What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-02-24 compared with 2025-02-25 · 1206 added, 1096 removed, 2536 unchanged (48% of the section changed)

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Note 15 – Income Taxes

Note 16 – Plans of Restructuring and Integration Costs

Note 16 – Plans of Restructuring and Related Costs

Note 17 – Commitments and Contingencies

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Note 24 – Related Party Transactions

Note 25 – Subsequent Event

Note 25 – KKR Investment and Accelerated Share Repurchase Program

Index to Financial Statements

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Opinion on the Consolidated Financial Statements

December 28, 2024 and December 30, 2023, the related consolidated statements of income, comprehensive income,

changes in stockholders’ equity,

and cash flows for each of

the three years in the period

comprehensive

income, changes in

stockholders’ equity,

ended December

(collectively

“consolidated

statements”).

consolidated financial

statements present

respects, the

financial position

27, 2025, and

the related notes

(collectively referred to

“consolidated financial statements”).

In our opinion,

the consolidated financial statements present fairly, in all material respects, the financial position of the Company at

December 27, 2025 and December 28, 2024, and the results of its operations and its cash flows for each of the three

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United States of America.

Sponsoring Organizations of the Treadway Commission (COSO) and

our report dated February 25, 2025 expressed

an unqualified opinion thereon.

(United States) (PCAOB),

the Company's internal

control over financial reporting

as of December

27, 2025, based

established in

Internal Control

Framework (2013)

the Committee

of Sponsoring

Organizations

unqualified opinion thereon.

Basis for Opinion

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responsibility is

Exchange Commission and the PCAOB.

registered with

Company Accounting

Oversight Board

are required to be independent with

respect to the Company in accordance

with the U.S.

federal securities laws and

the applicable rules and regulations of the Securities and Exchange Commission

and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

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accounts or disclosures to which it relates.

Index to Financial Statements

Business Acquisition - Valuation of Acquired Intangible Assets

As described in Note 5 of the consolidated financial statements, the Company

acquired TriMed Inc.

(“TriMed”) in

As a result of this acquisition, management was required

to determine the fair values of the identifiable assets

acquired and liabilities assumed.

In connection with the acquisition of TriMed, the Company recorded

of identifiable intangible assets related to product development.

We identified the revenue growth rates for certain periods used in the determination of the fair value of the acquired

product development in the acquisition of TriMed as a critical audit matter.

The principal consideration for our

determination was the subjective judgement required by management

in formulating these revenue growth rates.

Auditing these considerations involved especially subjective

and challenging auditor judgement due to the nature

and extent of audit effort required to address these matters.

The primary procedures we performed to address this critical audit matter

Evaluating the reasonableness of the revenue growth rates used in the determination

of the fair values of the

acquired product development

acquisition of TriMed

(i) reviewing

the historical performance

the acquired company utilizing their

As described in Notes 1 and 5 of the consolidated financial statements,

the Company acquired entities within the

Index to Financial Statements

Global Distribution and Value-Added Services, Global Specialty Products and Global Technology segments during

the year ended December 27, 2025 for total consideration of $392

The purchase price was allocated to the

assets acquired and liabilities assumed based on their respective

fair values on the date of acquisition.

Company estimated the fair value of identifiable intangible assets using

the relief-from-royalty method and the

multi-period excess earnings method which required the Company

to make significant estimates and assumptions,

including discount rates and projected revenue growth rates.

We identified the revenue growth rates for certain periods and the discount rates used in estimating the fair value of

certain trade name and customer relationships as a critical audit

The principal considerations for our

determination were the subjective judgement required by management

in formulating the revenue growth rates and

assessing the appropriateness of the discount rates used in developing

the fair value of the applicable acquired

identifiable intangible assets.

Auditing these considerations involved

especially subjective and challenging auditor

judgement due to the nature and extent of audit effort required to address these

matters, including the extent of

specialized skill or knowledge needed.

The primary procedures we performed to address

this critical audit matter included:

Evaluating the reasonableness of

the revenue growth rates

used in estimating the

fair value of

certain trade

relationships

utilizing its audited

financial statements, and (ii)

assessing the revenue projections against

industry metrics for certain periods.

industry metrics

for certain periods.

specialists with

reasonableness of

relationships

source information

underlying the

determination of

rates, developing

of independent

estimates for the discount rates, and comparing those to the discount

rates selected by the Company.

BDO USA, P.C.

We have served as the Company's auditor since 1984.

New York, New York

February 24, 2026

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shares authorized,

outstanding on December 28, 2024 and

outstanding on December 30, 2023

issued and outstanding on December 27, 2025 and

issued and outstanding on December 28, 2024

Additional paid-in capital

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Depreciation and amortization

Restructuring and integration costs

Restructuring and related costs

Operating income

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OF CHANGES IN STOCKHOLDERS' EQUITY

(in millions,

except share data)

(in millions, except share data)

$.01 Par Value

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noncontrolling interests)

Foreign currency translation loss (excluding loss of $

Foreign currency translation gain (excluding gain of $

attributable to Redeemable noncontrolling interests)

Unrealized gain from hedging activities,

net of tax of $

Pension adjustment gain, including tax of $

Unrealized loss from hedging activities,

including tax benefit of $

Pension adjustment loss, including tax benefit of $

Distributions to noncontrolling shareholders

Purchase of noncontrolling interests

Change in fair value of redeemable securities

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Settlement of stock-based compensation awards

Transfer of charges in excess of capital

Transfer of charges in excess of

Balance, December 30, 2023

Net income (excluding $

Net income (excluding loss of $

attributable to Redeemable

noncontrolling interests)

Foreign currency translation gain (excluding gain of $

Foreign currency translation loss (excluding loss of $

attributable to Redeemable noncontrolling interests)

Unrealized loss from hedging activities,

including tax benefit of $

Unrealized gain from hedging activities,

including tax of $

Pension adjustment loss, including tax benefit of $

Distributions to noncontrolling shareholders

Purchase of noncontrolling interests

Change in fair value of redeemable securities

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Settlement of stock-based compensation awards

Transfer of charges in excess of capital

Transfer of charges in excess of

Balance, December 28, 2024

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noncontrolling interests)

Foreign currency translation loss (excluding loss of $

Foreign currency translation gain (excluding gain of $

attributable to Redeemable noncontrolling interests)

Unrealized gain from hedging activities,

including tax of $

Pension adjustment loss, including tax benefit of $

Distributions to noncontrolling shareholders

Unrealized loss from hedging activities,

including tax benefit of $

Pension adjustment gain, net of tax of $

Net distributions to noncontrolling shareholders

Purchase of noncontrolling interests

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Noncontrolling interests and adjustments related to

business acquisitions

business acquisitions and contingent consideration

Issuance of common stock

Repurchase and retirement of common stock

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Settlement of stock-based compensation awards

Transfer of charges in excess of capital

Transfer of charges in excess of

Balance, December 27, 2025

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Cash flows from operating activities:

Adjustments to reconcile net income to net cash provided

by operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

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Impairment of capitalized software

Non-cash restructuring charges

Non-cash restructuring and related charges

Stock-based compensation expense

Provision for losses on trade and other accounts receivable

Benefit from deferred income taxes

Provision for (benefit from) deferred income taxes

Equity in earnings of affiliates

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Debt issuance costs

Issuance of common stock

Proceeds from issuance of stock upon exercise of stock options

Payments for repurchases and retirement of common stock

Payments for taxes related to shares withheld for employee

Payments for taxes related to shares withheld for employee taxes

Distributions to noncontrolling shareholders

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and ambulatory surgery centers, as well as

government, institutional health care clinics and alternate care clinics.

We also provide software and technology

services to health care practitioners.

Our dental businesses serve office-based dental practitioners, dental

laboratories, schools, government and other institutions.

Our medical businesses serve physician offices, urgent

care centers, ambulatory care sites, emergency medical technicians, dialysis centers,

home health, federal and state

governments and large enterprises, such as group practices and integrated delivery

networks, among other providers

across a wide range of specialties.

We have operations or affiliates in the United States, Argentina, Australia, Austria, Belgium, Brazil, Canada, Chile,

China, the Czech Republic, France, Germany, Hong Kong SAR, Ireland, Israel, Italy, Japan, Liechtenstein,

Luxembourg, Mexico, Morocco, the Netherlands, New Zealand, Peru, Poland, Portugal, South

Africa, Spain,

Sweden, Switzerland, Thailand, United Arab Emirates and the United Kingdom.

government, institutional health care clinics, home health providers, and alternate

care clinics.

We also provide

software and technology services to health care practitioners.

Our dental businesses serve office-based dental

practitioners, dental laboratories, schools, government and other institutions.

Our medical businesses serve

physician offices, urgent care centers, ambulatory care sites, emergency medical technicians, dialysis centers,

health, federal and state governments and large enterprises, such as group practices

and integrated delivery

networks, among other providers across a wide range of specialties.

We have significant operations in the United States, Germany, France, Canada, and Brazil.

meaningful market presence in several other European countries and the Asia-Pacific

Basis of Presentation

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decisions, and contractual and substantive participating rights of each party.

For this VIE, the trade accounts

receivable transferred to the VIE are pledged as collateral to the related debt.

The VIE’s creditors have recourse to

us for losses on these trade accounts receivable.

At December 28, 2024 and December 30, 2023,

certain trade

accounts receivable that can only be used to settle obligations of this VIE

For this VIE, related to our U.S.

accounts receivable securitization as discussed in

Note 14 – Debt

the trade accounts receivable transferred to the

VIE are pledged as collateral to the related debt.

The VIE’s creditors have recourse to us for losses on these trade

accounts receivable.

At December 27, 2025 and December 28, 2024, certain trade

accounts receivable that can

only be used to settle obligations of this VIE were $

million and $

respectively, and the liabilities of this VIE where the creditors have recourse to us were $

million, respectively, and the liabilities of

this VIE where the creditors have recourse to us were $

million and $

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The three levels of the fair value hierarchy are described as follows:

Level 1— Unadjusted quoted prices in active markets for identical assets

or liabilities that are accessible at the

measurement date.

Index to Financial Statements

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(in millions, except share and per share data)

Level 1— Unadjusted quoted prices in active markets for identical assets

or liabilities that are accessible at the

measurement date.

Level 2— Inputs other than quoted prices included within Level 1 that are

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the allowance for credit losses;

fair value of contingent

consideration;

hedging activity;

measurement of compensation

cost for certain share-based performance awards and cash bonus plans;

measurement of compensation cost for certain share-based

performance awards and cash bonus plans;

pension plan assumptions.

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Saturday of December.

The year ended December 28, 2024 consisted of

weeks, and the years ended December

30, 2023 and December 31, 2022 consisted of

weeks, respectively.

