What changed in this filing

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Item 1. Financial Statements

2025-07-31 compared with 2025-05-01 · 198 added, 129 removed, 452 unchanged (42% of the section changed)

3 unchanged sentences

(In thousands, except per share amounts)

Three-months Ended

March 30, 2025 March 31, 2024

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

(unaudited) (unaudited)

Revenue $ 249,093 $ 239,292 $ 465,129 $ 450,089

21 unchanged sentences

(In thousands)

Three-months Ended

March 30, 2025 March 31, 2024

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

(unaudited) (unaudited)

Net income $ 40,511 $ 36,212 $ 64,114 $ 48,234

1 unchanged sentence

Available-for-sale investments:

Net unrealized gain (loss), net of tax of $ 875 and $ 117 in the three-month periods, respectively

Net unrealized gain (loss), net of tax of $ 1,435 and $ 336 in the three-month periods, respectively, and net of tax of $ 2,310 and $ 453 in the six-month periods, respectively

1,742 1,020 4,453 1,379

Reclassification of net realized (gain) loss on the sale of available-for-sale investments into current operations ( 27 ) 10 ( 54 ) 8

8 unchanged sentences

CONSOLIDATED BALANCE SHEETS

(In thousands)

March 30, 2025 December 31, 2024

(In thousands, except share amounts)

June 29, 2025 December 31, 2024

Current assets:

8 unchanged sentences

Total current assets 625,725 613,367

Non-current investments, respectively, allowance for credit losses of $ 0 in 2025 and 2024

Non-current investments, allowance for credit losses of $ 0 in 2025 and 2024

324,348 340,898

37 unchanged sentences

(In thousands)

Three-months Ended

March 30, 2025 March 31, 2024

Six-months Ended

June 29, 2025 June 30, 2024

Cash flows from operating activities:

3 unchanged sentences

Depreciation of property, plant, and equipment 10,627 10,472

(Gain) loss on disposal of property, plant, and equipment 6 —

Amortization of intangible assets 5,306 5,540

Excess and obsolete inventory charges 710 1,343

Fair value adjustment on acquired inventories (Note 7) — 1,224

Fair value adjustment on acquired inventories — 1,224

Amortization of discounts or premiums on investments ( 314 ) 562

16 unchanged sentences

Purchases of property, plant, and equipment ( 4,695 ) ( 8,571 )

Net payments related to business acquisitions (Note 7) — ( 994 )

Net payments related to business acquisitions — ( 1,444 )

Net cash provided by (used in) investing activities 29,121 ( 13,785 )

11 unchanged sentences

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In thousands)

(In thousands, except unit and per unit data)

Common Stock Additional

3 unchanged sentences

Shares Par Value

Balance as of March 30, 2025 167,865 $ 336 $ 1,097,989 $ 405,949 $ ( 58,646 ) $ 1,445,628

Net issuance of common stock under stock plans 34 — 175 — — 175

Excise tax on repurchase of common stock — — — 11 — 11

Stock-based compensation expense — — 12,294 — — 12,294

Payment of dividends ($ 0.080 per common share)

— — — ( 13,431 ) — ( 13,431 )

Net income — — — 40,511 — 40,511

Net unrealized gain (loss) on available-for-sale investments, net of tax of $ 1,435

— — — — 1,742 1,742

Reclassification of net realized (gain) loss on the sale of available-for-sale investments ( 27 ) ( 27 )

Foreign currency translation adjustment — — — — 19,154 19,154

Balance as of June 29, 2025 (unaudited)

167,899 $ 336 $ 1,110,458 $ 433,040 $ ( 37,777 ) $ 1,506,057

Common Stock Additional

Paid-in Capital Retained Earnings Accumulated

Comprehensive

Shareholders’

Shares Par Value

Balance as of March 31, 2024 171,662 $ 343 $ 1,047,643 $ 502,338 $ ( 61,135 ) $ 1,489,189

Net issuance of common stock under stock plans 81 — 990 — — 990

Repurchase of common stock ( 242 ) — — ( 10,540 ) — ( 10,540 )

Stock-based compensation expense — — 12,964 — — 12,964

Payment of dividends ($ 0.075 per common share)

— — — ( 12,868 ) — ( 12,868 )

Net income — — — 36,212 — 36,212

Net unrealized gain (loss) on available-for-sale investments, net of tax of $ 336

— — — — 1,020 1,020

Reclassification of net realized (gain) loss on the sale of available-for-sale investments — — — — 10 10

Foreign currency translation adjustment — — — — ( 10,247 ) ( 10,247 )

Balance as of June 30, 2024 (unaudited)

171,501 $ 343 $ 1,061,597 $ 515,142 $ ( 70,352 ) $ 1,506,730

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

COGNEX CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In thousands of dollars, except unit and per unit data)

Common Stock Additional

Paid-in Capital Retained Earnings Accumulated

Comprehensive

Shareholders’

