What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-08-07 compared with 2025-02-06 · 146 added, 213 removed, 132 unchanged (73% of the section changed)

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The following discussion may contain forward-looking statements and should be read in conjunction with the “Cautionary Statement Regarding Forward-Looking Information” in this discussion.

Haemonetics is a global healthcare company dedicated to providing a suite of innovative medical technology solutions that improve the quality, effectiveness and efficiency of care.

We challenge ourselves to think big and make new possibilities a reality, so that our customers can make it matter for patients, every single day.

Our technology addresses important medical markets:

blood and plasma component collection, the surgical suite and hospital transfusion services.

When used in this report, the terms “we,” “us,” “our,” “Haemonetics” and the “Company” mean Haemonetics Corporation.

Haemonetics is a global medical technology company dedicated to improving the quality, effectiveness and efficiency of health care.

Our innovative solutions addressing critical medical needs include a suite of hospital technologies designed to advance standards of care and help enhance outcomes for patients;

end-to-end plasma collection technologies to optimize operations for plasma centers;

and products to enable blood centers to collect in-demand blood components.

We view our operations and manage our business in three principal reporting segments:

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For that purpose, “Plasma” includes plasma collection devices and disposables, donor management software and supporting software solutions sold to plasma customers.

“Blood Center” includes blood collection and processing devices and disposables for red cells, platelets and whole blood.

“Hospital” is comprised of Interventional Technologies, which includes Vascular Closure, Sensor Guided Technologies and Esophageal Protection products, and Blood Management Technologies, which includes Hemostasis Management, Cell Salvage and Transfusion Management products.

We believe that Plasma and Hospital have growth potential, while Blood Center competes in challenging markets that require us to manage the business differently, including reducing costs, shrinking the scope of the current product line, and evaluating opportunities to exit unfavorable customer contracts.

“Blood Center” includes blood collection and processing devices and disposables for plasma, red cells, and platelets.

“Hospital” is comprised of Interventional Technologies, which includes Vascular Closure, Sensor-Guided Technologies and Esophageal Protection product lines, and Blood Management Technologies, which includes Hemostasis Management, Cell Salvage and Transfusion Management product lines.

We believe that Plasma and Hospital have the greatest growth potential and are well positioned to drive long-term value.

Blood Center operates in more challenging markets, and we have sharpened our focus accordingly on targeted opportunities – particularly in plasma and platelets – while ensuring continued alignment of this business with our broader strategic objectives.

Recent Developments

Divestiture of the Whole Blood Product Line

On December 3, 2024, we announced that we had entered into a definitive agreement to sell our Whole Blood product line and related assets within our Blood Center business unit to GVS, S.p.A (“GVS”), a manufacturer of filter solutions for applications in the healthcare and life sciences sectors.

The divested assets include our complete portfolio of proprietary whole blood collection, processing and filtration solutions, along with our manufacturing facility in Covina, California where certain of these products are produced, and related equipment and assets located at our manufacturing facility in Tijuana, Mexico.

On January 13, 2024, subsequent to the third quarter ended December 28, 2024, we completed the transaction with GVS for total cash consideration of up to $67.8 million, which includes $45.3 million upfront and up to $22.5 million in contingent consideration, based on sales growth over the next three years and the achievement of certain other milestones.

As the related assets are considered held for sale as of December 28, 2024, we have reclassified $34.7 million of inventory, $7.3 million of property, plant and equipment, $4.5 million of goodwill and $0.5 million of accrued liabilities to Prepaid expenses and other current assets and Other current liabilities in the Condensed Consolidated Balance Sheets, which were previously included in our Blood Center reportable segment.

Accelerated Share Repurchase

In October 2024, we completed a $75.0 million repurchase of our common stock pursuant to an accelerated share repurchase agreement (“ASR”) entered into with Citibank N.A.

(“Citibank”) in August 2024.

The total number of shares repurchased under the ASR was 1.0 million at an average price per share upon final settlement of $74.36.

As of December 28, 2024, the total remaining authorization for repurchases of our common stock under the share repurchase program was $150.0 million.

Issuance of Convertible Senior Notes

On May 28, 2024, we issued $700.0 million aggregate principal amount of 2.5% convertible senior notes due 2029 (the “2029 Notes”).

The 2029 Notes are governed by the terms of the Indenture between the Company and U.S.

Bank National Association, as trustee.

The total net proceeds from the sale of the 2029 Notes, after deducting the initial purchasers’ discounts and debt issuance costs, were $682.8 million, of which $230.0 million was used to repay the entirety of the balance on the revolving credit facility under the Company’s current credit agreement, $185.5 million was used to repurchase a portion of our existing 0% convertible senior notes due 2026 and $88.2 million was used to complete capped call transactions, with the remaining proceeds available for other working capital requirements.

The 2029 Notes will mature on June 1, 2029, unless earlier converted, redeemed or repurchased.

Debt Issuance and Repayment

On April 30, 2024, we entered into a second amended and restated credit agreement with certain lenders to refinance our prior credit facilities and extend their maturity date through April 2029.

The second amended and restated credit agreement provides for a $250.0 million senior unsecured term loan, the proceeds of which, along with $12.5 million of cash on hand, have been used to retire the balance of the term loan under our prior credit facilities, and a $750.0 million senior unsecured revolving credit facility.

Acquisition of Attune Medical

On April 1, 2024, we completed our acquisition of Advanced Cooling Therapy, Inc., d/b/a Attune Medical (“Attune Medical”) for total consideration of $187.7 million, which included an upfront cash payment of $162.0 million, or $150.5 million net of cash acquired, the fair value of contingent consideration of $25.3 million, and $0.4 million of working capital adjustments.

The contingent consideration is based on sales growth over the next three years, which is uncapped, and the achievement of certain other milestones.