The years ended December 27, 2025, December 28, 2024 and December

Revenue Recognition

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inception by estimating the most likely amount

based upon historical data and estimates and are provided for in the

period in which the related sales are

Index to Financial Statements

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(in millions, except share and per share data)

based upon historical data and estimates and are provided for in the

period in which the related sales are

Revenue derived from the sale of consumable products and company-manufactured

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terms provided by the manufacturer;

however, in instances where we provide a warranty on company-manufactured products or labor services, the

however, in instances where we provide a warranty on company-manufactured products or labor services,

warranty costs are accrued in accordance with Accounting Standards Codification

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a straight-line basis over the requisite

service period for time-based restricted stock units and on a graded vesting

basis for the option awards.

performance-based awards, at each reporting date, we reassess whether achievement

of the performance condition

is probable and accrue compensation expense when achievement of

the performance condition is probable.

stock-based compensation expense is reflected in selling, general and administrative

service period for certain time-based restricted stock units with cliff vesting and on a accelerated

basis for the

option awards and certain time-based restricted stock units with graded

For performance-based awards, at

each reporting date, we reassess whether achievement of the performance condition

is probable and accrue

compensation expense when achievement of the performance condition is

Our stock-based compensation

expense is reflected in selling, general and administrative expenses.

Index to Financial Statements

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economic trends and reasonable supportable forecasts.

write off a receivable and charge it against its recorded

allowance when we deem them uncollectible.

write off accounts receivable and charge it against its

recorded allowance when we deem it uncollectible.

Our net accounts receivable balance was $

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as of the reporting date.

Contract assets are transferred to accounts receivable when

the right becomes

Contract assets are transferred to accounts receivable when the

right becomes

unconditional.

The contract assets primarily relate to our bundled arrangements for

the sale of equipment and

The contract assets primarily relate to our bundled arrangements for the

sale of equipment and

consumables and sales of term software licenses.

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Inventories and Reserves

Inventories consist primarily of finished goods,

raw materials and work-in-process and are valued at the lower

Inventories consist primarily of finished goods, raw materials and

work-in-process and are stated at the lower of

cost or net realizable value.

Cost is determined by the weighted average method for merchandise and by

for large equipment and high-tech equipment.

We manufacture certain of our products for our specialty businesses

(oral surgery solutions including dental implants, endodontics, and orthopedics).

In accordance with our policy for

inventory valuation, we consider many factors including the

condition and salability of the inventory, historical

sales, forecasted sales and market and economic trends.

From time to time, we adjust our assumptions for

anticipated changes in any of these or other factors expected to affect the value of inventory.

Cost is determined by the weighted average method for merchandise

and actual cost

for large equipment, high-technology equipment and drop-shipments.

Inventory costs for manufactured products

include direct materials, labor, and an allocation of related fixed and variable overhead.

The determination of

inventory carrying values requires management to make significant

estimates and judgments.

In assessing the need

for inventory reserves and evaluating net realizable value, we consider

multiple factors, including inventory

condition, on-hand quantities, historical and forecasted sales, product

life cycles, and prevailing market and

economic conditions.

Property and Equipment

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over the lesser of the useful life of the assets or the remaining lease term.

Capitalized Software Development Costs

Capitalized software costs consist of costs to purchase and develop software

for internal use and for sale or use by

For software to be used solely to meet internal needs, we capitalize

costs incurred during the

Index to Financial Statements

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(in millions, except share and per share data)

Capitalized Software Development Costs

Capitalized software costs consist of costs to purchase and develop

software for internal use and for sale or use by

For software to be used solely to meet internal needs, we capitalize

costs incurred during the

application development stage and include such costs within property

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(“ROU”) assets,

operating lease liabilities, and non-current operating lease liabilities in our

consolidated balance sheets.

operating lease liabilities, and non-current operating lease liabilities in

our consolidated balance sheets.

leases are included in property and equipment, current maturities of

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certain that we will exercise that option.

Lease expense for lease payments is recognized on a straight-line

Lease expense for lease payments is recognized on a straight-line basis

over the lease term.

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include the acquired businesses’ results of operations from that date.

Some prior owners of acquired subsidiaries are eligible to receive additional

Certain prior owners of acquired subsidiaries are eligible to receive additional

purchase price cash consideration, or

we may be entitled to recoup a portion of purchase price cash consideration

if certain financial targets are met.

have accrued liabilities for the estimated fair value of additional purchase

price consideration at the time of the

acquisition, using the income approach, including a probability-weighted

discounted cash flow method or an option

pricing method, where applicable.

Any adjustments to these accrual amounts are recorded

in selling, general and

administrative within our consolidated statements of income.

if certain financial targets or negotiated

goals are met.

We have accrued liabilities for the estimated fair value of additional purchase price consideration at

the time of the acquisition, using the income approach, including a probability-weighted

discounted cash flow

method or an option pricing method, where applicable.

Any adjustments to these accrual amounts are recorded in

selling, general and administrative within our consolidated statements of

While we use our best estimates and assumptions to accurately value

assets acquired and liabilities assumed at the

acquisition date, our estimates are inherently uncertain and subject

to refinement.

As a result, within

following the date of acquisition, or the measurement period, we

may record adjustments to the assets acquired and

liabilities assumed with the corresponding offset to goodwill within our consolidated balance

At the end of

the measurement period or final determination of the values of such assets

acquired or liabilities assumed,

whichever comes first, any subsequent adjustments are recognized

in our consolidated statements of operations.

consideration transferred, assets acquired and

liabilities assumed at the acquisition date, our estimates are inherently uncertain

and subject to refinement.

Index to Financial Statements

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(in millions, except share and per share data)

result, within

following the date of acquisition, or the measurement period, we

may record adjustments

to consideration transferred, assets acquired and liabilities assumed with

the corresponding offset to goodwill

within our consolidated balance sheets.

At the end of the measurement period or final determination of

of such assets acquired or liabilities assumed, whichever comes first,

any subsequent adjustments are recognized in

our consolidated statements of operations.

Any excess of acquisition consideration over the fair value of identifiable

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technology, as well as the assembled workforce.

Goodwill represents, for acquired business, the excess of the purchase price

over the estimated fair value of the net

assets acquired, including the amount assigned to identifiable intangible

Goodwill is subject to impairment

analysis annually or more frequently if needed.

Such impairment analyses for goodwill requires a comparison

the fair value to the carrying value of reporting units.

We aggregate operating segments into the reportable

segments based on economic similarities, the nature of their products, customer

basis, and methods of distribution

Global Distribution and Value-Added Services;

Global Specialty Products;

and Global Technology.

Goodwill was allocated to such reporting units, for the purpose of

preparing our impairment analyses, based on a

specific identification basis.

During the fourth quarter of our fiscal year ended December 28, 2024,

we revised our segment structure to align

with how our Chairman and Chief Executive Officer manages the business, assesses

performance and allocates

Our revised reportable segments now consist of:

(i) Global Distribution

-Added Services;

Global Specialty Products;

and (iii) Global Technology.

Reporting units under the former structure were tested for

impairment, and no impairment was identified.

As a result of the realignment and the change in operating

segments, we reallocated goodwill to each of our new reporting units using

a relative fair value approach.

the impairment test under the new structure, it was determined that the

fair values of our reporting units more likely

than not exceeded their carrying values, resulting in no impairment.

For both the former and new structure

goodwill impairment tests as of September 30, 2024, the fair values of reporting

units were computed using the

methodology described above.

Goodwill is subject to impairment analysis at least once annually as

of the first day of our fourth quarter, or if an

event occurs or circumstances change that would more likely than

not reduce a reporting unit’s fair value below

carrying value.

We conduct our goodwill impairment testing at the reporting unit level.

We identify our reporting

units by assessing whether two or more components are economically

similar and therefore should be aggregated.

Our reporting units are identified as our operating segments.

Goodwill is allocated to such reporting units for the

purposes of our impairment analyses.

For the year ended December 27, 2025, our reporting structure was:

Global Distribution and Value-Added Services reportable segment, which included the following

operating segments (a) US Distribution Group;

(b) Europe, Middle East,

and Africa Distribution Group;

and (d) Asia-Pacific and Australia

Distribution Group;

Global Specialty Products reportable segment, which included the following

operating segments (a) Global

Oral Reconstruction Group;

and (b) Healthcare Specialty Group;

Global Technology,

which is both a reportable segment and an operating segment.

Application of the goodwill impairment test requires judgment, including

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There are inherent

uncertainties related to fair value models, the inputs and our judgments

in applying them to this analysis.

significant inputs include estimation of future cash flows based on budget

expectations, and determination of

comparable companies to develop a weighted average cost of capital for each

reporting unit.

uncertainties, however, related to fair value models, the inputs and our judgments in applying them

to this analysis.

The most significant inputs include estimation of detailed future cash flows

based on budget expectations, and

determination of comparable companies to develop a weighted average

cost of capital for each reporting unit.

In January 2025, we performed a geographical realignment within

the Global Distribution and Value-Added

Services reportable segment intended to provide increased transparency

into the performance of our global

distribution businesses and to reflect evolving management oversight

and decision-making.

As a result of the

realignment and the change in reporting units, we reallocated goodwill to each

of our new reporting units using a

relative fair value approach.

The relative fair values of the new reporting units were determined based on

quantitative valuation analysis that considered projected cash flows,

market assumptions, and other relevant

valuation inputs.

Reporting units under the former and new structures

of the Global Distribution and Value-Added

Services reportable segment were tested for impairment as of January 1,

2025, and it was determined that the fair

values of our reporting units more likely than not exceeded their carrying

values, resulting in no impairment as of

January 1, 2025 under both structures.

In connection with our restructuring initiatives, during the year ended

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such impairment was calculated based on the relative fair value

For the year ended

December 31, 2022, we recorded a $

million impairment of goodwill, in the Global Specialty Products segment,

relating to the disposal of an unprofitable business for which estimated

fair value was lower than carrying value.

Intangible Assets

In connection with our business acquisitions, the major classes of

assets and liabilities to which we generally

allocate acquisition consideration to, excluding goodwill, include

identifiable intangible assets (i.e., customer

relationships and lists, trademarks and trade names, product development

and non-compete agreements), inventory

and accounts receivable.

The estimated fair value of identifiable intangible assets

is based on critical judgments

and assumptions derived from analysis of market conditions, including

discount rates, projected revenue growth

rates (which are based on historical trends and assessment of financial projections),

estimated customer attrition and

projected cash flows.

We have calculated the value of these intangible assets using the multi-period excess

Index to Financial Statements

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(in millions, except share and per share data)

earnings method, the relief-from-royalty method, and the with and without

method, where applicable.

assumptions are forward-looking and could be affected by future economic and

market conditions.