Shares Par Value

Balance as of December 31, 2024

2 unchanged sentences

Repurchase of common stock ( 3,047 ) ( 6 ) — ( 102,227 ) — ( 102,233 )

Excise tax on repurchase of common stock — — — ( 1,169 ) — ( 1,169 )

Stock-based compensation expense — — 22,233 — — 22,233

6 unchanged sentences

Foreign currency translation adjustment — — — — 30,601 30,601

Balance as of March 30, 2025 (unaudited)

Balance as of June 29, 2025 (unaudited)

167,899 $ 336 $ 1,110,458 $ 433,040 $ ( 37,777 ) $ 1,506,057

16 unchanged sentences

Foreign currency translation adjustment — — — — ( 26,403 ) ( 26,403 )

Balance as of March 31, 2024 (unaudited)

Balance as of June 30, 2024 (unaudited)

171,501 $ 343 $ 1,061,597 $ 515,142 $ ( 70,352 ) $ 1,506,730

3 unchanged sentences

Summary of Significant Accounting Policies

As permitted by the rules of the Securities and Exchange Commission applicable to Quarterly Reports on Form 10-Q, these notes are condensed and do not contain all disclosures required by generally accepted accounting principles ("GAAP").

Reference should be made to the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 for a full description of other significant accounting policies.

In the opinion of the management of Cognex Corporation (the "Company"), the accompanying consolidated unaudited financial statements contain all adjustments, consisting of normal, recurring adjustments and financial statement reclassifications necessary to present fairly the Company’s financial position as of March 30, 2025, and the results of its operations for the three-month periods ended March 30, 2025 and March 31, 2024, and changes in shareholders’ equity, comprehensive income, and cash flows for the periods presented.

The results disclosed in the Consolidated Statements of Operations for the three-month period ended March 30, 2025 are not necessarily indicative of the results to be expected for the full year.

Reference should be made to the consolidated financial statements and related notes included in Cognex Corporation's ("Cognex" or the "Company") Annual Report on Form 10-K for the year ended December 31, 2024 for a full description of other significant accounting policies.

In the opinion of the management of the Company, the accompanying consolidated unaudited financial statements contain all adjustments, consisting of normal, recurring adjustments and financial statement reclassifications necessary to present fairly the Company’s financial position as of June 29, 2025, and the results of its operations for the three-month and six-month periods ended June 29, 2025 and June 30, 2024, and changes in shareholders’ equity, comprehensive income, and cash flows for the periods presented.

The results disclosed in the Consolidated Statements of Operations for the three-month and six-month periods ended June 29, 2025 are not necessarily indicative of the results to be expected for the full year.

New Pronouncements

7 unchanged sentences

Management does not expect ASU 2023-09 to have a material impact on the Company's financial statements and disclosures.

ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)

ASU 2024-03 aims to enhance transparency for users of financial statements by requiring public business entities to disaggregate specific expense categories.

ASU 2024-03 mandates disclosures in the notes to financial statements detailing the composition and trends of key expense categories within major income statement captions.

Accounting Standards Update (ASU) 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)

This ASU aims to enhance transparency for users of financial statements by requiring public business entities to disaggregate specific expense categories.

This ASU mandates disclosures in the notes to financial statements detailing the composition and trends of key expense categories within major income statement captions.

These enhanced disclosures are intended to help investors more effectively assess the entity’s performance, understand its cost structure, and make more accurate forecasts of future cash flows.

For public business entities, ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027.

For public business entities, this ASU is effective for annual periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027.

The adoption will result in disclosure changes only.

3 unchanged sentences

Cash, Cash Equivalents, and Investments

The following table summarizes the Company’s cash, cash equivalents, and investments as of March 30, 2025 (in thousands):

The following table summarizes the Company’s cash, cash equivalents, and investments as of June 29, 2025 (in thousands):

Fair Value Level Amortized

2 unchanged sentences

Money market instruments Level 1 656 — — 656 656 — —

Certificate of deposit Level 2 20,979 — — 20,979 20,979 — —

Certificates of deposit Level 2 25,293 — — 25,293 25,293 — —

Treasury bills Level 2 2,000 — — 2,000 2,000 — —

16 unchanged sentences

The Company’s debt securities are reported at fair value based on model-driven valuations in which all significant inputs are observable or can be derived from or corroborated by observable market data for substantially the full term of the asset or liability, and are therefore classified as Level 2.

Management is responsible for estimating the fair value of these financial assets and liabilities, and in doing so, considers valuations provided by a large, third-party pricing service.

Management is responsible for estimating the fair value of these financial instruments, and in doing so, considers valuations provided by a large, third-party pricing service.

This service maintains regular contact with market makers, brokers, dealers, and analysts to gather information on market movement, direction, trends, and other specific data.

They use this information to structure yield curves for various types of debt securities and arrive at the daily valuations.

Accrued interest receivable is recorded in "Prepaid expenses and other current assets" on the Consolidated Balance Sheets and amounted to $ 3,284,000 and $ 4,144,000 as of March 30, 2025 and December 31, 2024, respectively.