We financed the acquisition through a combination of cash on hand and borrowings under our senior unsecured revolving credit facility.

Attune Medical's ensoETM technology is designed for use across a range of medical conditions involving patient cooling or warming, including treatment in electrophysiology, critical care, neurocritical care, trauma, burn surgery, spine surgery, and cancer surgery, among others.

The addition of our Esophageal Protection product line through this acquisition expands our Hospital business unit’s presence in electrophysiology and complements its Vascular Closure product line within Interventional Technologies, which is included in the Hospital reportable segment.

2025 Share Repurchase Program

In April 2025, our Board of Directors (the “Board”) approved a new three-year share repurchase program authorizing the repurchase of up to $500.0 million of our common stock, based on market conditions, through April 2028.

This new share repurchase program will help to offset the dilutive impact of recent and future employee equity grants.

The timing and amounts of activity under the share repurchase program will be at management’s discretion.

In addition to this share repurchase activity, our capital allocation strategy continues to prioritize funding of planned internal investments to support the business as well as inorganic opportunities to accelerate our long-term growth plans.

Market and Regional Alignment Initiative

In May 2025, the Board approved a new market and regional alignment initiative and delegated authority to our management to determine the details of the specific actions that will comprise the initiative.

This strategic initiative, which is expected to continue through the end of fiscal 2027, is designed to improve operational performance and reduce costs by directing our resources toward the markets and geographies that offer the greatest growth and portfolio advancement opportunities.

The amounts and timing of estimated costs and savings are subject to change until finalized.

The actual amounts and timing may vary materially based on various factors.

Financial Summary

Three Months Ended Nine Months Ended

(In thousands, except per share data) December 28,

2024 December 30,

2023 % Increase/ (Decrease) December 28,

2024 December 30,

2023 % Increase/ (Decrease)

Three Months Ended

June 28, 2025 June 29, 2024 Reported growth

(Dollars in Thousands, Except Per Share Data)

Net revenues $ 321,394 $ 336,172 (4.4) %

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% of net revenues 16.8 % 11.8 %

Interest and other expense, net $ (9,112) $ (1,949) 367.5 % $ (9,148) $ (6,489) 41.0 %

Interest and other (expense) income, net $ (8,703) $ 6,957 (225.1) %

Income before provision for income taxes $ 45,169 $ 46,713 (3.3) %

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Net income per share – diluted $ 0.70 $ 0.74 (5.4) %

Net revenues increased 3.7% and 6.7% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

Without the effects of foreign exchange, net revenues increased 3.6% and 6.9% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

Revenue increases in Hospital, primarily related to recent acquisitions as well as volume and price benefits, drove the overall increase, partially offset by declines in both Plasma and Blood Center during the three and nine months ended December 28, 2024.

Operating income in creased 28.4% and 11.5% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

The increase during the three months ended December 28, 2024 was primarily due to operating leverage, decreased performance-based compensation, decreased portfolio rationalization costs and lower transaction and integration costs, partially offset by increased amortization of acquired intangible assets, write downs of certain a ssets and costs associated with the operations of recent acquisitions.

T he increase for the nine months ended December 28, 2024 was primarily due to operating leverage, decreased performance-based compensation and the gains realized on the sale of a manufacturing facility in the first quarter of fiscal 2025, partially offset by operating, transaction and integration costs related to recent acquisitions, increased amortization of acquired intangible assets and amortization of fair value inventory step-up.

(1) Constant currency growth, a non-GAAP financial measure, measures the change in revenue between the current and prior year periods using a constant currency.

See “Management’s Use of Non-GAAP Measures.”

Net revenues decreased 4.4% during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

Revenue decreases in Plasma and Blood Center, primarily driven by the previously announced customer transition of CSL and the divestiture of the Whole Blood product line in fiscal 2025, drove the overall decrease in net revenues, but was partially offset by an increase in Hospital, primarily attributable to the Hemostasis Management product line within the Blood Management Technologies franchise, during the three months ended June 28, 2025.

Operating income increased 35.5% during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The increase during the three months ended June 28, 2025 was primarily due to pricing benefits across all business units and product mix, as well as decreased restructuring costs related to portfolio rationalization initiatives and decreased amortization of fair value inventory step-up, partially offset by lower gains on sales of property, plant and equipment.

Management’s Use of Non-GAAP Measures

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Three Months Ended

(In thousands) December 28,

2024 December 30,

2023 Reported growth Currency impact Constant currency growth (1)

United States $ 257,665 $ 250,804 2.7 % — % 2.7 %

International 90,877 85,446 6.4 % 0.1 % 6.3 %

Net revenues $ 348,542 $ 336,250 3.7 % 0.1 % 3.6 %

Nine Months Ended

(In thousands) December 28,

2024 December 30,

2023 Reported growth Currency impact Constant currency growth (1)

June 28, 2025 June 29, 2024 Reported growth Currency impact Constant currency growth (1)

(Dollars in Thousands)

United States $ 242,404 $ 248,902 (2.6) % — % (2.6) %

International 78,990 87,270 (9.5) % 2.0 % (11.5) %

Net revenues $ 1,030,225 $ 965,765 6.7 % (0.2) % 6.9 %

Total net revenues $ 321,394 $ 336,172 (4.4) % 0.5 % (4.9) %

(1) Constant currency growth, a non-GAAP financial measure, measures the change in revenue between the current and prior year periods using a constant currency.

See “Management’s Use of Non-GAAP Measures.”

Our principal operations are in the United States, Europe, Japan and other parts of Asia.

Our products are marketed in approximately 9 0 countries around the world through a combination of our direct sales force and independent distributors and agents.

During the three and nine months ended December 28, 2024, our revenue generated outside the U.S.

was 26.1% and 26.0% of total net revenues, respectively, as compared with 25.4% and 25.0%, respectively, during the three and nine months ended December 30, 2023.