Intangible Assets

In connection with our business acquisitions, we recognize assets acquired

and liabilities assumed based on fair

value estimates as of the date of acquisition.

The estimated fair value of identifiable intangible assets

customer relationships and lists, trademarks and trade names, product development

and non-compete agreements) is

based on critical judgments and assumptions derived from analysis of

market conditions, including discount rates,

projected revenue growth rates (which are based on historical trends

and assessment of financial projections),

estimated customer attrition and projected cash flows.

We have calculated the value of these intangible assets using

the multi-period excess earnings method, the relief-from-royalty method,

and the with and without method, where

These assumptions are forward-looking and could be affected by future economic

Intangible assets, other than goodwill, are evaluated for impairment whenever

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expected to be derived from such asset or asset group.

Definite and indefinite-lived intangible assets primarily consist of non-compete

agreements, trademarks, trade

names, customer lists, customer relationships and product development.

For long-lived assets used in operations,

impairment losses are only recorded if the asset or asset groups carrying amount

is not recoverable through its

undiscounted future cash flows.

We measure the impairment loss based on the difference between the carrying

amount and the estimated fair value.

Definite and indefinite-lived intangible assets primarily consist of customer

relationships, customer lists,

trademarks, trade names, product development and non-compete agreements.

For long-lived assets used in

operations, impairment losses are only recorded if the asset or asset groups

carrying amount is not recoverable

through its undiscounted future cash flows.

We measure the impairment loss based on the difference between the

carrying amount and the estimated fair value.

When an impairment exists, the related assets are written down to

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During the years ended December 27, 2025, December 28, 2024

December 31, 2022, we recorded impairment charges, within the restructuring and

integration costs line of our

December 30, 2023, we recorded impairment charges, within the restructuring and related

costs line of our

consolidated statements of income, of $

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Note 16 – Plans

of Restructuring and Integration Costs

of Restructuring and Related Costs

for additional information.

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The recorded value of the redeemable

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

noncontrolling interests cannot go below the floor level.

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that is attributable to redeemable noncontrolling

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Noncontrolling Interests

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translation gain (loss), unrealized gain (loss) from hedging activities

and unrealized pension adjustment gain.

and unrealized pension adjustment gain (loss).

Risk Management and Derivative Financial Instruments

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loss on the hedged item, are recorded in other, net, within our consolidated statements of income.

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Total return swaps are entered into for the purpose of economically hedging our SERP and DCP.

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changes in the fair values of our SERP and DCP liabilities.

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Foreign Currency Translation

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currency transactions are included in earnings.

Accounting Pronouncements Adopted

During the year ended December 28, 2024, we adopted Accounting Standards

Update (“ASU”) 2023-07, “

Reporting (Topic 280):

Accounting Pronouncements Recently Adopted

During the year ended December 27, 2025, we adopted Accounting Standards Update

(“ASU”) 2023-09, “

Improvements to Income Tax Disclosures

,” which requires public business entities to disclose

additional information in specified categories with respect to

the reconciliation of the effective tax rate to the

statutory rate for federal, state and foreign income taxes.

It also requires greater detail about individual reconciling

items in the rate reconciliation to the extent the impact of those items

exceeds a specified threshold.

In addition to

new disclosures associated with the rate reconciliation, this ASU requires

information pertaining to taxes paid (net

of refunds received) to be disaggregated for federal, state and foreign

taxes and further disaggregated for specific

jurisdictions to the extent the related amounts exceed a quantitative threshold.

This ASU also describes items that

need to be disaggregated based on their nature, which is determined by

reference to the item’s fundamental or

essential characteristics, such as the transaction or event that triggered

the establishment of the reconciling item and

the activity with which the reconciling item is associated.

This ASU eliminates the historic requirement that

entities disclose information concerning unrecognized tax benefits having

a reasonable possibility of significantly

increasing or decreasing in the 12 months following the reporting date.

We adopted this ASU on a prospective

basis, which resulted in the required additional disclosures included

Note 15 – Income Taxes

During the year ended December 28, 2024, we adopted ASU 2023-07, “

Segment Reporting (Topic 280):

Improvements to Reportable Segments

” (“Topic 280”),

which aims to improve financial

reporting by requiring disclosure of incremental segment information on an annual

and interim basis for all public

entities to enable investors to develop more decision-useful financial analyses.

The amendments in Topic 280 do

not change how a public entity identifies its operating segments, aggregates

those operating segments, or applies

the quantitative thresholds to determine its reportable segments.

which aims to improve financial reporting by requiring

disclosure of incremental segment information on an annual and

interim basis for all public entities to enable

investors to develop more decision-useful financial analyses.

The amendments in Topic 280 do not change how a

public entity identifies its operating segments, aggregates those operating

segments, or applies the quantitative

thresholds to determine its reportable segments.

We adopted Topic

280 on a retrospective basis,

which resulted in the required additional disclosures included in our 2024

fiscal year annual consolidated financial

During the year ended December 30, 2023, we adopted ASC Topic 848,

“Reference Rate Reform” (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting”

which provides optional expedients

and exceptions for applying GAAP to contracts, hedging relationships and

other transactions affected by the

discontinuation of the London Interbank Offered Rate or by another reference rate

expected to be discontinued

because of reference rate reform.

The adoption of Topic 848 did not have a material impact on our consolidated

financial statements.

Recently Issued Accounting Standards

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update

(“ASU”) 2024-03, “

Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosure

(Subtopic 220-40)

Disaggregation of Income Statement Expenses

,” which requires additional disclosure about the

specific expense categories in the notes to financial statements at interim and

annual reporting periods.

amendments in this ASU do not change or remove current expense

disclosure requirements but affect where this

information appears in the notes to financial statements.

This ASU is effective for annual reporting periods

beginning after December 15, 2026, and interim reporting periods beginning

after December 15, 2027, with early

adoption permitted.

Upon adoption, the guidance can be applied prospectively or retrospectively.

We are currently

evaluating the impact that ASU 2024-03 will have on our consolidated

280 on a retrospective basis, which resulted in

the required additional disclosures included in our consolidated

financial statements.

In March 2024, the FASB issued ASU 2024-01, “

Compensation - Stock Compensation (Topic 718):

Application of Profits Interest and Similar Awards,

” which clarifies how to determine whether profits interest and

similar awards should be accounted for as a share-based payment arrangement

under Topic 718 or within the scope

of other guidance.

The ASU provides an illustrative example with multiple fact patterns

and amends the structure

of paragraph 718-10-15-3 of Topic 718 to improve its clarity and operability.

The guidance in ASU 2024-01

applies to all entities that issue profits interest awards as compensation

to employees or nonemployees in exchange

for goods or services.

Entities can apply the amendments either retrospectively to

all periods presented in the

financial statements or prospectively to profits interest awards granted

or modified on or after the date of adoption.

If prospective application is elected, an entity must disclose the nature

of and reason for the change in accounting

principle that resulted from the adoption of the ASU.

This ASU is effective for fiscal years beginning after

Recently Issued Accounting Pronouncements

In December 2025, the Financial Accounting Standards Board (“FASB”) issued ASU 2025-11, “

Interim Reporting

-Scope Improvements

,” which is intended to improve navigability of the guidance

270, Interim Reporting, and clarify when it applies.

The ASU also addresses the form and content of such financial

statements and interim disclosure requirements, and establishes a principle

under which an entity must disclose

events since the end of the last annual reporting period that have a

material impact on the entity.

effective for annual reporting periods beginning after December 15, 2027, and interim

reporting periods within

those annual reporting periods, with early adoption permitted.

We are currently evaluating the impact that ASU

2025-11 will have on our consolidated financial statements and related disclosures.

Index to Financial Statements

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(in millions, except share and per share data)

December 15, 2024, including interim periods within those fiscal years.

We do not expect that the requirements of

ASU 2024-01 will have a material impact on our consolidated financial

In December 2025, the FASB issued ASU 2025-10, “

Income Taxes (Topic

Improvements to Income Tax

,” which requires public business entities to disclose additional

information in specified categories with

respect to the reconciliation of the effective tax rate to the statutory rate for federal, state and

foreign income taxes.

It also requires greater detail about individual reconciling items in

the rate reconciliation to the extent the impact of

those items exceeds a specified threshold.

In addition to new disclosures associated with the rate reconciliation,

ASU requires information pertaining to taxes paid (net of refunds received)

to be disaggregated for federal, state,

and foreign taxes and further disaggregated for specific jurisdictions

to the extent the related amounts exceed a

quantitative threshold.

The ASU also describes items that need to be disaggregated

based on their nature, which is

determined by reference to the item’s fundamental or essential characteristics, such as the transaction or event

triggered the establishment of the reconciling item and the activity with which

the reconciling item is associated.

The ASU eliminates the historic requirement that entities disclose information

concerning unrecognized tax

benefits having a reasonable possibility of significantly increasing

or decreasing in the 12 months following the

reporting date.

This ASU is effective for annual periods beginning after December 15, 2024.

Early adoption is

permitted for annual financial statements that have not yet been

issued or made available for issuance.

should be applied on a prospective basis;

however, retrospective application is permitted.

We are currently

evaluating the impact that ASU 2023-09 will have on our consolidated

Government Grants (Topic 832) - Accounting for Government

Grants Received by Business Entities,

” which establishes guidance on the recognition, measurement, and

presentation of government grants received by business entities.

This ASU is effective for annual reporting periods

beginning after December 15, 2028, and interim reporting periods within

those annual reporting periods, with early

adoption permitted.

We are currently evaluating the impact that ASU 2025-10 will have on our consolidated

financial statements and related disclosures.

In November 2025, the FASB issued ASU 2025-09, “

Derivatives and Hedging (Topic 815):

Hedge Accounting

Improvements,

” which is intended to more closely align financial reporting with

the economics of entities’ risk

management activities, including expanded eligibility of forecasted

transactions, additional flexibility in measuring

hedge effectiveness, and clarifications related to hedging non-financial items.

This ASU is effective for annual

reporting periods beginning June 1, 2027, and interim reporting

periods within those annual reporting periods, with

early adoption permitted, and should be applied prospectively.

We are currently evaluating the impact that ASU

2025-09 will have on our consolidated financial statements and related

In September 2025, the FASB issued ASU 2025-06, “

Intangibles - Goodwill and Other - Internal-Use Software

(Subtopic 350-40):

Targeted Improvements

to the Accounting for Internal-Use Software

,” which removes all

references to software development project stages.

The ASU requires entities to begin capitalizing software costs

when management authorizes and commits to funding the software project,

and it is probable that the project will

be completed and the software will be used for its intended purpose.

