What changed in this filing

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Item 1. Financial Statements

2026-05-07 compared with 2025-10-29 · 192 added, 321 removed, 469 unchanged (52% of the section changed)

3 unchanged sentences

Dollars in thousands, except per share amounts

Three Months Ended Nine Months Ended

October 3, 2025 September 27, 2024 October 3, 2025 September 27, 2024

Three Months Ended

April 3, 2026 April 4, 2025

Net sales $ 745,597 $ 678,138

4 unchanged sentences

Operating income 90,479 109,845

Pension settlement loss — — — 12,155

Interest expense and other, net 25,577 16,782

18 unchanged sentences

Dollars in thousands

Three Months Ended Nine Months Ended

October 3, 2025 September 27, 2024 October 3, 2025 September 27, 2024

Three Months Ended

April 3, 2026 April 4, 2025

Net income $ 49,237 $ 69,832

3 unchanged sentences

Unrealized loss on derivatives designated and qualifying as cash flow hedges, net of tax benefit of $ — and $( 497 )

— ( 3,130 ) ( 1,816 ) ( 3,968 )

Defined benefit pension and other post-retirement plan activity, net of tax expense of $ 87 and $ 11

250 343 773 1,299

Other comprehensive (loss) income ( 18,384 ) 77,835

6 unchanged sentences

Dollars in thousands, except share and per share amounts

October 3, 2025 December 31, 2024

April 3, 2026 December 31, 2025

CURRENT ASSETS:

14 unchanged sentences

CURRENT LIABILITIES:

Current portion of debt 2,175 15,000

Current portion of long-term debt $ 3,788 $ 2,412

Accounts payable 398,501 360,391

4 unchanged sentences

Total liabilities 3,389,001 2,554,565

Common stock - $ 0.001 par value - 600,000,000 shares authorized, 60,709,740 and 60,517,574 shares outstanding as of October 3, 2025 and December 31, 2024, respectively

Common stock - $ 0.001 par value - 600,000,000 shares authorized, 60,881,557 and 60,721,079 shares outstanding as of April 3, 2026 and December 31, 2025, respectively

Additional paid-in capital 1,905,399 1,904,889

17 unchanged sentences

Distributions to noncontrolling owners — — — — — ( 1,117 ) ( 1,117 )

Other comprehensive income, net of tax benefit of $ 4,808

Other comprehensive loss, net of tax expense of $( 2,984 )

— — — — ( 17,297 ) ( 1,087 ) ( 18,384 )

2 unchanged sentences

60,881,557 $ 61 $ 1,905,399 $ 842,343 $ ( 557,013 ) $ 44,878 $ 2,235,668

Net income — — — 66,883 — 1,221 68,104

Dividends declared ($ 0.10 per share)

— — — ( 6,091 ) — — ( 6,091 )

Distributions to noncontrolling owners — — — — — ( 6 ) ( 6 )

Other comprehensive income, net of tax benefit of $ 7,153

— — — — 102,158 262 102,420

Common stock-based award activity 74,050 — ( 3,048 ) — — — ( 3,048 )

Balance at July 4, 2025

60,696,786 61 1,898,801 720,467 ( 549,699 ) 42,141 2,111,771

Net income — — — 54,847 — 1,674 56,521

Dividends declared ($ 0.10 per share)

— — — ( 6,088 ) — — ( 6,088 )

Distributions and purchases relating to noncontrolling owners — — — — — 3,590 3,590

Other comprehensive income, net of tax expense of $ 997

— — — — ( 4,511 ) ( 1,326 ) ( 5,837 )

Common stock-based award activity 12,954 — 2,070 — — — 2,070

Balance at October 3, 2025

60,709,740 $ 61 $ 1,900,871 $ 769,226 $ ( 554,210 ) $ 46,079 $ 2,162,027

Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Noncontrolling Interest Total

5 unchanged sentences

— — — ( 4,868 ) — — ( 4,868 )

Other comprehensive loss, net of tax expense of $ 2,029

— — — — ( 23,389 ) ( 323 ) ( 23,712 )

Common stock-based award activity 128,787 — 480 — — — 480

Balance at March 29, 2024

60,424,421 60 1,881,534 406,867 ( 647,661 ) 41,578 1,682,378

Net income — — — 82,907 — 1,462 84,369

Dividends declared ($ 0.08 per share)

— — — ( 4,856 ) — — ( 4,856 )

Distributions to noncontrolling owners — — — — — ( 1,168 ) ( 1,168 )

Other comprehensive loss, net of tax benefit of $ 79

— — — — ( 15,712 ) ( 369 ) ( 16,081 )

Common stock-based award activity 14,417 — 4,833 — — — 4,833

Balance at June 28, 2024

60,438,838 60 1,886,367 484,918 ( 663,373 ) 41,453 1,749,425

Net income — — — 68,240 — 1,593 69,833

Dividends declared ($ 0.08 per share)

— — — ( 4,858 ) — — ( 4,858 )

Distributions to noncontrolling owners — — 2,860 — ( 1,706 ) ( 3,155 ) ( 2,001 )

Other comprehensive loss, net of tax benefit of $ 3,759

Other comprehensive income, net of tax benefit of $ 4,808

— — — — 77,717 118 77,835

Common stock-based award activity 105,162 — 512 — — — 512

Balance at September 27, 2024

Balance at April 4, 2025

60,622,736 $ 61 $ 1,901,849 $ 659,675 $ ( 651,857 ) $ 40,664 $ 1,950,392

3 unchanged sentences

Dollars in thousands

Nine Months Ended

October 3, 2025 September 27, 2024

Three Months Ended

April 3, 2026 April 4, 2025

Cash flows from operating activities:

4 unchanged sentences

Stock-based compensation expense 3,948 5,361

Deferred income tax (benefit) expense ( 7,707 ) 2,394

Non-cash interest expense 1,882 2,259

Pension settlement loss — 12,155

Deferred income tax benefit ( 4,771 ) ( 2,774 )

Amortization of debt issuance costs 5,764 628

Changes in operating assets and liabilities:

7 unchanged sentences

Proceeds from sale of property, plant and equipment 275 4,605

Acquisitions, net of cash received ( 439,669 ) ( 86,537 )

Other investing 539 ( 4,058 )

Net cash used in investing activities ( 13,428 ) ( 2,689 )

1 unchanged sentence

Proceeds from borrowings on Senior Notes 1,000,000 —

Proceeds from borrowings on revolving credit facilities and other 359,591 205,000

Repayments of borrowings on Term Loans — ( 2,500 )

Proceeds from borrowings on revolving credit facilities and other 131,217 —

Repayments of borrowings on revolving credit facilities and other ( 317,374 ) —

3 unchanged sentences

Other financing ( 3,438 ) ( 4,590 )

Net cash provided by financing activities 227,263 40,576

Net cash provided by (used in) financing activities 786,179 ( 13,119 )

Effect of foreign exchange rates on Cash and cash equivalents ( 739 ) 22,388

(Decrease) increase in Cash and cash equivalents ( 31,139 ) 151,667

Increase in Cash and cash equivalents 818,927 41,990

Cash and cash equivalents, beginning of period 185,863 249,358

2 unchanged sentences

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS

Organization and Basis of Presentation

1 unchanged sentence

ESAB provides its partners with fabrication technology advanced equipment, consumables, gas control equipment, robotics and digital solutions.

The Company’s rich history of innovative products, workflow solutions and its business management system, ESAB Business Excellence (“EBX”), enables the Company’s purpose of Shaping the world we imagine TM .

The Company’s rich history of innovative products, workflow solutions and its business management system, ESAB Business Excellence (“EBXai”), enables the Company’s purpose of Shaping the world we imagine TM .

The Company’s products are utilized to solve challenges in a wide range of industries, including cutting, joining and automated welding and gas control.

The Company conducts its operations through two reportable segments.

These segments consist of the “Americas,” which includes operations in North America and South America, and “EMEA & APAC,” which includes Europe, Middle East, India, Africa and Asia Pacific.

These segments consist of the “Americas,” which includes operations in North America and South America, and “EMEA & APAC,” which includes Europe, the Middle East, India, Africa and Asia Pacific.

The Company’s fiscal year ends December 31.

The Company’s third quarter ends on the last business day of the 13 th complete week after the end of the prior quarter.

As used herein, the third quarter results for 2025 and 2024 refer to the 13-week periods ended October 3, 2025 and September 27, 2024, respectively.

