by 35.4%.

The Organic Revenue growth rate was 1.0% and the Organic Revenue with Contingents growth rate was 1.3% for the first quarter of 2026.

The Organic Revenue growth rate was 1.5% and the Organic Revenue with Contingents growth rate was 2.5% for the second quarter of 2026.

The Organic Revenue growth rate was driven by net new business written during the preceding twelve months and growth on renewals of existing customers.

Growth for renewal business was moderated by slowing rate increases, rate decreases for certain lines of coverage, and a change to the revenue model for our specialty pharmacy consulting business.

Income before income taxes for the three months ended June 30, 2026 increased 62.2%, or $79 million, as compared to the same period in 2025, to $206 million.

The primary factors driving this increase were:

(i) a decrease in intercompany interest expense;

(ii) a decrease in estimated acquisition earn-out payables;

and (iii) the profit associated with the net increase in revenue as described above, partially offset by (iv) an increase in amortization expense and (v) Acquisition/Integration Costs.

EBITDAC - Adjusted for the three months ended June 30, 2026 increased 46.9%, or $90 million, as compared to the same period in 2025, to $282 million.

EBITDAC Margin - Adjusted for the three months ended June 30, 2026 increased to 29.8% from 27.5% in the same period in 2025.

The change in EBITDAC Margin - Adjusted was primarily driven by:

(i) increased Contingents;

(ii) leveraging our expense base;

and (iii) lower compensation as a result of employee departures associated with the Litigation-Related Impact.

The Retail segment’s total revenues for the six months ended June 30, 2026 increased 34.4%, or $552 million, as compared to the same period in 2025, to $2,156 million.

The $510 million increase in core commissions and fees revenue was driven by:

(i) approximately $507 million related to the core commissions and fees revenue from acquisitions that had no comparable revenues in the same period of 2025;

(ii) an increase of $19 million related to net new and renewal business;

(iii) an increase from the impact of Foreign Currency Translation of $16 million;

(iv) an offsetting decrease of $3 million related to commissions and fees recorded in 2025 from businesses since divested;

and (v) an offsetting decrease of $28 million related to the Litigation-Related Impact.

Contingents for the six months of 2026 increased 154.5%, or $34 million, as compared to the same period in 2025, to $56 million.

This increase was due to acquisitions completed within the last twelve months and qualifying for Contingents this year that we did not qualify for in the prior year.

The Retail segment’s total commissions and fees increased by 34.0%.

The Organic Revenue growth rate was 1.2% and the Organic Revenue with Contingents growth rate was 1.9% for the first six months of 2026.

The Organic Revenue growth rate was driven by net new business written during the preceding twelve months and growth from renewals of existing customers.

Growth for renewal business was moderated by slowing rate increases, rate decreases for certain lines of coverage, and a change to the revenue model in our specialty pharmacy consulting business.

Income before income taxes for the three months ended March 31, 2026 increased 11.6%, or $33 million, as compared to the same period in 2025, to $317 million.

Income before income taxes for the six months ended June 30, 2026 increased 27.0%, or $111 million, as compared to the same period in 2025, to $522 million.

The primary factors driving this increase were:

(i) a decrease in intercompany interest expense and (ii) the profit associated with the net increase in revenue as described above, partially offset by (iii) an increase in estimated acquisition earn-out payables, (iv) an increase in amortization expense;

(i) a decrease in intercompany interest expense;

(ii) a decrease in estimated acquisition earn-out payables;

and (iii) the profit associated with the net increase in revenue as described above, partially offset by (iv) an increase in amortization expense;

and (v) Acquisition/Integration Costs.

EBITDAC - Adjusted for the three months ended March 31, 2026 increased 29.0%, or $98 million, as compared to the same period in 2025, to $436 million.

EBITDAC Margin - Adjusted for the three months ended March 31, 2026 decreased to 36.0% from 37.3% in the same period in 2025.

The decrease in EBITDAC Margin - Adjusted was primarily driven by:(i) the timing of revenues and profit associated with certain recent acquisitions which was partially offset by;

EBITDAC - Adjusted for the six months ended June 30, 2026 increased 34.9%, or $185 million, as compared to the same period in 2025, to $715 million.

EBITDAC Margin - Adjusted for the six months ended June 30, 2026 increased to 33.2% from 33.0% in the same period in 2025.

