What changed in this filing

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Item 1. Financial Statements

2026-07-29 compared with 2026-05-05 · 156 added, 113 removed, 419 unchanged (39% of the section changed)

3 unchanged sentences

(in millions)

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Current assets:

23 unchanged sentences

Commitments and contingent liabilities (Note 8)

Common stock, 94.6 and 93.1 shares outstanding at March 31, 2026 and December 31, 2025, respectively

Common stock, 95.1 and 93.1 shares outstanding at June 30, 2026 and December 31, 2025, respectively

Additional paid-in capital 2,140.6 2,116.6

7 unchanged sentences

(in millions, except per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Revenues $ 678.2 $ 710.3 $ 1,314.7 $ 1,361.6

6 unchanged sentences

Total costs and expenses 663.4 1,040.6 1,303.3 2,212.0

Operating loss ( 3.4 ) ( 520.1 )

Operating income (loss) 14.8 ( 330.3 ) 11.4 ( 850.4 )

Other income (expense):

10 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in millions, except per share data)

Three Months Ended March 31,

(in millions)

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Net loss $ ( 13.2 ) $ ( 374.9 ) $ ( 36.8 ) $ ( 937.8 )

16 unchanged sentences

Issuance of common stock under employee stock plan 1.5 — — — — —

1.5 — — — — —

Balance at March 31, 2026 94.6 0.1 2,128.0 ( 1,406.8 ) ( 195.4 ) 525.9

Net loss — — — ( 13.2 ) — ( 13.2 )

Other comprehensive loss, net of tax — — — — ( 1.1 ) ( 1.1 )

Stock compensation — — 12.6 — — 12.6

Issuance of common stock under employee stock plan 0.5 — — — — —

Balance at June 30, 2026 95.1 $ 0.1 $ 2,140.6 $ ( 1,420.0 ) $ ( 196.5 ) $ 524.2

Shares Amounts Additional Paid-in Capital Accumulated Deficit Accumulated

6 unchanged sentences

Balance at March 31, 2025 90.5 0.1 2,056.8 ( 959.9 ) ( 238.2 ) 858.8

Net loss — — — ( 374.9 ) — ( 374.9 )

Other comprehensive income, net of tax — — — — 82.6 82.6

Stock compensation — — 22.7 — — 22.7

Issuance of common stock under employee stock plan 0.3 — — — — —

Balance at June 30, 2025 90.8 $ 0.1 $ 2,079.5 $ ( 1,334.8 ) $ ( 155.6 ) $ 589.2

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

2 unchanged sentences

(in millions) (unaudited)

Three Months Ended March 31,

Six Months Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss $ ( 36.8 ) $ ( 937.8 )

Adjustments to reconcile net loss to net cash used for operating activities:

Adjustments to reconcile net loss to net cash provided by (used for) operating activities:

Depreciation and amortization 39.4 39.1

12 unchanged sentences

24.6 ( 46.8 )

Increase in deferred revenue

Increase in unearned revenue

Decrease in accrued expenses and other ( 18.3 ) ( 1.7 )

Net cash used for operating activities ( 17.0 ) ( 124.2 )

Net cash provided by (used for) operating activities 11.9 ( 102.4 )

CASH FLOWS FROM INVESTING ACTIVITIES:

1 unchanged sentence

Proceeds from sale of business, net — 19.0

Proceeds from sale of assets 2.0 —

Net cash (used for) provided by investing activities ( 15.0 ) 8.6

25 unchanged sentences

and its subsidiaries;

which are all collectively referred to as the Enabling Services Segment (the “Transaction”).

collectively referred to as the Enabling Services Segment (the “Transaction”).

The final adjusted purchase price for the Transaction was $ 340.0 , subject to customary purchase price adjustments, with $ 295.0 paid at closing and $ 45.0 to be paid upon achievement of certain transition-related milestones.

24 unchanged sentences

Substantially all of the Company’s accounts receivable and unbilled services are with companies in the pharmaceutical, biotechnology and medical device industries.

As of March 31, 2026, one pharmaceutical customer accounted for 18.5 % of the Company's combined gross accounts receivable and unbilled services.

As of June 30, 2026, one pharmaceutical customer accounted for approximately 18.2 % of the Company's combined gross accounts receivable and unbilled services.

As of December 31, 2025, one pharmaceutical customer accounted for approximately 18.3 % of the Company's combined gross accounts receivable and unbilled services.

Additionally, for the three months ended March 31, 2026, one customer accounted for approximately 17.2 % of revenues.

For the three months ended March 31, 2025, one customer accounted for 15.4 % of revenues.