The Company’s first quarter ends on the last business day of the 13 th complete week after the end of the prior quarter.

As used herein, the first quarter results for 2026 and 2025 refer to the 13-week periods ended April 3, 2026 and April 4, 2025, respectively.

Russia and Ukraine Conflict

1 unchanged sentence

While ESAB continues to closely monitor the situation and evaluate options, the Company is meeting current contractual obligations while addressing applicable laws and regulations.

For the three and nine months ended October 3, 2025, Russia represented approximately 6 % and 5 %, respectively, of the Company’s Net sales and approximately $ 3 million and $ 9 million, respectively, of its Net income.

Russia also has approximately 5 % of the Company’s total net assets as of October 3, 2025, including approximately $ 48 million of Cash and cash equivalents that may be subject to delays in withdrawing from Russia, based upon the current environment at that time.

For the three months ended April 3, 2026, Russia represented approximately 4 % of the Company’s Net sales and contributed approximately $ 1 million of net losses to the Company’s Net income.

Russia also has approximately 5 % of the Company’s total net assets as of April 3, 2026, including approximately $ 42 million of Cash and cash equivalents that may be subject to delays in withdrawing from Russia, based upon the current environment at that time.

In case of the disposition of the Russia business, a portion of goodwill would need to be allocated and disposed of at the relative fair value attributable to the Russia business.

Russia has a cumulative translation loss of approximately $ 110 million as of October 3, 2025, which would be realized upon a transition out.

Russia has a cumulative translation loss of approximately $ 108 million as of April 3, 2026, which would be realized upon a transition out.

The Company is closely monitoring developments in Ukraine and Russia.

7 unchanged sentences

Intercompany transactions and accounts are eliminated in consolidation.

Certain line items on our Consolidated and Condensed Statements of Cash Flows have been reclassified to conform to the current presentation.

In the normal course of business, the Company incurs research and development costs related to new product development, which are expensed as incurred and included in Selling, general and administrative expense on the Company’s Consolidated and Condensed Statements of Operations.

Research and development costs were $ 10.5 million and $ 31.1 million during the three and nine months ended October 3, 2025, respectively, and $ 9.2 million and $ 29.0 million for the three and nine months ended September 27, 2024, respectively.

Research and development costs were $ 12.5 million during the three months ended April 3, 2026 and $ 10.1 million for the three months ended April 4, 2025.

T hese amounts do not include development and application engineering costs incurred in conjunction with fulfilling customer orders and executing customer projects, nor do they include costs related to securing third party product rights.

3 unchanged sentences

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

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

Disaggregation of Income Statement Expenses , which expands disclosure requirements for more detailed information about the types of expenses in commonly presented expense captions.

The ASU is effective for fiscal years beginning after December 15, 2026 , and interim reporting periods within annual reporting periods beginning after December 15, 2027.

Early adoption is permitted and the amendments may be applied either prospectively or retrospectively.

The Company is currently evaluating the effect the adoption of the ASU may have on its disclosures.

In September 2025, the FASB issued ASU No.

2025-06, Intangibles - Goodwill and Other Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software , which modernizes the accounting for costs incurred to develop internal-use software including which costs are required to be recognized as an asset .

The ASU is effective for annual and interim reporting periods beginning after December 15, 2027.

The Company is currently evaluating the effect the adoption of the ASU may have on its consolidated financial statements and disclosures.

Discontinued Operations

4 unchanged sentences

See Note 13, “Commitments and Contingencies” for further information.

Cas h used in operating activities related to discontinued operations was $ 3.6 million and $ 10.8 million for the three and nine months ended October 3, 2025, respectively, and $ 3.6 million and $ 12.1 million for the three and nine months ended September 27, 2024, respectively .

Cas h used in operating activities related to discontinued operations was $ 4.3 million for the three months ended April 3, 2026 and $ 2.3 million for the three months ended April 4, 2025 .

The Company continually evaluates potential acquisitions that either strategically fit with its existing portfolio or expand its portfolio into a new and attractive business area.

The Company has completed a number of acquisitions that have been accounted for using the acquisition method and have resulted in the recognition of goodwill in the Company’s financial statements.

This goodwill arises because the purchase prices for these businesses exceeded the fair value of acquired identifiable net assets.

This excess is attributable to a variety of factors, including, but not limited to, the anticipated future earnings and cash flow potential of the acquired businesses;

prevailing market multiples applied to earnings and cash flows in comparable transactions;

the competitive nature of the acquisition processes;

the strategic benefits of accelerating market entry or enhancing existing product offerings without incurring the time, cost and risk associated with internal development;

and the complementary fit and expected synergies these businesses contribute to the Company’s existing operations.

Under the acquisition method of accounting, the Company makes an initial allocation of the purchase price at the date of acquisition based upon its understanding of the fair value of the acquired assets and assumed liabilities from information obtained during due diligence and through other sources.

As the Company obtains additional information about these assets and liabilities, including through tangible and intangible asset appraisals, and learns more about the newly acquired business, the Company is able to refine the estimates of fair value and more accurately allocate the purchase price.

The fair values of acquired intangibles are determined based on estimates and assumptions that form the basis of the forecasted results of the acquired business including earnings before interest, taxes, depreciation and amortization (“EBITDA”), revenue, revenue growth rates, royalty rates and customer attrition rates.

These assumptions are forward looking and could be affected by future economic and market conditions.

The Company engages third-party valuation specialists who provide guidance on the Company’s critical assumptions and calculations of the fair value of acquired intangible assets in connection with significant acquisitions.

The Company makes appropriate adjustments to purchase price allocations prior to completion of the applicable measurement period, as required.

Only facts and circumstances that existed as of the acquisition date are considered for subsequent adjustment.

The following table describes the Company’s 2025 acquisition activity, for which it acquired 100% of the equity and voting interest of each acquired entity.

Acquisition Date Company Description Segment

April 30, 2025 Bavaria Schweisstechnik (“Bavaria”) A European provider of submerged-arc welding applications EMEA & APAC

June 4, 2025 DeltaP s.r.l.

(“DeltaP”) A European provider of medical central gas systems and aftermarket services EMEA & APAC

July 9, 2025 Aktiv Technologies Private Limited (“Aktiv”)

An industrial gas equipment manufacturer based in India

August 22, 2025 EWM GmbH (“EWM”)

A Global leader in heavy industrial welding equipment and advanced automation

The following table summarizes the preliminary allocation of the purchase price to the assets acquired and liabilities assumed for the nine months ended October 3, 2025.

These amounts, including inventories, deferred taxes, intangible assets, and property, plant and equipment, are determined based upon certain valuations and studies that have yet to be finalized.

Accordingly, the assets acquired and liabilities assumed, as detailed below, are subject to adjustment once the detailed analyses are completed.

None of the goodwill is expected to be deductible for tax purposes.

Refer to Note 5, “Acquisitions” in the Company’s 2025 Form 10-K for further information on the Company’s accounting treatment of acquisitions.

On January 31, 2026, the Company entered into an agreement to acquire Eddyfi Technologies (“Eddyfi”), a global leader in advanced inspection and monitoring technologies headquartered in Quebec, Canada, for a purchase price of approximately $ 1.45 billion (the “Acquisition”).

The Acquisition is expected to be funded with a combination of cash on hand, debt (refer to Note 9, “Debt” for additional information) and approximately $ 318 million of fully committed equity, consisting of the Mandatory Convertible Preferred Stock and common stock issuances described below.

The Acquisition is expected to be completed in mid-2026, subject to the receipt of applicable regulatory approvals and customary closing conditions.

Furthermore, in relation to the Acquisition, on February 2, 2026, the Company offered and agreed to issue and sell 175,000 shares (the “Preferred Shares”) of a newly created series of convertible preferred stock, designated as 6.50 % Series A Mandatory Convertible Preferred Stock, par value $ 0.001 per share (the “Mandatory Convertible Preferred Stock”), to certain investors (the “Preferred Stock Purchasers”), pursuant to a preferred stock purchase agreement (the “Preferred Stock Purchase Agreement”), for an aggregate liquidation preference of $ 175.0 million.

The Preferred Stock Purchasers include one or more entities affiliated with Mitchell Rales, the Chairman of our Board, and one or more entities affiliated with Steven Rales, Mitchell’s brother, who have agreed to purchase $ 100.0 million and $ 25.0 million, respectively, of the Mandatory Convertible Preferred Stock for investment purposes, and the remaining $ 50.0 million has been agreed to be purchased by other third parties.