The increase in EBITDAC Margin - Adjusted was primarily driven by:

(i) increased Contingents;

(ii) leveraging our expense base;

and (ii) lower compensation as a result of teammate defections associated with our pending litigation with a start-up US broker.

and (iii) lower compensation as a result of employee departures associated with the Litigation-Related Impact.

Specialty Distribution Segment

The Specialty Distribution Segment is composed of three divisions;

our programs business, known as Arrowhead Programs;

our wholesale brokerage business, known as Bridge Specialty Group;

and our specialty program business, known as Arrowhead Specialty .

our programs business, operating as Arrowhead Programs;

our wholesale brokerage business, operating as Bridge Specialty Group;

and our specialty program business, operating as Arrowhead Specialty .

Arrowhead Programs manages a diverse portfolio of professional liability, personal lines, commercial lines, public entity and specialty programs supported by over 100 well-capitalized insurance carriers.

4 unchanged sentences

Bridge Specialty Group offers global wholesale brokerage and delegated binding/underwriting capabilities across multiple lines, to independent agents and brokers, including Brown & Brown retail agents.

Our teams across the globe provide industry knowledge and expertise, for placements across multiple lines of coverage based on access to admitted, excess and surplus lines carriers, as well as the Lloyd’s markets in the United Kingdom.

Our teams across the globe provide deep industry knowledge and expertise, for placements across multiple lines of coverage based on access to admitted, excess and surplus lines carriers, as well as the Lloyd’s markets in the United Kingdom.

Arrowhead Specialty offers solutions across affinity organizations, administrative services, captives, reinsurance, travel/accident, warranty, and life & health.

4 unchanged sentences

Financial information relating to our Specialty Distribution segment is as follows:

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

(in millions, except percentages)

22 unchanged sentences

NMF = Not a meaningful figure

The Specialty Distribution segment’s total revenues for the three months ended March 31, 2026 increased 40.0%, or $195 million, as compared to the same period in 2025, to $682 million.

The Specialty Distribution segment’s total revenues for the three months ended June 30, 2026 increased 28.1%, or $158 million, as compared to the same period in 2025, to $721 million.

The $138 million increase in core commissions and fees revenue was driven by:

4 unchanged sentences

and (iv) a $2 million decline in core commission and fees revenue from dispositions that had no comparable revenues in the same period of 2026.

Contingents for the first quarter of 2026 increased approximately $38 million as compared to the first quarter of 2025.

This increase is a result of favorable loss ratios, increased premiums, and to a lesser extent acquisitions completed in the past twelve months.

The Organic Revenue with Contingents growth rate was 3.9% driven by the increase in Organic Contingents.

The Specialty Distribution segment’s total commissions and fees increased by 40.7%, with Organic Revenue decreasing 2.0% and Organic Revenue with Contingents increasing 3.9% for the three months ended March 31, 2026.

The Organic Revenue with Contingents growth rate was driven by:

Contingents for the second quarter of 2026 increased approximately $21 million as compared to the second quarter of 2025.

This increase is a result of acquisitions completed in the past twelve months and favorable loss ratios.

The Specialty Distribution segment’s total commissions and fees increased by 28.6%, with Organic Revenue decreasing 3.5% and Organic Revenue with Contingents decreasing 1.6% for the three months ended June 30, 2026.

The Organic Revenue with Contingents decline was driven by:

(i) increased Contingents;

(ii) net new and retained business;

(iii) and exposure unit expansion;

partially offset by (iv) declining rates on catastrophe ("CAT") property.

Income before income taxes for the three months ended March 31, 2026 increased 33.1%, or $55 million, as compared to the same period in 2025, to $221 million due to:

and (iii) exposure unit expansion;

which were more than offset by (iv) declining rates on catastrophe ("CAT") property.

Income before income taxes for the three months ended June 30, 2026 increased 8.6%, or $20 million, as compared to the same period in 2025, to $253 million due to:

(i) the growth of EBITDAC - Adjusted described below;

2 unchanged sentences

(iii) increased amortization expense;

(iv) Acquisition/Integration Costs;

and (v) increased depreciation expense.

EBITDAC - Adjusted for the three months ended June 30, 2026 increased 17.1%, or $45 million, from the same period in 2025, to $308 million.

EBITDAC Margin - Adjusted for the three months ended June 30, 2026 decreased to 42.7% from 46.7% in the same period in 2025.