Additionally, for the three months ended June 30, 2026, one customer accounted for approximately 16.8 % of revenues, and for the six months ended June 30, 2026, one customer accounted for approximately 17.0 % of revenues.

For the three months ended June 30, 2025, one customer accounted for 19.5 % of revenues, and for the six months ended June 30, 2025, one customer accounted for approximately 17.5 % of revenues.

Concentrations of credit risk are mitigated due to the number of the Company’s customers as well as their dispersion across many different geographic regions.

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The Company is currently evaluating the impact this guidance will have on its financial statements and disclosures.

The Company’s revenues by geography for the three months ended March 31, 2026 and 2025 are as follows:

Three Months Ended March 31, 2026 Three Months Ended March 31, 2025

The Company’s revenues by geography for the three and six months ended June 30, 2026 and 2025 are as follows:

Three Months Ended June 30, 2026 Three Months Ended June 30, 2025

North America Europe Other Total North America Europe Other Total

3 unchanged sentences

(dollars and shares in millions, except per share data)

Six Months Ended June 30, 2026 Six Months Ended June 30, 2025

North America Europe Other Total North America Europe Other Total

$ 616.5 $ 433.6 $ 264.6 $ 1,314.7 $ 653.8 $ 419.0 $ 288.8 $ 1,361.6

Revenue from the United States comprises substantially all revenue in North America.

1 unchanged sentence

The following table provides information about contract asset balances:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Sales commission assets $ 18.7 $ 21.4

1 unchanged sentence

Total $ 18.9 $ 21.8

Amortization related to sales commission assets for the three months ended March 31, 2026 and 2025 was $ 3.3 and $ 3.1 , respectively.

Amortization related to deferred contract costs for the three months ended March 31, 2026 and 2025 was $ 0.1 and $ 0.2 , respectively.

Amortization related to sales commission assets for the three months ended June 30, 2026 and 2025 was $ 2.8 and $ 2.8 , respectively, and for the six months ended June 30, 2026 and 2025 was $ 6.1 and $ 5.9 , respectively.

Amortization related to deferred contract costs for the three months ended June 30, 2026 and 2025 was $ 0.1 and $ 0.2 , respectively, and for the six months ended June 30, 2026 and 2025 was $ 0.2 and $ 0.4 , respectively.

Th e Company applies the practical expedient to not recognize the effect of financing in its contracts with customers when the difference in timing of payment and performance is one year or less.

1 unchanged sentence

The following table provides information about accounts receivable, unbilled services and unearned revenue from contracts with customers:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Accounts receivable $ 189.0 $ 113.6

3 unchanged sentences

Unearned revenue $ 502.7 $ 473.8

Revenue recognized during the period that was included in the unearned revenue balance at the beginning of the period was $ 154.9 and $ 88.7 for the three months ended March 31, 2026 and 2025, respectively.

Additionally, as of the quarter ended March 31, 2026, the Company had sold $ 300.0 of receivables as described in the Receivables Securitization Program section below.

Revenue recognized during the period that was included in the unearned revenue balance at the beginning of the period was $ 229.8 and $ 157.5 for the six months ended June 30, 2026 and 2025, respectively.

Additionally, as of June 30, 2026, the Company had sold $ 300.0 of receivables as described in the Receivables Securitization Program section below.

Credit Loss Rollforward

3 unchanged sentences

(dollars and shares in millions, except per share data)

The rollforward for the allowance for credit losses for the three months ended March 31, 2026 is as follows:

The rollforward for the allowance for credit losses for the six months ended June 30, 2026 is as follows:

Allowance for credit losses as of December 31, 2025 $ 41.2

1 unchanged sentence

Write-offs ( 7.2 )

Allowance for credit losses as of March 31, 2026 $ 36.9

Allowance for credit losses as of June 30, 2026 $ 38.0

Performance Obligations Under Long-Term Contracts

As of March 31, 2026, approximately $ 4,615.6 of revenues are expected to be recognized from remaining performance obligations.

The Company expects to recognize approximately 27 % of the existing performance obligations as of March 31, 2026 as revenue over the next 12 months and the remaining balance thereafter.

As of June 30, 2026, approximately $ 4,442.5 of revenues are expected to be recognized from remaining performance obligations.

The Company expects to recognize approximately 26 % of the existing performance obligations as of June 30, 2026 as revenue over the next 12 months and the remaining balance thereafter.

The Company’s long-term contracts generally range from one to eight years .

The customer contract transaction price allocated to the remaining performance obligations differs from backlog in that it does not include wholly unperformed contracts under which the customer has a unilateral right to cancel the arrangement.