Accrued interest receivable is recorded in "Prepaid expenses and other current assets" on the Consolidated Balance Sheets and amounted to $ 3,926,000 and $ 4,144,000 as of June 29, 2025 and December 31, 2024, respectively.

COGNEX CORPORATION

1 unchanged sentence

Realized Gains (Losses) on Debt Securities

The following table summarizes the Company's gross realized gains and losses on the sale of debt securities for the three-month periods ended March 30, 2025 and March 31, 2024 (in thousands):

Three-months Ended

March 30, 2025 March 31, 2024

The following table summarizes the Company's gross realized gains and losses on the sale of debt securities for the three-month and six-month periods ended June 29, 2025 and June 30, 2024 (in thousands):

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Gross realized gains $ 30 $ 6 $ 57 $ 8

4 unchanged sentences

Unrealized Losses on Debt Securities

The following table summarizes the Company’s gross unrealized losses and fair values for available-for-sale investments in an unrealized loss position as of March 30, 2025 (in thousands):

The following table summarizes the Company’s gross unrealized losses and fair values for available-for-sale investments in an unrealized loss position as of June 29, 2025 (in thousands):

Unrealized Loss Position For:

21 unchanged sentences

When developing an estimate of expected credit losses, management considers all relevant information including historical experience, current conditions, and reasonable forecasts of expected future cash flows.

Based on this evaluation, no allowance for credit losses on debt securities was recorded as of March 30, 2025 or December 31, 2024.

Based on this evaluation, no allowance for credit losses on debt securities was recorded as of June 29, 2025 or December 31, 2024.

Management currently intends to hold these securities to full value recovery at maturity.

2 unchanged sentences

Debt Securities Maturities

The following table presents the effective maturity dates of the Company’s available-for-sale investments as of March 30, 2025 (in thousands):

The following table presents the effective maturity dates of the Company’s available-for-sale investments as of June 29, 2025 (in thousands):

<1 year 1-2 Years 2-3 Years 3-4 Years 4-5 Years 5-8 Years Total

6 unchanged sentences

The Company’s foreign currency risk management strategy is principally designed to mitigate the potential financial impact of changes in the value of transactions and balances denominated in foreign currencies resulting from changes in foreign currency exchange rates.

The Company enters into economic hedges utilizing foreign currency forward contracts with maturities that do not exceed approximately three months to manage the exposure to fluctuations in foreign currency exchange rates arising primarily from foreign-denominated receivables and payables.

The Company enters into economic hedges utilizing foreign currency forward contracts with maturities that do not exceed twelve months to manage the exposure to fluctuations in foreign currency exchange rates arising primarily from foreign-denominated receivables and payables.

The gains and losses on these derivatives are intended to be offset by the changes in the fair value of the assets and liabilities being hedged.

1 unchanged sentence

The Company had the following outstanding forward contracts (in thousands):

March 30, 2025 December 31, 2024

June 29, 2025 December 31, 2024

Currency Notional

2 unchanged sentences

Singapore Dollar 38,000 $ 29,317 40,000 $ 29,457

Euro 20,000 21,682 25,000 26,029

Japanese Yen 1,500,000 10,015 2,000,000 12,789

Chinese Renminbi 70,000 9,780 95,000 12,990

Mexican Peso 150,000 7,939 220,000 10,701

Hungarian Forint 2,500,000 7,344 2,360,000 5,951

Indian Rupee 500,000 5,844 — —

British Pound 4,000 5,486 3,200 4,008

Korean Won 7,000,000 5,155 — —

Japanese Yen 300,000 2,080 2,000,000 12,789

Euro — — 25,000 26,029

Swiss Franc — — 2,200 2,432

Canadian Dollar — — 2,000 1,390

Mexican Peso — — 220,000 10,701

COGNEX CORPORATION

3 unchanged sentences

Fair Value Fair Value

Balance Sheet Location Fair Value Level March 30, 2025 December 31, 2024 Balance Sheet Location Fair Value Level March 30, 2025 December 31, 2024

Balance Sheet Location Fair Value Level June 29, 2025 December 31, 2024 Balance Sheet Location Fair Value Level June 29, 2025 December 31, 2024

Derivatives Not Designated as Hedging Instruments:

2 unchanged sentences

Gross amounts offset — — — —

Net amounts presented $ 188 $ 324 $ 23 $ 211

Net amounts presented on the Consolidated Balance Sheets $ 1,065 $ 689 $ 766 $ 757

The Company’s forward contracts are reported at fair value based on model-driven valuations in which all significant inputs are observable or can be derived from or corroborated by observable market data for substantially the full term of the asset or liability, and are therefore classified as Level 2.

1 unchanged sentence

The market participants are generally large commercial banks.