EBITDAC Margin - Adjusted decreased due to:

(i) the decline in Organic Revenue;

and (ii) investments to increase our capabilities in Europe;

partially offset by:

(iii) the increase in Contingents.

The Specialty Distribution segment’s total revenues for the six months ended June 30, 2026 increased 33.6%, or $353 million, as compared to the same period in 2025, to $1,403 million.

The $295 million increase in core commissions and fees revenue was driven by:

(i) approximately $322 million related to the core commissions and fees revenue from acquisitions that had no comparable revenues in the same period of 2025;

and (ii) an increase from the impact of Foreign Currency Translation of $4 million;

partially offset by:

(iii) a $26 million decrease in net new business, renewal business, and fee revenues;

and (iv) a $5 million decline in core commission and fees revenue from dispositions that had no comparable revenues in the same period of 2026.

Contingents for the six months ended June 30, 2026 increased approximately $60 million, or by 90.9%, as compared to the same period in 2025.

This increase is a result of favorable loss ratios and to a lesser extent acquisitions completed in the past twelve months.

The Specialty Distribution segment’s total commissions and fees increased by 34.3% with Organic Revenue decreasing 2.7% and Organic Revenue with Contingents increasing 1.2%, for the six months ended June 30, 2026.

The Organic Revenue with Contingents growth was driven by:

(i) increased Contingents;

(ii) net new and retained business;

and (iii) exposure unit expansion;

which were partially offset by (iv) declining rates on CAT property.

Income before income taxes for the six months ended June 30, 2026 increased 18.8%, or $75 million to $474 million, from the same period in 2025.

Income before income taxes increased due to:

(i) the growth of EBITDAC - Adjusted described below;

and (ii) a decrease in estimated acquisition earn-out payables;

partially offset by:

(iii) increased amortization expense;

and (iv) Acquisition/Integration Costs.

EBITDAC - Adjusted for the three months ended March 31, 2026 increased 41.1%, or $81 million, from the same period in 2025, to $278 million.

EBITDAC Margin - Adjusted for the three months ended March 31, 2026 increased to 40.8% from 40.5% in the same period in 2025.

EBITDAC Margin - Adjusted increased due to:

(i) the increase in Contingents (ii) the timing of revenues associated with recent acquisitions;

EBITDAC - Adjusted for the six months ended June 30, 2026 increased 27.8%, or $128 million to $588 million, as compared to the same period in 2025.

EBITDAC Margin - Adjusted for the six months ended June 30, 2026 decreased to 41.9% from 43.8% in the same period in 2025.

EBITDAC Margin - Adjusted decreased due to:

(i) the decline in Organic Revenue;

partially offset by:

(ii) the increase in Contingents;

and (iii) disciplined expense management.

3 unchanged sentences

Our capital requirements to operate as an insurance intermediary are low, and we have been able to grow and invest in our business through a combination of cash that has been generated from operations, the disciplined use of debt and the issuance of equity as part of the purchase price consideration to acquire certain businesses.

We have the ability to utilize our Revolving Credit Facility under the Second Amended and Restated Credit Agreement (the “Second Amended and Restated Credit Agreement”), which as of March 31, 2026 provided additional capacity for up to $475 million in available cash.

We have the ability to utilize our Revolving Credit Facility under the Third Amended and Restated Credit Agreement (the “Third Amended and Restated Credit Agreement”), which as of June 30, 2026 provided additional capacity for up to $975 million in available cash.

We believe that we have access to additional funds, if needed, through the capital markets or private placements to obtain further debt financing under the current market conditions.

The Company believes that its existing cash, cash equivalents, short-term investment portfolio and funds generated from operations, together with the funds available under the Revolving Credit Facility and the Loan Agreement, dated March 31, 2022, which provided term loan capacity of $800 million (the “Loan Agreement”), will be sufficient to satisfy its normal liquidity needs, including principal payments on our long-term debt, for the next twelve months and in the long term.

The Company believes that its existing cash, cash equivalents, short-term investment portfolio and funds generated from operations, together with the funds available under the Revolving Credit Facility will be sufficient to satisfy its normal liquidity needs, including principal payments on our long-term debt, for the next twelve months and in the long term.

The Revolving Credit Facility contains an expansion option for up to an additional $1,000 million of borrowing capacity, subject to the approval of participating lenders.