During the three months ended March 31, 2026, there were reductions of approximately $ 1 in revenue related to performance obligations partially satisfied in previous periods.

The change was associated with both changes in estimated effort to complete customer contract obligations of $( 5 ) and changes in scope or price of $ 4 .

During the three months ended March 31, 2025, there were reductions of approximately $ 16 in revenue related to performance obligations partially satisfied in previous periods.

The majority of the change was associated with changes in scope or price of $( 13 ) and a smaller portion related to changes in estimated effort to complete customer contract obligations of $( 3 ).

During the three and six months ended June 30, 2026, there were reductions of approximately $ 2 and $ 3 in revenue related to performance obligations partially satisfied in previous periods.

For the three months ended June 30, 2026, the change was associated with changes in estimated effort to complete customer contract obligations.

For the six months ended June 30, 2026, the majority of the change was associated with changes in estimated effort to complete customer contract obligations of $( 7 ), partially offset by changes in scope or price of $ 4 .

During the three and six months ended June 30, 2025, there were reductions of approximately $ 1 and $ 16 in revenue related to performance obligations partially satisfied in previous periods.

For the three months ended June 30, 2025, the majority of the change was associated with changes in estimated effort to complete customer contract obligations of $( 3 ), partially offset by changes in scope or price of $ 2 .

For the six months ended June 30, 2025, the majority of the change was associated with changes in scope or price of $( 11 ) and a smaller portion related to changes in estimated effort to complete customer contract obligations of $( 5 ).

The Company applies the practical expedient and does not disclose information about remaining performance obligations where (i) the performance obligation is part of a contract that has an original expected duration of one year or less or (ii) when the Company recognizes revenue from the satisfaction of the performance obligation in accordance with the right-to-invoice practical expedient.

2 unchanged sentences

Under this program, Fortrea Inc.

conveys receivable balances to a wholly-owned, bankruptcy-remote special purpose entity (“SPE”), who in turn, may sell receivables to a third-party financial institution in exchange for cash.

conveys receivable balances to a wholly-owned, bankruptcy-remote special purpose entity (“SPE”), which in turn, may sell receivables to a third-party financial institution in exchange for cash.

The facility is without recourse to the Company or any subsidiaries of the Company, other than with respect to limited indemnity obligations of Fortrea Inc., in respect to the character of the receivables sold and as to the performance of its duties as servicer and a limited performance guaranty by the Company.

2 unchanged sentences

The amended Receivables Facility is scheduled to terminate on February 23, 2029, unless terminated earlier pursuant to its terms.

As of March 31, 2026, the Company had sold $ 300.0 of receivables, which were derecognized from the Company’s consolidated balance sheet as described in the Accounts Receivable, Unbilled Services and Unearned Revenue section above.

Total costs associated with the sale were $ 4.7 and $ 4.4 for the three months ended March 31, 2026 and 2025, respectively, and are included within selling, general and administrative costs in the condensed consolidated statements of operations.

As of June 30, 2026, the Company had sold $ 300.0 of receivables, which were derecognized from the Company’s consolidated balance sheet as described in the Accounts Receivable, Unbilled Services and Unearned Revenue section above.

Total costs associated with the sale were $ 4.1 and $ 8.8 for the three and six months ended June 30, 2026 and, $ 4.5 and $ 8.9 for the three and six months ended June 30, 2025, respectively, and are included within selling, general and administrative costs in the condensed consolidated statements of operations.

FORTREA HOLDINGS INC.

4 unchanged sentences

These plans, which relate primarily to severance benefits, were accounted for under ASC 712, Compensation - Nonretirement Postemployment Benefits .

Action under these restructuring plans are expected to continue through 2026.

Actions under these restructuring plans are expected to continue through 2026.

The following represents the Company’s restructuring accrual activities for the periods indicated:

4 unchanged sentences

Cash payments and other adjustments ( 21.1 ) ( 1.1 ) ( 22.2 )

Balance as of March 31, 2026 $ 10.8 $ 0.5 $ 11.3

Balance as of June 30, 2026 $ 7.5 $ 0.5 $ 8.0

Severance and Other Employee Costs Facility and

3 unchanged sentences

Cash payments and other adjustments ( 17.9 ) ( 1.4 ) ( 19.3 )

Balance as of March 31, 2025 $ 14.1 $ 0.6 $ 14.7

The restructuring liabilities are current as of March 31, 2026 and December 31, 2025 and are included in accrued expenses and other current liabilities in the condensed consolidated balance sheets.

Balance as of June 30, 2025 $ 14.0 $ 0.6 $ 14.6

The current portion of the restructuring liabilities is included in the condensed consolidated balance sheets in accrued expenses and other current liabilities.