Information regarding the effect of derivative instruments on the Consolidated Statement of Operations was as follows (in thousands):

Statement of Operations Location Three-months Ended

March 30, 2025 March 31, 2024

Information regarding the effect of derivative instruments on the Consolidated Statements of Operations was as follows (in thousands):

Statement of Operations Location Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Derivatives Not Designated as Hedging Instruments:

Gains (losses) recognized in current operations Foreign currency gain (loss) $ ( 420 ) $ 876 $ ( 967 ) $ 631

Activities related to derivative instruments are reflected within "Net cash provided by (used in) operating activities" on the Consolidated Statements of Cash Flows.

Inventories consisted of the following (in thousands):

March 30, 2025 December 31, 2024

June 29, 2025 December 31, 2024

Raw materials $ 78,836 $ 86,917

2 unchanged sentences

$ 144,577 $ 157,527

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The Company's leases are primarily leased properties across different worldwide locations where the Company conducts its business.

1 unchanged sentence

Certain leases may contain options to extend or terminate the lease at the Company's sole discretion.

As of March 30, 2025, there were no options to terminate and nineteen options to extend that were accounted for in the determination of the applicable lease term for the Company's outstanding leases.

As of June 29, 2025, there were no options to terminate and twenty options to extend that were accounted for in the determination of the applicable lease term for the Company's outstanding leases.

Certain leases contain leasehold improvement incentives, retirement obligations, escalating clauses, rent holidays, and variable payments tied to a consumer price index.

There were no restrictions or covenants for outstanding leases as of March 30, 2025.

The Company did not have any leases that had not yet commenced but that created significant rights and/or obligations as of March 30, 2025.

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

There were no restrictions or covenants for outstanding leases as of June 29, 2025.

The Company did not have any leases that had not yet commenced but that created significant rights and/or obligations as of June 29, 2025.

The components of lease expense were as follows (in thousands):

Three-months Ended

March 30, 2025 March 31, 2024

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Operating lease expense $ 3,521 $ 3,474 $ 6,992 $ 7,037

Short-term lease expense (1)

211 $ 57 420 $ 139

(1) Leases with a term of twelve months or less for which the Company elected not to recognize a lease asset or lease liability

Supplemental balance sheet information related to leases was as follows:

March 30, 2025 December 31, 2024

June 29, 2025 December 31, 2024

Weighted average remaining lease term 9.3 years

1 unchanged sentence

Supplemental cash flow information related to leases was as follows (in thousands):

Three-months Ended

March 30, 2025 March 31, 2024

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Cash paid for amounts included in the measurement of operating lease liabilities $ 3,412 $ 3,406 $ 6,834 $ 6,614

Maturities of lease liabilities as of March 30, 2025 were as follows (in thousands):

Maturities of lease liabilities as of June 29, 2025 were as follows (in thousands):

Remainder of fiscal 2025

3 unchanged sentences

Total operating lease liabilities $ 83,185

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The Company leases a building in Singapore that serves as a distribution center for customers in Asia.

1 unchanged sentence

an 88,000 square-foot premises that had a commencement date in June of 2023 and a second 27,000 square-foot premises that does not commence until the fourth quarter of 2025.

Accordingly, the second component of the lease has not yet been recorded on the Consolidated Balance Sheets, nor has it created any significant rights and obligations as of March 30, 2025.

Accordingly, the second component of the lease has not yet been recorded on the Consolidated Balance Sheets, nor has it created any significant rights and obligations as of June 29, 2025.

This second lease component has an original term of eight years and the Company has the right and option to extend this term by an additional five years , commencing upon the expiration of the original term.

Future payment obligations associated with this lease component total $ 13,396,000 , $ 163,000 of which is payable in the remainder of 2025 and which reflects the estimated extension period of five years .

Future payment obligations related to this lease component are not included in the future operating lease cash payments table above.

Undiscounted lease payment obligations associated with this lease component total $ 14,084,000 , $ 172,000 of which is payable in the remainder of 2025 and which reflects the estimated extension period of five years .

Undiscounted lease payment obligations related to this lease component are not included in the lease liability maturity table above as the lease component has not yet commenced.

The Company has entered into a lease for a 6,500 square-foot building in Aachen, Germany for a term of ten years .

The commencement date for this lease is expected to be in the second quarter of 2025, and therefore it has not yet been recorded on the Consolidated Balance Sheets, nor has it created any significant rights and obligations as of March 30, 2025.

The lease had a commencement date in June of 2025, and therefore, was recorded on the Consolidated Balance Sheet as of June 29, 2025.

The Company has the right and option to extend the term of this lease for an additional period of five years , commencing upon the expiration of the original term.

Future payment obligations associated with this lease total $ 9,142,000 , $ 503,000 of which is payable in the remainder of 2025.

Future payment obligations related to this lease are not included in the future operating lease cash payments table above.

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Undiscounted lease payment obligations associated with this lease are included in the lease liability maturity table above and total $ 9,742,000 , $ 464,000 of which is payable in the remainder of 2025.