Additionally, the Company may, subject to satisfaction of certain conditions, including receipt of additional term loan commitments by new or existing lenders, increase either Term Loan Commitment under the existing Loan Agreement or the term loans issued thereunder or issue new tranches of term loans in an aggregate additional amount of up to $400 million.

Including the expansion options under all existing credit agreements, the Company has access to up to $1,375 million of incremental borrowing capacity as of March 31, 2026.

Cash and cash equivalents totaled $1,003 million at March 31, 2026 reflecting a decrease of $76 million from the $1,079 million balance at December 31, 2025.

This decrease is primarily due to the payment of annual bonus compensation and deferred contingent consideration paid during the quarter offset by our cash generated.

Including the expansion options under all existing credit agreements, the Company has access to up to $1,975 million of incremental borrowing capacity as of June 30, 2026.

Cash and cash equivalents totaled $918 million at June 30, 2026 reflecting a decrease of $161 million from the $1,079 million balance at December 31, 2025.

This decrease was primarily driven by share repurchases and deferred contingent consideration payments, partially offset by cash generated from operations .

Operating Cash Flows

Our operating cash flows are primarily derived from the net income generated during the period adjusted for non-cash expenses, which include depreciation, amortization, changes in estimated earnout payables, mark-to-market escrow liability, non-cash stock-based compensation and deferred income taxes while excluding gains and losses on sales/disposals of investments, businesses, fixed assets and customer accounts, payments on acquisition earn-outs in excess of original estimated payables and changes in working capital which relate primarily to the timing of payments of accrued liabilities and receipts of receivables from commissions and fees related to our revenues.

Our ratio of current assets to current liabilities was 1.02 and 1.04 for March 31, 2026 and December 31, 2025, respectively.

Cash flows generated from operating activities totaled $262 million and $213 million for the three months ended March 31, 2026 and 2025, respectively, representing an increase of $49 million.

Our ratio of current assets to current liabilities was 1.13 and 1.04 for June 30, 2026 and December 31, 2025, respectively.

Cash flows generated from operating activities totaled $608 million and $538 million for the six months ended June 30, 2026 and 2025, respectively, representing an increase of $70 million.

Operating cash flows generated in 2026 included $716 million from net income before non-controlling interests with $303 million of non-cash adjustments, offset by $411 million from changes in working capital.

1 unchanged sentence

Investing Cash Flows

Cash flows used for investing activities were $38 million and $79 million for the three months ended March 31, 2026 and 2025, respectively, a decrease of $41 million.

During the three months ended March 31, 2026, the Company completed eight acquisitions (including book purchases) and paid $17 million, net of cash, and cash and cash equivalents held in a fiduciary capacity acquired.

Net cash paid for acquisitions decreased $50 million in the three months ended March 31, 2026, down from $67 million during the same period in 2025.

The Company received minimal cash proceeds from the sale of businesses, fixed assets and customer accounts during the three months ended March 31, 2026, compared to $9 million proceeds received in the same period in 2025.

Cash flows used for investing activities were $71 million and $187 million for the six months ended June 30, 2026 and 2025, respectively, a decrease of $116 million.

During the six months ended June 30, 2026, the Company completed 14 acquisitions (including book purchases) and paid $30 million net of cash acquired, and including cash and cash equivalents held in a fiduciary capacity.

Net cash paid for acquisitions decreased $131 million in the six months ended June 30, 2026, from $161 million during the same period in 2025.

The Company received $3 million from the sale of businesses, fixed assets and customer accounts during the six months ended June 30, 2026, compared to $10 million proceeds received in the same period in 2025.

The decrease is attributed to smaller sales of businesses in the current period.

Capital Expenditures

Capital expenditures amounted to $21 million and $17 million in the three months ended March 31, 2026 and 2025, respectively, and included purchases of furniture and fixtures, leasehold improvements related to office moves and hardware and software purchases related to information technology investments.

Capital expenditures amounted to $38 million and $32 million in the six months ended June 30, 2026 and 2025, respectively, and included purchases of furniture and fixtures, leasehold improvements related to office moves and hardware and software purchases related to information technology investments.

Financing Cash Flows

Net cash flows used by financing activities totaled $354 million and $218 million in the three months ended March 31, 2026 and 2025, respectively, an increase of $136 million.

Net cash flows used by financing activities totaled $526 million and net cash flows sourced totaled $7,981 million in the six months ended June 30, 2026 and 2025, respectively.