The non-current portion of the restructuring liabilities is included in the condensed consolidated balance sheets in other liabilities.

The non-current portion of the restructuring liabilities as of June 30, 2026 and December 31, 2025 was $ 0.5 and $ — , respectively.

EARNINGS (LOSS) PER SHARE

3 unchanged sentences

The following represents the computation of basic and diluted earnings (loss) per share.

Three Months Ended March 31,

Three Months Ended June 30,

Per Share Amount

3 unchanged sentences

$ ( 13.2 ) 94.8 $ ( 0.14 ) $ ( 374.9 ) 90.6 $ ( 4.14 )

FORTREA HOLDINGS INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

Six Months Ended June 30,

Earnings Shares Per Share Amount Earnings Shares Per Share Amount

Basic and diluted earnings (loss) per share:

Net earnings (loss)

$ ( 36.8 ) 94.2 $ ( 0.39 ) $ ( 937.8 ) 90.4 $ ( 10.37 )

Diluted earnings per share represent the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.

3 unchanged sentences

The following table summarizes the potential common shares not included in the computation of diluted earnings per share because their impact would have been antidilutive:

FORTREA HOLDINGS INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Employee stock options and awards 0.3 8.2 0.4 5.4

Antidilutive employee stock options and awards excluded based on reporting a net loss for the period 4.7 0.4 4.6 0.8

During the three months ended March 31, 2025, due to a sustained decline in the Company’s share price and uncertainties in global macroeconomic conditions, the Company determined that an indicator of impairment existed.

As a result, the Company performed an interim impairment test.

For the goodwill impairment test as of March 31, 2025, the fair values of the Clinical Development and Clinical Pharmacology reporting units were computed using both income-based and market-based valuation methods.

During the first and second quarters of 2025, due to sustained declines in the Company’s share price and uncertainties in global macroeconomic conditions, the Company determined that indicators of impairment existed.

As a result, the Company performed interim impairment tests as of March 31, 2025 and June 30, 2025.

Based upon the results of the quantitative assessment as of March 31, 2025, the Company concluded that the fair value of the Clinical Development reporting unit was less than its carrying value and recorded a goodwill impairment of $ 488.8 .

Based upon the results of the quantitative assessment as of June 30, 2025, the Company concluded that the fair value of the Clinical Development reporting unit was less than its carrying value and recorded a goodwill impairment of $ 309.1 .

For the goodwill impairment tests, the fair values of the Clinical Development and Clinical Pharmacology reporting units were computed using both income-based and market-based valuation methods.

The income-based approach is based on the reporting unit's forecasted future cash flows that are discounted to the present value using the reporting unit's weighted average cost of capital.

The discount rate used reflects the risks inherent in realizing the forecasted cash flows and considers the risk-free rate of return on long-term treasury securities, the risk premium associated with investing in equity securities of comparable companies, the beta obtained from the comparable companies and the cost of debt for investment grade issuers.

The discount rate used for the Clinical Development reporting unit quantitative assessments as of March 31, 2025 and June 30, 2025 was 10.0 % and 10.5 %, respectively.

The increase in the discount rate was primarily the result of macroeconomic and market factors and impacted the impairment during the second quarter of 2025 by approximately $ 60 .

For the market-based approach, the Company utilizes a number of factors such as publicly available information regarding the market capitalization of the Company as well as operating results, business plans, market multiples, and present value techniques.

Based upon the range of estimated values developed from the income and market-based methods, the Company determines the estimated fair value for the reporting unit.

The income-based fair value methodology requires management's assumptions and judgments regarding economic conditions in the markets in which the Company operates and conditions in the capital markets, many of which are outside of management's control.

At the reporting unit level, fair value estimation requires management's assumptions and judgments regarding the effects of overall economic conditions on the specific reporting unit, along with assessment of the reporting unit's strategies and forecasts of future cash flows.

Forecasts of individual reporting unit cash flows involve management's estimates and assumptions regarding:

• Annual cash flows, on a debt-free basis, arising from future revenues and profitability, changes in working capital, capital spending and income taxes for at least a five-year forecast period.

• A terminal growth rate for years beyond the forecast period.

The terminal growth rate is selected based on consideration of growth rates used in the forecast period, historical performance of the reporting unit and economic conditions.

• A discount rate that reflects the risks inherent in realizing the forecasted cash flows.

A discount rate considers the risk-free rate of return on long-term treasury securities, the risk premium associated with investing in equity securities of comparable companies, the beta obtained from the comparable companies and the cost of debt for investment grade issuers.