This ASU is effective for annual reporting

periods beginning after December 15, 2027, and interim reporting periods

within those annual reporting periods,

with early adoption permitted.

Upon adoption, the guidance can be applied prospectively, retrospectively, or with a

modified transition approach.

We are currently evaluating the impact that ASU 2025-06 will have on our

consolidated financial statements.

In July 2025, the FASB issued ASU 2025-05, “

Financial Instruments - Credit Losses (Subtopic 326):

of Credit Losses for Accounts Receivable and Contract Assets,

” which introduces a practical expedient permitting

an entity to assume that conditions at the balance sheet date remain unchanged

throughout the remaining life of the

asset when estimating expected credit losses on current accounts

receivable and current contract asset under Topic

606 on revenue from contracts with customers.

This ASU is effective for annual

reporting periods beginning after

December 15, 2025, with early adoption permitted.

We do not expect ASU 2025-05 to have a material impact on

our consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, “

Income Statement - Reporting Comprehensive Income -

Expense Disaggregation Disclosure (Subtopic 220-40)

Disaggregation of Income Statement Expenses

requires additional disclosure about the specific expense categories in

the notes to financial statements at interim

and annual reporting periods.

The amendments in this ASU do not change or remove current

expense disclosure

requirements, but affect where this information appears in the notes to financial statements.

This ASU is effective

for annual reporting periods beginning after December 15, 2026, and

interim reporting periods beginning after

December 15, 2027, with early adoption permitted.

Upon adoption, the guidance can be applied prospectively

retrospectively.

We are currently evaluating the impact that ASU 2024-03 will have on our consolidated financial

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Note 2 – Cyber Incident

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ecommerce platform and related applications, which was remediated.

During the years ended December 28, 2024 and December 30, 2023, we had

a sales decrease in our dental and

medical distribution businesses, which we believe was primarily a

result of lower sales to episodic customers

following last year’s cyber incident.

During the years ended December 28, 2024 and December 30, 2023, we incurred

million and $

respectively, of expenses directly related to the cyber incident, mostly consisting of professional fees.

cyber insurance, subject to certain retentions and policy limitations.

With respect to the October 2023 cyber

incident, we have a $

With respect to the October 2023 cyber incident, we had a $

million insurance policy, following a $

million retention.

During the years ended

December 28, 2024 we received insurance proceeds of $

million under this policy representing a partial

insurance recovery of losses related to the cyber incident, with the remaining

million of the claim being under

review by our insurance providers.

During the years ended December 27, 2025, December 28, 2024

and December 30, 2023, we incurred $

million and $

million, respectively, of expenses related to the cyber incident, mostly consisting of

professional fees.

During the year ended December 28, 2024, we received insurance

proceeds of $

representing a partial insurance recovery of losses related to the cyber incident.

During the year ended December

27, 2025, we received insurance proceeds of $

million under this policy, representing insurance recovery of

losses related to the cyber incident.

The expenses and insurance recoveries related to the cyber

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statements of income.

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Note 3 – Net Sales from Contracts with Customers

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Disaggregation of Net Sales

As noted further in

Note 4 – Segment and Geographic Data

during the fourth quarter of our fiscal year ended

December 28, 2024, we revised our reportable segments to align with how

the Chairman and Chief Executive

Officer manages the business, assesses performance and allocates resources.

All prior comparative segment

information has been recast to reflect our new segment structure.

The following table disaggregates our net sales by reportable and operating segment

and geographic area:

The following table disaggregates our net sales by reportable segment:

Global Distribution and Value

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Note 4 – Segment and Geographic Data

During the fourth quarter of our fiscal year ended December 28, 2024,

we revised our reportable segments to align

with how the Chairman and Chief Executive Officer manages the business, assesses

performance and allocates

Our revised reportable segments now consist of:

(i) Global Distribution

-Added Services;

We conduct our business through

reportable segments:

(i) Global Distribution and Value-Added Services;

Global Specialty Products;

and (iii) Global Technology.

These segments offer different products and services to

the same customer base.

All prior comparative segment information has been recast

to reflect our new segment

We aggregate operating segments into these reportable segments based on economic similarities, the nature of their

products, customer base and methods of distribution.

Global Distribution and Value-Added Services includes

merchandise and equipment distribution businesses that serve the global dental

and medical markets;

includes value-added services such as equipment repair services, financial

services on a non-recourse basis,

continuing education services for practitioners, consulting and other

Global Distribution and Value-Added Services includes distribution to the global dental and medical markets of

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quality consumable merchandise.

Global Specialty Products includes manufacturing, marketing and sales

Global Specialty Products includes manufacturing, marketing

and sales of dental

implant and biomaterial products;

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(a) direct cybersecurity costs and related

insurance recovery proceeds, (b) impairment of capitalized assets, (c)

amortization of acquisition intangibles, (d)

settlement and litigation, (e) organizational restructuring expenses, (f) impairment

of intangible assets, (g) changes

in fair value of contingent consideration, and (h) costs associated with

shareholder advisory matters.

adjustments are either:

insurance recovery proceeds, (b) amortization of acquisition intangibles,

expenses, (d) impairment of intangible assets, (e) changes in fair value

of contingent consideration, (f) litigation

settlements, and (g) costs associated with shareholder advisory

matters and select value creation consulting costs.

These adjustments are either:

(i) non-cash or non-recurring in nature;

(ii) not allocable

or controlled by the segment;

(iii) not tied to the operational performance of the segment.

Assets by segment are not a measure used to assess the

performance of the Company by CODM and thus are not reported in

our disclosures.

allocable or controlled by the segment;

or (iii) not tied to the operational performance of the segment.

Assets by segment are not a measure used to assess

the performance of the Company by CODM and thus are not reported

in our disclosures.

The accounting policies of the reportable segments are generally

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Presentation and Significant Accounting Policies

Sales and transfers between operating segments are eliminated

Sales and transfers between reportable segments are eliminated

in consolidation.

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Global Specialty Products

Global Technology

Total Eliminations

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Total Net Sales

Segment Cost of Sales:

Global Distribution and Value

-Added Services

Global Specialty Products

Global Technology

Segment Operating Expenses:

Global Distribution and Value

-Added Services

Global Specialty Products

Global Technology

Operating Income:

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Total Segment Operating Income

Corporate, net

Total Operating Income

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Global Technology

Total Segment Depreciation and Amortization

Acquisition intangible amortization within adjustments

Total Depreciation and Amortization

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Global Distribution and Value

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are distributed to health care providers.

Cost of goods sold in our Global Distribution and Value-Added Services segment and our Global Specialty Products segment

includes product cost and inbound and outbound freight charges.

Cost of goods sold in our Global Technology segment consists

primarily of software development and third-party provider costs, including technology use and hosting fees.

Significant segment operating expenses for our reportable segments and Corporate include primarily compensation costs, and to a

lesser extent, rent, depreciation and maintenance costs related to operating our facilities.

Adjustments represent items excluded from segment operating income to enable comparison of financial results between periods.

The following table presents a breakdown of such adjustments:

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Restructuring costs

Restructuring and related costs

Acquisition intangible amortization

Cyber incident-third-party advisory expenses, net of insurance

Changes in contingent consideration

Cyber incident-insurance proceeds, net of third-party advisory

Change in contingent consideration

Litigation settlements

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Impairment of intangible assets

Costs associated with shareholder advisory matters

Costs associated with shareholder advisory matters and select value

creation consulting costs

Total adjustments

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Note 5 – Business Acquisitions

Our acquisition strategy is focused on investments in companies that

add new customers and sales teams, increase

our geographic footprint (whether entering a new country, such as emerging markets, or building scale where we

have already invested in businesses), and finally, those that enable us to access new products and technologies.

Our acquisition strategy is focused on investments in companies, including

high growth high margin businesses

aligned with our BOLD+1 strategy, that add new customers and sales teams, increase our geographic footprint

(whether entering a new country, such as emerging markets, or building scale where we have already invested in

businesses), and finally, those that enable us to access new products and technologies.

2025 Acquisitions

During the year ended December 27, 2025, we acquired companies within

the Global Distribution and Value-

Added Services,

Global Specialty Products and Global Technology segments.

Our acquired ownership interest in

these companies range from

The following table aggregates the preliminary estimated fair value, as of

the date of the acquisition, of

consideration paid and net assets acquired for acquisitions during the year ended

December 27, 2025:

Allocation as of

December 27, 2025

Acquisition consideration:

Deferred consideration

Estimated fair value of contingent consideration payable

Fair value of previously held equity method investments

Redeemable noncontrolling interests

Total consideration

Identifiable assets acquired and liabilities assumed:

Current assets

Intangible assets

Other noncurrent assets

Current liabilities

Long-term debt

Deferred income taxes

Other noncurrent liabilities

Total identifiable

Total net assets acquired

The accounting for acquisitions in the year ended December 27, 2025 has not been

completed in several areas,

including, but not limited to, pending assessment of certain assets,

primarily including identifiable intangibles and

certain equity method investments, and certain liabilities, primarily

including deferred income taxes.

year ended December 27, 2025, we did not record any material measurement

period adjustments.

Goodwill is a result of the synergies and cross-selling opportunities that these acquisitions

are expected to provide

for us, as well as the expected growth potential.

The majority of the acquired goodwill is not deductible

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

The following table summarizes the intangible assets acquired during the year

ended December 27, 2025:

Weighted Average

Lives (in years)

Customer relationships and lists

Trademarks / Tradenames

Product development

Non-compete agreements

During the year ended December 27, 2025, in connection with acquisitions

of controlling interests of affiliates, we

recognized gains of approximately $

million, related to the remeasurement to fair value of our previously held

equity investments.

Such gains were calculated using a discounted cash flow model

based on Level 3 inputs, as

Note 11 – Fair Value Measurements

which was recorded in

selling, general and administrative

consolidated statements of income.

The impact of these acquisitions, individually and in the aggregate, was

not considered material to our consolidated

financial statements.

Pro forma financial information since the acquisition date has not been presented

because the impact of these

acquisitions was immaterial to our consolidated financial statements.

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

2024 Acquisitions

Acquisition of TriMed

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This acquisition is reported in our Global Specialty Products segment.

During the year ended

December 28, 2024, we completed the accounting for this acquisition.

The following table aggregates the final fair

value, as of the date of the acquisition, of consideration paid and net

assets acquired in the TriMed acquisition:

The following table

aggregates the final fair value, as of the date of the acquisition, of consideration

paid and net assets acquired in the

TriMed acquisition:

Final Allocation

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The acquired goodwill is not deductible for tax purposes.

