What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-12-05 compared with 2024-12-06 · 65 added, 65 removed, 188 unchanged (41% of the section changed)

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However, we face significant risks and uncertainties in our global operating environment as further described in the “Risk Factors” section in Part I, Item 1A of this filing.

These risks include uncertain global and regional business, political and economic conditions, including but not limited to those associated with man-made or natural disasters, pandemic conditions, inflation, foreign exchange rate fluctuations, regulatory developments, supply chain disruptions, and escalating global trade barriers.

These risks and uncertainties have adversely affected our sales, cash flow and performance in the past and could further adversely affect our future sales, cash flow and performance.

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CooperVision has FDA approval for its MiSight 1 day lens, which is the first and only FDA-approved product indicated to slow the progression of myopia in children with treatment initiated between the ages of 8-12.

Further, CooperVision has Chinese NMPA approval for its MiSight 1 day lens for use in China.

Further, CooperVision received Chinese NMPA approval for use of the MiSight 1 day lens in China and received MHLW approval for use of the MiSight 1 day lens in Japan.

CooperVision is focused on greater worldwide market penetration using recently introduced products, and we continue to expand our presence in existing and emerging markets, including through acquisitions.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations

We protect our products through patents and trademark registrations, both in the United States and in international markets.

We monitor competitive products trademark use worldwide and, when determined appropriate, we have enforced and plan to continue to enforce and defend our patent and trademark rights.

We also rely upon trade secrets, licenses, technical know-how and continuing technological innovation to develop and maintain our competitive position.

CooperVision, CooperSurgical, and other trade names, trademarks or service marks of the Company and its subsidiaries appearing in this report are the property of the Company and its subsidiaries.

Trade names, trademarks and service marks of the other companies appearing in this report are the property of their respective holders.

CooperVision Net Sales

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• Spherical lenses, including lenses that correct near- and farsightedness uncomplicated by more complex visual defects, myopia management lenses, which slow the progression of and correct myopia in age-appropriate children, and other specialty lenses.

CooperVision Net Sales by Category

THE COOPER COMPANIES, INC.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations

CooperVision Net Sales by Category

($ in millions) 2025 2024 2025 vs 2024 % Change

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$ 2,743.8 $ 2,609.4 5 %

In the fiscal year ended October 31, 2024, the growth experienced across all categories was partially offset by unfavorable foreign exchange rate fluctuations, which approximated $14.6 million.

• Toric and multifocal grew primarily through the success of MyDay and Biofinity.

• Sphere, other grew primarily through MyDay, MiSight and Biofinity.

• "Other" products represented approximately 1% of net sales in fiscal 2024 and 2023.

In the fiscal year ended October 31, 2025, the growth experienced across all categories was positively impacted by favorable foreign exchange rate fluctuations of approximately $16.0 million.

• Toric and multifocal grew primarily through the success of Biofinity and MyDay.

• Sphere, other grew primarily through MiSight and MyDay, offset by a decrease in legacy hydrogel products.

• "Other" products represented less than 1% of net sales in fiscal 2025 and 2024.

CooperVision Net Sales by Geography

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$ 2,743.8 $ 2,609.4 5 %

CooperVision's growth in net sales across all regions was primarily attributable to increased sales of silicone hydrogel contact lenses.

CooperVision's growth in net sales in the Americas and EMEA was primarily attributable to market gains of silicone hydrogel contact lenses.

The growth in EMEA was positively impacted by favorable foreign exchange rate fluctuations.

Refer to CooperVision Net Sales by Category above for further discussion.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Management’s Discussion and Analysis of Financial Condition and Results of Operations

CooperSurgical Net Sales

CooperSurgical supplies the fertility and women's health care market with a diversified portfolio of products and services in two categories:

• Office and surgical offerings include products that facilitate surgical and non-surgical procedures that are commonly performed primarily by obstetricians and gynecologists in hospitals, surgery centers, and medical offices.

This includes medical devices, cryostorage (such as cord blood and cord tissue storage), and contraception.

• Fertility offerings include highly specialized products and services that target the IVF process, including diagnostics testing with a goal to make fertility treatment safer, more efficient and convenient.

• Fertility offerings include highly specialized products and services that target the in vitro fertilization process, including diagnostics testing with a goal to make fertility treatment safer, more efficient and convenient.

This includes fertility consumables and equipment, donor gamete services, and genomic services (including genetic testing).

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Management’s Discussion and Analysis of Financial Condition and Results of Operations

CooperSurgical Net Sales by Category

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$ 1,348.6 $ 1,286.0 5 %

In the fiscal year ended October 31, 2024, office and surgical net sales increased primarily due to the addition of Cook Medical on November 1, 2023.