The transactions with the entities affiliated with Mitchell Rales and the entities affiliated with Steven Rales were on the same terms as the transactions with unaffiliated third parties.

The Preferred Shares were offered at a price of $ 1,000 per Preferred Share and the net proceeds to the Company, after deducting the fees payable to the placement agents but before deducting other offering expenses, are expected to be approximately $ 172 million.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

EWM All Others Total

(in thousands)

Cash and cash equivalents $ 10,349 $ 6,803 $ 17,152

Inventories, net 39,903 7,662 47,565

Property, plant and equipment, net 31,470 6,284 37,754

162,926 65,865 228,791

Identifiable intangible assets (2)

137,141 43,938 181,079

Customer relationships (3)

96,433 35,771 132,204

Trade names 20,536 6,294 26,830

Technology 20,172 1,873 22,045

Deferred tax liability ( 35,605 ) ( 12,006 ) ( 47,611 )

Other, net (4)

( 11,438 ) ( 890 ) ( 12,328 )

Preliminary purchase price consideration 334,746 117,656 452,402

(1) Goodwill for “All Others” includes approximately $ 39 million for Bavaria and $ 17 million for Aktiv.

(2) Definite-lived intangibles are subject to estimated weighted-average useful lives ranging from five to twenty years .

(3) Customer relationships for “All Others” includes approximately $ 23 million for Bavaria.

(4) Includes current and non-current amounts and non-controlling interest.

For the three and nine months ended October 3, 2025, the above acquisitions added approximately $ 27 million and $ 35 million, respectively, to Net sales.

The Company incurred approximately $ 1 million and $ 10 million of acquisition-related costs for the acquisitions completed in 2025 in the three and nine months ended October 3, 2025, respectively.

These costs were expensed in Selling, general and administrative expense in the Consolidated and Condensed Statements of Operations.

For a description of the Company’s acquisition activity for the year ended December 31, 2024, reference is made to the financial statements as of and for the year ended December 31, 2024 and Note 5, “Acquisitions” thereto in the Company’s 2024 Annual Report.

The Mandatory Convertible Preferred Stock will be issued on the acquisition closing date and will automatically convert into common stock on the conversion date, which is approximately three years from issuance, unless earlier converted by the holder or upon a fundamental change.

The shares accrue cumulative dividends at a rate of 6.50 % per annum, payable quarterly when and if declared.

Each share will convert at a rate ranging from 7.1806 to 8.2576 shares of common stock, depending on the average market price during the specified settlement period and subject to certain customary anti‑dilution and other protective adjustment provisions.

Holders may elect early conversion at the minimum conversion rate, subject to adjustments for unpaid dividends.

The preferred stock has a liquidation preference senior to common equity and is not redeemable, except for limited redemptions required to address regulatory ownership restrictions.

Management believes these shares could be dilutive to the Company’s GAAP earnings per share after the Acquisition has closed.

In addition, on February 2, 2026, the Company offered and agreed to issue and sell 1,254,255 shares of its Common Stock, par value $ 0.001 per share, to certain institutional investors (the “Common Stock Purchasers” and, together with the Preferred Stock Purchasers, the “Purchasers”), pursuant to a common stock purchase agreement (the “Common Stock Purchase Agreement” and, together with the Preferred Stock Purchase Agreement, the “Purchase Agreements”), at a price of $ 114.00 per share, for an aggregate purchase price of approximately $ 143 million.

The net proceeds to the Company, after deducting the fees payable to the placement agents but before deducting other offering expenses, are expected to be approximately $ 140.1 million.

In connection with the Common Stock Purchase Agreement, the Company has agreed to provide the Common Stock Purchasers with certain customary registration rights with respect to the shares of Common Stock to be issued thereunder.

Under the terms of the Purchase Agreements, the obligation of the Purchasers to purchase the shares is conditioned upon, among other things, the substantially concurrent consummation of the Acquisition.

The Purchase Agreements may be terminated by either the Company or the Purchasers if the closing does not occur on or before November 30, 2026.

The issuance of the Preferred Shares and the shares of Common Stock described above, together with the related net proceeds, are each expected to occur concurrently with, and are conditioned upon, the closing of the Acquisition.

For a description of the Company’s acquisition activity for the year ended December 31, 2025, reference is made to the financial statements as of and for the year ended December 31, 2025 and Note 5, “Acquisitions” thereto in the Company’s 2025 Form 10-K.

The Company provides fabrication technology advanced equipment, consumables, gas control equipment, robotics and digital solutions.

1 unchanged sentence

The Company disaggregates its revenue into the following product groups:

Three Months Ended Nine Months Ended

October 3, 2025 September 27, 2024 October 3, 2025 September 27, 2024

Three Months Ended

April 3, 2026 April 4, 2025

(In thousands)

4 unchanged sentences

The consumables product grouping generally has less production complexity and shorter production cycles than equipment products.

Given the nature of the business, the total amount of unsatisfied performance obligations with an original contract duration of greater than one year as of October 3, 2025 is immaterial.

Given the nature of the business, the total amount of unsatisfied performance obligations with an original contract duration of greater than one year as of April 3, 2026 is immaterial.

In some circumstances, customers are billed in advance of revenue recognition, resulting in contract liabilities.

As of December 31, 2024 and December 31, 2023, total contract liabilities were $ 26.4 million and $ 31.2 million, respectively, and were included in Accrued liabilities on the Consolidated and Condensed Balance Sheets.

During the three and nine months ended October 3, 2025, revenue recognized that was included in the contract liabilities balance at the beginning of the year was $ 1.9 million and $ 15.5 million, respectively.

During the three and nine months ended September 27, 2024, revenue recognized that was included in the contract liabilities balance at the beginning of the year was $ 1.3 million and $ 22.6 million, respectively.

As of October 3, 2025 and September 27, 2024, total contract liabilities were $ 27.2 million and $ 27.8 million, respectively.

As of December 31, 2025 and December 31, 2024, total contract liabilities were $ 19.7 million and $ 26.4 million, respectively, and were included in Accrued liabilities on the Consolidated Balance Sheets.

During the three months ended April 3, 2026, revenue recognized that was included in the contract liabilities balance at the beginning of the year was $ 10.4 million.

During the three months ended April 4, 2025, revenue recognized that was included in the contract liabilities balance at the beginning of the year was $ 9.9 million.

As of April 3, 2026 and April 4, 2025, total contract liabilities were $ 33.9 million and $ 25.3 million, respectively.

ESAB CORPORATION

2 unchanged sentences

A summary of the activity in the Company’s allowance for credit losses included within Trade receivables in the Consolidated and Condensed Balance Sheets is as follows:

Nine Months Ended October 3, 2025

Three Months Ended April 3, 2026

of Period Charged to Expense, net Write-Offs and Deductions Foreign

5 unchanged sentences

The Company allocates earnings to participating securities and computed earnings per share using the two-class method as follows:

Three Months Ended Nine Months Ended

October 3, 2025 September 27, 2024 October 3, 2025 September 27, 2024

Three Months Ended

April 3, 2026 April 4, 2025

(In thousands, except share and per share data)

13 unchanged sentences

Net income per share from continuing operations – diluted $ 0.82 $ 1.14

(1) Net income from continuing operations attributable to ESAB Corporation for the respective periods is calculated using Net income from continuing operations, less Income attributable to noncontrolling interest, net of taxes, of $ 1.7 million and $ 5.4 million for the three and nine months ended October 3, 2025, respectively, and $ 1.6 million and $ 4.7 million for the three and nine months ended September 27, 2024, respectively.

(1) Net income from continuing operations attributable to ESAB Corporation for the respective periods is calculated using Net income from continuing operations, less Income attributable to noncontrolling interest, net of taxes, of $ 1.6 million for the three months ended April 3, 2026 and $ 2.5 million for the three months ended April 4, 2025.

(2) Potentially dilutive securities include stock options, performance-based restricted stock units and non-performance-based restricted stock units.

During the three and nine months ended October 3, 2025, Income from continuing operations before income taxes was $ 83.0 million and $ 264.2 million, respectively, while Income tax expense was $ 17.7 million and $ 56.5 million, respectively.

The effective tax rate was 21.3 % and 21.4 % for the three and nine months ended October 3, 2025, respectively.