The following table summarizes the identifiable intangible assets acquired

as part of the acquisition of TriMed:

Weighted Average

Lives (in years)

Product development

Trademarks / Tradenames

In process research & development

Not Applicable

Except for in-process research and development (“IPR&D”), intangible assets

acquired as a result of the TriMed

acquisition are being amortized over their estimated useful lives

using the straight-line method of amortization.

The IPR&D is accounted for as an indefinite-lived intangible asset and

is not amortized until completion or

abandonment of the associated research and development efforts.

IPR&D is tested for impairment annually or

periodically if an indicator of impairment exists during the period until completion.

The intangible assets acquired consisted of product development of $

million, trademarks and tradenames of $

million, and in-process research and development of $

Weighted average useful lives for these acquired

intangible assets were

years and indefinite-lived, respectively.

Except for in-process research and

development (“IPR&D”), intangible assets acquired as a result of the TriMed acquisition are being

amortized over

their estimated useful lives using the straight-line method of amortization.

IPR&D is accounted for as an

indefinite-lived intangible asset and is not amortized until completion or

abandonment of the associated research

and development efforts.

IPR&D is tested for impairment annually or periodically if

an indicator of impairment

exists during the period until completion.

Pro forma financial information and TriMed’s revenue and earnings since the acquisition date have not been

presented because the impact of the TriMed acquisition was immaterial to our consolidated

financial statements.

Index to Financial Statements

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(in millions, except share and per share data)

Pro forma financial information and TriMed’s revenue and earnings since the acquisition date have not been

presented because the impact of the TriMed acquisition during the year ended December

28, 2024 was immaterial

to our consolidated financial statements.

Other 2024 Acquisitions

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the Global Distribution and Value-

Added Services, Global Specialty Products, and Global Technology segments.

Our acquired ownership interest in

these companies range from

Added Services and Global Specialty Products segments.

Our acquired ownership interest in these companies

Total consideration for these acquisitions was $

million (including

cash paid of $

million (including cash paid of $

million, fair value of previously held equity investment of $

million, noncontrolling interest of $

million, estimated fair value of contingent consideration payable of

estimated fair value of contingent consideration payable of $

million, and deferred consideration of $

1 unchanged sentence

million of goodwill and $

million of intangible

The intangible assets acquired consisted of customer relationships

and lists of $

million, trademarks and

tradenames of $

million of intangible assets.

intangible assets acquired consisted of customer relationships and lists of

million, trademarks and tradenames

million, product development of $

million and non-compete agreements of $

Weighted average useful lives for these acquired intangible assets were

Weighted average

useful lives for these acquired intangible assets were

, respectively.

During the year ended December 28, 2024, we completed the accounting

for certain acquisitions that occurred in

fiscal year 2024 and we did not record any material measurement period

adjustments related to these acquisitions.

The accounting for other acquisitions in fiscal year 2024 has not been

completed in several areas, including but not

limited to pending assessment of current expected credit losses.

We completed the accounting for all other acquisitions that occurred during the year ended December 28, 2024 and

we did not record any material measurement period adjustments

related to these acquisitions during the year ended

December 27, 2025.

Goodwill is a result of the synergies and cross-selling opportunities that these acquisitions

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The majority of the acquired goodwill is not deductible

During the year ended December 28, 2024, in connection with an acquisition

of a controlling interest of an affiliate,

we recognized a gain of approximately $

million related to the remeasurement to fair value of our previously

held equity investment, using a discounted cash flow model based on

Level 3 inputs, as defined in

Note 11 – Fair

Value Measurements

which was recorded in selling, general and administrative

in the consolidated statements of

The impact of these acquisitions, individually and in the aggregate, was

not considered material to our consolidated

financial statements.

During the year ended December 28, 2024, in connection with the acquisition

of a controlling interest of an

affiliate, we recognized a gain of approximately $

million related to the remeasurement to fair value of our

previously held equity investment, using a discounted cash flow model based

on Level 3 inputs, as defined in

11 – Fair Value Measurements

which was recorded in

selling, general and administrative

in the consolidated

statements of income.

Pro forma financial information for our 2024 acquisitions has not been

presented because the impact of the

acquisitions was immaterial to our consolidated financial statements.

Index to Financial Statements

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monitoring devices directly to patients in their homes.

During the year ended December 28, 2024, we completed the accounting

for our acquisition of Shield.

following table aggregates the final fair value, as of the date of the acquisition,

of consideration paid and net assets

acquired in the Shield acquisition:

The following table aggregates the final fair value, as of the date of the acquisition,

of consideration paid and net

assets acquired in the Shield acquisition:

Final Allocation

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% voting equity interest in S.I.N.

Implant System (“S.I.N.”) for consideration of

Implant System (“S.I.N.”) for consideration

This acquisition is reported in our Global Specialty Products segment.

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United States and other international markets.

During the year ended December 28, 2024, we completed the accounting

for our acquisition of S.I.N.

following table aggregates the final fair value, as of the date of acquisition,

The following table aggregates the final fair value, as of the date of acquisition,

of consideration paid and net assets

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to our consolidated financial statements.

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Acquisition of Biotech Dental

11 unchanged sentences

improved patient experience.

During the year ended December 28, 2024, we completed the accounting

for our acquisition of Biotech Dental.

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

The following table aggregates the final fair value, as of the date of acquisition,

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Our acquired ownership interest ranged between

year ended December 28, 2024, we recorded an adjustment of $

million, within selling, general and

administrative in our consolidated statements of income, representing a change

in the fair value of contingent

consideration related to a 2023 acquisition.

During the year ended December 28, 2024, we completed the accounting

for certain fiscal year 2023 acquisitions.

In relation to these acquisitions, we did not record material adjustments

in our consolidated financial statements

relating to changes in estimated values of assets acquired, liabilities

assumed and contingent consideration assets

and liabilities.

year ended December 30, 2023, in connection with the acquisition of

a controlling interest of an affiliate, we

recognized a gain of approximately $

million related to the remeasurement to fair value of our previously

equity investment, using a discounted cash flow model based on Level

3 inputs, as defined in

Note 11 – Fair Value

Goodwill of $

13 unchanged sentences

acquisitions was immaterial to our consolidated financial statements.

2022 Acquisitions

During the year ended December 31, 2022, we acquired companies within

the Global Distribution and Value-

Added Services, Global Specialty Products, and Global Technology segments.

Our acquired ownership interest

ranged between

For the years ended December 30, 2023 and December 31, 2022,

there were no

material adjustments recorded in our financial statements relating

to acquisitions for which provisional amounts

were recorded in prior periods.

During the year ended December 28, 2024, we recorded an

adjustment of $

million, within selling, general and administrative in our consolidated statements

of income, representing a change

in the fair value of contingent consideration related to a 2022 acquisition.

Goodwill of $

million is a result of the synergies and cross-selling opportunities that these acquisitions

expected to provide for us, as well as the expected growth potential.

Approximately half of the acquired goodwill

is deductible for tax purposes.

Intangible assets of $

million, consisting of $

million of customer relationships

million of trademarks and tradenames, and other of $

million are being amortized over their weighted

average useful lives that range from

Pro forma financial information for our 2022 acquisitions has not been

presented because the impact of the

acquisitions was immaterial to our consolidated financial statements.

Acquisition Costs

45 unchanged sentences

Note 8 – Leases

finance lease amounts included in property and equipment, net within our

for finance lease amounts included in property and equipment, net within our

consolidated balance sheets.

During the year ended December 30, 2023 we recorded a $

million impairment of capitalized software, within

our Global Distribution and Value-Added Services segment.

million impairment of capitalized software, related to

the Global Distribution and Value-Added Services segment.

Index to Financial Statements

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and certain equipment.

Our leases have remaining terms of less than

to approximately

Our leases have remaining terms of less than one year to

approximately

years, some of

8 unchanged sentences

million and $

million, respectively, related to facility leases recorded in "Restructuring and integration costs"

within our consolidated statements of income.

Further, for the years ended December 28, 2024, December 30, 2023 and December 31, 2022, we recognized

impairment of operating lease right-of-use assets of $

million, respectively, related to facility leases recorded in restructuring and related costs within our

consolidated statements of income.

Further, for the year ended December 27, 2025 we recognized a gain of $

million on early lease termination

related to facility leases which was recorded in restructuring and related costs

within our consolidated statement of

For the years ended December 28, 2024 and December

30, 2023, we recognized a net impairment of

operating lease right-of-use assets of $

million and $

million respectively, related to

facility leases recorded in “Restructuring and integration costs” within our consolidated

statement of income.

million respectively, related to facility leases recorded in

restructuring and related costs within our consolidated statement of

Supplemental balance sheet information related to leases is as follows:

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Finance leases

Average Discount

Weighted Average

Discount Rate:

Operating leases

21 unchanged sentences

These operating leases will commence after December 27,

2024, with lease terms of

2025, with lease terms of less than one year to

Certain of our facilities related to our acquisitions are leased from

7 unchanged sentences

At December 27, 2025, related party leases represented

total current and non-current operating lease liabilities, respectively.

As of December 30, 2023, current and non-

current liabilities associated with related party operating leases were

the total current and non-current operating lease liabilities, respectively.

As of December 28, 2024, current and

non-current liabilities associated with related party operating leases were

million and $

million, respectively.

December 30, 2023 related party leases represented

% of the total current and non-current operating

lease liabilities, respectively.

At December 28, 2024 related party leases represented

% of the total current and non-current

operating lease liabilities, respectively.

Index to Financial Statements

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Balance as of December 27, 2025

During the fourth quarter of our fiscal year ended December 28, 2024,

we revised our segment structure to align

with how our Chairman and Chief Executive Officer manages the business, assesses

performance and allocates

Our revised reportable segments now consist of:

(i) Global Distribution

-Added Services;

Global Specialty Products;

and (iii) Global Technology.

Reporting units under the former structure were tested for

impairment, and no impairment was identified.

As a result of the realignment and the change in operating

segments, we reallocated goodwill to each of our new reporting units using

a relative fair value approach.

the impairment test under the new structure, it was determined that the fair values

of our reporting units more likely

than not exceeded their carrying values, resulting in no impairment.

For both the former and new structure

goodwill impairment tests as of September 30, 2024, the fair values of reporting

units were computed using the

methodology described in

Note 1 – Basis of Presentation and Significant Accounting Policies.

In January 2025, we performed a geographical realignment within

the Global Distribution and Value-Added

Services reportable segment intended to provide increased transparency

into the performance of our global

distribution businesses and to reflect evolving management oversight

and decision-making.

As a result of the

realignment and the change in reporting units, we reallocated goodwill

to each of our new reporting units using a

relative fair value approach.