In addition, the discount rate may consider any Company-specific risk in achieving the prospective financial information.

Under the market-based fair value methodology, judgment is required in evaluating market multiples and recent transactions.

Management believes that the assumptions used for its impairment tests are representative of those that would be used by market participants performing similar valuations of the reporting units.

The resulting estimated fair values of the combined reporting units are reconciled to the Company's market capitalization including an estimated implied control premium.

The share price used to calculate the Company’s market capitalization was $ 7.55 per share and $ 4.94 per share as of March 31, 2025 and June 30, 2025, respectively.

FORTREA HOLDINGS INC.

1 unchanged sentence

(dollars and shares in millions, except per share data)

Based upon the results of the qualitative and quantitative assessments as of March 31, 2025, the Company concluded that the fair value of the Clinical Development reporting unit was less than its carrying value and recorded a goodwill impairment of $ 488.8 .

The changes in the carrying amount of goodwill for the three months ended March 31, 2026 and 2025 are as follows:

March 31, 2026 March 31, 2025

The changes in the carrying amount of goodwill for the six months ended June 30, 2026 and 2025 are as follows:

June 30, 2026

June 30, 2025

Balance as of December 31 $ 960.0 $ 1,710.4

1 unchanged sentence

Foreign currency impact and other adjustments to goodwill ( 9.7 ) 52.7

Balance as of March 31 $ 950.8 $ 1,242.5

Balance as of June 30 $ 950.3 $ 965.2

The current portion of long-term debt consisted of the following:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Current portion of senior secured term loan A facility due 2028 $ 17.3 $ 4.8

Debt issuance discount and fees ( 0.2 ) —

Total short-term borrowings and current portion of long-term debt $ 10.9 $ 4.8

Total current portion of long-term debt $ 17.1 $ 4.8

Long-term debt consisted of the following:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

7.5 % senior notes due 2030

12 unchanged sentences

The initial revolving facility includes a $ 75.0 swingline sub-facility and a $ 75.0 letter of credit sub-facility.

FORTREA HOLDINGS INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

The Company drew on the term loan A and term loan B on June 30, 2023.

2 unchanged sentences

The term loans accrue interest at a per annum rate equal to the sum of, at the option of the Company, a Base Rate or a Term SOFR Rate and the Applicable Margin as defined by the Credit Agreement.

As of March 31, 2026, the effective interest rate on the term loan A and term loan B was 5.67 % and 7.17 %, respectively.

As of June 30, 2026, the effective interest rate on the term loan A and term loan B was 5.66 % and 7.16 %, respectively.

FORTREA HOLDINGS INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

The revolving credit facility is permitted, subject to certain covenant restrictions, to be used for general corporate purposes, including working capital and capital expenditures.

There were no balances outstanding on the Company’s current revolving credit facility and there were $ 2.3 in letters of credit issued under the letter of credit sublimit, resulting in $ 447.7 available for borrowing as of March 31, 2026 and December 31, 2025.

As of March 31, 2026, the effective interest rate on the revolving credit facility was 5.67 %, assuming a one-month interest election.

As of June 30, 2026, the effective interest rate on the revolving credit facility was 5.64 %, assuming a one-month interest election.

There is an annual agency fee associated with the Credit Agreement ($ 0.1 paid in quarterly installments) and a variable commitment fee associated with the revolving credit facility based on the Company’s Total Leverage Ratio as defined under the Credit Agreement.

As of March 31, 2026, the commitment fee was 0.30 % (per annum and paid quarterly).

As of June 30, 2026, the commitment fee was 0.30 % (per annum and paid quarterly).

The credit facility matures on June 30, 2028.

2 unchanged sentences

On February 28, 2025, the Company entered into an amendment to modify certain financial covenants for additional flexibility under the Credit Agreement.

The Company was in compliance with all covenants in the Credit Agreement at March 31, 2026 and believes it will be in compliance with all covenants for a period of at least 12 months from the date these financial statements are issued.

The Company was in compliance with all covenants in the Credit Agreement at June 30, 2026 and believes it will be in compliance with all covenants for a period of at least 12 months from the date these financial statements are issued.

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

9 unchanged sentences

The table below presents the fair value of the Company’s derivatives on a gross basis and the balance sheet classification of those instruments:

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Balance Sheet Classification Asset Liability Asset Liability

1 unchanged sentence

Interest rate swaps

Accrued expenses and other $ — $ ( 0.6 ) $ — $ ( 1.2 )

Accrued expenses and other current liabilities $ — $ ( 0.3 ) $ — $ ( 1.2 )

Other liabilities — — — —

1 unchanged sentence

Foreign currency forward contracts Prepaid expenses and other $ 0.1 $ — $ 0.3 $ —

Other current liabilities — ( 0.6 ) — ( 0.6 )

The notional amounts of the Company’s interest rate swaps and foreign currency forward contracts were $ 150.0 and $ 316.5 as of March 31, 2026 and $ 150.0 and $ 305.7 as of December 31, 2025, respectively.