Our principal operations are in the United St ates, Europe, Japan and other parts of Asia.

We market and sell our products in approximate ly 96 countries through a combination of our direct sales force and independent distributors.

During the three months ended June 28, 2025, our revenue generated outside the U.S.

was 24.6% of total net revenues, as compared with 26.0% during the three months ended June 29, 2024.

International sales are generally conducted in local currencies, primarily Japanese Yen, Euro and Chinese Yuan.

Our results of operation s are impacted by changes in foreign exchange rates, particularly in the value of the Yen and Euro relative to the U.S.

Our results of operations are impacted by changes in foreign exchange rates, particularly in the value of the Yen and Euro, relative to the U.S.

We have placed foreign currency hedges on certain foreign currencies to mitigate our exposure to foreign currency fluctuations.

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Three Months Ended

(In thousands) December 28,

2024 December 30,

2023 Reported growth Currency impact Constant currency growth (1)

Plasma $ 134,224 $ 147,641 (9.1) % — % (9.1) %

Apheresis 55,388 52,565 5.4 % — % 5.4 %

Whole Blood 14,957 19,814 (24.5) % — % (24.5) %

Blood Center 70,345 72,379 (2.8) % — % (2.8) %

Interventional Technologies (2)

63,253 43,007 47.1 % (0.4) % 47.5 %

Blood Management Technologies (3)

80,720 73,223 10.2 % 0.3 % 9.9 %

Hospital 143,973 116,230 23.9 % 0.1 % 23.8 %

Net revenues (4)

$ 348,542 $ 336,250 3.7 % 0.1 % 3.6 %

Nine Months Ended

(In thousands) December 28,

2024 December 30,

2023 Reported growth Currency impact Constant currency growth (1)

Plasma $ 408,695 $ 430,056 (5.0) % — % (5.0) %

June 28, 2025 June 29, 2024 Reported growth Currency impact Constant currency growth (1)

(Dollars in Thousands)

Plasma net revenues $ 129,897 $ 135,910 (4.4) % 0.3 % (4.7) %

Apheresis 51,822 49,094 5.6 % 1.2 % 4.4 %

Whole Blood 17 17,151 (99.9) % — % (99.9) %

Blood Center 205,118 211,241 (2.9) % (1.0) % (1.9) %

Blood Center net revenues 51,839 66,245 (21.7) % 1.1 % (22.8) %

Interventional Technologies (2)

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81,175 70,973 14.4 % 0.6 % 13.8 %

Hospital 416,412 324,468 28.3 % (0.2) % 28.5 %

Net revenues (4)

$ 1,030,225 $ 965,765 6.7 % (0.2) % 6.9 %

Hospital net revenues 139,658 134,017 4.2 % 0.4 % 3.8 %

Total net revenues $ 321,394 $ 336,172 (4.4) % 0.5 % (4.9) %

(1) Constant currency growth, a non-GAAP financial measure, measures the change in revenue between the current and prior year periods using a constant currency.

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(3) Blood Management Technologies includes Hemostasis Management, Cell Salvage and Transfusion Management product lines of the Hospital business unit.

(4) Beginning in fiscal 2025, the Company integrated service revenue within its three business units.

Prior periods were conformed to current presentation.

Pla sma revenue decreased 9.1% and 5.0% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

Without the effects of foreign exchange, Plasma revenue decreased 9.1% and 5.0% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

The decreases during the three and nine months ended December 28, 2024 were primarily driven by lower sales volumes in North America, primarily relating to the previously announced customer transition of CSL Plasma, whose non-exclusive supply agreement with the Company is scheduled to expire in December 2025.

We anticipate sales of approximately $100.0 million to CSL in fiscal 2025.

Blood Center revenue decreased 2.8% and 2.9% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024 .

Without the effects of foreign exchange, Blood Center revenue decreased 2.8% and 1.9% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

The decreases during the three and nine months ended December 28, 2024 were primarily driven by declines in our Whole Blood business, which was divested in January 2025, subsequent to the end of the third fiscal quarter of 2025.

Hospital rev enue increased 23.9% and 28.3% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fisca l 2024 .

Without the effects of foreign exchange, Hospital revenue increased 23.8% and 28.5% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

The increases during the three and nine months ended December 28, 2024 were primarily attributable to the product lines within the Interventional Technologies franchise, including benefits from the recently acquired Sensor Guided Technologies and Esophageal Protection product lines and growth in Vascular Closure, as well as contributions from the product lines within the Blood Management Technologies franchise.

Three Months Ended Nine Months Ended

(In thousands) December 28,

2024 December 30,

2023 % Increase December 28,

2024 December 30,

2023 % Increase

Plasma revenue decreased by 4.4% on an as reported basis and by 4.7% without the effect of foreign exchange during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The decrease was driven by lower sales volumes in North America, primarily relating to the previously announced customer transition of CSL Plasma, which was partially offset by pricing benefits, share gains and upfront revenue recognition on execution of a renegotiated long-term software agreement with an existing software customer.

We do not expect any North America disposable sales to CSL Plasma in fiscal 2026.

Blood Center revenue decreased by 21.7% on an as reported basis and by 22.8% without the effect of foreign exchange during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The decrease was primarily driven by the divestiture of our Whole Blood product line, which was completed in January 2025.

Hospital rev enue increased by 4.2% on an as reported basis and by 3.8% without the effect of foreign exchange during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The increase was primarily attributable to the Hemostasis Management product line within the Blood Management franchise, driven by volume growth, which was partially offset by lower volume in the Interventional Technologies franchise.