Goodwill and Intangible Assets

2 unchanged sentences

Foreign exchange rate changes 12,452

Balance as of March 30, 2025 $ 389,929

Amortized intangible assets as of March 30, 2025 consisted of the following (in thousands):

Balance as of June 29, 2025 $ 397,389

Amortized intangible assets as of June 29, 2025 consisted of the following (in thousands):

Value Accumulated

4 unchanged sentences

Non-compete agreements 340 ( 315 ) 25

Balance as of March 30, 2025 $ 130,786 $ ( 39,652 ) $ 91,134

Balance as of June 29, 2025 $ 135,020 $ ( 42,885 ) $ 92,135

Amortized intangible assets as of December 31, 2024 consisted of the following (in thousands):

6 unchanged sentences

Balance as of December 31, 2024 $ 127,304 $ ( 36,620 ) $ 90,684

Future amortization expense related to intangible assets as of March 30, 2025 is as follows (in thousands):

Remainder of fiscal 2025

Thereafter 39,506

Business Combinations

On October 18, 2023, the Company acquired all the outstanding shares of Moritex Corporation ("Moritex"), a global provider of premium optical components based in Japan, for an enterprise value of ¥ 40 billion Japanese Yen, or approximately $ 270 million U.S.

Dollars based on the closing date foreign exchange rate.

The cash-free, debt-free enterprise value was adjusted by cash acquired, debt assumed, and final working capital balances to arrive at total consideration to be allocated to assets acquired and liabilities assumed of ¥ 44,376,245,000 ($ 296,138,000 based on the closing date foreign exchange rate), of which ¥ 44,227,414,000 ($ 295,144,000 ) was paid in cash on the closing date and ¥ 148,831,000 ($ 994,000 ) was paid during the three-month period ended March 31, 2024 as a purchase price adjustment based on the closing balance sheet.

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Future amortization expense related to intangible assets as of June 29, 2025 is as follows (in thousands):

Remainder of fiscal 2025

Thereafter 41,223

Warranty Obligations

9 unchanged sentences

Foreign exchange rate changes 17

Balance as of March 30, 2025 $ 5,728

Balance as of June 29, 2025 $ 5,918

Commitments and Contingencies

As of March 30, 2025, the Company had outstanding purchase orders totaling $ 53,401,000 to procure inventory from various vendors.

As of June 29, 2025, the Company had outstanding purchase orders totaling $ 50,682,000 to procure inventory from various vendors.

Certain of these purchase orders may be canceled by the Company, subject to cancellation penalties.

These purchase commitments relate primarily to expected sales in the next twelve months.

A significant portion of the Company's outstanding inventory purchase orders as of March 30, 2025, as well as additional preauthorized commitments to procure strategic components based on the Company's expected customer demand, are placed with the Company's primary contract manufacturer for the Company's assembled products.

A significant portion of the Company's outstanding inventory purchase orders as of June 29, 2025, as well as additional preauthorized commitments to procure strategic components based on the Company's expected customer demand, are placed with the Company's primary contract manufacturer for the Company's assembled products.

The Company has the obligation to purchase any non-cancelable and non-returnable components that have been purchased by the contract manufacturer with the Company's preauthorization, when these components have not been consumed within the period defined in the terms of the Company's agreement with this contract manufacturer.

3 unchanged sentences

While we cannot predict the outcome of these matters, we believe that any liability arising from them will not have a material adverse effect on our financial position, liquidity, or results of operations.

Stockholder's Equity

Stock Repurchase Program

In March 2022, the Company's Board of Directors authorized the repurchase of $ 500,000,000 of the Company's common stock.

Under this March 2022 program, in addition to repurchases made in other periods, the Company repurchased 231,000 shares at a total cost of $ 9,339,000 during the three-month period ended March 31, 2024 and 3,047,000 shares at a total cost of $ 103,413,000 during the three-month period ended March 30, 2025, including $ 1,180,000 of buyback Excise Tax in accordance with the Inflation Reduction Act of 2022, leaving a remaining balance of $ 164,020,000 as of March 30, 2025.

The Company may repurchase shares under this program in future periods depending on a variety of factors, including, among other things, the impact of dilution from employee stock awards, stock price, share availability, and cash requirements.

The Company is authorized to make repurchases of its common stock through open market purchases, pursuant to Rule 10b5-1 trading plans, or in privately negotiated transactions.

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Stockholders' Equity

Stock Repurchase Program

In March 2022, the Company's Board of Directors (the "Board") authorized a program providing for the repurchase of $ 500,000,000 of the Company's common stock (the "Program").

Under the Program, in addition to repurchases made in other periods, the Company repurchased 473,000 shares at a total cost of $ 19,879,000 during the six-month period ended June 30, 2024 and 3,047,000 shares at a total cost of $ 102,233,000 during the six-month period ended June 29, 2025, leaving a remaining balance of $ 164,020,000 as of June 29, 2025.

The Company may repurchase shares under the Program in future periods depending on a variety of factors, including, among other things, the impact of dilution from employee stock awards, stock price, share availability, and cash requirements.

The Company is authorized to make repurchases of its common stock through open market purchases, pursuant to Rule 10b5-1 trading plans, or in privately negotiated transactions.