During the three months ended April 3, 2026, Income from continuing operations before income taxes was $ 64.9 million while Income tax expense was $ 13.1 million.

The effective tax rate was 20.2 % for the three months ended April 3, 2026.

The effective tax rate differed from the 2026 U.S.

federal statutory rate of 21.0% primarily due to the impact of a law change in a foreign jurisdiction and withholding tax offset by a release of a valuation allowance in a foreign jurisdiction.

During the three and nine months ended September 27, 2024, Income from continuing operations before income taxes was $ 89.1 million and $ 273.9 million, respectively, while Income tax expense was $ 18.1 million and $ 54.5 million, respectively.

The effective tax rate was 20.3 % and 19.9 % for the three and nine months ended September 27, 2024, respectively.

federal statutory rate of 21.0% primarily due to the U.S.

tax benefit for qualifying Foreign-Derived Deduction Eligible Income (“FDDEI”).

During the three months ended April 4, 2025, Income from continuing operations before income taxes was $ 93.1 million while Income tax expense was $ 20.5 million.

The effective tax rate was 22.0 % for the three months ended April 4, 2025.

The effective tax rate differed from the 2025 U.S.

federal statutory rate of 21.0% primarily due to the mix of income outside of the U.S.

taxed at higher statutory tax rates.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

effective tax rate differed from the 2024 U.S.

federal statutory rate of 21.0% primarily due to a favorable final ruling in a tax case in a foreign jurisdiction and an agreement with a taxing authority on the treatment of subsidy income in a foreign jurisdiction.

Inventories, Net

Inventories, net consisted of the following:

October 3, 2025 December 31, 2024

April 3, 2026 December 31, 2025

(In thousands)

7 unchanged sentences

Accrued and Other liabilities in the Consolidated and Condensed Balance Sheets consisted of the following:

October 3, 2025 December 31, 2024

April 3, 2026 December 31, 2025

Current Noncurrent Current Noncurrent

13 unchanged sentences

A summary of the activity in the Company’s warranty liability included in Accrued liabilities in the Company’s Consolidated and Condensed Balance Sheets is as follows:

Nine Months Ended

October 3, 2025 September 27, 2024

Three Months Ended

April 3, 2026 April 4, 2025

(In thousands)

10 unchanged sentences

A summary of the activity in the Company’s restructuring liability included in Accrued liabilities and Other liabilities in the Consolidated and Condensed Balance Sheets is as follows:

Nine Months Ended October 3, 2025

Balance at Beginning of Period Charges Payments Foreign Currency Translation Balance at End of Period

Three Months Ended April 3, 2026

Balance at Beginning of Period Charges Payments Foreign Currency Translation and Other Balance at End of Period

(In thousands)

3 unchanged sentences

1,677 5,186 ( 6,057 ) — 806

Subtotal 10,504 6,362 ( 7,106 ) ( 89 ) 9,671

Non-cash charges (2)

Termination benefits (1)

6,223 687 ( 1,322 ) ( 62 ) 5,526

(1) Includes severance and other termination benefits, including outplacement services.

(2) Includes the cost of relocating associates, relocating equipment and other costs in connection with the closure and optimization of facilities and product lines.

Benefit Plans

The Company sponsors various defined benefit plans and other post-retirement benefits plans, including health and life insurance, for certain eligible employees or former employees.

During the nine months ended September 27, 2024, the Company recognized a non-cash pension settlement loss of $ 12.2 million related to the transfer of plan assets to a third party as part of externalizing the risk associated with a foreign defined benefit plan.

This amount is reflected in Pension settlement loss in the Consolidated and Condensed Statements of Operations.

Facility closure costs and other (2)

889 493 ( 709 ) 49 722

Subtotal 7,112 1,180 ( 2,031 ) ( 13 ) 6,148

Non-cash charges (2)

Total $ 17,616 7,542 $ ( 9,137 ) $ ( 102 ) $ 15,919

Non-cash charges (2)

Total Provision $ 10,161

(1) I ncludes severance and other termination benefits, including outplacement services.

(2) I ncludes the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines .

The following table shows the components of the Company’s debt:

October 3, 2025 December 31, 2024

April 3, 2026 December 31, 2025

(In thousands)

8 unchanged sentences

Senior Notes, Term Loans and Revolving Credit Facility

On April 4, 2022, the Company entered into a credit agreement (as amended and restated from time-to-time, the “Credit Agreement”) that initially consisted of a $ 750 million revolving credit facility (the “Revolving Facility”) with a maturity date of April 4, 2027, a Term A-1 loan with an initial aggregate principal amount of $ 400 million (the “Term Loan A-1 Facility”), with a maturity date of April 4, 2027;

and a $ 600 million 364 -day senior term loan facility (the “Term Loan A-2 Facility”) with a maturity date of April 3, 2023.

The Revolving Facility contains a $ 300 million foreign currency sublimit and a $ 50 million swing line loan sub-facility.

On June 28, 2022, the Company amended and restated the Credit Agreement by entering into Amendment No.

2 to the Credit Agreement (“Credit Agreement Amendment”).

The Credit Agreement Amendment provides for a $ 600 million term loan facility (the “Term Loan A-3 Facility,” collectively the “Term Facilities” with Term A-1 Facility and Term A-2 Facility) with a maturity date of April 3, 2025 to refinance the Company’s existing Term Loan A-2 Facility.

Also on June 28, 2022, the

On April 4, 2022, the Company entered into a credit agreement that initially consisted of (i) a $ 750 million revolving credit facility with a maturity date of April 4, 2027, (ii) a senior term loan A-1 facility with an initial aggregate principal amount of $ 400 million with a maturity date of April 4, 2027 and (iii) a $ 600 million 364 -day senior term loan A-2 facility with a maturity date of April 3, 2023.

The senior term loan A-2 facility was subsequently refinanced in June 2022 extending its maturity date to April 3, 2025 to become a senior term loan A-3 facility.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

Company borrowed the entire $ 600 million under Term Loan A-3 Facility to fund the repayment of the Term Loan A-2 Facility.

On April 9, 2024, the Company issued $ 700 million in aggregate principal amount of 6.25 % senior notes due 2029 (the “2029 Senior Notes”) governed by an indenture (the “2029 Indenture”).

The Company used the net proceeds from the Senior Notes to pay off its Term Loan A-3 Facility and pay fees associated with the offering.

After the quarter ended October 3, 2025, on October 16, 2025, the Company entered into an Amended and Restated Credit Agreement that, among other things, provides for (i) a senior term loan A facility in an aggregate principal amount of $ 350 million, and (ii) a senior revolving credit facility in the amount of $ 1.05 billion to replace the Company’s existing $ 400 million Term Loan A-1 Facility and $ 750 million Revolving Facility and pay off the outstanding principal and interest thereunder.

The 2029 Senior Notes have a contractual maturity interest rate of 6.25 % and maturity date of April 15, 2029.

The Company used the net proceeds from the 2029 Senior Notes to pay off its senior term loan A-3 facility and pay fees associated with the offering.

On October 16, 2025, the Company entered into an Amended and Restated Credit Agreement (the “A&R Credit Agreement”) that, among other things, provides for (i) a senior term loan A facility (the “Term Loan A Facility”) in an aggregate principal amount of $ 350 million and (ii) a senior revolving credit facility (the “Revolving Facility”) in the amount of $ 1.05 billion to replace the Company’s existing $ 400 million senior term loan A-1 facility and $ 750 million revolving credit facility and pay off the outstanding principal and interest thereunder.

Both facilities mature on October 16, 2030, subject to a springing maturity date under certain circumstances.

The new covenants and applicable interest rate under the Amended and Restated Credit Agreement are substantially similar to the prior agreement.

Refer to “Note 16, Subsequent Events” for further details.

As of October 3, 2025, the Company’s debt primarily consisted of the following facilities:

• A $ 750 million Revolving Facility with a maturity date of April 4, 2027, with $ 260 million drawn;

• A Term Loan A-1 Facility with an aggregate principal amount of $ 375 million and a maturity date of April 4, 2027;

• Senior Notes with an aggregate principal amount of $ 700 million and a maturity date of April 15, 2029.

The Credit Agreement and the Indenture contain customary covenants.

The Revolving Facility contains a $ 300 million foreign currency sublimit and a $ 50 million swing line loan sub-facility.