Three Months Ended

June 28, 2025 June 29, 2024 Reported growth Currency impact Constant currency growth (1)

(Dollars in Thousands)

Gross profit $ 192,244 $ 174,924 9.9 % 1.2 % 8.7 %

% of net revenues 59.8 % 52.0 %

Gross profit increased 8.8% and 7.8% for the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

Without the effects of foreign exchange, gross profit increased 9.3% and 9.4% during the three and nine months ended December 28, 2024, respectively , as compared with the same periods of fiscal 2024.

The increase during the three months ended December 28, 2024 was driven by increased revenues in the Hospital business, primarily volume as well as price, partially offset by the amortization of fair value inventory step-up related to the Attune Medical acquisition.

The increase during the nine months ended December 28, 2024 was driven by increased revenues in the Hospital business and volume, mix and price, partially offset by amortization of fair value inventory step-up related to the Attune Medical acquisition, restructuring costs related to portfolio rationalization initiatives and foreign exchange.

(1) Constant currency growth, a non-GAAP financial measure, measures the change in revenue between the current and prior year periods using a constant currency.

See “Management’s Use of Non-GAAP Measures.”

Gross profit increased by 9.9% on an as reported basis and by 8.7% without the effect of foreign exchange during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The increase was driven primarily by pricing benefits across all business units and product mix, decreased restructuring costs related to portfolio rationalization initiatives and decreased amortization of fair value inventory step-up related to the Attune Medical acquisition.

Operating Expenses

Three Months Ended Nine Months Ended

(In thousands) December 28,

2024 December 30,

2023 % Increase/

(Decrease) December 28,

2024 December 30,

2023 % Increase

Three Months Ended

June 28, 2025 June 29, 2024 Reported growth Currency impact Constant currency growth (1)

(Dollars in Thousands)

Research and development $ 16,261 $ 14,449 12.5 % (0.2) % 12.7 %

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% of net revenues 43.1 % 40.2 %

(1) Constant currency growth, a non-GAAP financial measure, measures the change in revenue between the current and prior year periods using a constant currency.

See “Management’s Use of Non-GAAP Measures.”

Research and Development

Research and development expenses increased 19.3% and 21.3% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

Without the effects of foreign exchange, research and development expenses increased 19.4% and 21.4% during the three and nine months ended December 28, 2024, respectively, as compared with the same periods of fiscal 2024.

The increases during the three and nine months ended December 28, 2024 were primarily due to increased headcount as a result of recent acquisitions.

Research and development expenses increased by 12.5% on an as reported basis and by 12.7% without the effect of foreign exchange during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The increase was primarily due to increased headcount as a result of recent acquisitions and continued focus on the development of new products.

Selling, General and Administrative

Selling, general and administrativ e expenses decreased 4.7% during the three months ended December 28, 2024 and increased 0.4% during the nine months ended December 28, 2024, as compared with the same periods of fiscal 2024.

Without the effects of foreign exchange, selling, general, and administrative expenses decreased 5.0% during the three months ended December 28, 2024 and increased 0.4% during the nine months ended December 28, 2024, as compared with the same periods of fiscal 2024.

The decrease during the three months ended December 28, 2024 was driven by decreased performance-based compensation, operating leverage and lower integration and transaction costs, partially offset by write downs of certain assets and costs associated with the operations of recent acquisitions.

The increase during the nine months ended December 28, 2024 was primarily driven by digital transformation costs incurred as part of the upgrade of our enterprise resource planning system, transaction, integration and operating costs related to recent acquisitions and increased headcount, partially offset by gains realized on the sale of a manufacturing facility in the first quarter of fiscal 2025, decreases in impairment of intangible assets and decreases in litigation costs compared to the prior year period.

SG&A expenses increased by 2.3% on an as reported basis and by 1.9% without the effect of foreign exchange during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The increase was primarily driven by lower gains on sales of property, plant and equipment and higher performance-based compensation, partially offset by lower integration and transaction costs and lower freight costs.

Amortization of Acquired Intangible Assets

We recognized amortization expense related to our acquired intangible assets of $12.2 million and $37.0 million during the three and nine months ended December 28, 2024, respectively, and $6.9 million and $21.6 million during the three and nine months ended December 30, 2023, respectively .

The increases were primarily related to the amortization of the intangible assets acquired in conjunction with the recent acquisitions of OpSens and Attune Medical.

Interest and Other Expense, Net

Interest and other exp ense increased by $7.2 million and $2.7 million during the three and nine months ended December 28, 2024, respectively , as compared with the same periods of fiscal 2024.

The increase during the three months ended December 28, 2024, as compared with the prior year period, was primarily driven by interest expense and amortization of deferred financing costs on the 2029 Notes issued in fiscal 2025 and foreign exchange.

The increase during the nine months ended December 28, 2024 was primarily driven by interest expense and amortization of deferred financing costs on the 2029 Notes issued in fiscal 2025 as well as higher interest incurred on our revolving credit facilities, as compared with the same period of fiscal 2024, partially offset by the net gain on the repurchase of convertible notes during the first quarter of fiscal 2025.

We recognized amortization expense related to our acquired intangible assets of $11.4 million du ring the three months ended June 28, 2025, as compared with $12.5 million during the three months ended June 29, 2024 .

The decrease was primarily due to certain intangible assets becoming fully amortized during fiscal 2025.

Interest and Other (Expense) Income, Net

Interest and other (exp ense) income, net decreased by $15.7 million during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The decrease was primarily driven by gains recognized in the first quarter of fiscal 2025 on the repurchase of $200.0 million of aggregate principal of the our 0.0% convertible senior notes due in 2026 (the “2026 Notes”).

For further discussion on the 2026 Notes, refer to Note 12, Notes Payable and Long-Term Debt within these condensed consolidated financial statements.

We conduct business globally and report our results of operations in a number of foreign jurisdictions in addition to the United States.