Fertility net sales increased due to an increase in revenue from consumable products and genetic testing.

The above growth experienced across all categories was partially offset by unfavorable foreign exchange rate fluctuations, which approximated $9.5 million.

Consolidated gross margin was relatively flat at 67% in fiscal 2024 compared to 66% in fiscal 2023.

In the fiscal year ended October 31, 2025, office and surgical net sales increased primarily due to increased sales of Paragard contraceptive intrauterine devices and the acquisition of obp Surgical on August 1, 2024.

Fertility net sales increased primarily due to an increase in revenue from genomic services and gamete services.

Consolidated gross margin decreased in fiscal 2025 to 66% compared to 67% in fiscal 2024, primarily driven by inventory and long-lived asset write-offs and severance costs related to workforce optimization initiatives.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Selling, General and Administrative (SGA) Expenses

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$ 1,627.8 40 % $ 1,533.7 39 % 6 %

CooperVision's SGA expenses increased in fiscal 2024 compared to fiscal 2023 primarily due to a $31.8 million release of contingent consideration liability associated with SightGlass Vision's regulatory approval milestone in fiscal 2023 and increased selling activities in fiscal 2024.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Management’s Discussion and Analysis of Financial Condition and Results of Operations

CooperSurgical's SGA expenses decreased in fiscal 2024 compared to fiscal 2023 primarily due to the payment of a $45.0 million termination fee under an asset purchase agreement related to Cook Medical’s reproductive health business in fiscal 2023, partially offset by an increase in selling activities and distribution costs.

Corporate SGA expenses increased in fiscal 2024 compared to fiscal 2023 primarily due to share-based compensation related expenses and corporate support functions.

CooperVision's SGA expenses increased in fiscal 2025 compared to fiscal 2024 primarily due to increased selling activities, severance costs related to workforce optimization initiatives, and long-lived asset write-offs.

CooperSurgical's SGA expense s increased in fiscal 2025 compared to fiscal 2024 primarily due to severance costs related to workforce optimization initiatives, increased selling activities, and long-lived asset write-offs.

Corporate SGA expenses increased in fiscal 2025 compared to fiscal 2024 primarily due to an increase in severance costs related to workforce optimization initiatives.

Research and Development (R&D) Expenses

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$ 172.2 4 % $ 155.1 4 % 11 %

Coop erVision's R&D expenses increased in fiscal 2024 compared to fiscal 2023 primarily due to myopia management programs and R&D projects.

Coop erVision's R&D expense s increased in fiscal 2025 compared to fiscal 2024 primarily due to an increase in R&D project spend.

CooperVision's R&D activities are primarily focused on the development of contact lenses, manufacturing technology and process enhancements.

CooperSurgical's R&D expenses increased in fiscal 2024 compared to fiscal 2023 mainly due to an increase in R&D project spend.

CooperSurgical's R&D activities are focused on developing and refining diagnostic and therapeutic products including medical interventions, surgical devices and fertility solutions.

CooperSurgical's R&D expenses increased in fiscal 2025 compared to fiscal 2024 primarily due to an increase in R&D project spend.

CooperSurgical's R&D activities are primarily focused on the development of surgical devices and fertility solutions, manufacturing technology and process enhancements.

Amortization Expense

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$ 199.2 5 % $ 201.2 5 % (1) %

CooperVision's amortization expense for fiscal 2024 comp ared to fiscal 2023 decreased primarily due to more intangible assets becoming fully amortized during fiscal 2024.

CooperSurgical's amortization expense increased in fiscal 2024 compared to fiscal 2023, primarily due to the amortization of intangible assets recently acquired through acquisitions.

CooperVision's amortization expense decreased in fiscal 2025 comp ared to fiscal 2024, primarily due to certain intangible assets being fully amortized.

CooperSurgical's amortization exp ense increased in fiscal 2025 compared to fiscal 2024 , primarily due to the amortization of intangible assets acquired through acquisitions in the second half of fiscal 2024.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Operating Income

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$ 682.9 17 % $ 705.7 18 % (3) %

CooperVision's operating income increased in fiscal 2024 compared to fiscal 2023, primarily due to the increase in net sales outpaced the increase in operating expenses.

CooperSurgical's operating income increased in fiscal 2024 compared to fiscal 2023, primarily due to payment of a $45.0 million termination fee under an asset purchase agreement related to Cook Medical’s reproductive health business in fiscal 2023 and decrease in advertising and marketing expenses in fiscal 2024.

THE COOPER COMPANIES, INC.

AND SUBSIDIARIES

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Corporate operating loss increased in fiscal 2024 compared to fiscal 2023, primarily due to higher share-based compensation expenses.