On March 26, 2026, the Company issued $ 1.0 billion in aggregate principal amount of 5.625 % senior notes due 2031 (the “2031 Senior Notes” and, together with the 2029 Senior Notes, the “Senior Notes”) governed by an indenture (the “2031 Indenture” and together with the 2029 Indenture, the “Indentures”).

The 2031 Senior Notes have a contractual maturity interest rate of 5.625 % and maturity date of April 1, 2031.

The Company used a portion of the net proceeds to pay down the revolving line of credit for a total of $ 240 million and plans to use the remaining net proceeds from the sale of the 2031 Senior Notes to pay a portion of the acquisition of Eddyfi and associated costs and expenses.

The 2031 Senior Notes are subject to a special mandatory redemption at a redemption price equal to 100% of the initial issue price of the 2031 Senior Notes, plus any accrued and unpaid interest to, but not including, the date of such special mandatory redemption, if (i) the Acquisition is not consummated on or prior to the outside date as set forth under the related share purchase agreement or (ii) the Company notifies the trustee that the share purchase agreement has been terminated in accordance with its terms or upon the occurrence of certain other events prior to the outside date as set forth under the share purchase agreement.

Refer to Note 3, “Acquisitions” for additional information.

The Indentures also provide for certain optional or mandatory redemptions or prepayments in other circumstances, none of which are currently expected by management as of April 3, 2026.

The A&R Credit Agreement and the Indentures contain customary covenants.

These covenants limit the ability of the Company and its subsidiaries to, among other things, incur debt or liens, merge or consolidate with others, dispose of assets, make investments or pay dividends.

In addition, the Credit Agreement requires that the Company maintains certain financial covenants and the Company was in compliance with all of its debt covenants as of October 3, 2025.

The Credit Agreement and the Indenture contain various events of default (including failure to comply with the covenants under the Credit Agreement and related agreements) and upon an event of default the lenders may, subject to various customary cure rights, require the immediate payment of all amounts outstanding under the Term A-1 Facility, Senior Notes and the Revolving Facility.

Certain United States subsidiaries of the Company have agreed to guarantee the obligations of the Company under the Credit Agreement and Senior Notes.

Loans made under the Term A-1 Facility will bear interest, at the election of the Company, at either the base rate (as defined in the Credit Agreement) or at the term Secured Overnight Financing Rate (“SOFR”) plus an adjustment (as defined in the Credit Agreement), in each case, plus the applicable interest rate margin.

Loans made under the Revolving Facility will bear interest, at the election of the Company, at either the base rate or, (i) in the case of loans denominated in dollars, the term SOFR plus an adjustment or the daily simple SOFR plus an adjustment, (ii) in the case of loans denominated in euros, the adjusted Euro Interbank Offered Rate (“EURIBOR”) rate and, (iii) in the case of loans denominated in sterling, Sterling Overnight Index Average (“SONIA”) plus an adjustment (as all such rates are defined in the Credit Agreement Amendment), in each case, plus the applicable interest rate margin.

The applicable interest rate margin changes based upon the Company’s total leverage ratio (consolidated total debt divided by EBITDA, as defined in the credit agreement and ranging from 1.125 % to 1.750 % or in the case of the base rate margin, 0.125 % to 0.750 %).

In addition, the A&R Credit Agreement requires that the Company maintains certain financial covenants and the Company was in compliance with all of its debt covenants as of April 3, 2026.

The A&R Credit Agreement and the Indentures contain various events of default (including failure to comply with the covenants under the A&R Credit Agreement) and upon an event of default the lenders may, subject to various customary cure rights, require the immediate payment of all amounts outstanding under the Term Loan A Facility, Senior Notes and the Revolving Facility.

Certain United States subsidiaries of the Company have agreed to guarantee the obligations of the Company under the A&R Credit Agreement and Senior Notes.

Loans made under the Term Loan A Facility will bear interest, at the election of the Company, at either the base rate (as defined in the A&R Credit Agreement) or at the term Secured Overnight Financing Rate (“SOFR”) plus an adjustment (as defined in the A&R Credit Agreement), in each case, plus the applicable interest rate margin.

Loans made under the Revolving Facility will bear interest, at the election of the Company, at either the base rate or, (i) in the case of loans denominated in dollars, the term SOFR plus an adjustment or the daily simple SOFR plus an adjustment, (ii) in the case of loans denominated in euros, the adjusted Euro Interbank Offered Rate (“EURIBOR”) rate and, (iii) in the case of loans denominated in sterling, Sterling Overnight Index Average (“SONIA”) plus an adjustment (as all such rates are defined in the A&R Credit Agreement), in each case, plus the applicable interest rate margin.

The applicable interest rate margin changes based upon the Company’s total leverage ratio (consolidated total net debt divided by EBITDA, as defined in the credit agreement and ranging from 1.125 % to 1.750 % or in the case of the base rate margin, 0.125 % to 0.750 %).

Each swing line loan denominated in dollars will bear interest at the base rate plus the applicable interest rate margin.

To manage exposures to currency exchange rates and interest rates arising in Long-term debt, the Company entered into interest rate and cross-currency swap agreements.

To manage exposures to currency exchange rates and interest rates arising in Long-term debt, the Company entered into cross-currency swap agreements.

Refer to Note 10, “Derivatives” for additional information.

As of October 3, 2025, the weighted-average interest rate of borrowings under the Credit Agreement and Indenture was 5.55 %, including the net impact from the cross-currency swaps and excluding accretion of deferred financing fees, and there was $ 490 million of borrowing capacity available under the Revolving Facility, subject to the Company meeting financial covenants and other requirements.

As of April 3, 2026, the weighted-average interest rate of borrowings under the Credit Agreement and Indentures was 5.45 %, including the net impact from the cross-currency swaps and excluding accretion of deferred financing fees, and there

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

was $ 1,050 million of borrowing capacity available under the Revolving Facility, subject to the Company meeting financial covenants and other requirements.

Bridge Loan Commitment Letter

On January 31, 2026, the Company entered into a commitment letter with JPMorgan Chase Bank, N.A.

to provide a $ 1.0 billion aggregate principal senior unsecured bridge term loan facility (the “Bridge Loan”) to fund the Acquisition and related fees and expenses.

On March 26, 2026, following the issuance of the 2031 Senior Notes, the Company terminated the Bridge Loan.

The Company never drew down on the Bridge Loan and paid $ 4.8 million for customary upfront fees related to the Bridge Loan that were expensed through Interest expense and other, net upon termination of the Bridge Loan.

Other Indebtedness

In addition to the debt agreements discussed above, the Company also has the ability to incur approximately $ 50 million of indebtedness pursuant to certain uncommitted credit lines, consisting of an uncommitted credit line that the Company has used from time to time in the past for short-term working capital needs.

In addition to the debt agreements discussed above, the Company also has the ability to incur $ 73.1 million of indebtedness pursuant to certain uncommitted credit lines, consisting primarily of an uncommitted credit line that the Company has used from time to time in the past for short-term working capital needs.

The Company is party to letter of credit facilities with an aggregate capacity of $ 114.3 million.

Total letters of credit of $ 32.4 million were outstanding as of October 3, 2025.

Total letters of credit of $ 37.2 million were outstanding as of April 3, 2026.

Deferred Financing Fees

The Company had total deferred financing fees of $ 8.0 million included in its Consolidated and Condensed Balance Sheets as of October 3, 2025, which will be charged to Interest expense and other, net, over the term of the related debt instruments.

The costs associated with the Term Facilities and Senior Notes noted above will be amortized over the contractual term of the related facility and the costs associated with these will be amortized over the life of the Credit Agreement or the Indenture.

Of the $ 8.0 million, $ 0.4 million of deferred financing fees relating to the Revolving Facility are included in Other assets and $ 7.6 million of deferred financing fees relating to the Term Facilities and Senior Notes are recorded as a contra-liability within Long-term debt.

The Company uses derivative instruments to manage exposures to currency exchange rates and interest rates arising in connection with long-term debt and the normal course of business.

The Company had total deferred financing fees of $ 24.5 million included in its Consolidated and Condensed Balance Sheets as of April 3, 2026, which will be charged to Interest expense and other, net, over the term of the related debt instruments.

The costs associated with the Term Loan A Facility and Senior Notes noted above will be amortized over the contractual term of the related facility and the costs associated with these will be amortized over the life of the A&R Credit Agreement or the Indentures, respectively.