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statutory tax rate.

Our effective tax rate is adversely impacted by non-deductible expenses including executive compensation and transaction costs.

For the three and nine months ended December 28, 2024, the Company reported income tax expense of $12.4 million and $31.6 million, respectively, representing effective tax rates of 24.9% and 22.4%.

The effective tax rate for the nine months ended December 28, 2024 includes $3.3 million of discrete tax benefit, primarily related to stock compensation windfalls.

Our effective tax rate is adversely impacted by non-deductible expenses including executive compensation and is favorably impacted by jurisdictional mix of earnings and research credits generated.

For the three months ended June 28, 2025, we reported income tax expense of $11.1 million, representing an effective tax rate of 24.7%.

The effective tax rate for the three months ended June 28, 2025 includes $0.1 million of discrete tax expense, primarily related to stock compensation shortfalls.

For the three months ended June 29, 2024, we reported income tax expense of $8.3 million, representing an effective tax rate of 17.9%.

The effective tax rate for the three months ended June 29, 2024 includes $3.6 million of discrete tax benefit, primarily related to stock compensation windfalls.

The discrete benefit also includes other items such as provision to return differences.

For the three and nine months ended December 30, 2023, the Company reported income tax expense of $12.8 million and $31.3 million, respectively, representing effective tax rates of 29.0% and 24.3%, respectively.

The effective tax rate for the nine months ended December 30, 2023 includes $1.1 million of discrete tax benefit, of which $2.6 million relates to stock compensation windfalls, partially offset by other discrete items.

The decrease in the reported tax rate for the three months ended December 28, 2024, compared to the same period in fiscal 2024, relates primarily to the decrease in non-deductible acquisition-related expenses.

The decrease in the reported tax rate for the nine months ended December 28, 2024, compared to the same period in fiscal 2024, relates primarily to increased discrete tax benefits year-over-year and decreased non-deductible acquisition-related expenses.

The increase in the reported tax rate for the three months ended June 28, 2025, compared to the same period in fiscal 2025, relates primarily to the decrease in stock compensation windfall benefits.

Liquidity and Capital Resources

The following table contains certain key performance indicators we believe depict our liquidity and cash flow position:

(Dollars in thousands) December 28,

2024 March 30,

June 28, 2025 March 29, 2025

(Dollars in Thousands)

Cash and cash equivalents $ 292,898 $ 306,763

Availability under revolving credit facility $ 750,000 $ 750,000

Working capital $ 381,753 $ 356,862

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$ (931,884) $ (918,025)

Days sales outstanding (DSO) 55 54

Days sales outstanding 56 55

Inventory turnover 1.2 1.4

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Our primary sources of liquidity are cash and cash equivalents, internally generated cash flow from operations and our senior unsecured revolving credit facility.

We believe these sources are sufficient to fund our cash requirements over at least the next twelve months and to meet our known long-term cash requirements, including our convertible senior notes due March 1, 2026.

Our e xpected cash outlays relate primarily to acquisitions, investments, capital expenditures, including enhancements to our North American manufacturing facilities, share repurchases, portfolio rationalization initiatives and cash principal and interest payments under our revised credit agreements.

As of December 28, 2024, we had $320.8 million in cash and cash equivalents, the majority of which is held in the U.S.

We believe these sources are sufficient to fund our cash requirements over at least the next twelve months and to meet our known long-term cash requirements, including our 2026 Notes and 2.5% convertible senior notes due in 2029 (the “2029 Notes”).

Our e xpected cash outlays relate primarily to acquisitions, investments, capital expenditures, share repurchases, the market and regional alignment initiative and cash principal and interest payments under our revised credit agreements.

As of June 28, 2025, we had $292.9 million in cash and cash equivalents, the majority of which is held in the U.S.

or in countries from which it can be repatriated to the U.S.

In the first quarter of fiscal 2025, the Company used a portion of its proceeds from the 2029 Notes to repurchase, for $185.5 million, $200.0 million of the $500.0 million aggregate principal amount of its 0% convertible senior notes due 2026 (the “2026 Notes”), resulting in a gain of $14.5 million related to the discount on repurchase.

Convertible Senior Notes

In the first quarter of fiscal 2025, we used a portion of its proceeds from the 2029 Notes to repurchase $200.0 million of the $500.0 million aggregate principal amount of our 2026 Notes for a total cost of $185.5 million, resulting in a gain of $14.5 million related to the discount on repurchase.

As the repurchase of the 2026 Notes met the criteria for extinguishment accounting, $1.9 million of unamortized debt issuance costs were allocated to the repurchase, resulting in a net gain of $12.6 million.

As of December 28, 2024, the $300.0 million remaining principal balance on the 2026 Notes was netted down by $1.9 million of remaining debt issuance costs, resulting in a net convertible note payable of $298.1 million.

Interest expense related to the 2026 Notes was $0.4 million and $1.4 million for the three and nine months ended December 28, 2024, respectively, which is entirely attributable to the amortization of the debt issuance costs.

As of June 28, 2025, the $300.0 million remaining principal balance on the 2026 Notes was netted down by $1.1 million of remaining debt issuance costs, resulting in a net convertible note payable of $298.9 million.

The 2026 Notes will mature on March 1, 2026, unless earlier converted, redeemed or repurchased.

Interest expense related to the 2026 Notes was $0.4 million for the three months ended June 28, 2025 which is entirely attributable to the amortization of the debt issuance costs.

The remaining debt issuance costs are amortized at an effective interest rate of 0.6%.

As of December 28, 2024, the $700.0 million principal balance of the 2029 Notes was netted down by $15.4 million of remaining debt issuance costs, resulting in a net convertible note payable of $684.6 million.