The decrease of $8,507 million in sourced financing activities was primarily driven by the proceeds of the Company's follow-on common stock offering and senior notes issuance in June 2025, held in preparation for the closing of the Company's acquisition of Accession, offset by share repurchases and deferred contingent consideration payments in 2026.

Fiduciary Receivables and Liabilities

1 unchanged sentence

The net change in fiduciary cash is represented by the net change in fiduciary liabilities and fiduciary receivables and is presented as cash flows from financing activities in the statement of cash flows.

Financing cash flows reflect a decrease of $76 million and $90 million in the three months ended March 31, 2026 and 2025, respectively, related to fiduciary receivables and liabilities.

Financing cash flows reflect an increase of $157 million and $119 million in the six months ended June 30, 2026 and 2025, respectively, related to fiduciary receivables and liabilities.

Acquisition Earn-outs

Payments on acquisition earn-outs related to the original acquisition date estimates totaled $150 million and $26 million in the three months ended March 31, 2026 and 2025, respectively.

During the three months ended March 31, 2026 and 2025, the Company paid cash dividends of $57 million and $43 million, respectively, an increase of $14 million, or 32.6%.

On April 27, 2026, the board of directors approved a quarterly cash dividend of $0.165 per share to be paid on May 20, 2026.

Net cash proceeds from long term debt totaled $206 million in the three months ended March 31, 2026, compared to net cash use of $19 million in the same period of 2025.

Total debt at March 31, 2026 was $7,822 million net of unamortized discount and debt issuance costs, which was an increase of $209 million compared to December 31, 2025.

During the three months ended March 31, 2026, the Company repaid $6 million of principal related to the Second Amended and Restated Credit Agreement term loan through the quarterly scheduled principal payments.

The Second Amended and Restated Credit Agreement term loan had an outstanding balance of $163 million as of March 31, 2026.

The Company's next scheduled principal payment is due in June 2026 and is equal to $6 million.

During the three months ended March 31, 2026, the Company repaid $13 million of principal related to the Term Loans issued under the Term A-2 Loan Commitment (“Term A-2 Loans”) through quarterly scheduled principal payments.

The Term A-2 Loans had an outstanding balance of $350 million as of March 31, 2026.

The Company’s next scheduled principal payment is $13 million due in June 2026.

Deferred contingent consideration payments totaled $224 million and $46 million during the six months ended June 30, 2026 and 2025, respectively, including $184 million and $45 million, respectively, classified as financing activities related to acquisition earn-outs associated with original acquisition-date estimates.

During the six months ended June 30, 2026 and 2025, the Company paid cash dividends of $112 million and $86 million, respectively, an increase of $26 million, or 30.2%.

On July 22, 2026, the Board of Directors approved a quarterly cash dividend of $0.165 per share to be paid on August 19, 2026.

Net cash proceeds from long term debt totaled $141 million in the six months ended June 30, 2026, compared to net cash proceeds of $3,718 million in the same period of 2025.

Total debt at June 30, 2026 was $7,759 million net of unamortized discount and debt issuance costs, which was an increase of $146 million compared to December 31, 2025.

The increase includes the drawdown of $225 million on the Revolving Credit Facility and the amortization of discounted debt related to our various unsecured senior notes and debt issuance cost amortization of $5 million, offset by $81 million of payments on outstanding term loan and Revolving Credit Facility balances and an additional $3 million of deferred financing costs associated with the Third Amended and Restated Credit Agreement.

On June 5, 2026, the Company entered into the Third Amended and Restated Credit Agreement with the lenders named therein, JPMorgan Chase Bank, N.A.

as administrative agent, Bank of America, N.A., Truist Bank and BMO Bank N.A.

as co-syndication agents, and U.S.

Bank National Association, Fifth Third Bank, National Association, Wells Fargo Bank, National Association, PNC Bank, National Association, HSBC Bank USA, National Association, Citizens Bank, N.A., The Huntington National Bank, and Barclays Bank PLC as co-documentation agents.

The Third Amended and Restated Credit Agreement amended and restated the credit agreement dated October 27, 2021, which amended and restated the prior credit agreement, terminated the Company's existing term loan facility, and refinanced the outstanding borrowings thereunder into new term loan facilities.

The agreement increased revolving credit commitments from $800 million to $1.25 billion and extended the maturity date to June 5, 2031.