Of the $ 24.5 million, $ 3.9 million of deferred financing fees relating to the Revolving Facility are included in Other assets and $ 20.6 million of deferred financing fees relating to the Term Loan A Facility and Senior Notes are recorded as a contra-liability within Long-term debt.

The deferred financing fees related to the 2031 Senior Notes make up approximately $ 13 million of the $ 20.6 million.

The Company uses derivative instruments to manage exposures to currency exchange rates arising in connection with Long-term debt and the normal course of business.

The Company has established policies and procedures that govern the risk management of these exposures.

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Counterparties include a number of major banks and financial institutions.

None of the concentrations of risk with an individual counterparty was considered significant as of October 3, 2025.

None of the concentrations of risk with an individual counterparty was considered significant as of April 3, 2026.

The Company does not expect any counterparties to fail to meet their obligations.

The Company records derivatives in the Consolidated and Condensed Balance Sheets at fair value.

Cash Flow Hedges

On July 14, 2022, the Company entered into two interest rate swap agreements to manage interest rate risk exposure.

The aggregate notional amount of these contracts was $ 600 million and they were set to mature in April 2025.

These interest rate swap agreements utilized by the Company effectively modify the Company’s exposure to interest rate risk by converting a portion of the Company’s floating-rate debt to a fixed rate of 3.293 %, plus a spread, thus reducing the impact of interest-rate changes on future interest expense.

The applicable spread may vary between 1.125 % to 1.750 %, depending on the total leverage ratio of the Company.

In March 2024, the Company settled one of the interest rate swaps associated with the Company’s floating-rate debt and received $ 5.5 million in connection with that settlement.

The termination of the interest rate swap was related to the repayment of the Term A-3 Facility in April 2024.

Refer to Note 10, “Debt” for further information.

As this interest rate swap was designated as a cash flow hedge, $ 5.5 million was deferred in accumulated other comprehensive loss (“AOCL”) and was recognized in earnings over the period the originally forecasted hedged transaction impacted earnings.

The remaining $ 300 million swap was hedged against the remaining floating-rate debt through its maturity on April 3, 2025.

Therefore, the Company does not have any interest rate swaps outstanding as of October 3, 2025.

The cash inflows and outflows associated with the Company’s interest rate swap agreement designated as cash flow hedges were classified in cash flows from operating activities in the accompanying Consolidated and Condensed Statements of Cash Flows.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

The effects of designated cash flow hedges on the Company’s Consolidated and Condensed Statements of Operations consisted of the following:

Three Months Ended Nine Months Ended

Derivative Type Gain Recognized in the Consolidated and Condensed Statements of Operations October 3, 2025 September 27, 2024 October 3, 2025 September 27, 2024

(In thousands)

Interest rate swap agreement(s) Interest expense and other, net $ — $ ( 1,910 ) $ ( 1,414 ) $ ( 7,680 )

Net Investment Hedges

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Prior to the maturity of these two cross-currency swaps, on June 25, 2024, the Company de-designated these swaps and entered into four new cross-currency swaps for the same above notional amounts that mature in October 2026.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

On August 22, 2024, the Company entered into two additional cross-currency swap agreements, set to mature in October 2026.

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These swaps are designated and accounted for as a net investment hedge.

The changes in the spot rate of these instruments are recorded in AOCI in equity, partially offsetting the foreign currency translation adjustment of the Company’s related net investment that is also recorded in AOCI.

The changes in the spot rate of these instruments are recorded in Accumulated Other Comprehensive Loss (“AOCL”) in equity, partially offsetting the foreign currency translation adjustment of the Company’s related net investment that is also recorded in AOCL.

The Company uses the spot method of assessing hedge effectiveness and as such, the initial value of the hedge components excluded from the assessment of effectiveness is recognized in the Interest expense and other, net line item in the Consolidated and Condensed Statements of Operations under a systematic and rational method over the life of the cross-currency swap agreements.

Any ineffective portions of net investment hedges are reclassified from AOCI into earnings during the period of change.

Due to the de-designation transaction above on June 25, 2024, the Company will keep the balance in AOCI related to the original derivative for the duration that the investment is held.

The Company did not have any ineffectiveness related to net investment hedges during the nine months ended October 3, 2025.

Any ineffective portions of net investment hedges are reclassified from AOCL into earnings during the period of change.

Due to the de-designation transaction above on June 25, 2024, the Company will keep the balance in AOCL related to the original derivative for the duration that the investment is held.

The Company did not have any ineffectiveness related to net investment hedges during the three months ended April 3, 2026.

The cash inflows and outflows associated with the excluded components of the Company’s cross-currency swap agreements designated as net investment hedges are classified in operating activities in the accompanying Consolidated and Condensed Statements of Cash Flows.

The effects of the excluded components of designated net investment hedges on the Company’s Consolidated and Condensed Statements of Operations consisted of the following:

Three Months Ended Nine Months Ended

Derivative Type Gain Recognized in the Consolidated and Condensed Statements of Operations October 3, 2025 September 27, 2024 October 3, 2025 September 27, 2024

(In thousands)

Cross-currency swap agreements Interest expense and other, net $ ( 903 ) $ ( 1,061 ) $ ( 1,687 ) $ ( 3,415 )

The table below shows the fair value of the derivatives recognized in the Consolidated and Condensed Balance Sheets:

October 3, 2025 December 31, 2024

April 3, 2026 December 31, 2025

Designated as Hedging Instruments Other Liabilities Other Assets Other Liabilities Other Assets

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Cross-currency swap agreements $ 40,092 $ — $ 48,778 $ —

Interest rate swap agreement — — — 842

$ 49,741 $ — $ 1,830 $ 842

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

Derivatives Not Designated as Hedging Instruments

The Company has certain foreign currency contracts that are not designated as hedges.

As of October 3, 2025 and December 31, 2024, the Company had foreign currency contracts related to purchases and sales with notional values of $ 130.2 million and $ 178.7 million, respectively.

As of April 3, 2026 and December 31, 2025, the Company had foreign currency contracts related to purchases and sales with notional values of $ 142.3 million and $ 105.2 million, respectively.

The table below shows the fair value of derivative instruments not designated in a hedging relationship recognized in the Consolidated and Condensed Balance Sheets:

October 3, 2025 December 31, 2024

April 3, 2026 December 31, 2025

Not Designated as Hedging Instruments Accrued Liabilities Other Current Assets Accrued Liabilities Other Current Assets

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Foreign currency contracts $ 1,159 $ 163 $ 183 $ 780

The amounts in the table above as of October 3, 2025 reflect the fair value of the Company’s foreign currency contracts on a net basis where allowable under master netting agreements.

The amounts in the table above as of April 3, 2026 reflect the fair value of the Company’s foreign currency contracts on a net basis where allowable under master netting agreements.

Had these amounts been recognized on a gross basis, the impact would have been a $ 0.4 million increase in Other current assets with a corresponding increase in Accrued liabilities.

The Company recognized the following in its Consolidated and Condensed Financial Statements related to its derivative instruments not designated in a hedging relationship:

Three Months Ended Nine Months Ended

Foreign Currency Contracts October 3, 2025 September 27, 2024 October 3, 2025 September 27, 2024

(In thousands)

Change in unrealized gains (losses) $ 660 $ ( 1,220 ) $ 1,945 $ ( 591 )

Realized gains $ 670 $ 919 $ 2,260 $ 903

The above gains or losses on foreign currency contracts are usually offset by foreign exchange exposure on cash and intercompany positions, all of which are recognized in Interest expense and other, net, in the Consolidated and Condensed Statements of Operations.

The gains or losses on foreign currency contracts are usually offset by foreign exchange exposure on cash and intercompany positions, all of which are recognized in Interest expense and other, net, in the Consolidated and Condensed Statements of Operations.

Financial Instruments and Fair Value Measurements

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The estimated fair values may not represent actual values of the financial instruments that could be realized as of the balance sheet date or that will be realized in the future.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

A summary of the Company’s assets and liabilities that are measured at fair value for each fair value hierarchy level for the periods presented is as follows:

October 3, 2025 December 31, 2024

April 3, 2026 December 31, 2025

Three Total Level

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Foreign currency contracts — 519 — 519 — 857 — 857

Interest rate swap agreement — — — — — 842 — 842

Deferred compensation plans — 7,099 — 7,099 — 7,214 — 7,214

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$ — $ 48,706 $ — $ 48,706 $ — $ 56,252 $ — $ 56,252

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

The Company measures the fair value of foreign currency contracts, cross-currency swap agreements and interest rate swap agreement(s) using Level Two inputs based on observable spot and forward rates in active markets.