Interest expense related to the 2029 Notes was $5.2 million and $12.1 million for the three and nine months ended December 28, 2024, respectively, which includes nominal interest expense and the amortization of the debt issuance costs.

On July 26, 2022, the Company entered into an amended and restated credit agreement to refinance its credit facilities initially entered into in 2018 and extend their maturity date through June 2025.

The amended and restated credit agreement provided for a $280.0 million senior unsecured term loan and a $420.0 million senior unsecured revolving credit facility (together, the “2022 Revised Credit Facilities”) with applicable interest rates during the period established using an annual rate equal to the Adjusted Term SOFR Rate plus an applicable rate ranging from 1.125% to 1.750% based on the Company’s consolidated net leverage ratio, as specified in the agreement.

On April 30, 2024, the Company entered into a second amended and restated credit agreement with certain lenders to refinance the 2022 Revised Credit Facilities and extend their maturity date through April 2029.

The second amended and restated credit agreement provides for a $250.0 million senior unsecured term loan, the proceeds of which, along with $12.5 million of cash on hand, were used to retire the balance of the term loan under the 2022 Revised Credit Facilities, and a $750.0 million senior unsecured revolving credit facility (together, the “2024 Revised Credit Facilities”).

Loans under the 2024 Revised Credit Facilities bear interest at an annual rate equal to the Adjusted Term SOFR Rate (as specified in the second amended and restated credit agreement), which is subject to a floor of 0.0%, plus an applicable rate ranging from 1.125% to 1.750% based on the Company’s consolidated net leverage ratio (as specified in the second amended and restated credit agreement) at the applicable measurement date.

The revolving credit facility carries an unused fee that ranges from 0.125% to 0.250% annually based on the Company’s consolidated net leverage ratio at the applicable measurement date.

For further discussion on the 2026 Notes, refer to Note 12, Notes Payable and Long-Term Debt within these condensed consolidated financial statements.

As of June 28, 2025, the $700.0 million principal balance of the 2029 Notes was netted down by $13.7 million of remaining debt issuance costs, resulting in a net convertible note payable of $686.3 million.

The 2029 Notes will mature on June 1, 2029, unless earlier converted, redeemed or repurchased.

Interest expense related to the 2029 Notes was $5.2 million for the three months ended June 28, 2025 which includes nominal interest expense and the amortization of the debt issuance costs.

For further discussion on the 2029 Notes, refer to Note 12, Notes Payable and Long-Term Debt within these condensed consolidated financial statements.

Credit Facilities

On April 30, 2024, we entered into a second amended and restated credit agreement with certain lenders to refinance our 2022 unsecured credit facilities and extend their maturity date through April 2029.

The second amended and restated credit agreement provides for a $250.0 million senior unsecured term loan, the proceeds of which, along with $12.5 million of cash on hand, were used to retire the balance of the term loan under our 2022 unsecured credit facilities, and a $750.0 million senior unsecured revolving credit facility (together, the “2024 Revised Credit Facilities”).

Loans under the 2024 Revised Credit Facilities bear interest at an annual rate equal to the Adjusted Term SOFR Rate (as specified in the second amended and restated credit agreement), which is subject to a floor of 0.0%, plus an applicable rate ranging from 1.125% to 1.750% based on our consolidated net leverage ratio (as specified in the second amended and restated credit agreement) at the applicable measurement date.

The revolving credit facility carries an unused fee that ranges from 0.125% to 0.250% annually based on our consolidated net leverage ratio at the applicable measurement date.

The 2024 Revised Credit Facilities mature on April 30, 2029.

The principal amount of the term loan under the 2024 Revised Credit Facilities amortizes quarterly through the maturity date at a rate of 2.5% for the first three years following the closing date, 5.0% for the fourth year following the closing date and 7.5% for the fifth year following the closing date, with the unpaid balance due at maturity.

At December 28, 2024, $246.9 million was outstanding under the term loan with an effective interest rate of 6.1%.

There were no outstanding borrowings under the revolving credit facilities at December 28, 2024.

The Company also had $18.0 million of uncommitted operating lines of credit to fund its global operations under which there were no outstanding borrowings as of December 28, 2024.

The Company has scheduled principal payments of $1.6 million required during the remainder of fiscal 2025 related to its term loan.

During fiscal 2022, our Board of Directors approved a revised Operational Excellence Program.

We estimate that we will incur aggregate charges of approximately $85.0 million by the end of fiscal 2025 under the program in connection with the Operational Excellence Program.

These charges, the majority of which will result in cash outlays, including severance and other employee costs, will be incurred as the specific actions required to execute these initiatives are identified and approved and are expected to be substantially completed by the end of fiscal 2025.

During the three and nine months ended December 28, 2024, the Company incurred $1.9 million and $6.0 million , respectively, of restructuring and restructuring related costs under this program.

Nine Months Ended

(In thousands) December 28,

2024 December 30,

For further discussion on the 2029 Notes, refer to Note 12, Notes Payable and Long-Term Debt within these condensed consolidated financial statements.

At June 28, 2025, $243.8 million was outstanding under the term loan with an effective interest rate of 6.4%.

There were no outstanding borrowings under the revolving credit facilities at June 28, 2025.

We also had $19.5 million of uncommitted operating lines of credit to fund its global operations under which there were no outstanding borrowings as of June 28, 2025.

We have scheduled principal payments of $4.7 million required during the remainder of fiscal 2026 related to its term loan.

2025 Share Repurchase Program

In April 2025 our Board approved a new three-year share repurchase program authorizing the repurchase of up to $500.0 million of our common stock, based on market conditions, through April 2028.

This new share repurchase program will help to offset the dilutive impact of recent and future employee equity grants.

Under the share repurchase program, we are authorized to repurchase, from time to time, outstanding shares of common stock in accordance with applicable laws on the open market, including under trading plans established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, and in privately negotiated transactions.