Accrued expenses and other current liabilities — ( 1.1 ) — ( 0.6 )

The notional amounts of the Company’s interest rate swaps and foreign currency forward contracts were $ 150.0 and $ 383.7 as of June 30, 2026 and $ 150.0 and $ 305.7 as of December 31, 2025, respectively.

The following table presents the pre-tax effects of cash flow hedges included in the Company’s condensed consolidated statements of comprehensive loss:

Pre-Tax Gain (Loss) Included in Other Comprehensive (Loss) Income

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Interest rate swaps $ 0.1 $ ( 0.1 ) $ 0.5 $ ( 0.8 )

1 unchanged sentence

Amounts Reclassified from Other Comprehensive Loss into Earnings

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

Statement of Operations Classification 2026 2025 2026 2025

Interest rate swaps Interest expense $ 0.2 $ ( 0.1 ) $ 0.4 $ ( 0.1 )

The estimated amount of pre-tax net losses included in other comprehensive (loss) income that is expected to be reclassified into earnings over the twelve months following March 31, 2026, is $ 0.6 .

The estimated amount of pre-tax net losses included in other comprehensive (loss) income that is expected to be reclassified into earnings over the twelve months following June 30, 2026, is $ 0.3 .

Refer to Note 9, “Preferred Stock and Common Shareholders' Equity” for the impact of the Company’s derivative instruments included in accumulated other comprehensive loss.

The following table presents a summary of the gain for derivative contracts not designated as hedges included in the Company’s condensed consolidated statements of operations:

Gain on Derivatives Recognized in Earnings

Three Months Ended March 31,

The following table presents a summary of the gains and losses for derivative contracts not designated as hedges included in the Company’s condensed consolidated statements of operations:

(Loss) Gain on Derivatives Recognized in Earnings

Three Months Ended June 30, Six Months Ended June 30,

Statement of Operations Classification 2026 2025 2026 2025

11 unchanged sentences

however the Company also considers and enters into discussions regarding settlement of disputes, and may enter into settlement agreements, if in management’s judgment, it is in the best interest of the Company to do so.

For the three months ended March 31, 2025, the Company recorded legal expenses of $ 1.9 related to the settlement of legal matters initiated prior to the spin.

Legal settlement expenses for the three months ended March 31, 2026 were not significant.

For the three and six months ended June 30, 2025, the Company recorded legal expenses of $ — and $ 1.9 related to the settlement of legal matters initiated prior to the Spin.

Legal settlement expenses for the three and six months ended June 30, 2026 we re not significant.

The Company does not believe that any liabilities resulting from claims and legal actions will have a material effect on its financial condition, results of operations or cash flows.

On July 6, 2026, Thermo Fisher Scientific Inc., Clario Holdings, Inc., and eResearch Technology, Inc.

d/b/a Clario (collectively, the “Plaintiffs”) filed an action in the Court of Chancery of the State of Delaware against Jason Knoblauch and the Company challenging the Company’s appointment of Mr.

Knoblauch as Chief Financial Officer.

Plaintiffs allege that Mr.

Knoblauch’s employment by the Company violates restrictive covenants and that he retained confidential information belonging to Plaintiffs.

Plaintiffs sought expedited proceedings and temporary and preliminary injunctive relief.

On July 25, 2026, the Court entered a temporary restraining order temporarily prohibiting Mr.

Knoblauch from performing services for the Company pending further order of the Court.

The Company disagrees with Plaintiffs’ allegations but is complying with the Court’s order and intends to defend the action.

In light of the order, the Company’s Board of Directors appointed board member David R.

Smith, to serve as interim Chief Financial Officer and principal financial officer, effective July 27, 2026.

A hearing on Plaintiffs’ motion for a preliminary injunction is expected to be scheduled for early September.

On June 2, 2025, a purported shareholder class action complaint captioned Lucas Deslande v.

Fortrea Holdings Inc., et al., No 1:25-sv-04630 was filed in the U.S.

Fortrea Holdings Inc., et al., No 1:25-cv-04630 was filed in the U.S.

District Court for the Southern District of New York, naming the Company and certain of its current and former officers as defendants.

3 unchanged sentences

Lead plaintiffs filed their opposition to the Company’s motion to dismiss on March 19, 2026.

The Company filed its reply to the lead plaintiff’s opposition to the Company’s motion to dismiss on April 9, 2026.

The Company filed its reply to the lead plaintiffs’ opposition to the Company’s motion to dismiss on April 9, 2026.

The Company believes it has valid defenses to the claims alleged and intends to vigorously defend itself, but there is no guarantee that the Company will prevail.

14 unchanged sentences

The Company is authorized to issue up to 30.0 shares of preferred stock, par value $ 0.001 per share.

There were no preferred shares outstanding as of March 31, 2026 and December 31, 2025.

There were no preferred shares outstanding as of June 30, 2026 and December 31, 2025.

Stockholder Rights Plan

2 unchanged sentences

Each Right entitles the registered holder to purchase from the Company one one thousandth of a share of Series A Preferred Stock, par value $ 0.001 per share, of the Company (the “Preferred Shares”) at a price of $ 50.00 per one one thousandth of a Preferred Share represented by a Right, subject to adjustment.

Initially, the Rights will be attached to all Common Share certificates and no separate certificates evidencing the Rights will be issued.

Until the Distribution Date (as defined per the Rights Agreement), the Rights will be transferred with and only with the Common Shares.

As long as the Rights are attached to the Common Shares, the Company will issue one Right with each new Common Share so that all such Common Shares will have Rights attached.

The Rights are generally exercisable only in the event that a person or group of affiliated or associated persons (such person or group being an “Acquiring Person”), acquires (or commences a tender offer or exchange offer the consummation of which would result in) beneficial ownership of 10 % or more of the outstanding Common Shares.

In such case (with certain limited exceptions), each holder of a Right (other than the Acquiring Person, whose Rights shall become void) will have the right to receive, upon exercise at the then current exercise price of the Right, Common Shares (or, if the Board so elects, cash, securities, or other property) having a value equal to two times the exercise price of the Right.

Until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends.

The Rights will expire at the close of business on June 10, 2026, unless terminated earlier.

FORTREA HOLDINGS INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

The Rights Agreement expired in accordance with its terms at the close of business on June 10, 2026.

Accumulated Other Comprehensive Loss

7 unchanged sentences

Balance at March 31, 2026 ( 189.7 ) ( 5.3 ) ( 0.4 ) ( 195.4 )

Current quarter foreign exchange adjustments ( 1.3 ) — — ( 1.3 )

Unrealized gain on derivative instruments — — 0.1 0.1

Amounts reclassified from accumulated other comprehensive loss — — 0.2 0.2

Tax effect of adjustments — — ( 0.1 ) ( 0.1 )

Balance at June 30, 2026 $ ( 191.0 ) $ ( 5.3 ) $ ( 0.2 ) $ ( 196.5 )

FORTREA HOLDINGS INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars and shares in millions, except per share data)

Foreign Currency Translation Adjustments Net Benefit Plan Adjustments Unrealized Gain (Loss) on Derivative Instruments Accumulated Other Comprehensive Loss

5 unchanged sentences

Balance at March 31, 2025 ( 230.8 ) ( 6.5 ) ( 0.9 ) ( 238.2 )

For the three months ended March 31, 2026 and 2025, the Company recognized income tax expenses of $ 11.3 and $ 14.9 , respectively, which resulted in effective tax rates of ( 91.9 )% and ( 2.7 )%, respectively.

The effective tax rate for the three months ended March 31, 2026 was lower than the Company’s statutory tax rate primarily due to an increase in valuation allowance, non-deductible compensation expenses, earnings taxed in jurisdictions with higher tax rates and withholding taxes for 2026 non-US earnings that are not permanently reinvested.

For the three months ended March 31, 2025, the Company’s effective tax rate was primarily impacted by impairment of goodwill with no tax benefit, an increase in valuation allowance, Base Erosion and Anti-Abuse Tax (“BEAT”), non-deductible compensation expense, and withholding taxes on non-U.S.

Current quarter foreign exchange adjustments 82.8 — — 82.8

Unrealized loss on derivative instruments — — ( 0.1 ) ( 0.1 )

Amounts reclassified from accumulated other comprehensive loss — — ( 0.1 ) ( 0.1 )

Tax effect of adjustments — — — —

Balance at June 30, 2025 $ ( 148.0 ) $ ( 6.5 ) $ ( 1.1 ) $ ( 155.6 )

For the three months ended June 30, 2026 and 2025, the Company recognized income tax expenses of $ 12.0 and $ 4.2 , respectively, which resulted in effective tax rates of ( 1000.0 )% and ( 1.1 )%, respectively.

The effective tax rate for the three months ended June 30, 2026 was lower than the Company’s statutory tax rate primarily due to an increase in valuation allowance, non-deductible compensation expenses, earnings taxed in jurisdictions with higher tax rates and withholding taxes for 2026 non-U.S.

earnings that are not permanently reinvested.

On July 4, 2025, new legislation commonly referred to as the One Big Beautiful Bill Act of 2025 (the “Tax Act”) was signed into law.

The Tax Act includes substantial changes to the U.S.

federal tax code and broader fiscal policy for tax year 2025 and forward.

The Company has recorded any applicable impacts to its three months ended March 31, 2026 tax provision.

For the three months ended June 30, 2025, the Company’s effective tax rate was lower than the Company’s statutory tax rate primarily due to impairment of goodwill that has no tax benefit, an increase in valuation allowance of deferred tax assets, BEAT, non-deductible compensation expenses and withholding taxes for 2025 non-U.S.

earnings that are not permanently reinvested.

For the six months ended June 30, 2026 and 2025, the Company recognized income tax expense of $ 23.3 and $ 19.1 , respectively, which resulted in effective tax rates of ( 172.6 )% and ( 2.1 )%, respectively.

The effective tax rate for the six months ended June 30, 2026 was lower than the Company’s statutory tax rate primarily due to an increase in valuation allowance, non-deductible compensation expenses, earnings taxed in jurisdictions with higher tax rates and withholding taxes for 2026 non-U.S.

earnings that are not permanently reinvested.

For the six months ended June 30, 2025, the Company’s effective tax rate was lower than the Company’s statutory tax rate primarily due to impairment of goodwill that has no tax benefit, an increase in valuation allowance of deferred tax assets, BEAT, non-deductible compensation expenses and withholding taxes for 2025 non-U.S.

earnings that are not permanently reinvested.

STOCK COMPENSATION PLANS

The Company granted 1.9 and 0.9 of restricted stock units and performance stock units, respectively, during the three months ended March 31, 2026 with weighted average grant date fair values of $ 9.57 and $ 11.66 per share.

Total stock-based compensation expense and the associated income tax benefits recognized by the Company in the condensed consolidated statements of operations were as follows:

The Company granted 0.4 and 2.3 restricted stock units, respectively, during the three and six months ended June 30, 2026 with weighted average grant date fair values of $ 15.45 and $ 10.54 per share.

The Company granted — and 0.9 performance stock units, respectively, during the three and six months ended June 30, 2026 with weighted average grant date fair values of $ — and $ 11.66 per share.

FORTREA HOLDINGS INC.

1 unchanged sentence

(dollars and shares in millions, except per share data)

Three Months Ended March 31,

Total stock-based compensation expense and the associated income tax benefits recognized by the Company in the condensed consolidated statements of operations were as follows:

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Direct costs $ 8.2 $ 17.2 $ 16.3 $ 28.8

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SUPPLEMENTAL CASH FLOW INFORMATION

Three Months Ended March 31,

Six Months Ended June 30,

Supplemental schedule of cash flow information:

5 unchanged sentences

BUSINESS SEGMENT INFORMATION

The following table is a summary of segment information for the three months ended March 31, 2026 and 2025.

The following table is a summary of segment information for the three and six months ended June 30, 2026 and 2025.

The segment information is based upon the way the management of the Company organizes segments within an enterprise for making operating decisions and assessing performance.

5 unchanged sentences

Clinical Services, which provides phase I-IV clinical trials, including clinical pharmacology and comprehensive clinical development capabilities.

The measure of segment profit or loss that the CODM uses to evaluates performance and allocate resources is segment operating income.

The measure of segment profit or loss that the CODM uses to evaluate performance and allocate resources is segment operating income.

The CODM uses segment operating income to monitor budget versus actual results and to make decisions about resources to be allocated to the segment and assess its performance.

4 unchanged sentences

(dollars and shares in millions, except per share data)

Segment operating income for the three months ended March 31, 2026 and 2025 is reconciled to loss before income taxes as follows:

Three Months Ended March 31,

Segment operating income for the three and six months ended June 30, 2026 and 2025 is reconciled to loss before income taxes as follows:

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Revenues $ 678.2 $ 710.3 $ 1,314.7 $ 1,361.6

8 unchanged sentences

Restructuring and other charges 2.7 10.3 9.4 16.8

Operating loss ( 3.4 ) ( 520.1 )

Operating income (loss) 14.8 ( 330.3 ) 11.4 ( 850.4 )

Interest expense ( 19.3 ) ( 23.3 ) ( 38.4 ) ( 45.6 )

3 unchanged sentences

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