The relative fair values of the new reporting units were determined based on

quantitative valuation analysis that considered projected cash flows,

market assumptions, and other relevant

valuation inputs.

Reporting units under the former and new structures of

the Global Distribution and Value-Added

Services reportable segment were tested for impairment as of January 1,

2025, and it was determined that the fair

values of our reporting units more likely than not exceeded their carrying

values, resulting in no impairment as of

January 1, 2025 under both structures.

In connection with our restructuring initiatives, during the year ended

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such impairment was calculated based on the relative fair value

For the year ended

December 31, 2022, in connection with our restructuring initiatives, we

million impairment of

goodwill, in the Global Specialty Products segment, relating to the disposal

of an unprofitable business for which

estimated fair value was lower than carrying value.

Index to Financial Statements

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Weighted Average

Remaining Life

Life (in years)

Customer relationships and lists

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Weighted Average

Remaining Life

Life (in years)

Customer relationships and lists

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our Global Distribution and Value-Added Services segment.

The impairment charges included $

primarily related to customer lists and relationships attributable

to lower than anticipated operating margins in these

The remaining impairment charges of $

million related to trade names and non-compete agreements.

During the year ended December 28, 2024, we recorded $

million of impairment charges related to businesses in

our Global Distribution and Value-Added Services segment.

It included $

million of trade name impairment,

calculated using the relative fair value related to a

disposal of a business and $

million of a trade name impairment,

calculated using the relative fair value, related to a disposal of a business, and

million related to trade name

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The remaining $

impairment charges related to trade names and non-compete agreements were calculated

as the differences between

the carrying values and the estimated fair values of the impaired intangible assets,

using a discounted estimate of

future cash flows.

impairment charges related to trade names and non-compete agreements.

During the year ended December 30, 2023, we recorded $

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million charge related to the planned exit of a business in connection with our restructuring

impairment charges were calculated as the differences between the carrying values and the estimated

the impaired intangible assets, using a discounted estimate of future

During the year ended December 31, 2022 we recorded $

million of impairment charges related to businesses in

our Global Distribution and Value-Added Services segment, the components of which were a $

million charge

The impairment charges for the years ended December 27, 2025, December 28, 2024,

and December 30, 2023 were

measured as the excess of the carrying values over the estimated fair values

of the related intangible assets,

determined using discounted estimates of future cash flows and the

relief-from-royalty method.

Index to Financial Statements

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(in millions, except share and per share data)

related to the disposal of an unprofitable business in connection with

our restructuring initiatives and a $

charge related to customer lists and relationships attributable to customer attrition

rates being higher than expected

in certain other distribution and value-added services businesses.

These impairment charges were calculated as the

differences between the carrying values and the estimated fair values of the impaired intangible

assets, using a

discounted estimate of future cash flows.

Note 16 – Plans of Restructuring and Integration Costs

Note 16 – Plans of Restructuring and Related Costs

for additional details.

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and administrative expenses

and in restructuring and integration charges in our consolidated statement of income.

and in restructuring and related costs in our consolidated statement of

The annual amortization expense expected to be recorded for existing

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% and are due in varying installments through

November 21, 2028

Amortization expense, related to capitalized costs for software to be sold,

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million impairment of capitalized software costs,

within our Global Technology segment.

related to the Global Technology segment.

Index to Financial Statements

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Note 1 – Basis of Presentation and Significant Accounting

Note 9 – Goodwill and Other Intangibles

, Net for additional information.

Note 9 – Goodwill and Other Intangibles, Net

for additional information.

Defined Benefit Plans

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payments are included in selling, general and administrative expenses

in our consolidated statements of

For transactions involving changes in our ownership

in subsidiaries without a change in our control,

subsequent changes in the estimated fair value of contingent consideration

payments are recognized in additional

paid-in capital in our consolidated balance sheet.

We measure contingent consideration at the fair value on a

recurring basis using significant unobservable inputs classified as

Level 3 of the fair value hierarchy.

various valuation techniques, including the Monte Carlo simulation

and probability-weighted scenarios, to

determine the fair value of the contingent consideration liabilities on

the acquisition date and at each reporting

in our consolidated statements of income

Note 5 – Business Acquisitions

For transactions involving changes in our ownership in consolidated

without a change in our control, subsequent changes in the estimated fair

value of contingent consideration

payments are recognized in additional paid-in capital in our consolidated

balance sheet.

We measure contingent

consideration at the fair value on a recurring basis using significant unobservable

inputs classified as Level 3 of the

fair value hierarchy.

We use various valuation techniques, including the Monte Carlo simulation and probability-

weighted scenarios, to determine the fair value of the contingent consideration

liabilities on the acquisition date and

at each reporting period.

Our fair value measurement inputs include expected operating

performance, discount and risk-free rates,

and credit spread.

performance, discount and

risk-free rates, and credit spread.

Contingent consideration is remeasured to fair value at each reporting

During the year ended December 27,

2025, we updated the fair value of contingent consideration in connection

with 2025 and 2023 business

acquisitions, which resulted in expense of $

million and income of $

million, respectively.

During the year

ended December 28, 2024, we updated the fair value of contingent

consideration in connection with 2023 and 2022

business acquisitions, which resulted in expense of $

million and $

million, respectively.

These changes were

recorded in selling, general and administrative in the consolidated

statements of income.

During the year ended

December 27, 2025, we also updated the fair value of contingent consideration

related to changes in ownership.

These changes were recorded within additional paid-in-capital in the consolidated

balance sheets.

The components of the change in the fair value of contingent consideration

for the year ended December 27, 2025

and December 28, 2024 are presented in the following table:

Balance, beginning of period

Increase in contingent consideration due to business acquisitions and acquisitions of

noncontrolling interests in subsidiaries

Decrease in contingent consideration due to payments

Change in fair value of contingent consideration in connection with business acquisitions

Change in fair value of contingent consideration in connection with changes in ownership in

consolidated subsidiaries

Balance, end of period

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

The following table presents our assets and liabilities that are measured and

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Derivative contracts undesignated

Contingent consideration

Total liabilities

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Note 12 – Concentrations of Risk

Certain financial instruments potentially subject us to concentrations of credit

Certain financial instruments potentially subject us to concentrations of

These financial instruments

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utilizing numerous investment grade counterparties.

With respect to our trade receivables, credit risk is somewhat limited due to a relatively large customer base and

With respect to our trade receivables, credit risk is somewhat limited due to a relatively large customer base

dispersion across different types of health care professionals and geographic areas.

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return swaps, and interest rate swaps.

During 2019 we entered foreign currency forward contracts that we designated

as net investment hedges to hedge a

During 2019 we entered foreign currency forward contracts that we

designated as net investment hedges to hedge a

portion of our euro-denominated foreign operations.

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million, and $

million, respectively, within other comprehensive income related to these foreign currency forward

million, respectively, within other comprehensive income related to these foreign currency

forward contracts.

Note 11 – Fair Value Measurements

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the years ended December 27, 2025, December 28, 2024,

and December 31, 2022,

we recorded within selling,

and December 30, 2023, we recorded within selling,

general and administrative expenses in our consolidated statement of income,

a gain (loss) of $

million, and $(

million, respectively, net of transaction costs, related to this undesignated swap.

Employee Benefit Plans

Note 19 – Employee

Benefit Plans

for additional information.

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million, respectively, related to the change in the fair value of these interest rate

swap agreements, since we have designated these swaps agreements as cash flow

swap agreements, since we have designated these swap agreements as cash

Fluctuations in the value of certain foreign currencies as compared

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Prepaid expenses and other

October 30, 2025

December 24, 2026

Interest rate swaps

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Foreign currency forward contracts

Prepaid expenses and other

Accrued expenses, other

November 3, 2028

Undesignated hedging relationships:

Accrued expenses, other

Prepaid expenses and other

December 30, 2025

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Foreign currency forward contracts

Accrued expenses, other

November 21, 2024

Prepaid expenses and other

October 30, 2025

Interest rate swaps

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Foreign currency forward contracts

Accrued expenses, other

Prepaid expenses and other

November 3, 2028

Undesignated hedging relationships:

Prepaid expenses and other

January 3, 2024

Accrued expenses, other

December 30, 2024

The following table summarizes the effect of cash flow hedges and net investment hedges

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billion revolving credit agreement (the “Revolving Credit Agreement”)

which was subsequently amended and restated on

which was amended and restated on

July 11, 2023

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July 11, 2028

update the interest rate provisions to reflect the current market approach

for a multicurrency facility.

rate on this revolving credit facility is based on Term Secured Overnight Financing Rate (“

spread based on our leverage ratio at the end of each financial reporting

As of December 28, 2024 the

interest rate on this revolving credit facility was

% for a combined rate of

As of December

30, 2023 the interest rate on this revolving credit facility was

and update the

interest rate provisions to reflect the current market approach for a

multicurrency facility.

On June 6, 2025, we

amended and restated the Revolving Credit Agreement to, among other

things, modify certain financial definitions

and covenants.

The interest rate on this revolving credit facility is based on Term Secured Overnight Financing

”) plus a spread based on our leverage ratio at the end

of each financial reporting quarter.

December 27, 2025 the interest rate on this revolving credit facility

% for a combined rate of

As of December 28, 2024 the interest rate on this revolving

credit facility was

combined rate of

The Revolving Credit Agreement requires, among other things, that we

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revolving credit facility.

During the year ended December 28, 2024, the average

outstanding balance under the

During the year ended December 27, 2025, the average outstanding balance

Revolving Credit Agreement was approximately $

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million, respectively, were outstanding.

the year ended December 28, 2024, the average outstanding balances under our

various other short-term bank credit

lines was approximately $

During the year ended December 27, 2025, the average outstanding balances

under our various other short-term

bank credit lines was approximately $

As of December 27, 2025 and December 28, 2024, borrowings

short-term bank credit lines had weighted average interest rates of

under other short-term bank credit lines had weighted average interest

%, respectively.

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from time to time through

October 20, 2026

December 19, 2028

The facilities allow us to issue senior promissory notes to the

at a fixed rate based on an agreed upon spread over applicable treasury

lenders at a fixed rate based on an agreed upon spread over applicable treasury

notes at the time of issuance.

each possible issuance will be selected by us and can range from

(with an average life no longer

The proceeds of any issuances under the facilities will be used

for general corporate purposes,

including working capital and capital expenditures, to refinance existing

indebtedness, and/or to fund potential

acquisitions.

The agreements provide, among other things, that we maintain

certain maximum leverage ratios, and

contain restrictions relating to subsidiary indebtedness, liens, affiliate transactions,

disposal of assets and certain

changes in ownership.