The actual timing, number and value of shares repurchased will be determined by our discretion and will depend on a number of factors, including market conditions, applicable legal requirements and compliance with the terms of loan covenants.

The share repurchase program may be suspended, modified or discontinued at any time, and we have no obligation to repurchase any amount of our common stock under the program.

Market and Regional Alignment Initiative

In May 2025, our Board approved a new market and regional alignment initiative and delegated authority to management to determine the details of the specific actions that will comprise the initiative.

This strategic initiative is designed to improve operational performance and reduce costs by directing Company resources toward the markets and geographies that offer the greatest growth and portfolio advancement opportunities.

During the three months ended June 28, 2025, we incurred $2.8 million of restructuring related costs under this initiative.

Total cumulative charges under the market and regional alignment initiative are $3.4 million as of June 28, 2025.

The amounts and timing of estimated costs and savings are subject to change until finalized.

The actual amounts and timing may vary materially based on various factors.

Three Months Ended

June 28, 2025 June 29, 2024

(Dollars in Thousands)

Net cash provided by (used in):

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GAAP, we have eliminated the effect of foreign currency throughout our cash flow statement, except for its effect on our cash and cash equivalents.

Net cash provided by operating activities decreased by $52.5 million during the nine months ended December 28, 2024, as compared with the nine months ended December 30, 2023.

The decrease in cash provided by operating activities was primarily due to decreased accrued performance-based compensation, increased inventory balances and spend related to digital transformation costs incurred as part of the upgrade of our enterprise resource planning system, partially offset by collections of accounts receivable and increased net income.

Net cash used in investing activities decreased by $129.4 million during the nine months ended December 28, 2024, as compared with the nine months ended December 30, 2023.

The decrease in cash used in investing activities was primarily the result of the acquisition of OpSens Inc.

completed during fiscal 2024 and the proceeds from the sales of property, plant and equipment in fiscal 2025, partially offset by the acquisition of Attune Medical in fiscal 2025.

Net cash provided by financing activities increased by $158.6 million during the nine months ended December 28, 2024, as compared with the nine months ended December 30, 2023, primarily due to the issuance of the 2029 Notes, partially offset by the repurchase of a portion of the 2026 Notes, proceeds on the revolving credit facility in the previous year, capped call transactions, share repurchases, payments on the revolving credit facility in the current year and debt issuance costs.

Concentration of Credit Risk

Concentrations of credit risk with respect to trade accounts receivable are generally limited due to our large number of customers and their diversity across many geographic areas.

Certain markets and industries, however, can expose us to concentrations of credit risk.

For example, in the Plasma business unit, sales are concentrated with several large customers.

As a result, accounts receivable extended to any one of these biopharmaceutical customers can be significant at any point in time.

In addition, a portion of our trade accounts receivable outside the U.S.

include sales to government-owned or supported healthcare systems in several countries, which are subject to payment delays and local economic conditions.

Payment is dependent upon the financial stability and creditworthiness of those countries’ national economies.

We have not incurred significant losses on trade accounts or other receivables.

We continually evaluate all receivables for potential collection risks associated with the availability of government funding and reimbursement practices.

If the financial

condition of customers or the countries’ healthcare systems deteriorate such that their ability to make payments is uncertain, allowances may be required in future periods.

Foreign Exchange

During the three and nine months ended December 28, 2024 , 26.1% and 26.0%, respectively, of our sa les were generated outside the U.S., generally in foreign currencies, yet our reporting currency is the U.S.

We also incur certain manufacturing, marketing and selling costs in international markets in local currency.

Our primary foreign currency exposures relate to sales denominated in Japanese Yen, Euro and Chinese Yuan.

We also have foreign currency exposure related to manufacturing and other operational costs denominated in Swiss Francs, Canadian Dollars, Mexican Pesos and Malaysian Ringgit.

The Yen, Euro and Yuan sales exposure is partially mitigated by costs and expenses for foreign operations and sourcing products denominated in foreign currencies.

Since our foreign currency denominated Yen, Euro and Yuan sales exceed the foreign currency denominated costs, whenever the U.S.

Dollar strengthens relative to the Yen, Euro or Yuan, there is an adverse effect on our results of operations and, conversely, whenever the U.S.

Dollar weakens relative to the Yen, Euro or Yuan, there is a positive effect on our results of operations.

For Swiss Francs, Canadian Dollars, Mexican Pesos and Malaysian Ringgit, our primary cash flows relate to product costs or costs and expenses of local operations.

Whenever the U.S.

Dollar strengthens relative to these foreign currencies, there is a positive effect on our results of operations.

Conversely, whenever the U.S.

Dollar weakens relative to these currencies, there is an adverse effect on our results of operations.

We have a program in place that is designed to mitigate our exposure to changes in foreign currency exchange rates.

That program includes the use of derivative financial instruments to minimize, for a period of time, the unforeseen impact on our financial results from changes in foreign exchange rates.

We utilize forward foreign currency contracts to hedge the anticipated cash flows from transactions denominated in foreign currencies, primarily Japanese Yen and Euro, and to a lesser extent Canadian Dollar, Swiss Franc and Mexican Peso.

This does not eliminate the volatility of foreign exchange rates, but because we generally enter into forward contracts one year out, rates are fixed for a one-year period, thereby facilitating financial planning and resource allocation.

These contracts are designated as cash flow hedges.

The final impact of currency fluctuations on the results of operations is dependent on the local currency amounts hedged and the actual local currency results.

Operating Cash Flows

Net cash provided by operating activities increased by $44.8 million during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The fiscal 2026 period included cash inflows for net income of $34.0 million and increases in non-cash adjustments of $38.8 million, partially offset by unfavorable working capital adjustments of $55.5 million.