CooperVision's operating income increased in fiscal 2025 compared to fiscal 2024, primarily due to the increase in net sales outpacing the increase in operating expenses.

CooperSurgical's operating income decreased in fiscal 2025 compared to fiscal 2024, primarily due to inventory and long-lived asset write-offs, severance costs related to workforce optimization initiatives and an increase in amortization expense.

Corporate operating loss increased in fiscal 2025 compared to fiscal 2024, primarily due to an increase in severance costs related to workforce optimization initiatives.

Interest Expense

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Interest expense $ 100.0 2 % $ 114.3 3 % (13) %

Interest expense increased during fiscal 2024 compared to the prior year, primarily due to higher interest rates and higher debt balances.

Interest expense decreased during fiscal 2025 compared to the prior year, primarily due to lower interest rates and lower average debt balances.

Other Expense, Net

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Other expense, net

Foreign exchange loss was primarily associated with the relative weakening of the U.S.

dollar against foreign currencies and the effect on intercompany receivables.

Other expense, net decreased in fiscal 2024, primarily due to a decrease in loss on minority investments.

Foreign exchange loss was primarily due to movements of U.S.

dollar against various foreign currencies and the effect on intercompany receivables and payables.

Other expense, net increased in fiscal 2025, primarily due to a loss on the disposal of a minority interest investment.

Provision for Income Taxes

The effective tax rates for fiscal 2025 and 2024 were 33.8% and 32.6%, respectively.

The increase was primarily due to changes in the geographic composition of pre-tax earnings and an increase in the UK statutory tax rate from 19% to 25%.

The effective tax rate for fiscal 2024 was higher than the U.S.

federal statutory rate primarily due to foreign earnings subject to U.S.

tax and foreign earnings in jurisdictions with higher tax rates.

The effective tax rate for fiscal 2023 was higher than the U.S.

The increase was primarily due to changes in valuation allowance and a decrease in excess tax benefits from share-based compensation, partially offset by changes in unrecognized tax benefits and changes in the geographic composition of pre-tax earnings.

The effective tax rate for fiscal 2025 and 2024 was higher than the U.S.

federal statutory rate primarily due to foreign earnings subject to U.S.

tax and foreign earnings in jurisdictions with different tax rates.

The One Big Beautiful Bill Act was enacted in the United States during the third quarter of fiscal 2025.

It is not expected to have a material impact on the provision for income taxes.

Income Taxes for further information.

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Working capital at October 31, 2025, and October 31, 2024, was $993.6 million and $928.7 million, respectively.

The increase in working capital was primarily due to increases in trade accounts receivable, prepaid expenses and other current assets, and inventories, partially offset by an increase in other current liabilities.

The increase in working capital was primarily due to increases in trade accounts receivable mainly driven by higher sales and timing of collections and inventories, partially offset by increases in accounts payable, employee compensation and benefits and short-term debt.

($ in millions) 2025 2024 2023

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Financing activities (425.9) 39.2 (173.9)

Effect of exchange rate changes on cash, cash equivalents, restricted

cash and restricted cash equivalents 2.9 (2.3) (12.9)

Net decrease in cash, cash equivalents, restricted cash and

restricted cash equivalents

$ (13.2) $ (17.7) $ 42.0

Effect of exchange rate changes on cash, cash equivalents and restricted cash 5.6 2.9 (2.3)

Net increase (decrease) in cash, cash equivalents and restricted cash $ 2.9 $ (13.2) $ (17.7)

Operating Cash Flow

Cash provided by operating activities in fiscal 2024 increased compared to fiscal 2023, primarily due to increases in net income, and non-cash add backs such as deferred income taxes and share-based compensation expenses in fiscal 2024 and the release of $31.8 million contingent consideration liability associated with SightGlass Vision's regulatory approval milestone in fiscal 2023, offset by net changes in operating capital.

Cash provided by operating activities in fiscal 2025 increased compared to fiscal 2024, primarily due to changes in prepaid and other assets and an increase in non-cash add-back of long-lived asset write-offs.

Investing Cash Flow

Cash used in investing activities in fiscal 2024 increased compared to cash used in investing activities in fiscal 2023, primarily attributable to $343.4 million cash paid for acquisitions in fiscal 2024.

Cash used in investing activities in fiscal 2025 decreased compared to cash used in investing activities in fiscal 2024, primarily attributable to $343.4 million cash paid for acquisitions in fiscal 2024.

Financing Cash Flow

Cash used in financing activities in fiscal 2025 was primarily attributable to the repurchase of common stock, net repayments on the revolving credit, and the first installment payment related to the Cook Medical acquisition.

Cash provided by financing activities in fiscal 2024 was primarily attributable to funds received from the 2024 Revolving Credit Facility, partially offset by repayments to fully repay all borrowings outstanding under the 2020 Term Loan Facility and the 2020 Revolving Credit Facility.