Stock-Based Compensation Expense

The Company’s stock-based awards that result in compensation expense consist of stock options, restricted stock units ("RSUs"), and performance restricted stock units ("PRSUs").

The following table summarizes the number of stock-based awards granted by the Company and the weighted-average grant-date fair value per unit for the three-month periods ended March 30, 2025 and March 31, 2024:

Three-months Ended

March 30, 2025 March 31, 2024

The following table summarizes the number of stock-based awards granted by the Company and the weighted-average grant-date fair value per unit for the three-month and six-month periods ended June 29, 2025 and June 30, 2024:

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Stock-Based Awards Granted

(in thousands) Weighted-

thousands) Weighted-

Grant-Date Fair Value Stock-Based Awards Granted

(in thousands) Weighted-

thousands) Weighted-

Grant-Date Fair Value Stock-Based Awards Granted

thousands) Weighted-

Grant-Date Fair Value Stock-Based Awards Granted

thousands) Weighted-

Grant-Date Fair Value

2 unchanged sentences

Performance restricted stock units — $ — — $ — 184 $ 32.14 55 $ 39.05

During the three-month period ended March 30, 2025, the Company granted PRSUs that vest upon the achievement of (1) a service condition of three years of continuous employment and (2) a performance condition established by the Compensation Committee of our Board of Directors as of the grant date.

290 129 3,082 2,472

During the first quarter of 2025, the Company granted PRSUs that vest upon the achievement of (1) a service condition of three years of continuous employment and (2) a performance condition established by the Compensation Committee of the Board as of the grant date.

The number of shares earned could range between 0 % and 120 % based on achievement of the performance condition, which includes certain financial targets over the three-year measurement period.

1 unchanged sentence

Compensation expense for these PRSUs is recognized based on the probable outcome of the performance condition with a cumulative catch-up adjustment for prior periods in the period that the probable outcome changes.

During the three-month period ended March 30, 2025, the Company recorded $ 152,000 in compensation expense based on the probable three-year financial target outcome for the PRSUs granted during the three-month period ended March 30, 2025.

During the three-month and six-month periods ended June 29, 2025, the Company recorded $ 344,000 and $ 496,000 in compensation expense based on the probable three-year financial target outcome for the PRSUs granted during the first quarter of 2025.

The Company stratifies its employee population into two groups:

3 unchanged sentences

Credits of $ 4,789,000 and $ 1,832,000 were recorded in 2025 and 2024, respectively, to true up previously recorded compensation expense for this forfeiture rate revision.

As of March 30, 2025, total unrecognized compensation expense, net of estimated forfeitures, related to non-vested equity awards, including stock options, RSUs, and PRSUs, was $ 80,214,000 , which is expected to be recognized over a weighted-average period of 2.0 years.

As of June 29, 2025, total unrecognized compensation expense, net of estimated forfeitures, related to non-vested equity awards, including stock options, RSUs, and PRSUs, was $ 69,681,000 , which is expected to be recognized over a weighted-average period of 1.9 years.

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table presents the stock-based compensation expense by caption for each period presented on the Consolidated Statements of Operations (in thousands):

Three-months Ended

March 30, 2025 March 31, 2024

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Cost of revenue $ 537 $ 413 $ 1,205 $ 1,018

2 unchanged sentences

Total stock-based compensation expense $ 12,294 $ 12,964 $ 22,233 $ 26,266

No compensation expense was capitalized as of March 30, 2025 or December 31, 2024.

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

No compensation expense was capitalized as of June 29, 2025 or December 31, 2024.

Revenue Recognition

The following table summarizes disaggregated revenue information by geographic area based upon the customer's country of domicile (in thousands):

Three-months Ended

March 30, 2025 March 31, 2024

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Americas $ 92,137 $ 85,162 $ 191,867 $ 168,297

4 unchanged sentences

The following table summarizes disaggregated revenue information by revenue type (in thousands):

Three-months Ended

March 30, 2025 March 31, 2024

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Standard products and services $ 216,035 $ 200,856 $ 420,545 $ 388,488

2 unchanged sentences

Costs to Fulfill a Contract

Costs to fulfill a contract are included in "Prepaid expenses and other current assets" on the Consolidated Balance Sheet and amounted to $ 12,326,000 and $ 10,705,000 as of March 30, 2025 and December 31, 2024, respectively.

Costs to fulfill a contract are included in "Prepaid expenses and other current assets" on the Consolidated Balance Sheet and amounted to $ 14,133,000 and $ 10,705,000 as of June 29, 2025 and December 31, 2024, respectively.

Accounts Receivable, Contract Assets, and Contract Liabilities

3 unchanged sentences

Contract liabilities consist of deferred revenue and customer deposits which arise when amounts are billed to or collected from customers in advance of revenue recognition.