The fiscal 2025 period included cash inflows for net income of $38.4 million being more than offset by cash outflows for non-cash adjustments related to a $12.6 million gain on the repurchase of convertible senior notes in the first quarter of fiscal 2025, a $14.3 million gain on the sale of property, plant and equipment, and unfavorable working capital adjustments of $79.0 million.

Investing Cash Flows

Net cash used in investing activities decreased by $106.2 million during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The fiscal 2026 period included cash outflows for strategic investments of $18.1 million and non-cash transfers from inventory of $11.5 million.

The fiscal 2025 period included cash outflows for the acquisition of Attune Medical of $149.2 million and non-cash transfers from inventory of $4.2 million, partially offset by proceeds from the sale of property, plant and equipment of $20.4 million.

Financing Cash Flows

Net cash provided by financing activities decreased by $336.1 million during the three months ended June 28, 2025, as compared with the same period of fiscal 2025.

The fiscal 2026 period included cash outflows for repayments of term loan borrowings and employee equity award settlements.

The fiscal 2025 period included cash inflows relating to proceeds from the sale of the 2029 Notes of $700.0 million and proceeds from term loan borrowings of $250.0 million, partially offset by cash outflows for the repurchase of a portion of the 2026 Notes of $185.5 million, capped call purchases of $88.2 million, term loan redemptions of $262.5 million, payments on the revolving credit facility of $50.0 million, and debt issuance costs of $23.1 million.

Recent Accounting Pronouncements

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expected operating results and financial performance;

the Company’s strategy for growth;

our strategy for growth;

product development, commercialization and anticipated performance and benefits;

2 unchanged sentences

and market position and expenditures.

Because forward-looking statements are based on current beliefs, expectations and assumptions regarding future events, they are subject to uncertainties, risks and changes that are difficult to predict and many of which are outside of the Company ’ s control.

Investors should realize that if underlying assumptions prove inaccurate, or known or unknown risks or uncertainties materialize, the Company’s actual results and financial condition could vary materially from expectations and projections expressed or implied in its forward-looking statements.

Investors should realize that if underlying assumptions prove inaccurate, or known or unknown risks or uncertainties materialize, our actual results and financial condition could vary materially from expectations and projections expressed or implied in its forward-looking statements.

Investors are therefore cautioned not to rely on these forward-looking statements.

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For further discussion of these and other factors, see Item 1A.

“Risk Factors” in our most recent Annual Report on Form 10-K (as supplemented by Part II, Item 1A.

“Risks Factors” of our Quarterly Report on Form 10-Q for the first quarter ended June 29, 2024).

“Risk Factors” in our most recent Annual Report on Form 10-K.

• Our ability to achieve our long-term strategic and financial-improvement goals;

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regulatory agencies), reputational damage, declining sales or litigation;

• Security breaches of our information technology systems or our products, which could impair our ability to conduct business or compromise sensitive information of the Company or its customers, suppliers and other business partners, or of customers’ patients;

• The potential that the expected strategic benefits and opportunities from completed or planned acquisitions, including the Company’s acquisitions of OpSens Inc.

and Attune Medical, divestitures or other strategic investments by the Company may not be realized or may take longer to realize than expected;

• Security breaches of our products or information technology systems, or those of our customers, suppliers or other business partners, which could impair our ability or our customers’ ability to conduct business or compromise sensitive information of the Company or its customers, suppliers and other business partners, or of customers’ patients;

• The potential that the expected strategic benefits and opportunities from completed or planned acquisitions, including our acquisitions of OpSens Inc.

and Attune Medical, divestitures or other strategic investments by us may not be realized or may take longer to realize than expected;

• Pricing pressures resulting from trends toward healthcare cost containment, including the continued consolidation among healthcare providers and other market participants;

• Disruptions to the continuity, availability and pricing of plastic and other raw materials, finished goods and components used in the manufacturing of our products (including those purchased from sole-source suppliers) and the related continuity of our manufacturing, sterilization, supply chain and distribution operations, including disruptions caused by natural disasters, extreme weather and other conditions caused by or related to climate change, labor strikes, terrorism acts, cyber incidents or other adverse events;

• Our ability to obtain the anticipated benefits of restructuring programs that we have or may undertake, including the Operational Excellence Program and portfolio rationalization initiatives;

• Our ability to obtain the anticipated benefits of restructuring programs that we have or may undertake, including our market and regional alignment and portfolio rationalization initiatives;

• The impact of enhanced requirements to obtain regulatory approval in the U.S.

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• The impact of changes in U.S.

and international tax laws;

and international tax laws, including with respect to the OBBBA;

• Our ability to meet our debt obligations and raise additional capital when desired on terms reasonably acceptable to us;

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• Our ability to execute and realize anticipated benefits from our investments in emerging economies;

• The potential effect of foreign currency fluctuations and interest rate fluctuations on our net sales, expenses and resulting margins;

• The potential effect of foreign currency fluctuations and interest rate fluctuations on our net revenues, expenses and resulting margins;

• Our ability to protect intellectual property and the outcome of patent litigation;

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Investors should understand that it is not possible to predict or identify all such factors and should not consider the risks described above and in Item 1A.

“Risk Factors” in our Annual Report on Form 10-K (as supplemented by Part II, Item 1A.

“Risk Factors” of our Quarterly Report on Form 10-Q for the first quarter ended June 29, 2024) to be a complete statement of all potential risks and uncertainties.

The Company does not undertake to publicly update any forward-looking statement that may be made from time to time, whether as a result of new information or future events or developments.

“Risk Factors” in our Annual Report on Form 10-K to be a complete statement of all potential risks and uncertainties.

We do not undertake to publicly update any forward-looking statement that may be made from time to time, whether as a result of new information or future events or developments.

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 2. Management’s Discussion and Analysis