Financing Arrangements for further information.

Cash used in financing activities in fiscal 2023 was primarily due to repayments of $338.0 million on the 2021 364-day term loan, partially offset by $172.6 million of funds drawn on the 2020 Revolving Credit Facility.

The following is a summary of the maximum commitments and the net amounts available to us under different credit facilities as of October 31, 2025:

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As of October 31, 2025, the Company was in compliance with all debt covenants.

On May 1, 2024, the Company entered into a Revolving Credit Agreement.

On May 1, 2024, the Company entered into a Revolving Credit Agreement (the 2024 Credit Agreement).

The Company drew on the 2024 Credit Agreement to fully repay borrowings outstanding under the 2020 Term Loan and 2020 Revolving Credit Facility and terminated the 2020 Credit Agreement.

Financing Arrangements for further information.

Considering recent market conditions, we have re-evaluated our operating cash flows and cash requirements and continue to believe that current cash, cash equivalents, future cash flow from operating activities and cash available under our 2024 Credit Agreement will be sufficient to meet our anticipated cash needs, including working capital needs, capital expenditures and contractual obligations for at least 12 months from the issuance date of the Consolidated Financial Statements included in this annual report.

To the extent additional funds are necessary to meet our liquidity needs such as

We have re-evaluated our operating cash flows and cash requirements and continue to believe that current cash, cash equivalents, future cash flow from operating activities and cash available under our 2024 Credit Agreement will be sufficient to meet our anticipated cash needs, including working capital needs, capital expenditures and contractual obligations for at least 12 months from the issuance date of the Consolidated Financial Statements included in this annual report.

To the extent additional funds are necessary to meet our liquidity needs such as for acquisitions, share repurchases or other activities as we execute our business strategy, we anticipate that additional funds could be obtained through the incurrence of additional indebtedness, additional equity financings or a combination of these potential sources of funds;

however, such financing may not be available on favorable terms, or at all.

THE COOPER COMPANIES, INC.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations

for acquisitions, share repurchases or other activities as we execute our business strategy, we anticipate that additional funds could be obtained through the incurrence of additional indebtedness, additional equity financings or a combination of these potential sources of funds;

however, such financing may not be available on favorable terms, or at all.

Share Repurchases

In March 2017, the authorization under the 2012 Share Repurchase Program (2012 Program) was increased to $1.0 billion by the Company's Board of Directors.

As of October 31, 2024, $256.4 million remained authorized for repurchase under the program.

Stockholders’ Equity for additional information.

Share Repurchase

In September 2025, the authorization under the 2012 Share Repurchase Program was increased to $2.0 billion by the Company's Board of Directors.

As of October 31, 2025, $966.4 million remains authorized for repurchase.

In fiscal 2025, the Company repurchased 4.1 million shares of its common stock for $290.1 million, at a weighted average price of $69.30 per share under the program.

In fiscal 2024, there were no share repurchases under the program.

Stockholders’ Equity for additional information.

In December 2023, the Company's Board of Directors decided to end the declaration of the semiannual dividend.

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The installment for fiscal 2025 is classified in "Other current liabilities" in our Consolidated Balance Sheet.

We are unable to reliably estimate the timing of future payments related to uncertain tax positions and have excluded $20.4 million of long-term income taxes payable.

Income Taxes for the expected one-time transition tax payments.

Purchase obligations consist of agreements to purchase goods and services that are enforceable and legally binding and includes obligations for inventory, capital expenditures and other operating expense commitments.

As of October 31, 2024, we had purchase obligations of $696.0 million, with $272.8 million payable within the twelve months ending Oct 31, 2025.

As of October 31, 2025, we had purchase obligations of $585.1 million, with $279.3 million payable within the twelve months ending October 31, 2026.

The minimum future payments for operating leases are disclosed in Note 2.

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Deferred tax assets and liabilities are estimated based on temporary differences between the financial reporting basis and income tax basis of assets and liabilities.

Judgment is required in measuring the value of deferred tax assets, which are reduced by a valuation allowance to the extent it is more likely than not the assets are not expected to be realized.

These deferred tax assets are primarily tax credits and net operating loss carryforwards expected to expire before they can be claimed or deducted.

Judgment is required in measuring the value of deferred tax assets, which are reduced by a valuation allowance to the extent it is more likely than not that the tax benefits are not expected to be realized, including tax credits and net operating loss carryforwards expected to expire before they can be claimed or deducted.

For uncertain tax positions, judgment is required in evaluating tax positions for uncertainty in the application of accounting guidance and tax laws.

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

What changed 10-K

Item 7. Management’s Discussion and Analysis