The following table summarizes the allowance for credit losses activity for the three-month period ended March 30, 2025 (in thousands):

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table summarizes the allowance for credit losses activity for the six-month period ended June 29, 2025 (in thousands):

Balance as of December 31, 2024 $ 827

2 unchanged sentences

Foreign exchange rate changes ( 20 )

Balance as of March 30, 2025 $ 598

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table summarizes the deferred revenue and customer deposits activity for the three-month period ended March 30, 2025 (in thousands):

Balance as of June 29, 2025 $ 620

The following table summarizes the deferred revenue and customer deposits activity for the six-month period ended June 29, 2025 (in thousands):

Balance as of December 31, 2024 $ 25,035

2 unchanged sentences

Foreign exchange rate changes 655

Balance as of March 30, 2025 $ 39,858

Balance as of June 29, 2025 $ 53,077

As a practical expedient, the Company has elected not to disclose the aggregate amount of the transaction price allocated to unsatisfied performance obligations for our contracts that have an original expected duration of less than one year.

The remaining unsatisfied performance obligations for our contracts that have an original expected duration of more than one year, primarily related to extended warranties, are not material.

The Company's effective tax rate was 15 % and 32 % for the three-month periods ended March 30, 2025 and March 31, 2024, respectively.

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The Company's effective tax rate was 16 % and 15 % for the three-month and six-month periods ended June 29, 2025, respectively, and 13 % and 18 % for the three-month and six-month periods ended June 30, 2024, respectively.

The Company has defined its major tax jurisdictions as the United States, Ireland, China, Japan, and Korea, and within the United States, Massachusetts.

1 unchanged sentence

federal statutory corporate tax rate of 21 %.

These foreign tax rate differences resulted in a favorable impact to the effective tax rate for both the three-month periods ended March 30, 2025 and March 31, 2024.

The Company recorded a net discrete tax benefit totaling $ 307,000 for the three-month period ended March 30, 2025 and a net discrete tax expense totaling $ 3,085,000 for the three-month period ended March 31, 2024.

Discrete tax items for the three-month period ended March 30, 2025 included (1) an increase in tax expense of $ 1,616,000 related to stock-based compensation;

These foreign tax rate differences resulted in a favorable impact to the effective tax rate for both the three-month and six-month periods ended June 29, 2025 and June 30, 2024.

The Company recorded a net discrete tax benefit totaling $ 211,000 and $ 518,000 for the three-month and six-month periods ended June 29, 2025, respectively, and a net discrete tax benefit totaling $ 463,000 and a net discrete tax expense totaling $ 2,622,000 for the three-month and six-month periods ended June 30, 2024, respectively.

Discrete tax items for the six-month period ended June 29, 2025 included (1) an increase in tax expense of $ 2,668,000 related to stock-based compensation;

(2) an increase in tax expense of $ 884,000 for interest expense related to tax reserves;

(3) a net decrease in tax expense of $ 278,000 related to return-to-provision adjustments;

and (4) a net decrease in tax expense of $ 2,031,000 related to an adjustment to the Company's deferred tax position.

Discrete tax items for the three-month period ended March 31, 2024 included (1) an increase in tax expense of $ 1,123,000 related to stock-based compensation;

(3) an increase in tax expense of $ 669,000 related to taxability of payroll tax credit refunds received during the year;

(4) a decrease in tax expense of $ 2,393,000 for release of tax reserves related to statute of limitation lapse;

(5) a net decrease in tax expense of $ 2,013,000 related to an adjustment to the Company's deferred tax position;

and (6) a net decrease in tax expense of $ 333,000 related to return-to-provision adjustments.

Discrete tax items for the six-month period ended June 30, 2024 included (1) an increase in tax expense of $ 1,371,000 related to stock-based compensation;

(2) an increase in tax expense of $ 477,000 related to state tax matters;

(3) an increase in tax expense of $ 922,000 for interest expense related to tax reserves;

and (4) a net increase in tax expense of $ 1,046,000 for other tax matters.

The Company’s reserve for income taxes, including gross interest and penalties, was $ 29,561,000 as of March 30, 2025, of which $ 27,194,000 was classified as a non-current liability and $ 2,367,000 was classified as an offset to deferred tax assets.

(4) a net decrease in tax expense of $ 1,278,000 related to return-to-provision adjustments;

and (5) an increase in tax expense of $ 1,130,000 for other tax matters.

The Company’s reserve for income taxes, including gross interest and penalties, was $ 28,109,000 as of June 29, 2025, of which $ 25,742,000 was classified as a non-current liability and $ 2,367,000 was classified as an offset to deferred tax assets.

If the Company’s tax positions were sustained or the statutes of limitations related to certain positions expired, these reserves would be released and income tax expense would be reduced in a future period.

Within the United States, the tax years 2021 through 2024 remain open to examination by the IRS, and 2020 through 2024 remain open to examination by various state tax authorities.

Within the United States, the tax years 2021 through 2024 remain open to examination by the Internal Revenue Service, and 2020 through 2024 remain open to examination by various state tax authorities.

The tax years 2013 through 2024 remain open to examination by various international taxing authorities in other jurisdictions in which the Company operates.