The Company measures the fair value of foreign currency contracts and cross-currency swap agreements using Level Two inputs based on observable spot and forward rates in active markets.

Additionally, the fair value of derivatives designated in hedging relationships includes a credit valuation adjustment to appropriately incorporate nonperformance risk for the Company and the respective counterparty.

For the nine months ended October 3, 2025, the impact of the credit valuation adjustment on the Company’s derivatives is immaterial.

For the three months ended April 3, 2026, the impact of the credit valuation adjustment on the Company’s derivatives is immaterial.

Refer to Note 10, “Derivatives” for additional information.

There were no transfers in or out of Level One, Two or Three during the nine months ended October 3, 2025.

There were no transfers in or out of Level One, Two or Three during the three months ended April 3, 2026.

ESAB CORPORATION

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On August 13, 2024, the Board of Directors authorized and approved a stock repurchase program to repurchase up to five million shares of the Company’s Common stock, par value $ 0.001 per share, from time-to-time on the open market, in privately negotiated transactions or as may otherwise be determined by the Company’s management in its discretion.

No repurchases of the Company’s Common stock have been made through the nine months ended October 3, 2025.

No repurchases of the Company’s Common stock have been made through the share repurchase program through the three months ended April 3, 2026 since inception.

The timing and amount of any shares repurchased will be determined by the Company’s management based on its evaluation of market conditions, applicable legal requirements and other factors.

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Accumulated Other Comprehensive Loss

The following tables present the changes in the balances of each component of AOCL including reclassifications out of AOCL for the nine months ended October 3, 2025 and September 27, 2024.

The following tables present the changes in the balances of each component of AOCL including reclassifications out of AOCL for the three months ended April 3, 2026 and April 4, 2025.

All amounts are net of tax and noncontrolling interest, if any.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

Accumulated Other Comprehensive Loss Components

Net Unrecognized Pension and Other Post-Retirement Benefit Cost Foreign Currency Translation Adjustment Net Investment Hedges Cash Flow Hedges Total

Net Unrecognized Pension and Other Post-Retirement Benefit Cost Foreign Currency Translation Adjustment Net Investment Hedges Total

(In thousands)

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$ ( 51,677 ) $ ( 450,325 ) $ ( 37,714 ) $ ( 539,716 )

Other comprehensive (loss) income before reclassifications:

Net actuarial loss 48 — — — 48

Other comprehensive income (loss) before reclassifications:

Foreign currency translation adjustment 110 ( 29,642 ) 6,729 ( 22,803 )

Gain on long-term intra-entity foreign currency transactions — 5,137 — 5,137

Unrealized gain on cash flow hedges — — — 16 16

Other comprehensive (loss) income before reclassifications ( 373 ) 95,004 ( 15,371 ) 16 79,276

Other comprehensive income (loss) before reclassifications 110 ( 24,505 ) 6,729 ( 17,666 )

Amounts reclassified from Accumulated other comprehensive loss (1)

273 — — ( 1,832 ) ( 1,559 )

Net current period Other comprehensive (loss) income ( 100 ) 95,004 ( 15,371 ) ( 1,816 ) 77,717

Net current period Other comprehensive income (loss) 479 ( 24,505 ) 6,729 ( 17,297 )

Balance at April 3, 2026

$ ( 51,198 ) $ ( 474,830 ) $ ( 30,985 ) $ ( 557,013 )

Other comprehensive (loss) income before reclassifications:

Foreign currency translation adjustment ( 431 ) 117,446 ( 25,027 ) — 91,988

Gain on long-term intra-entity foreign currency transactions — 9,968 — — 9,968

Other comprehensive (loss) income before reclassifications ( 431 ) 127,414 ( 25,027 ) — 101,956

Amounts reclassified from Accumulated other comprehensive loss (1)

202 — — — 202

Net current period Other comprehensive (loss) income ( 229 ) 127,414 ( 25,027 ) — 102,158

Balance at July 4, 2025

( 50,681 ) ( 457,373 ) ( 41,645 ) — ( 549,699 )

Other comprehensive (loss) income before reclassifications:

Foreign currency translation adjustment ( 56 ) ( 7,176 ) 3,244 — ( 3,988 )

Loss on long-term intra-entity foreign currency transactions — ( 773 ) — — ( 773 )

Other comprehensive (loss) income before reclassifications ( 56 ) ( 7,949 ) 3,244 — ( 4,761 )

Amounts reclassified from Accumulated other comprehensive loss (1)

250 — — — 250

Net current period Other comprehensive (loss) income 194 ( 7,949 ) 3,244 — ( 4,511 )

Balance at October 3, 2025

$ ( 50,487 ) $ ( 465,322 ) $ ( 38,401 ) $ — $ ( 554,210 )

(1) The amounts on this line within the Net Unrecognized Pension and Other Post-Retirement Benefit Cost column are included in the computation of net periodic benefit cost.

(2) The amount within the Cash Flow Hedges column is a component of Interest expense and other, net.

See Note 11, “Derivatives” for additional details.

ESAB CORPORATION

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$ ( 50,352 ) $ ( 679,791 ) $ ( 1,247 ) $ 1,816 $ ( 729,574 )

Other comprehensive income (loss) before reclassifications:

Foreign currency translation adjustment 243 ( 38,265 ) 4,995 — ( 33,027 )

Gain on long-term intra-entity foreign currency transactions — 7,996 — — 7,996

Unrealized gain on cash flow hedges — — — 3,920 3,920

Other comprehensive income (loss) before reclassifications 243 ( 30,269 ) 4,995 3,920 ( 21,111 )

Amounts reclassified from Accumulated other comprehensive loss (1)(2)

629 — — ( 2,907 ) ( 2,278 )

Net current period Other comprehensive income (loss) 872 ( 30,269 ) 4,995 1,013 ( 23,389 )

Balance at March 29, 2024

( 58,933 ) ( 584,891 ) ( 12,220 ) 8,383 ( 647,661 )

Other comprehensive income (loss) before reclassifications:

Other comprehensive (loss) income before reclassifications:

Net actuarial loss 48 — — — 48

Foreign currency translation adjustment ( 421 ) 94,613 ( 15,371 ) — 78,821

1 unchanged sentence

Unrealized gain on cash flow hedges — — — 16 16

Other comprehensive income (loss) before reclassifications 6 ( 14,880 ) 686 811 ( 13,377 )

Amounts reclassified from Accumulated other comprehensive loss (1)(2)

327 — — ( 2,662 ) ( 2,335 )

Net current period Other comprehensive income (loss) 333 ( 14,880 ) 686 ( 1,851 ) ( 15,712 )

Balance at June 28, 2024

( 58,600 ) ( 599,771 ) ( 11,534 ) 6,532 ( 663,373 )

Other comprehensive income (loss) before reclassifications:

Foreign currency translation adjustment ( 291 ) 63,336 ( 8,945 ) — 54,100

Gain on long-term intra-entity foreign currency transactions — 8,866 — — 8,866

Unrealized loss on cash flow hedges — — — ( 1,230 ) ( 1,230 )

Other comprehensive income (loss) before reclassifications ( 291 ) 72,202 ( 8,945 ) ( 1,230 ) 61,736

Other comprehensive (loss) income before reclassifications ( 373 ) 95,004 ( 15,371 ) 16 79,276

Amounts reclassified from Accumulated other comprehensive loss (1)(2)

273 — — ( 1,832 ) ( 1,559 )

Purchase related to noncontrolling interest — ( 1,706 ) — — ( 1,706 )

Net current period Other comprehensive income (loss) 52 70,496 ( 8,945 ) ( 3,130 ) 58,473

Balance at September 27, 2024

Net current period Other comprehensive (loss) income ( 100 ) 95,004 ( 15,371 ) ( 1,816 ) 77,717

Balance at April 4, 2025

$ ( 50,452 ) $ ( 584,787 ) $ ( 16,618 ) $ — $ ( 651,857 )

6 unchanged sentences

Asbestos Contingencies

Certain entities are the legal obligor, or owner, for certain asbestos obligations including long-term asbestos insurance assets, long-term asbestos insurance receivables, accrued asbestos liabilities, long-term asbestos liabilities, asbestos indemnity expenses, asbestos-related defense costs and asbestos insurance recoveries related to the asbestos obligations of the Company’s legacy industrial businesses.