The agreement also provides for a $250 million term loan due June 5, 2029 and a $250 million term loan due June 5, 2031.

Total borrowings outstanding under the facilities were approximately $775 million as of June 30, 2026.

During the six months ended June 30, 2026, the Company made $6 million of scheduled principal payments on its Second Amended and Restated Credit Agreement term loan.

On June 5, 2026, the remaining $163 million outstanding under the term loan was refinanced and consolidated into the Third Amended and Restated Credit Agreement.

During the six months ended June 30, 2026, the Company repaid $25 million of principal related to the Term Loans issued under the Term A-2 Loan Commitment (“Term A-2 Loans”).

Upon execution of the Third Amended and Restated Credit Agreement on June 5, 2026, the remaining $338 million outstanding was refinanced and consolidated into the new credit facility.

During the first quarter, the Company drew $225 million on the Revolving Credit Facility in connection with a share repurchase program.

There is an outstanding balance of $325 million on the Revolving Credit Facility as of March 31, 2026.

The Company has repaid $50 million of the balance as of June 30, 2026.

There is an outstanding balance of $275 million on the Revolving Credit Facility as of June 30, 2026.

On February 12, 2026, the Company entered into accelerated share repurchase agreement ("ASR") with an investment bank to purchase an aggregate $250 million of the Company's common stock.

The program ended on March 9, 2026 and during the period, the Company received a total of 3,574,890 shares of the Company's common stock.

At March 31, 2026, the remaining amount authorized by our board of directors for share repurchases was approximately $1,150 million.

During the three months ended June 30, 2026, the Company repurchased an additional 4,279,712 shares for $250 million.

At June 30, 2026, the remaining amount authorized by our board of directors for share repurchases was approximately $900 million.

Contractual Cash Obligations

As of March 31, 2026, our contractual cash obligations were as follows:

As of June 30, 2026, our contractual cash obligations were as follows:

Payments Due by Period

12 unchanged sentences

The timing and amount of any future settlement remains subject to the achievement of contractual milestones and may vary from the amounts disclosed.

The value as of March 31, 2026, was $552 million.

The value as of June 30, 2026, was $552 million.

(2) Includes $310 million of current and non-current estimated acquisition earn-out payables.

2 unchanged sentences

Certain acquisition agreements include provisions with no maximum potential earn-out amount.

The amount recorded for these acquisitions as of March 31, 2026 is $248 million.

(3) Does not include approximately $56 million of current liability for a dividend of $0.1650 per share approved by the board of directors on April 27, 2026 to be paid on May 20, 2026.

The amount recorded for these acquisitions as of June 30, 2026 is $190 million.

(3) Does not include approximately $55 million of current liability for a dividend of $0.1650 per share approved by the Board of Directors on July 22, 2026 to be paid on August 19, 2026.

Quantitative and Qualita tive Disclosures About Market Risk

4 unchanged sentences

These investments are subject to interest rate risk.

The fair value of our invested assets at March 31, 2026 and December 31, 2025 approximated their respective carrying values due to their short-term duration and therefore, such market risk is not considered to be material.

The fair value of our invested assets at June 30, 2026 and December 31, 2025 approximated their respective carrying values due to their short-term duration and therefore, such market risk is not considered to be material.

We do not actively invest or trade in equity securities.

In addition, we generally dispose of any significant equity securities received in conjunction with an acquisition shortly after the acquisition date.

As of March 31, 2026, we had $838 million outstanding under the Second Amended and Restated Credit Agreement and the Loan Agreement tied to the Secured Overnight Financing Rate (“SOFR”).

As of June 30, 2026, we had $775 million outstanding under the Third Amended and Restated Credit Agreement tied to the Secured Overnight Financing Rate (“SOFR”).

These agreements bear interest on a floating basis and are therefore subject to changes in the associated interest expense.

3 unchanged sentences

in the following functional currencies, British pounds, Canadian dollar, euros and, to a lesser extent, other currencies.

Based upon our foreign currency rate exposure as of March 31, 2026, an immediate 10% hypothetical change of foreign currency exchange rates would not have a material effect on our Condensed Consolidated Financial Statements.

Based upon our foreign currency rate exposure as of June 30, 2026, an immediate 10% hypothetical change of foreign currency exchange rates would not have a material effect on our Condensed Consolidated Financial Statements.

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis