What changed in this filing

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Item 1. Financial Statements

2024-04-24 compared with 2023-10-25 · 195 added, 256 removed, 359 unchanged (56% of the section changed)

3 unchanged sentences

($ in millions, except share and per share amounts)

September 29, 2023 December 31, 2022

March 29, 2024 December 31, 2023

Current assets:

Cash and equivalents $ 704.6 $ 1,888.8

Trade accounts receivable less allowance for doubtful accounts of $ 39.6 at September 29, 2023 and $ 43.9 at December 31, 2022

Accounts receivable less allowance for doubtful accounts of $ 33.1 and $ 39.2 , respectively

Finished goods 226.6 214.1

4 unchanged sentences

Total current assets 2,613.9 3,671.6

Property, plant and equipment, net of accumulated depreciation of $ 803.0 at September 29, 2023 and $ 754.5 at December 31, 2022

Property, plant and equipment, net of accumulated depreciation of $ 793.1 and $ 809.0 , respectively

Other assets 536.2 518.9

4 unchanged sentences

Current liabilities:

Current portion of long-term debt $ 749.9 $ 999.7

Trade accounts payable 667.2 608.6

6 unchanged sentences

$ 0.01 par value, 2.0 billion shares authorized;

363.4 million issued and 351.4 million outstanding at September 29, 2023;

361.5 million issued and 352.9 million outstanding at December 31, 2022

365.3 and 363.7 issued;

352.0 and 350.7 outstanding, respectively

Additional paid-in capital 3,906.1 3,851.3

10 unchanged sentences

($ and shares in millions, except per share amounts)

Three Months Ended Nine Months Ended

September 29, 2023 September 30, 2022 September 29, 2023 September 30, 2022

Three Months Ended

March 29, 2024 March 31, 2023

Sales of products and software $ 1,299.9 $ 1,236.6

8 unchanged sentences

Research and development expenses ( 104.1 ) ( 100.1 )

Russia exit and wind down costs — ( 1.1 ) — ( 17.3 )

Gain on sale of property

Operating profit 302.2 240.4

15 unchanged sentences

($ in millions)

Three Months Ended Nine Months Ended

September 29, 2023 September 30, 2022 September 29, 2023 September 30, 2022

Three Months Ended

March 29, 2024 March 31, 2023

Net earnings $ 207.4 $ 173.6

18 unchanged sentences

Shares withheld for taxes ( 0.2 ) — ( 18.4 ) — — — —

Change in noncontrolling interests — — — — — — 0.6

Balance, March 29, 2024 352.0 $ 3.7 $ 3,906.1 $ ( 715.8 ) $ 7,685.2 $ ( 402.5 ) $ 6.4

Net earnings for the period — — — — 209.0 $ — $ —

Dividends to common shareholders — — — — ( 24.6 ) — —

Other comprehensive income (loss) — — — — — ( 7.6 ) —

Common stock-based award activity 0.5 — 52.3 — — — —

Common stock repurchases ( 2.0 ) — — ( 129.1 ) — — —

Shares withheld for taxes ( 0.1 ) — ( 4.1 ) — — — —

Change in noncontrolling interests — — — — — — 0.2

Balance, June 30, 2023 351.9 $ 3.6 $ 3,778.7 $ ( 572.0 ) $ 7,075.4 $ ( 319.9 ) $ 6.0

Net earnings for the period — — — — 218.0 $ — $ —

Dividends to common shareholders — — — — ( 24.6 ) — —

Other comprehensive income (loss) — — — — — ( 45.9 ) —

Common stock-based award activity 0.7 — 54.8 — — — —

Common stock repurchases ( 1.0 ) — — ( 78.8 ) — — —

Shares withheld for taxes ( 0.2 ) — ( 11.5 ) — — — —

Change in noncontrolling interests — — — — — — ( 0.2 )

Balance, September 29, 2023 351.4 $ 3.6 $ 3,822.0 $ ( 650.8 ) $ 7,268.8 $ ( 365.8 ) $ 5.8

Common Stock Additional Paid-In Capital Treasury Shares Retained Earnings Accumulated

Common Stock Additional Paid-In Capital Treasury

Retained Earnings Accumulated

Comprehensive

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Balance, December 31, 2022

Adoption of ASU 2020-06 — — ( 65.7 ) — 62.8 — —

Balance, January 1, 2022 359.1 3.6 3,604.3 — 6,086.4 ( 185.0 ) 4.8

352.9 $ 3.6 $ 3,706.3 $ ( 442.9 ) $ 6,742.1 $ ( 325.7 ) $ 5.2

Net earnings for the period — — — — 173.6 — —

2 unchanged sentences

Common stock-based award activity 0.8 — 36.3 — — — —

Common stock repurchases ( 1.0 ) — — ( 63.8 ) — — —

Shares withheld for taxes ( 0.2 ) — ( 12.1 ) — — — —

Change in noncontrolling interest — — — — — — 0.6

Balance, April 1, 2022 358.4 $ 3.6 $ 3,619.1 $ ( 63.8 ) $ 6,226.4 $ ( 223.9 ) $ 5.3

Net earnings for the period — — — — 173.0 — —

Dividends to common shareholders — — — — ( 24.9 ) — —

Other comprehensive income — — — — — ( 118.2 ) —

Common stock-based award activity 0.2 — 32.7 — — — —

Common stock repurchases ( 3.0 ) — — ( 179.1 ) — — —

Shares withheld for taxes — — ( 0.6 ) — — — —

Change in noncontrolling interests — — — — — — ( 0.2 )

Balance, July 1, 2022 355.6 $ 3.6 $ 3,651.2 $ ( 242.9 ) $ 6,374.5 $ ( 342.1 ) $ 5.1

Net earnings for the period — — — — 189.9 — —

Dividends to common shareholders — — — — ( 24.8 ) — —

Other comprehensive income (loss) — — — — — ( 111.6 ) —

Common stock-based award activity 0.2 — 28.3 — — — —

Common stock repurchases ( 2.0 ) — — ( 133.2 ) — — —

Shares withheld for taxes — — ( 2.1 ) — — — —

Change in noncontrolling interests — — — — — — ( 0.2 )

Balance, September 30, 2022 353.8 $ 3.6 $ 3,677.4 $ ( 376.1 ) $ 6,539.6 $ ( 453.7 ) $ 4.9

Balance, March 31, 2023 353.5 $ 3.6 $ 3,730.5 $ ( 442.9 ) $ 6,891.0 $ ( 312.3 ) $ 5.8

See the accompanying Notes to Consolidated Condensed Financial Statements.

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($ in millions)

Nine Months Ended

September 29, 2023 September 30, 2022

Three Months Ended

March 29, 2024 March 31, 2023

Cash flows from operating activities:

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Stock-based compensation expense 28.9 26.7

Russia exit and wind down costs — 9.2

Gain on sale of property

Change in trade accounts receivable, net 8.8 21.5

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Cash flows from investing activities:

Payments for additions to property, plant and equipment ( 73.7 ) ( 59.7 )

Cash paid for acquisitions, net of cash received ( 1,721.8 ) —

Payments for additions to property, plant and equipment ( 26.4 ) ( 24.8 )

Proceeds from sale of property 10.8 —

Proceeds from sale of business — 6.6

Net cash used in investing activities ( 1,737.4 ) ( 24.8 )

3 unchanged sentences

Repayment of borrowings (maturities greater than 90 days) ( 1,000.0 ) —

Payment of 0.875 % convertible senior notes due 2022

— ( 1,156.5 )

Repurchase of common shares ( 207.9 ) ( 376.1 )

Payment of dividends ( 28.1 ) ( 24.7 )

All other financing activities 25.4 ( 3.1 )

Net cash used in financing activities ( 766.3 ) ( 838.4 )

Net cash provided by (used in) financing activities

306.9 ( 187.1 )

Effect of exchange rate changes on cash and equivalents ( 10.4 ) 1.1

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Fortive Corporation (“Fortive,” “the Company,” “we,” “us,” or “our”) is a provider of essential technologies for connected workflow solutions across a range of attractive end-markets.

Our strategic segments - Intelligent Operating Solutions, Precision Technologies, and Advanced Healthcare Solutions - include well-known brands with leading positions in their markets.

Our strategic segments - Intelligent Operating Solutions (“IOS”), Precision Technologies (“PT”), and Advanced Healthcare Solutions (“AHS”) - include well-known brands with leading positions in their markets.

Our businesses design, develop, manufacture, and service professional and engineered products, software, and services, building upon leading brand names, innovative technologies, and significant market positions.

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In our opinion, the accompanying financial statements contain all adjustments, which consist of only normal, recurring accruals necessary to fairly present our financial position, results of operations, comprehensive income, stockholders’ equity, and cash flows for the periods presented.

The results of operations for the three and nine months ended September 29, 2023, are not necessarily indicative of the results for the full year.

Russia Ukraine Conflict

In February 2022, Russian forces invaded Ukraine (“Russia Ukraine Conflict”) resulting in broad economic sanctions being imposed on Russia.

In the second quarter of 2022, the Company exited business operations in Russia, other than for ASP’s sterilization products, which are exempt from international sanctions as humanitarian products.

In the three and nine-month periods ended September 30, 2022, the Company recorded pre-tax charges of $ 1.1 million and $ 17.3 million, respectively, primarily relating to the write-off of net assets, the cumulative translation adjustment in earnings for legal entities deemed substantially liquidated, and to record provisions for employee severance and legal contingencies.

These costs are identified as the “Russia exit and wind down costs” in the Condensed Consolidated Statements of Earnings.

The exit activities were completed in 2022.

The results of operations for the three months ended March 29, 2024, are not necessarily indicative of the results for the full year.

Segment Realignment

In January 2024, we realigned Invetech from the AHS segment to the PT segment, as we explored strategic alternatives for certain products and services of Invetech (the “Segment Realignment”).

In March 2024, we entered into a non-binding memorandum of understanding with the management of Invetech, pursuant to which we will transfer ownership of certain product lines of Invetech to its current management team.

The products and operations of Invetech that we will retain following such transfer of ownership are more closely aligned with the PT segment than the AHS segment.

Prior period segment amounts in Note 3, 6, and 11 have been recast to conform to the revised segment presentation.

Accumulated Other Comprehensive Loss

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subsidiaries.

We have designated our outstanding ¥ 14.4 billion Yen-denominated term loan and our € 275 million Euro-denominated term loan as net investment hedges of our investment in applicable foreign operations.

We recognized after-tax foreign currency transaction gains of $ 9.6 million and $ 14.6 million during the three-month periods ended September 29, 2023 and September 30, 2022, respectively, and gains of $ 13.0 million and $ 18.3 million during the nine-month periods ended September 29, 2023 and September 30, 2022, respectively, on the debt that was deferred in the foreign currency translation component of Accumulated Other Comprehensive Income (Loss) (“AOCI”) as an offset to the foreign currency translation adjustments on our investments in foreign subsidiaries.

As of March 29, 2024, our outstanding € 500 million Euro-denominated senior unsecured notes due 2026, € 700 million Euro-denominated senior unsecured notes due 2029, € 275 million Euro-denominated term loan, and ¥ 14.4 billion Yen-denominated term loan were designated as net investment hedges of our investment in applicable foreign operations.

We recognized after-tax foreign currency transaction gains of $ 8.4 million and losses of $ 1.7 million during the three-month periods ended March 29, 2024 and March 31, 2023, respectively, on the debt that was deferred in the foreign currency translation component of Accumulated Other Comprehensive Income (Loss) (“AOCI”) as an offset to the foreign currency translation adjustments on our investments in foreign subsidiaries.

Any amounts deferred in AOCI will remain until the hedged investment is sold or substantially liquidated.

We recorded no ineffectiveness from our net investment hedges during the three and nine-month periods ended September 29, 2023 and September 30, 2022.

We recorded no ineffectiveness from our net investment hedges during the three-month periods ended March 29, 2024 and March 31, 2023.

The changes in AOCI by component are summarized below ($ in millions):

adjustments Pension & post-retirement plan benefit adjustments (a)

For the Three Months Ended September 29, 2023:

Balance, June 30, 2023 $ ( 295.4 ) $ ( 24.5 ) $ ( 319.9 )

Other comprehensive income (loss) before reclassifications, net of income taxes ( 46.0 ) ( 0.4 ) ( 46.4 )

Amounts reclassified from AOCI into income:

Increase (decrease) — 0.6 (b)

Income tax impact — ( 0.1 ) ( 0.1 )

Amounts reclassified from AOCI into income, net of income taxes

Net current period other comprehensive income (loss), net of income taxes ( 46.0 ) 0.1 ( 45.9 )

Balance, September 29, 2023 $ ( 341.4 ) $ ( 24.4 ) $ ( 365.8 )

For the Three Months Ended September 30, 2022:

Balance, July 1, 2022 $ ( 280.7 ) $ ( 61.4 ) $ ( 342.1 )

Other comprehensive income (loss) before reclassifications, net of income taxes ( 112.4 ) — ( 112.4 )

Amounts reclassified from AOCI into income:

Increase (decrease) — 1.2 (b)

Income tax impact — ( 0.4 ) ( 0.4 )

Amounts reclassified from AOCI into income, net of income taxes

Net current period other comprehensive income (loss), net of income taxes ( 112.4 ) 0.8 ( 111.6 )

Balance, September 30, 2022 $ ( 393.1 ) $ ( 60.6 ) $ ( 453.7 )

adjustments Pension & post-retirement plan benefit adjustments (a)

For the Nine Months Ended September 29, 2023:

For the Three Months Ended March 29, 2024:

Balance, December 31,2023 $ ( 291.7 ) $ ( 34.4 ) $ ( 326.1 )

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Increase (decrease) — 0.1 (b)

Income tax impact — 0.1 0.1

Income tax impact — — (c)

Amounts reclassified from AOCI into income, net of income taxes

Net current period other comprehensive income (loss) ( 40.0 ) ( 0.1 ) ( 40.1 )

Balance, September 29, 2023 $ ( 341.4 ) $ ( 24.4 ) $ ( 365.8 )

For the Nine Months Ended September 30, 2022:

Net current period other comprehensive income (loss), net of income taxes ( 76.5 ) 0.1 ( 76.4 )

Balance, March 29, 2024 $ ( 368.2 ) $ ( 34.3 ) $ ( 402.5 )

For the Three Months Ended March 31, 2023:

Balance, December 31, 2022 $ ( 301.4 ) $ ( 24.3 ) $ ( 325.7 )

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Amounts reclassified from AOCI into income, net of income taxes

Net current period other comprehensive income (loss) ( 270.4 ) 1.7 ( 268.7 )

Balance, September 30, 2022 $ ( 393.1 ) $ ( 60.6 ) $ ( 453.7 )

Net current period other comprehensive income (loss), net of income taxes 13.4 — 13.4

Balance, March 31, 2023 $ ( 288.0 ) $ ( 24.3 ) $ ( 312.3 )

(a) Includes balances relating to defined benefit plans, supplemental executive retirement plans, and other postretirement employee benefit plans.

(b) This component of AOCI is included in the computation of net periodic pension cost (refer to Note 11 in our most recently filed Form 10-K for additional details).

Allowances for Doubtful Accounts

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Additions to the allowances are charged to current period earnings, amounts determined to be uncollectible are charged directly against the allowances, while amounts recovered on previously written-off accounts increase the allowances.

During the three and nine-month periods ending September 29, 2023 and September 30, 2022, the activity was immaterial.

During the three-month periods ending March 29, 2024 and March 31, 2023, the activity was immaterial.

Property Sale

On March 14, 2024, we sold land and certain office buildings in our PT segment for $ 90 million, for which we received $ 20 million in cash proceeds and a $ 70 million promissory note secured by a letter of credit, with principal due in August and November 2024.

The promissory note is recorded within Prepaid expenses and other current assets.

During the three-month period ended March 29, 2024, we recorded a gain on sale of property of $ 63.1 million in the Consolidated Condensed Statements of Earnings.

Concurrently, using a portion of the proceeds from the property sale, we entered into an arm’s length transaction with the Fortive Foundation (the “Foundation”), pledging a charitable contribution of $ 20 million, which had no donor imposed conditions or restrictions.

The Foundation, a not-for-profit entity, is a related party due to certain Fortive executives serving as members of the entity’s board of directors.

The charitable contribution is recorded within the “Other non-operating expense, net” line in the Consolidated Condensed Statements of Earnings and the liability related to the pledged donation is recorded within Accrued expenses and other current liabilities in the Consolidated Condensed Balance Sheets.

Restructuring

We initiated a discrete plan in the first quarter of 2023 that is expected to be completed by December 31, 2023.

We initiated a discrete plan in the first quarter of 2023 that was completed during the fourth quarter of 2023.

The nature of these activities were broadly consistent throughout our segments and consist primarily of targeted workforce reductions in response to overall macroeconomic and other external conditions.

We incurred these costs to position ourselves to provide superior products and services to customers in a cost-efficient manner, while taking into consideration the impact of broad economic uncertainties.

During the three and nine-month periods ended September 29, 2023, we incurred charges of $ 0.9 million and $ 29.2 million, respectively.

During the three-month period ended March 31, 2023, we incurred charges of $ 17.6 million.

These charges are recorded within Cost of sales and Selling, general, and administrative expenses in the Consolidated Condensed Statements of Earnings.

Accrued restructuring costs were $ 10 million as of September 29, 2023 and are recorded within Accrued expenses and other current liabilities in the Consolidated Condensed Balance Sheets.

During the third quarter, the plan was amended due to on-going macroeconomic and external conditions.

As a result, we now expect to recognize approximately $ 60 to $ 65 million under this discrete plan during the year ending December 31, 2023.

Convertible Senior Notes

On February 22, 2019, we issued $ 1.4 billion in aggregate principal amount of our 0.875 % Convertible Senior Notes due 2022 (“Convertible Notes”), including $ 187.5 million in aggregate principal amount resulting from an exercise in full of an over-allotment option.

The Convertible Notes were issued in a private placement to certain initial purchasers for resale to qualified institutional buyers pursuant to Rule 144A under the Securities Act.

Upon conversion of the Convertible Notes, holders were entitled to receive cash, shares of our common stock, or a combination thereof, at our election.

Upon adopting Accounting Standards Update No.

2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), on January 1, 2022, we accounted for the Convertible Notes under the if-converted method in our calculation of diluted EPS, as required under the new guidance.

On February 15, 2022, the maturity date of the Convertible Notes, Fortive repaid, in cash, $ 1.2 billion in outstanding principal and accrued interest thereon.

Accrued restructuring costs were $ 13 million and $ 26 million as of March 29, 2024 and December 31, 2023 and are recorded within Accrued expenses and other current liabilities in the Consolidated Condensed Balance Sheets.

Recently Issued Accounting Standard

The Financial Accounting Standards Board (“FASB”) establishes changes to accounting principles under GAAP in the form of accounting standards updates (“ASUs”) to the Accounting Standards Codification (“ASC”).

We consider the applicability and impact of all ASUs.

Any recently issued ASUs were assessed and determined to be either not applicable or are expected to have an immaterial impact on the Company’s result of operations, financial position or cash flows.

ACQUISITIONS AND DIVESTITURES

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2023-07, Segment Reporting (Topic 280)—Improvements to Reportable Segment Disclosures , which amends the disclosure requirements for reportable segments on the interim and annual basis.

This standard is effective for fiscal year ending December 31, 2024 and interim periods within fiscal year ending December 31, 2025, with early adoption permitted.

The adoption of the standard will not impact our consolidated financial statements.

Upon adoption, we will update the applicable interim and annual disclosures to align with the new standard.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) —Improvements to Income Tax Disclosures , which amends certain disclosure requirements related to income taxes on an annual basis.

This standard is effective for fiscal year ending December 31, 2025, with early adoption permitted.

The adoption of the standard will not impact our consolidated financial statements.

Upon adoption, we will update the applicable annual disclosures to align with the new standard.

We continually evaluate potential mergers and acquisitions that align with our business portfolio strategy.

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The purchase price for acquired businesses reflect a number of factors, including the future earnings and cash flow potential of the business, the strategic fit and resulting synergies from the complementary portfolio of the acquired business to our existing operations, industry expertise, and market access.

During the three and nine month periods ended September 29, 2023, we made three acquisitions (“the Q3 2023 acquisitions”) in our Intelligent Operating Solutions segment for an aggregate cash consideration of $ 59.0 million, which includes an immaterial deferred payment, net of acquired cash.

The Q3 2023 acquisitions accelerate our strategy and strengthen our product portfolio, providing world-class solutions to our customers.

The purchase price allocation is provisional and is subject to further adjustments as we finalize the measurement of the acquired tangible and intangible assets and liabilities, as well as the associated income tax considerations.

The preliminary fair value of the net assets acquired was based on several estimates and assumptions.

As additional information necessary to complete the valuation is obtained and analyzed, we will make appropriate adjustments to purchase price allocations prior to completion of the applicable measurement period, as required and as soon as practicable.

During the three-month period ended March 29, 2024, immaterial adjustments were made to the purchase price allocation of prior year acquisitions.

On January 3, 2024, we acquired EA Elektro-Automatik Holding GmbH (“EA”), a leading supplier of high-power electronic test solutions for energy storage, mobility, hydrogen, and renewable energy applications.

The acquisition of EA will bolster our innovative portfolio of products and services for engineers with complementary test and measurement solutions enabling the global energy transition.

The total consideration paid was approximately $ 1.72 billion, net of acquired cash.

We funded this transaction with financing activities and available cash.

We recorded approximately $ 1.2 billion of goodwill within our PT segment related to the EA acquisition, which is not tax deductible.

For the three-month period ended March 29, 2024, we incurred approximately $ 27 million of pretax transaction-related costs related to the EA acquisition, which were primarily for banking fees, legal fees, and amounts paid to other third-party advisers.

These costs were recorded within Selling, general, and administrative expenses in the Consolidated Condensed Statement of Earnings.

The following table summarizes the preliminary estimated acquisition date fair values of the assets acquired and liabilities assumed as of March 29, 2024 ($ in millions):

Accounts receivable $ 21.5

Property, plant and equipment

Goodwill 1,167.0

Other intangible assets (customer relationships, technology, and trade names)

Deferred tax liabilities ( 183.3 )

Other assets and liabilities, net ( 22.5 )

Net cash consideration $ 1,718.2

During 2023, we made four acquisitions (“the 2023 acquisitions”) in our IOS segment for an aggregate cash consideration of $ 101.4 million, which includes an immaterial deferred payment, net of acquired cash.

The 2023 acquisitions are intended to accelerate our strategy and strengthen our product portfolio, providing world-class solutions to our customers.

We recorded approximately $ 55.8 million of goodwill related to the acquisitions, which is not tax deductible, as well as $ 43.2 million of intangible assets, primarily consisting of customer relationships, technology, and trade names.

All other acquired assets and assumed liabilities are immaterial.

The purchase price allocation is provisional and is subject to further adjustments as additional information becomes available concerning the fair value of the assets acquired and liabilities assumed.

We make appropriate adjustments to purchase price allocations prior to completion of the applicable measurement period, as required and as soon as practicable.

On September 30, 2022, we completed the sale of our Therapy Physics product line, which was reported in our Advanced Healthcare Solutions segment, to an unrelated third party for total consideration of $ 9.6 million.

As a result of the sale, in the three and nine month periods ended September 30, 2022, we recorded a net realized pre-tax gain totaling $ 2.3 million, net of transaction costs, which is recorded within Other non-operating expense, net in the Consolidated Condensed Statements of Earnings.

The divestiture of this product line did not represent a strategic shift with a major effect on the Company’s operations and financial results and therefore the divested product line is not reported as a discontinued operation.

Subsequent Event

On October 22, 2023, we entered into a definitive agreement to acquire EA Elektro-Automatik Holding GmbH, a leading supplier of high-power electronic test solutions for energy storage, mobility, hydrogen, and renewable energy applications, for a total purchase price of approximately $ 1.665 billion in cash.

The acquisition is subject to customary closing conditions and regulatory approvals and is expected to close early in the first quarter of 2024.

GOODWILL AND OTHER INTANGIBLE ASSETS

The following is a roll forward of our carrying value of goodwill by segment ($ in millions):

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Balance, December 31, 2023 $ 4,148.9 $ 1,856.5 $ 3,116.3 $ 9,121.7

Measurement period adjustments for prior year acquisitions

( 0.9 ) — — ( 0.9 )

Attributable to acquisitions

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Foreign currency translation and other ( 10.4 ) ( 33.8 ) ( 9.0 ) ( 53.2 )

Balance, September 29, 2023 $ 4,111.5 $ 1,794.8 $ 3,152.4 $ 9,058.7

Balance, March 29, 2024 $ 4,137.6 $ 2,989.7 $ 3,107.3 $ 10,234.6

Due to the Segment Realignment, the beginning goodwill balance for PT and AHS have been recast to conform to the revised segment presentation.

Refer to Note 1 for further information on the realignment.

The increase in the goodwill balance of the PT segment for the three-month period ended March 29, 2024 is a result of the EA acquisition.

Refer to Note 2 for more information.

The following summarizes the gross carrying value and accumulated amortization for each major category of intangible asset ($ in millions):

March 29, 2024 December 31, 2023

Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization

Finite-lived intangibles:

Patents and technology $ 1,275.4 $ ( 720.0 ) $ 1,139.6 $ ( 687.1 )

Customer relationships and other intangibles 4,038.6 ( 1,645.1 ) 3,568.0 ( 1,573.2 )

Trademarks and trade names 174.7 ( 23.8 ) 117.7 ( 19.8 )

Total finite-lived intangibles 5,488.7 ( 2,388.9 ) 4,825.3 ( 2,280.1 )

Indefinite-lived intangibles:

Trademarks and trade names 612.9 — 614.6 —

Total intangibles $ 6,101.6 $ ( 2,388.9 ) $ 5,439.9 $ ( 2,280.1 )

Finite-lived intangible assets are amortized over the shorter of their legal or estimated useful lives.

During the three-month period ended March 29, 2024, we acquired finite-lived intangible assets, consisting of customer relationships, developed technology, and trade names, with a weighted average life of approximately 9 years as a result of the EA acquisition.

Refer to Note 2 for additional information on the intangible assets acquired.

FAIR VALUE MEASUREMENTS

Accounting standards define fair value based on an exit price model, establish a framework for measuring fair value where certain assets and liabilities are required to be carried at fair value, and provide for certain disclosures related to the valuation methods used within a valuation hierarchy as established within the accounting standards.

Accounting standards define fair value based on an exit price model, establish a framework for measuring fair value for assets and liabilities required to be carried at fair value, and provide for certain disclosures related to the valuation methods used within the valuation hierarchy as established within the accounting standards.

This hierarchy prioritizes the inputs into three broad levels as follows:

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• Level 3 inputs are unobservable inputs based on our assumptions.

The classification of a financial asset or liability within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

Below is a summary of financial liabilities that are measured at fair value on a recurring basis ($ in millions):

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(Level 3) Total

September 29, 2023

March 29, 2024

Deferred compensation liabilities $ — $ 43.2 $ — $ 43.2

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All amounts deferred under such plans are unfunded, unsecured obligations and are recorded within Other long-term liabilities in the accompanying Consolidated Condensed Balance Sheets.

Participants may choose among alternative earnings rates for the amounts they defer, which are primarily based on investment options within our defined contribution plans for the benefit of U.S.

Participants may choose among alternative earning rates for the amounts they defer, which are primarily based on investment options within our defined contribution plans for the benefit of U.S.

employees (except that the earnings rates for amounts contributed unilaterally by the Company are entirely based on changes in the value of Fortive common stock).

Changes in the deferred compensation liability under these programs are recognized based on changes in the fair value of the participants’ accounts and are recorded within Selling, general and administrative in the Consolidated Condensed Statements of Earnings.

Changes in the deferred compensation liability under these programs are recognized based on changes in the fair value of the participants’ accounts and are recorded within Selling, general and administrative expenses in the Consolidated Condensed Statements of Earnings.

Non-recurring Fair Value Measurements

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However, these assets are required to be assessed for impairment whenever events or circumstances indicate that their carrying value may not be fully recoverable, and at least annually for goodwill and indefinite-lived intangible assets.

We evaluated events or circumstances that may indicate the carrying value of our non-financial assets may not be fully recoverable during the three and nine-month periods ended September 29, 2023, and recorded no material impairments.

We evaluated events and circumstances that, during the three and nine month periods ended September 30, 2022, indicated the carrying value of the equity investment in a third-party entity held by our Intelligent Operating Solutions segment was no

longer recoverable.

As a result, in the three and nine month periods ended September 30, 2022, we recorded a pre-tax impairment loss of $ 8.1 million to write down an investment to fair value.

The loss was recorded within Other non-operating expense, net in our Consolidated Condensed Statement of Earnings.

We evaluated events or circumstances that may indicate the carrying value of our non-financial assets may not be fully recoverable during the three-month period ended March 29, 2024, and recorded no impairments.

Fair Value of Financial Instruments

The carrying amount and fair value of financial instruments are as follows ($ in millions):

September 29, 2023 December 31, 2022

March 29, 2024 December 31, 2023

Carrying Amount Fair Value Carrying Amount Fair Value

Current portion of long-term debt $ 749.9 $ 750.0 $ 999.7 $ 1,000.0

Long-term debt, net of current maturities 1,982.1 1,795.6 2,251.6 2,078.1

As of September 29, 2023 and December 31, 2022, the current portion of long-term debt and long-term debt, net of current maturities were categorized as Level 1.

The fair values of long-term borrowings were based on quoted market prices.

Long-term debt

$ 3,941.7 $ 3,835.4 $ 3,646.2 $ 3,539.4

As of March 29, 2024 and December 31, 2023, the current portion of long-term debt and long-term debt, net of current maturities were categorized as Level 1.

The fair value of the long-term borrowings were based on quoted market prices.

The difference between the fair value and the carrying amounts of long-term borrowings may be attributable to changes in market interest rates and/or our credit ratings subsequent to the borrowing.

The fair value of cash and cash equivalents, trade accounts receivable, net, trade accounts payable, and commercial paper approximates their carrying value due to the short-term maturities of these instruments.

The fair value of cash and equivalents, trade accounts receivable, net, trade accounts payable, and commercial paper approximates their carrying amount due to the short-term maturities of these instruments.

The components of our debt were as follows ($ in millions):

September 29, 2023 December 31, 2022

March 29, 2024 December 31, 2023

dollar-denominated commercial paper $ 820.0 $ 1,251.2

Delayed-Draw Term Loan due 2023 750.0 1,000.0

3.7 % Euro-denominated senior unsecured notes due 2026

3.7 % Euro-denominated senior unsecured notes due 2029

Euro Term Loan due 2025 296.7 303.6

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4.30 % senior unsecured notes due 2046

Delayed-Draw Term Loan due 2024

Long-term debt, principal amounts 3,956.6 3,656.9

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Long-term debt, carrying value $ 3,941.7 $ 3,646.2

current portion of long-term debt, carrying value

Long-term debt, net of current maturities $ 1,982.1 $ 2,251.6

Refer to Note 10 of our 2023 Annual Report on Form 10-K for further details of our debt financing.

Euro-denominated Senior Unsecured Notes Due 2026 and 2029

On February 13, 2024, we completed the registered offering of the following Euro-denominated senior unsecured notes:

• € 500 million in aggregate principal amount of our 3.7 % Euro-denominated senior unsecured notes due 2026 (the “2026 Notes”) issued at 99.928 % of their principal amount and bearing interest at 3.7 % per annum.

The 2026 Notes mature on February 13, 2026 with interest payable in arrears on February 13 of each year, beginning in 2025.

• € 700 million in aggregate principal amount of our 3.7 % Euro-denominated senior unsecured notes due 2029 (the “2029 Notes”) issued at 99.943 % of their principal amount and bearing interest at 3.7 % per annum.

The 2029 Notes mature on August 15, 2029 with interest payable in arrears on August 15 of each year, beginning in 2024.

The net proceeds from the offering, after underwriting discounts and commissions and offering expenses, were approximately $ 1.3 billion based on the currency exchange rates at which the Euro denominated proceeds were converted into U.S.

We used the net proceeds to refinance the $ 1.0 billion outstanding principal of the Delayed-Draw Term Loan Due 2024, refinance borrowings under the U.S.

dollar-denominated commercial paper, and for general corporate purposes.

Redemption Provisions and Covenants Applicable to 2026 and 2029 Notes

Prior to July 15, 2029 for the 2029 Notes, and prior to maturity for the 2026 Notes, we may redeem the applicable series of notes at our option, in whole or in part, at any time and from time to time, at the applicable make-whole redemption price specified in the indentures.

On or after July 15, 2029, we may redeem the 2029 Notes, in whole or in part, at any time and from time to time, at a redemption price equal to 100 % of the principal amount of the 2029 Notes being redeemed plus accrued and unpaid interest thereon to, but not including, the redemption date.

We may, at our option, redeem the applicable series of notes, in whole but not in part, at a redemption price equal to 100 % of the principal amount of such series of notes to be redeemed, together with any accrued and unpaid interest thereon to, but not including, the redemption date, at any time, if as a result of any change in, or amendment to, the laws, regulations, treaties, or rulings of the United States or any political subdivision of or in the United States or any taxing authority thereof or therein affecting taxation, or any change in, or amendment to, the application, official interpretation, administration or enforcement of such laws, regulations, treaties or rulings (including a holding by a court of competent jurisdiction in the United States), which change or amendment is enacted, adopted, announced or become effective, we become or, based upon a written opinion of independent counsel selected by us, will become obligated to pay additional amounts with respect to the applicable series of notes.

If a change of control triggering event occurs, we will, in certain circumstances, be required to make an offer to repurchase the notes from each holder at a purchase price equal to 101 % of the principal amount of the notes being repurchased, plus accrued and unpaid interest to, but not including the repurchase date.

A change of control triggering event is defined as the occurrence of both a change of control and a rating event, each as defined in the indentures.

Except in connection with a change of control triggering event, the 2026 Notes and 2029 Notes do not have any credit rating downgrade triggers that would accelerate the maturity of the notes.

The 2026 Notes and 2029 Notes contain customary covenants.

None of these covenants are considered restrictive to our operations and as of March 29, 2024, we were in compliance with all of our covenants.

Delayed-Draw Term Loan due 2024

On August 24, 2023, we repaid $ 250 million of the Delayed-Draw Term Loan Due 2023, which is prepayable at our option without premium or penalty.

The amount repaid may not be reborrowed.

The remaining principal is due on December 14, 2023.

On January 2, 2024, we drew down an additional $ 450 million of the Delayed-Draw Term Loan due 2024 as part of the funding for the acquisition of EA, with $ 1.0 billion outstanding immediately following such additional draw.

Refer to Note 2 for additional information regarding the EA acquisition.

On February 13, 2024, we used the net proceeds from the 2026 Notes and 2029 Notes to refinance the entire $ 1.0 billion outstanding principal and accrued interest thereon.

Other Liquidity Sources

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Interest expense on commercial paper is paid at maturity and is generally based on our credit ratings at the time of issuance and prevailing short-term interest rates.

The details of our outstanding Commercial Paper Programs as of September 29, 2023 were as follows ($ in millions):

The details of our outstanding Commercial Paper Programs as of March 29, 2024 were as follows ($ in millions):

Carrying value (a)

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Credit support for the Commercial Paper Programs is provided by a five-year $ 2.0 billion senior unsecured revolving credit facility that expires on October 18, 2027 (the “Revolving Credit Facility”) which, to the extent not otherwise providing credit support for our commercial paper programs, can also be used for working capital and other general corporate purposes.

As of September 29, 2023, no borrowings were outstanding under the Revolving Credit Facility.

As of March 29, 2024, no borrowings were outstanding under the Revolving Credit Facility.

We classified our borrowings outstanding under the Commercial Paper Programs as Long-term debt in the accompanying Consolidated Condensed Balance Sheets as we had the intent and ability, as supported by availability under the Revolving Credit Facility, to refinance these borrowings for at least one year from the balance sheet date.

We derive revenue primarily from the sale of products, including software, and services.

We derive revenue primarily from the sales of products, including software, and services.

Revenue is recognized when control of promised products or services is transferred to customers in an amount that reflects the consideration we expect to be entitled to in exchange for those products, software, or services.

Product sales include revenue from the sale of products and equipment, which includes our software and SaaS product offerings and equipment rentals.

Product sales include revenue from the sale of products and equipment, which includes our software and software as a service (“SaaS”) product offerings and equipment rentals.

Service sales include revenues from extended warranties, post-contract customer support (“PCS”), maintenance contracts or services, contract labor to perform ongoing service at a customer location, services related to previously sold products, and software implementation services.

Contract Assets — In certain circumstances, we record contract assets which include unbilled amounts typically resulting from sales under contracts when revenue recognized exceeds the amount billed to the customer, and right to payment is not only subject to the passage of time.

Contract assets were $ 108 million as of September 29, 2023 and $ 82 million as of December 31, 2022.

Contract assets were $ 107 million as of March 29, 2024 and $ 108 million as of December 31, 2023.

Contract assets are recorded within Prepaid expenses and other current assets in our Consolidated Condensed Balance Sheets.

Contract Costs — We incur and capitalize incremental costs to obtain certain contracts, typically sales-related commissions where the amortization period is greater than one year and costs associated with assets used by our customers in certain service arrangements.

As of September 29, 2023 and December 31, 2022, we had $ 48 million and $ 42 million, respectively, in net revenue-related contract costs primarily related to certain software contracts.

Revenue-related contract costs are recorded within Prepaid expenses and other current assets and Other assets in our Consolidated Condensed Balance Sheets.

As of March 29, 2024 and December 31, 2023, we had $ 52 million and $ 51 million, respectively, in net revenue-related contract costs primarily related to certain software contracts.

Revenue-related contract costs are recorded within Other assets in our Consolidated Condensed Balance Sheets.

These assets have estimated useful lives between three and five years .

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Our contract liabilities consisted of the following ($ in millions):

September 29, 2023 December 31, 2022

March 29, 2024 December 31, 2023

Deferred revenue - current $ 540.1 $ 544.6

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Total contract liabilities $ 585.5 $ 590.4

During the three and nine-month periods ended September 29, 2023, we recognized revenue related to our contract liabilities at December 31, 2022 of $ 80 million and $ 368 million, respectively.

The change in our contract liabilities from December 31, 2022 to September 29, 2023 was primarily due to the timing of billings and revenue recognized for subscription-based software contracts, PCS and extended warranty services.

During the three-month period ended March 29, 2024, we recognized revenue related to our contract liabilities at December 31, 2023 of $ 196 million.

The change in our contract liabilities from December 31, 2023 to March 29, 2024 was primarily due to the timing of billings and revenue recognized for subscription-based software contracts, PCS and extended warranty services.

Remaining Performance Obligations — Our remaining performance obligations represent the transaction price of firm, non-cancelable orders and the average contract value for software contracts, for which work has not been performed.

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The aggregate remaining performance obligations attributable to each of our segments is as follows ($ in millions):

September 29, 2023

March 29, 2024

Intelligent Operating Solutions $ 565.9

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We disaggregate revenue from contracts with customers by sales of products and software and services, geographic location, and end market for each of our segments, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

Disaggregation of revenue for the three-month period ended September 29, 2023 is presented as follows ($ in millions):

Due to the Segment Realignment, prior period segment amounts have been recast to conform to the revised segment presentation.

Refer to Note 1 for further information on the realignment.

Disaggregation of revenue for the three-month period ended March 29, 2024 is presented as follows ($ in millions):

Total Intelligent Operating Solutions Precision Technologies Advanced Healthcare Solutions

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Industrial & Manufacturing 350.3 242.2 103.5 4.6

Utilities & Power 105.3 46.5 58.8 —

Government 126.2 69.5 47.6 9.1

Communications, Electronics & Semiconductor 101.1 24.7 76.4 —

Aerospace & Defense 74.9 0.1 74.8 —

Oil & Gas 70.6 68.3 2.3 —

Retail & Consumer 82.4 64.8 17.6 —

Other 167.3 96.9 70.4 —

Total direct sales 1,440.5 611.7 509.2 319.6

Distributors 54.0 32.6 21.4 —

Total $ 1,494.5 $ 644.3 $ 530.6 $ 319.6

(a) Direct sales by end market include sales made through third-party distributors where we have visibility into the end customer.

Disaggregation of revenue for the three-month period ended September 30, 2022 is presented as follows ($ in millions):

Total Intelligent Operating Solutions Precision Technologies Advanced Healthcare Solutions

Sales of products and software $ 1,227.7 $ 519.2 $ 467.3 $ 241.2

Sales of services 228.3 94.5 56.4 77.4

Total $ 1,456.0 $ 613.7 $ 523.7 $ 318.6

United States $ 799.0 $ 342.0 $ 267.8 $ 189.2

China 186.0 56.6 102.6 26.8

All other (each country individually less than 5 % of total sales)

471.0 215.1 153.3 102.6

Total $ 1,456.0 $ 613.7 $ 523.7 $ 318.6

Direct sales:

Healthcare $ 354.1 $ 11.1 $ 42.1 $ 300.9

Industrial & Manufacturing 334.5 217.6 111.3 5.6

Utilities & Power 101.9 49.2 52.7 —

Government 122.7 65.5 48.7 8.5

Communications, Electronics & Semiconductor 90.4 27.9 62.5 —

Aerospace & Defense 83.4 0.1 83.3 —

Oil & Gas 66.4 65.3 1.1 —

Retail & Consumer 76.8 61.7 15.1 —

Other 166.3 91.2 75.1 —

Total direct sales 1,399.2 582.5 501.3 315.4

Distributors 56.8 31.2 22.4 3.2

Total $ 1,456.0 $ 613.7 $ 523.7 $ 318.6

(a) Direct sales by end market include sales made through third-party distributors where we have visibility into the end customer.

Disaggregation of revenue for the nine-month period ended September 29, 2023 is presented as follows ($ in millions):

Total Intelligent Operating Solutions Precision Technologies Advanced Healthcare Solutions

Sales of products and software $ 3,786.3 $ 1,622.2 $ 1,412.9 $ 751.2

Sales of services 695.3 307.3 170.6 217.4

Total $ 4,481.6 $ 1,929.5 $ 1,583.5 $ 968.6

United States $ 2,433.0 $ 1,068.2 $ 813.5 $ 551.3

China 522.4 176.0 268.5 77.9

All other (each country individually less than 5 % of total sales)

1,526.2 685.3 501.5 339.4

Total $ 4,481.6 $ 1,929.5 $ 1,583.5 $ 968.6

Direct sales:

Healthcare $ 1,052.3 $ 33.4 $ 104.9 $ 914.0

Industrial & Manufacturing 1,051.1 687.2 345.8 18.1

Utilities & Power 308.8 140.1 168.7 —

Government 389.5 212.2 151.9 25.4

Communications, Electronics & Semiconductor 304.4 73.6 229.4 1.4

Aerospace & Defense 218.8 0.4 218.4 —

Oil & Gas 72.7 69.5 3.2 —

Retail & Consumer 249.7 189.2 60.5 —

Other 188.2 95.9 92.3 —

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Total $ 1,524.5 $ 665.7 $ 559.0 $ 299.8

(a) Direct sales by end market include sales made through third-party distributors where we have visibility into the end customer.

Disaggregation of revenue for the nine-month period ended September 30, 2022 is presented as follows ($ in millions):

(a) Direct sales by end market include sales made through third-party distributors where we have visibility to the end customer.

Disaggregation of revenue for the three-month period ended March 31, 2023 is presented as follows ($ in millions):

Total Intelligent Operating Solutions Precision Technologies Advanced Healthcare Solutions

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Industrial & Manufacturing 353.2 228.3 120.6 4.3

Utilities & Power 273.4 136.4 137.0 —

Government 111.1 61.8 40.9 8.4

Utilities & Power 98.9 47.3 51.6 —

Communications, Electronics & Semiconductor 105.9 25.6 80.3 —

Aerospace & Defense 67.6 0.1 67.5 —

Oil & Gas 199.8 193.4 6.4 —

Retail & Consumer 82.9 62.3 20.6 —

Oil & Gas 70.3 65.9 4.4 —

Other 170.1 95.0 75.1 —

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Total $ 1,460.7 $ 632.1 $ 541.1 $ 287.5

(a) Direct sales by end market include sales made through third-party distributors where we have visibility into the end customer.

Our effective tax rates for the three and nine-month period ended September 29, 2023 were 15.2 % and 15.8 %, respectively, as compared to 12.7 % and 14.4 %, respectively, for the three and nine-month period ended September 30, 2022.

The increase in the effective tax rate for the three-month period ended September 29, 2023 as compared to the three-month period ended September 30, 2022 was primarily due to a change in non-recurring permanent differences recognized.

The increase in the effective tax rate for the nine-month period ended September 29, 2023 as compared to the nine-month period ended September 30, 2022 was primarily due to uncertain tax position reserves recorded.

Our effective tax rates for the three and nine-month periods ended September 29, 2023, differ from the U.S.

(a) Direct sales by end market include sales made through third-party distributors where we have visibility to the end customer.

Our effective tax rates for the three-month period ended March 29, 2024 were 11.4 % as compared to 15.7 % for the three-month period ended March 31, 2023.

The decrease in the effective tax rate for the three-month period ended March 29, 2024 as compared to the three-month period ended March 31, 2023 was primarily related to cash repatriation, resulting in a discrete tax credit in the three-month period ended March 29, 2024

Our effective tax rates for the three-month period ended March 29, 2024, differ from the U.S.

federal statutory rate of 21% due primarily to the impact of credits and deductions provided by law and changes in our uncertain tax position reserves.

On August 16, 2022, the U.S.

enacted the Inflation Reduction Act of 2022, which among other provisions, implements a 15% corporate alternative minimum tax.

Based upon our current analysis of the Inflation Reduction Act of 2022 and subsequently released guidance, we believe the 15% corporate minimum tax will not have a material impact on our financial statements during 2023.

STOCK-BASED COMPENSATION

The 2016 Stock Incentive Plan (the “Stock Plan”), provides for the grant of stock appreciation rights, restricted stock units, and performance stock units (collectively, “Stock Awards”), stock options, or any other stock-based award.

As of September 29, 2023, approximately 14 million shares of our common stock were available for subsequent issuance under the Stock Plan.

As of March 29, 2024, approximately 12 million shares of our common stock were available for subsequent issuance under the Stock Plan.

For a full description of our Stock Plan, refer to Note 15 of our 2023 Annual Report on Form 10-K.

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The following summarizes the components of our stock-based compensation expense under the Stock Plan ($ in millions):

Three Months Ended Nine Months Ended

September 29, 2023 September 30, 2022 September 29, 2023 September 30, 2022

Three Months Ended

March 29, 2024 March 31, 2023

Stock Awards:

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Total stock-based compensation expense, net of income taxes $ 25.2 $ 22.9

The following summarizes the unrecognized compensation cost for the Stock Plan awards as of September 29, 2023.

The following summarizes the unrecognized compensation cost for the Stock Plan awards as of March 29, 2024.

This compensation cost is expected to be recognized over a weighted average period of approximately two years , representing the remaining service period related to the awards.

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We generally accrue estimated warranty costs at the time of sale.

In general, manufactured products are warrantied against defects in material and workmanship when properly used for their intended purpose, installed correctly, and appropriately maintained.

In general, manufactured products are warranted against defects in material and workmanship when properly used for their intended purpose, installed correctly, and appropriately maintained.

Warranty period terms depend on the nature of the product and range from 90 days up to the life of the product.

1 unchanged sentence

The accrued warranty liability is reviewed on a quarterly basis and may be adjusted as additional information regarding expected warranty costs becomes known.

During the nine-month periods ending September 29, 2023 and September 30, 2022, warranty related activity was immaterial.

Operating lease cost for both the three-month periods ended September 29, 2023 and September 30, 2022 was $ 13 million.

Operating lease costs for the nine-month periods ended September 29, 2023 and September 30, 2022 was $ 37 million and $ 42 million, respectively.

During the nine-month periods ended September 29, 2023 and September 30, 2022, cash paid for operating leases included in operating cash flows was $ 36 million and $ 38 million, respectively.

Right-of-use (“ROU”) assets obtained in exchange for operating lease obligations were $ 29 million and $ 18 million during the nine-month periods ended September 29, 2023 and September 30, 2022, respectively.

Operating lease ROU assets were $ 157 million and $ 162 million as of September 29, 2023 and December 31, 2022, respectively.

Operating lease liabilities were $ 165 million and $ 169 million as of September 29, 2023 and December 31, 2022, respectively.

During the three-month periods ended March 29, 2024 and March 31, 2023, warranty related activity was immaterial.

Operating lease costs for the three-month periods ended March 29, 2024 and March 31, 2023 was $ 13 million and $ 12 million, respectively.

During both the three-month periods ended March 29, 2024 and March 31, 2023, cash paid for operating leases included in operating cash flows was $ 12 million.

Right-of-use (“ROU”) assets obtained in exchange for operating lease obligations were $ 4 million during both the three-month periods ended March 29, 2024 and March 31, 2023, respectively.

Operating lease ROU assets were $ 170 million and $ 155 million as of March 29, 2024 and December 31, 2023, respectively.

Operating lease liabilities were $ 177 million and $ 164 million as of March 29, 2024 and December 31, 2023, respectively.

Operating lease ROU assets and operating lease liabilities are recorded in the Consolidated Condensed Balance Sheets within Other assets, Accrued expenses and other current liabilities, and Other long-term liabilities, respectively.

Other Matters

We discovered that a subsidiary of ours made certain incorrect representations regarding status as a small business concern as defined by the Small Business Act for certain contracts that it was awarded by the Defense Logistics Agency (“DLA”).

As a result, on January 26, 2024, we voluntarily notified the Department of Defense Office of Inspector General (“OIG”) and the DLA of this matter.

While we are continuing to investigate, we currently do not expect this matter to have a material adverse effect on our financial condition or results of operations.

However, resolution of this matter could subject us to fines or penalties, and we cannot provide assurance as to the timing or outcome of such resolution.

NET EARNINGS PER SHARE

Basic net EPS is calculated by dividing net earnings attributable to common stockholders by the weighted average number of shares of common stock outstanding for the applicable period.

Diluted EPS is similarly calculated, except that the calculation includes the dilutive effect of the assumed conversion of 0.875 % Convertible Notes and associated issuance of shares under the if-converted method, while outstanding in 2022, and the assumed issuance of shares under stock-based compensation plans under the treasury stock method, except where the inclusion of such shares would have an anti-dilutive impact.

Anti-dilutive options excluded from the diluted EPS calculation for the three and nine-month periods ended September 29, 2023 were 0.1 million and 0.5 million, respectively, and were 7.3 million for both the three and nine-month periods ended September 30, 2022.

Basic net earnings per share (“EPS”) is calculated by dividing net earnings attributable to common stockholders by the weighted average number of shares of common stock outstanding for the applicable period.

Diluted EPS is similarly calculated, except that the calculation includes the dilutive effect of the assumed issuance of shares under stock-based compensation plans under the treasury stock method, except where the inclusion of such shares would have an anti-dilutive impact.

Anti-dilutive options excluded from the diluted EPS calculation for the three-month periods ended March 29, 2024 and March 31, 2023 were 1.2 million and 2.9 million, respectively.

Information related to the calculation of net earnings per share of common stock is summarized as follows ($ and shares in millions, except per share amounts):

Three Months Ended Nine Months Ended

September 29, 2023 September 30, 2022 September 29, 2023 September 30, 2022

Three Months Ended

March 29, 2024 March 31, 2023

Net earnings $ 207.4 $ 173.6

Convertible note interest add-back (if converted method) — — — 1.8

Diluted Net Earnings $ 218.0 $ 189.9 $ 600.6 $ 529.8

Weighted average common shares outstanding used in basic earnings per share 351.7 353.6

1 unchanged sentence

Assumed exercise of dilutive options and vesting of dilutive Stock Awards 4.3 2.9

Conversion of convertible notes (if converted method) — — — 2.1

Weighted average common shares outstanding used in diluted earnings per share 356.0 356.5

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First quarter $ 0.08 $ 28.1

Second quarter 0.07 24.6

Third quarter 0.07 24.6

Total $ 0.08 $ 28.1

First quarter $ 0.07 $ 24.7

Second quarter 0.07 24.9

Third quarter 0.07 24.8

Total $ 0.07 $ 24.7

* The sum of the components of total dividends paid may not equal the total amount due to rounding.

Share Repurchase Program

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The repurchase program may be suspended or discontinued at any time by the Board of Directors.

During the three and nine-month periods ended September 29, 2023, the Company purchased 1 million and 3 million shares of its common stock at an average price of $ 78.74 and $ 69.27 , respectively.

During the three and nine-month periods ended September 30, 2022, the Company purchased 2 million and 6 million shares of its common stock at an average share price of $ 66.57 and $ 62.67 , respectively.

As of September 29, 2023, there were 10 million shares remaining for repurchase under the program.

As of December 31, 2023, there were 9 million shares remaining for repurchase under the program.

On January 23, 2024, the Company’s Board of Directors increased the number of shares authorized under the share repurchase program by an additional 11 million shares.

During the three-month periods ended March 29, 2024 and March 31, 2023, respectively, the Company made no repurchases under the plan.

As of March 29, 2024, there were 20 million shares remaining for repurchase under the program.

SEGMENT INFORMATION

We report our results in three separate business segments consisting of Intelligent Operating Solutions, Precision Technologies, and Advanced Healthcare Solutions.

We report our results in three separate business segments consisting of IOS, PT, and AHS.

Our chief operating decision maker (“CODM”) assesses performance and allocates resources based on our operating segments, which are also our reportable segments.

Our Intelligent Operating Solutions segment provides advanced instrumentation, software and services to tens of thousands of customers enabling their mission-critical workflows.

Due to the Segment Realignment, prior period segment amounts have been recast to conform to the revised segment presentation.

Refer to Note 1 for further information on the realignment.

Our IOS segment provides advanced instrumentation, software and services to tens of thousands of customers enabling their mission-critical workflows.

These offerings include electrical test & measurement, facility and asset lifecycle software applications, connected worker safety and compliance solutions across a range of vertical end markets, including manufacturing, process industries, healthcare, utilities and power, communications and electronics, among others.

Our Precision Technologies segment helps solve tough technical challenges to speed breakthroughs in a wide range of applications, from food and beverage production and manufacturing to next-generation electric vehicles and clean energy, as our customers seek new test solutions to enable the electrification and connectivity of everything.

Our expertise in materials, methods and measurements are reflected in our electrical test & measurement, sensing and material technologies offered to a broad set of customers and vertical end markets, including industrial, power and energy, automotive, medical equipment, food and beverage, aerospace and defense, semiconductor, and other general industries.

Our Advanced Healthcare Solutions segment supplies critical workflow solutions enabling healthcare providers to deliver exceptional patient care more efficiently.

Our offerings include instrument sterilization solutions, instrument tracking, cell therapy equipment design and manufacturing, biomedical test tools, radiation detection and safety monitoring, and end-to-end clinical productivity software and solutions.

Our PT segment helps solve tough technical challenges to speed breakthroughs in a wide range of applications, from food and beverage production and manufacturing to next-generation electric vehicles and clean energy, as our customers seek new test solutions to enable the electrification and connectivity of everything.

Our expertise in materials, methods and measurements are reflected in our electrical test & measurement, sensing and material technologies, and cell therapy equipment design and manufacturing offered to a broad set of customers and vertical end markets, including industrial, power and energy, automotive, medical equipment, food and beverage, aerospace and defense, semiconductor, and other general industries.

Our AHS segment supplies critical workflow solutions enabling healthcare providers to deliver exceptional patient care more efficiently.

Our offerings include instrument sterilization solutions, instrument tracking, biomedical test tools, radiation detection and safety monitoring, and end-to-end clinical productivity software and solutions.

Our healthcare offerings help ensure critical safety standards are met, instruments and operating rooms are working at peak performance, and complex procedures are followed accurately in these mission-critical healthcare environments.

Our segment results are as follows ($ in millions):

Three Months Ended Nine Months Ended

September 29, 2023 September 30, 2022 September 29, 2023 September 30, 2022

Three Months Ended

March 29, 2024 March 31, 2023

Intelligent Operating Solutions $ 665.7 $ 632.1

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Other ( 38.5 ) ( 32.1 )

Russia exit and wind down costs — ( 1.1 ) — ( 17.3 )

Total Operating Profit 302.2 240.4

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