On July 4, 2025, tax legislation known as the One Big Beautiful Bill Act ("OBBBA") was enacted in the United States.

OBBBA modifies certain international tax provisions such as the tax on Global Intangible Low Taxed Income ("GILTI") and renames GILTI as Net CFC Tested Income ("NCTI").

The Company records NCTI taxes on a deferred basis.

The Company is in the early stages of evaluating the impact of U.S.

tax law changes introduced by OBBBA on our consolidated financial statements and disclosures.

As of the date of this filing, we expect OBBBA to materially increase our deferred tax liability and income tax expense in the third quarter of 2025, while also providing a cash tax benefit estimated between $ 12 million and $ 15 million for the full year.

A full quantitative estimate of all specific financial impacts cannot be reasonably determined at this time due to the complexity of the changes in OBBBA and the need for further analysis.

COGNEX CORPORATION

1 unchanged sentence

Earnings per Share

The following table shows the computation of basic and diluted earnings per share for the three-month periods ended March 30, 2025 and March 31, 2024 (in thousands, except per share amounts):

Three-months Ended

March 30, 2025 March 31, 2024

The following table shows the computation of basic and diluted earnings per share for the three-month and six-month periods ended June 29, 2025 and June 30, 2024 (in thousands, except per share amounts):

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Net income 40,511 36,212 $ 64,114 $ 48,234

5 unchanged sentences

Diluted 0.24 0.21 0.38 0.28

The computation of diluted weighted-average common shares outstanding excludes the following weighted average anti-dilutive stock-based awards outstanding for the three-month periods ended March 30, 2025 and March 31, 2024 (in thousands):

Three-months Ended

March 30, 2025 March 31, 2024

The computation of diluted weighted-average common shares outstanding excludes the following weighted average anti-dilutive stock-based awards outstanding for the three-month and six-month periods ended June 29, 2025 and June 30, 2024 (in thousands):

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Stock options 10,418 8,325 10,095 8,415

2 unchanged sentences

Total weighted average anti-dilutive stock-based awards outstanding 10,617 8,326 10,095 8,424

Segment and Geographic Information

Segment Information

The Company operates in one segment, machine vision technology.

7 unchanged sentences

The following table summarizes significant segment expenses, which represents the difference between segment revenue and segment net income (in thousands):

Three-months Ended

March 30, 2025 March 31, 2024

Three-months Ended Six-months Ended

June 29, 2025 June 30, 2024 June 29, 2025 June 30, 2024

Revenue $ 249,093 $ 239,292 $ 465,129 $ 450,089

22 unchanged sentences

Net income $ 40,511 $ 36,212 $ 64,114 $ 48,234

(1) Cost of revenue includes depreciation and amortization expense (including amortization of acquired technologies) of $ 3,018,000 and $ 3,150,000 for March 30, 2025 and March 31, 2024, respectively.

(1) Cost of revenue includes depreciation and amortization expense (including amortization of acquired technologies) of $ 3,144,000 and $ 6,162,000 for the three-month and six-month periods ended June 29, 2025, respectively, and $ 2,988,000 and $ 6,138,000 for the three-month and six-month periods ended June 30, 2024, respectively.

(2) Incentive compensation includes company bonus and sales commissions.

(3) Other segment expenses include outside services, prototyping materials, sales demonstration equipment, travel and entertainment, marketing programs, and rent, among other less significant expenses.

Segment assets amounted to $ 1,932,503 and $ 1,992,850 as of March 30, 2025 and December 31, 2024, respectively.

Segment assets amounted to $ 2,003,541 and $ 1,992,850 as of June 29, 2025 and December 31, 2024, respectively.

COGNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Subsequent Events

On April 30, 2025, the Company’s Board of Directors declared a cash dividend of $ 0.08 per share.

The dividend is payable on May 29, 2025 to all shareholders of record as of the close of business on May 15, 2025.

On July 30, 2025, the Board declared a cash dividend of $ 0.08 per share.

The dividend is payable on August 28, 2025 to all shareholders of record as of the close of business on August 14, 2025.

In July 2025, the Company entered into a commercial partnership with a strategic channel partner (the “Partner”) to better serve Original Equipment Manufacturer (OEM) customers in the specialized field of medical lab automation.

Through 2030, the Partner has exclusive rights to sell machine vision hardware into these applications in combination with licensed Company software, in exchange for annual minimum license fees paid to the Company.

The Company expects to recognize the minimum license fees as revenue in the third quarter of 2025, at the point in time when the Partner receives access to the software.

Although the license revenue will be recognized upfront, payments are expected to be received over the duration of the partnership, resulting in unbilled revenue.

Also in the third quarter of 2025, the Company will transfer related inventories at cost to the Partner.

As a result of the upfront recognition of the license revenue and transfer of inventories, the Company expects a one-time benefit ranging from $ 8 million to $ 14 million of revenue in the third quarter of 2025.

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

What changed 10-Q

Item 1. Financial Statements