These facilities contain make-whole provisions in the event that we

pay off the facilities

prior to the applicable due dates.

term of each possible issuance will be selected by us and can range from

(with an average life no

The proceeds of any issuances under the facilities will be used for

general corporate

purposes, including working capital and capital expenditures, to refinance

existing indebtedness, and/or to fund

potential acquisitions.

On December 19, 2025, we amended and restated our private placement

facilities to, among

other things, (i) extend the scheduled facility termination dates to

December 19, 2028

and (ii) modify certain

financial definitions and covenants.

The agreements provide, among other things, that we

maintain certain

maximum leverage ratios, and contain restrictions relating to subsidiary

indebtedness, liens, affiliate transactions,

disposal of assets and certain changes in ownership.

These facilities contain make-whole provisions in the event

that we pay off the facilities prior to the applicable due dates.

Index to Financial Statements

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September 2, 2030

December 15, 2025

December 15, 2032

December 15, 2025

December 15, 2032

Deferred debt issuance costs

The components of our private placement facility borrowings as of December

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% are presented in the following table:

January 20, 2012

January 20, 2024

December 24, 2012

December 24, 2024

June 16, 2017

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September 2, 2030

Deferred debt issuance costs

Index to Financial Statements

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million term loan credit agreement (the “Term Credit

The interest rate on this term loan is based on the

plus a spread based on our leverage

ratio at the end of each financial reporting quarter.

This term loan matures on

Agreement”), which was originally scheduled to mature on

July 11, 2026

We are required to

make quarterly payments of $

million from September 2024 through June 2026, with the remaining

balance due in

Previously, we had been required to make quarterly payments of $

million from September 2023

through June 2024.

As of December 28, 2024, the borrowings outstanding under

this term loan were $

At December 28, 2024, the interest rate under the Term Credit Agreement was

% for a combined

As of December 30, 2023, the borrowings outstanding under

this term loan were $

December 30, 2023, the interest rate under the Term Credit Agreement was

% for a combined rate

However, we have a hedge in place that ultimately creates an effective fixed rate of

December 28, 2024 and December 30, 2023, respectively.

The Term Credit Agreement requires, among other

things, that we maintain certain maximum leverage ratios.

On June 6, 2025, this agreement was

amended and restated to, among other things, (i) extend the maturity date

, and (ii) modify certain

financial definitions and covenants.

The interest rate on this term loan is based on the

plus a spread

based on our leverage ratio at the end of each financial reporting quarter.

Beginning in June 2026 and continuing

through June 2027, we are required to make quarterly payments of $

In September 2027, the quarterly

payment amount increases to $

million, continuing through June 2030 with the remaining balance due

As of December 27, 2025, the borrowings outstanding under this

term loan were $

27, 2025, the interest rate under the Term Credit Agreement was

% for a combined rate of

As of December 28, 2024, the borrowings outstanding under this term

At December 28,

2024, the interest rate under the Term Credit Agreement was

% for a combined rate of

However, at December 28, 2024, we had a hedge in place creating an effective fixed rate of

After renewing

the Term Credit Agreement in June of 2025, our hedged portion of the Term Credit Agreement is now

approximately

% of the notional total.

As of December 27, 2025, the effective fixed rate was

floating rate was

%, resulting in a weighted average rate of

The Term Credit Agreement requires,

among other things, that we maintain certain maximum leverage ratios.

Additionally, the Term

Credit Agreement contains

customary representations, warranties and affirmative covenants as well as customary

negative covenants, subject

to negotiated exceptions, on liens, indebtedness, significant corporate changes

(including mergers), dispositions and

certain restrictive agreements.

Credit Agreement

contains customary representations, warranties and affirmative covenants as well

as customary negative covenants,

subject to negotiated exceptions, on liens, indebtedness, significant corporate

changes (including mergers),

dispositions and certain restrictive agreements.

Trade Accounts Receivable Securitization

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This facility agreement has a purchase limit of $

million with two banks as agents.

banks as agents.

As of December 27, 2025 and December 28, 2024, the borrowings outstanding

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(in millions, except share and per share data)

The tax provisions differ from the amount computed using the federal statutory income

tax rate as follows:

The effective income tax rate for the year ended December 27, 2025 differs from the statutory federal

rate as follows:

ended December 27, 2025

Income tax provision at federal statutory rate

State income tax provision, net of federal income tax effect

Foreign Tax effects

Cayman Islands:

Foreign partnership loss

Other foreign jurisdictions:

Equity investment remeasurement gain

Notional interest deduction

Effects of changes in tax laws or rates enacted in current period

Cross-border tax laws

Changes in valuation allowance

Nontaxable and nondeductible items

Worldwide changes

in unrecognized tax benefits

Other adjustments:

Previously held non-controlling equity investment

Effective tax rate

State taxes in California, Illinois, Massachusetts, New Jersey, and New York

make up the majority (greater than 50%) of the tax effect

in this category.

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

As previously disclosed for the years ended December 28, 2024 and December

20, 2023, prior to the adoption of

ASU 2023-09, the tax provisions differ from the amount computed using the federal

statutory income tax rate as

Income tax provision at federal statutory rate

State income tax provision, net of federal income tax effect

Foreign income tax provision

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In 2023, our effective tax rate was

The difference between our effective tax rate and the federal

statutory tax rate is primarily due to state and foreign income taxes

and interest expense.

On December 22, 2017, the U.S.

government passed the Tax Cuts and Jobs Act, which requires U.S.

pay a mandatory one-time transition tax on historical offshore earnings that have not

been repatriated to the U.S.

The transition tax is payable over eight years.

Within our consolidated balance sheets, transition tax of $

million were included in accrued taxes for 2024 and 2023, respectively, and $

million was included in

other liabilities for 2023.

The difference between our effective and federal statutory tax

rates primarily relates to state and foreign income taxes and interest expense,

as well as the tax treatment associated

with the acquisition of a controlling interest of a previously held non-controlling

equity investment.

On July 4, 2025, President Trump signed the reconciliation tax bill, commonly known as the “One Big Beautiful

Bill Act” (OBBBA), into law.

Corporate provisions in the OBBBA include immediate expensing of domestic

research and experimental expenditures, limitations on certain deductions

and modifications to international tax

The changes resulting from the OBBBA did not have a significant impact

to the total tax provision.

The OECD issued technical and administrative guidance on Pillar Two rules in December 2021, which provides for

a global minimum tax rate on the earnings of large multinational businesses on a country-by-country

Effective January 1, 2024, the minimum global tax rate is 15% for various jurisdictions pursuant

to the Pillar Two

Future tax reform resulting from these developments may result

in changes to long-standing tax principles,

which may adversely impact our effective tax rate going forward or result in higher cash

tax liabilities.

December 27, 2025, the impact of the Pillar Two rules to our financial statements was immaterial.

Due to the one-time transition tax and the imposition of the GILTI provisions, all previously unremitted earnings

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liability with respect to such earnings is not practicable.

The Organization of Economic Co-Operation and Development (OECD) issued

technical and administrative

guidance on Pillar Two rules in December 2021, which provides for a global minimum tax rate on the earnings of

large multinational businesses on a country-by-country basis.

Effective January 1, 2024, the minimum global tax

rate is 15% for various jurisdictions pursuant to the Pillar Two rules.

Future tax reform resulting from these

developments may result in changes to long-standing tax principles, which

may adversely impact our effective tax

rate going forward or result in higher cash tax liabilities.

As of December 28, 2024, the impact of the Pillar Two

rules to our financial statements was immaterial.

ASC Topic 740 prescribes the accounting for uncertainty in income taxes recognized in accordance with other

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Such examinations may result in future tax

and interest assessments by these taxing authorities for uncertain tax positions

taken in respect of certain tax

Index to Financial Statements

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(in millions, except share and per share data)

and interest assessments by these taxing authorities for uncertain tax positions

taken in respect of certain tax

The total amount of unrecognized tax benefits, which are included in “other

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million, respectively, would affect the effective tax rate if recognized.

possible that the amount of unrecognized tax benefits will change in the next 12

months, which may result in a

material impact on our consolidated statements of income.

All tax returns audited by the IRS are officially closed through 2021.

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for taxes was $

million in 2024, 2023 and 2022, respectively.

The total amount of accrued interest is included in other

liabilities within our consolidated balance sheets, and was $

million during the years ended December 27, 2025, December 28, 2024

and December 30, 2023,

respectively.

The total amount of accrued interest is included in other liabilities

within our consolidated balance

sheets, and was $

million as of December 27, 2025 and $

of December 30, 2023.

The amount of penalties accrued for during the periods presented was not

material to our

million as of December 28, 2024.

The amount of

penalties accrued for during the periods presented was not material to our

consolidated financial statements.

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(in millions, except share and per share data)

Note 16 – Plans of Restructuring and Integration Costs

On August 6, 2024, we committed to a new restructuring plan (the “2024

Plan”) to integrate recent acquisitions,

right-size operations and further increase efficiencies.

During the year ended December 28, 2024, we recorded

restructuring charges associated with the 2024 Plan of $

million, which primarily related to severance and

employee-related costs, accelerated amortization of right-of-use

lease assets and fixed assets, impairment of

intangible assets related to the disposal of a portion of a business

and other exit costs.

We expect to record

restructuring charges associated with the 2024 Plan in 2025;

however an estimate

of the amount of these charges

Note 16 – Plans of Restructuring and Related Costs

On August 6, 2024, we committed to a restructuring plan (the “2024

Plan”) to integrate our acquisitions, right-size

operations and further increase efficiencies.

We currently expect this plan to be completed at the end of 2027.

During the years ended December 27, 2025 and December 28, 2024, we recorded

restructuring and related charges

associated with the 2024 Plan of $

million and $

million, respectively.

The restructuring and related costs for

these periods primarily related to severance and employee-related costs, accelerated

amortization of right-of-use

assets and fixed assets, and other exit costs.

We expect to record restructuring and related charges associated with

the 2024 Plan through the end of 2027;

however, an estimate of the amount of these charges for 2026 through 2027

has not yet been determined.

During the year ended December 27, 2025, in connection with the 2024 Plan,

we recorded a loss of $

million related to the disposal of businesses in the Global Distribution and Value-Added Services and Global

Specialty Product segments, respectively, and a net gain related to disposal of a business in the Global Technology

These amounts are included in the $

million of restructuring and related charges discussed above.

During the year ended December 28, 2024, in connection with the 2024 Plan,

we recorded an impairment of

goodwill and intangible assets of $

million related to the disposal of a portion of a business.

This impairment is

included in the $

million of restructuring charges discussed above and related to the Global Specialty Products

million related to the disposal of a portion of a business in the Global

Specialty Products segment.

This impairment is included in the $

million of restructuring and related charges

discussed above.