Certain subsidiaries of the Company are the legal obligor, or owner, for certain asbestos obligations including long-term asbestos insurance assets, long-term asbestos insurance receivables, accrued asbestos liabilities, long-term asbestos liabilities, asbestos indemnity expenses, asbestos-related defense costs and asbestos insurance recoveries related to the asbestos obligations of the Company’s legacy industrial businesses.

As a result, the Company holds certain asbestos-related contingencies and insurance coverages.

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Such components were acquired from third-party suppliers, and were not manufactured by any of the Company’s subsidiaries, nor were the subsidiaries producers or direct suppliers of asbestos.

The manufactured products that are alleged to have contained or used asbestos generally were provided to meet the specifications of the subsidiaries’ customers, including the U.S.

The manufactured products that are alleged to have contained or used asbestos generally were provided to meet the specifications of the subsidiaries’ customers, including the United States Navy.

The subsidiaries settle asbestos claims for amounts the Company considers reasonable given the facts and circumstances of each claim.

The annual average settlement payment per asbestos claimant has fluctuated during the past several years while the number of cases has remained substantially even versus prior year.

For additional information on these asbestos claims, refer to Note 19, “Commitments and Contingencies” thereto in the Company’s 2025 Form 10-K.

The annual number of cases and average settlement payment per asbestos claimant has fluctuated during the past several years.

The Company expects such settlement value fluctuations to continue in the future based upon, among other things, the number and type of claims settled in a particular period and the jurisdictions in which such claims arise.

1 unchanged sentence

The Company has classified asbestos-related activity in Loss from discontinued operations, net of taxes in the Consolidated and Condensed Statements of Operations.

Refer to the 2024 Form 10-K for further detail on this classification.

The Company has projected each subsidiary’s future asbestos-related liability costs with regard to pending and future unasserted claims based upon the Nicholson methodology.

7 unchanged sentences

The Company estimates the insurance assets for each subsidiary based upon the applicable policy language, expected recoveries and allocation methodologies, and law pertaining to the affected subsidiary’s insurance policies.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

Asbestos-related claims activity since December 31 is as follows:

Nine Months Ended

October 3, 2025 September 27, 2024

Three Months Ended

April 3, 2026 April 4, 2025

(Number of claims)

6 unchanged sentences

(2) Claims resolved include all asbestos claims that have been settled, dismissed or that are in the process of being settled or dismissed based upon agreements or understandings in place with counsel for the claimants.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

The Company’s Consolidated and Condensed Balance Sheets included the following amounts related to asbestos-related litigation:

October 3, 2025 December 31, 2024

April 3, 2026 December 31, 2025

(In thousands)

21 unchanged sentences

There can be no assurance, however, as to the ultimate outcome of any of these matters, and if all or substantially all of these legal proceedings were to be determined adverse to the Company, there could be a material adverse effect on the financial condition, results of operations or cash flow of the Company.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

Segment Information

ESAB is a focused premier industrial compounder.

ESAB provides its partners with fabrication technology advanced equipment, consumables, gas control equipment, welding robotics and digital solutions.

The Company conducts its operations through two reportable segments.

These segments consist of the “Americas,” which includes operations in North America and South America, and “EMEA & APAC,” which includes Europe, Middle East, India, Africa and Asia Pacific.

The Company’s management considers its Chief Operating Decision Maker (“CODM”) as Shyam Kambeyanda, President, Chief Executive Officer and Director.

The Company’s management and CODM evaluate the operating results of each reportable segment, including assessment of profit or loss, performance and allocation of resources, based upon Net sales and Adjusted EBITDA, which represents Net income from continuing operations excluding the impact of Income tax expense, Interest expense and other, net, Pension settlement loss, Restructuring and other related charges, acquisition - amortization and other related charges and depreciation and other amortization .

The Company’s management considers its Chief Operating Decision Maker (“CODM”) to be Shyam Kambeyanda, President, Chief Executive Officer and Director.

The Company’s management and CODM evaluate the operating results of each reportable segment, including assessment of profit or loss, performance and allocation of resources, based upon Net sales and Adjusted EBITDA, which represents Net income from continuing operations excluding the impact of Income tax expense, Interest expense and other, net, Restructuring and other related charges, acquisition - amortization and other related charges and depreciation and other amortization .

Segment results reflect the allocation of overhead costs, which primarily consist of Selling, general and administrative expense.

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

The Com pany’s segment results were as follows:

Three Months Ended Nine Months Ended

October 3, 2025 September 27, 2024 October 3, 2025 September 27, 2024

Three Months Ended

April 3, 2026 April 4, 2025

(In thousands)

27 unchanged sentences

(1) The following is a reconciliation of Net income from continuing operations to Adjusted EBITDA.

Three Months Ended Nine Months Ended

October 3, 2025 September 27, 2024 October 3, 2025 September 27, 2024

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

Three Months Ended

April 3, 2026 April 4, 2025

(In thousands)

2 unchanged sentences

Interest expense and other, net 25,577 16,782

Pension settlement loss — — — 12,155

Restructuring and other related charges (1)

4,347 1,875 10,236 8,572

Acquisition - amortization and other related charges (2)

16,489 10,064 47,682 25,571

Depreciation and other amortization 13,125 9,955

Adjusted EBITDA $ 136,559 $ 133,900

ESAB CORPORATION

NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS — (Continued)

(1) I ncludes severance and other termination benefits, including outplacement services, as well as the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines .

(2) Includes transaction, diligence and integration expenses totaling $ 6.1 million and $ 20.4 million for the three and nine months ended October 3, 2025, respectively, and $ 2.5 million and $ 3.1 million for the three and nine months ended September 27, 2024, respectively.

Additionally, it includes amortization of intangibles and fair value charges on acquired inventories totaling $ 10.3 million and $ 27.3 million three and nine months ended October 3, 2025, respectively, and $ 7.6 million and $ 22.4 million for the three and nine months ended September 27, 2024, respectively.

October 3, 2025 December 31, 2024

(2) Includes transaction, diligence and integration expenses totaling $ 10.3 million for the three months ended April 3, 2026 and $1.4 million for the three months ended April 4, 2025.

Additionally, it includes amortization of intangibles and fair value step up on acquired inventories totaling $ 12.5 million for the three months ended April 3, 2026 and $8.2 million for the three months ended April 4, 2025.

The Com pany’s investments in equity method investees and total assets by segment were as follows:

April 3, 2026 December 31, 2025

(In thousands)

7 unchanged sentences

$ 5,624,669 $ 4,766,094

The Com pany’s property, plant and equipment, net by geography were as follows:

April 3, 2026 December 31, 2025

(In thousands)

Property, plant and equipment, net (1) :

1 unchanged sentence

Czech Republic 72,207 75,028

Germany 46,759 48,245

India 31,497 31,437

Mexico 24,795 23,464

Poland 19,731 17,227

Other foreign countries 129,719 131,085

1 unchanged sentence

(1) As the Company does not allocate all long-lived assets, specifically intangible assets, to each individual country, evaluation of long-lived assets in total is impracticable.

Subsequent Events

The dividend of $ 6.1 million included in Accrued liabilities in the Consolidated and Condensed Balance Sheets at October 3, 2025 was paid on October 17, 2025 to stockholders of record as of October 3, 2025.

On October 16, 2025, the Company entered into an Amended and Restated Credit Agreement, by and among the Company, as the lead borrower, the other loan parties from time to time party thereto, including certain subsidiaries of the Company identified therein, as guarantors, the lenders from time to time party thereto, and Bank of America, N.A., as administrative agent (the “A&R Credit Agreement”).

The A&R Credit Agreement, among other things, provides for (i) a senior term loan A facility in an aggregate principal amount of $ 350 million, and (ii) a senior revolving credit facility in the amount of $ 1.05 billion to pay off the outstanding principal and interest on the Company’s existing $ 400 million Term Loan A-1 Facility and replace the Company’s $ 750 million Revolving Facility.

Both facilities mature on October 16, 2030, subject to a springing maturity date under certain circumstances.

Subsequent Event

The dividend of $ 6.1 million included in Accrued liabilities in the Consolidated and Condensed Balance Sheets at April 3, 2026 was paid on April 17, 2026 to stockholders of record as of April 2, 2026.

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