On August 1, 2022, we committed to a restructuring plan (the “2022

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increase efficiency.

The 2022 Plan has

been completed as of July 31, 2024.

During the years ended December 28, 2024, December

30, 2023, and

December 31, 2022, in connection with our 2022 Plan, we recorded restructuring

million, respectively.

The restructuring costs for these periods primarily related to

severance and

employee-related costs, accelerated amortization of right-of-use

lease assets and fixed assets, impairment of

intangible assets related to disposal of a U.S.

and other exit costs.

The 2022 Plan was

completed as of July 31, 2024.

During the years ended December 28, 2024 and December 30, 2023, in

with our 2022 Plan, we recorded restructuring and related costs of $

million and $

million, respectively, which

primarily related to severance and employee-related costs, accelerated amortization

of right-of-use assets and fixed

assets, and other exit costs.

During the year ended December 30, 2023, in connection with the 2022 Plan,

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million related to disposal of a U.S.

This impairment is included in the $

million of restructuring costs discussed above and related to the Global Specialty

Products segment.

was completed during the first quarter of 2024.

During the year ended December 31, 2022, in connection with the 2022 Plan,

of the buildings at our

corporate headquarters in Melville, New York, which resulted in an accelerated amortization of a right-of-use lease

We also initiated the disposal of a non-profitable U.S.

business within the Global Specialty

Products segment and recorded related costs of $

million, which primarily consisted of impairment of intangible

assets and goodwill, inventory impairment, and severance and employee-related

costs, which are included in the

Global Specialty Products segment.

These costs are included in the $

million of restructuring charges discussed

The disposal was completed during the first quarter of 2023.

On August 26, 2022, we acquired Midway Dental Supply.

In connection with this acquisition, during the year

ended December 31, 2022, we recorded integration costs of $

million related to one-time employee and other

costs, as well as restructuring charges of $

million, which are included in the $

million of restructuring charges

discussed above.

The integration and restructuring costs related to Midway Dental

Supply are recorded in the

Global Distribution and Value-Added Services segment.

business in the Global Specialty Products

impairment is included in the $

million of restructuring and related costs discussed above.

The disposal was

completed during the first quarter of 2024.

Restructuring and related costs recorded for the fiscal years ended 2025,

2024 and 2023 in connection with the

2024 Plan and 2022 Plan, respectively, consisted of the following:

December 27, 2025

Global Distribution

and Value-Added

Severance and employee-related costs

Impairment and accelerated depreciation and

amortization of right-of-use lease assets and other

long-lived assets

Exit and other related costs

Loss/(Gain) on disposal of a business

Restructuring and related costs-2024 Plan

Index to Financial Statements

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(in millions, except share and per share data)

Restructuring and integration costs recorded during our 2024, 2023 and

2022 fiscal years consisted of the

December 28, 2024

Global Distribution and

Value-Added Services

Restructuring

Restructuring Costs

Global Distribution

and Value-Added

Severance and employee-related costs

Impairment and accelerated depreciation and

amortization of right-of-use lease assets and

other long-lived assets

amortization of right-of-use lease assets and other

long-lived assets

Exit and other related costs

Loss on disposal of a business

Restructuring and integration costs-2024 Plan

Restructuring and related costs-2024 Plan

Severance and employee-related costs

1 unchanged sentence

Exit and other related costs

Restructuring and integration costs-2022 Plan

Total restructuring and integration costs

December 30, 2023

Global Distribution and

Value-Added Services

Restructuring

Restructuring Costs

Severance and employee-related costs

Impairment and accelerated depreciation and

amortization of right-of-use lease assets and

other long-lived assets

Exit and other related costs

Loss on disposal of a business

Total restructuring and integration costs

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Restructuring and related costs-2022 Plan

Total restructuring and related costs

December 30, 2023

Global Distribution and

Value-Added Services

Restructuring

Restructuring Costs

Global Distribution

and Value-Added

Severance and employee-related costs

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Loss on disposal of a business

Integration employee-related and other costs

Total restructuring and integration costs

Restructuring and related costs-2022 Plan

The following table summarizes, by plan year, the activity related to the liabilities associated with

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The remaining accrued

balance of restructuring costs as of December 28, 2024, which primarily

relates to severance and employee-related

costs, is included in accrued expenses:

other within our consolidated balance

Liabilities related to exited

leased facilities are recorded within our current and non-current operating

lease liabilities within our consolidated

balance sheets.

balance of restructuring and related costs as of December 27, 2025, which

primarily relates to severance and

employee-related costs, is included in accrued expenses:

our consolidated balance sheets.

related to exited leased facilities are recorded within our current and non-current

operating lease liabilities within

our consolidated balance sheets.

Balance, December 30, 2023

Restructuring costs

Non-cash accelerated depreciation and amortization

Restructuring and related costs

Non-cash impairment, accelerated depreciation and

Non-cash impairment on disposal of a business

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Balance, December 28, 2024

Restructuring costs

Non-cash accelerated depreciation and amortization

Non-cash impairment on disposal of a business

Restructuring and related costs

Non-cash impairment, accelerated depreciation and

Non-cash charges related to disposal of a business

Cash payments and other adjustments

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Henry Schein, Inc.

has been named as a defendant in multiple opioid

related lawsuits (currently less than one-

hundred and seventy-five (

one or more of Henry Schein, Inc.’s subsidiaries is also named as a defendant in a

number of those cases).

Generally, the lawsuits allege that the manufacturers of prescription opioid drugs engaged

in a false advertising campaign to expand the market for such drugs and

their own market share and that the entities

in the supply chain (including Henry Schein, Inc.

and its subsidiaries) reaped

financial rewards by refusing or

otherwise failing to monitor appropriately and restrict the improper distribution

of those drugs.

These actions

consist of some that have been consolidated within the MultiDistrict Litigation

(“MDL”) proceeding In Re National

was named as a defendant in multiple opioid related

lawsuits (currently less than ten (

more of Henry Schein, Inc.’s subsidiaries was also named as a defendant in a number of those cases).

the lawsuits allege that the manufacturers of prescription opioid drugs

engaged in a false advertising campaign to

expand the market for such drugs and their own market share and that

the entities in the supply chain (including

Henry Schein, Inc.

and its subsidiaries) reaped financial rewards by refusing

or otherwise failing to monitor

appropriately and restrict the improper distribution of those drugs.

The actions that remain have been consolidated

within the MultiDistrict Litigation (“MDL”) proceeding In Re National

Prescription Opiate Litigation (MDL No.

and are currently stayed, and others which

remain pending in state courts and are proceeding independently and outside

On January 29, 2025,

the court granted our motion for summary judgment in the action

filed by Mobile County Board of Health, et al.

Alabama state court and dismissed all claims against Henry Schein

with prejudice.

We have settled the action filed

by DCH Health Care Authority, et al.

in Alabama state court (

plaintiffs) for an immaterial amount and

the claims against Henry Schein have been dismissed with prejudice.

We have also settled

case in which we were not yet named a defendant) filed by plaintiffs represented

by the Napoli Shkolnik PLLC

law firm for an immaterial amount.

Stipulations of Discontinuance with Prejudice in those cases

this time, the following case is set for trial:

the action filed by Florida Health Sciences

hospitals located throughout the State of Florida) in Florida state court,

which is currently scheduled for a jury trial

in September 2025.

17-md-2804) and are currently stayed.

Of Henry Schein’s 2025 net sales of approximately $

billion, sales of opioids represented

billion, sales of opioids represented less than

-tenths of 1 percent.

Opioids represent a negligible part of our business.

We intend to defend

ourselves vigorously against these actions.

On January 18, 2024, a putative class action was filed against the Company

District Court for the

Eastern District of New York (“EDNY”), Case No.

24-cv-387 (the “Cruz-Bermudez Action”), based on the

October 2023 cyber incident described in

Note 3 – Cyber Incident

On January 26, 2024, a second putative class

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

action was filed against the Company based on the cyber incident, also

24-cv-550 (the

“Depperschmidt Action”).

On February 12, 2024, the Depperschmidt Action was voluntarily dismissed

On February 16, 2024, an amended complaint was filed in

the Cruz-Bermudez Action with additional

plaintiffs’ counsel from the Depperschmidt Action and an additional new plaintiff.

Plaintiffs in the Cruz-Bermudez Action seek to represent a class of all individuals

whose personally identifying

information and personal health information was compromised by

the incident.

Plaintiffs generally claim to have

been harmed by alleged actions and/or omissions by the Company

in connection with the incident and that the

Company made deceptive public statements regarding privacy and data protection.

Plaintiffs assert a variety of

claims seeking monetary damages, injunctive relief, costs and attorneys’

fees, and other related relief.

22, 2024, plaintiffs voluntarily withdrew two of their five causes of action.

On April 8, 2024, the court denied the

Company’s motion to dismiss the remaining claims.

On June 6, 2024, plaintiffs and the Company informed the court that they had agreed

to a term sheet for a class

action settlement of the Cruz-Bermudez Action.

Plaintiffs and the Company entered into a class action settlement

agreement on September 13, 2024, and the court preliminarily approved

the settlement on September 16,

Under the terms of the settlement, all claims in the Cruz-Bermudez

Action will be dismissed, the Cruz-

Bermudez Action will be terminated, the Company will receive a

release of claims from the class, and the

Company will pay $

million into a fund for class members.

The court has approved the settlement and entered

the final approval order on February 20, 2025.

The settlement agreement’s effective date is

after the final

approval order assuming no appeals have been filed.

Opioids represent a negligible part of our

We intend to defend ourselves vigorously against these actions.

From time to time, we may become a party to other legal proceedings,

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stock options.

Starting with our 2023

plan year, we returned to granting our employees equity-based awards solely in the form of

time-based and

performance-based RSUs.

Our non-employee directors receive equity-based awards solely in the form

Our non-employee

directors receive equity-based awards solely in the form of time-based RSUs with

-month cliff vesting.

Starting with our 2023 plan year, we returned to granting our employees equity-based awards solely in

time-based RSUs (which vest solely based on the recipient’s continued service over time) and performance-based

RSUs (which vest based on achieving specified performance

measurements and the recipient’s continued service

In our 2025 plan year, stock awards issued to our Chief Executive Officer were allocated

% to time-based RSU

cliff vesting and

% to performance-based RSU awards with

cliff vesting.

2025 plan year, stock awards issued to members of our Executive Management Committee were allocated

time-based RSU awards with

cliff vesting and

% to performance-based RSU awards with

cliff vesting.

In our 2025 plan year, stock awards issued to our eligible vice-presidents were allocated

% to time-based RSU

% to performance-based RSU awards with

cliff vesting.

Our vice-president level time-

based awards will vest

% on the third anniversary of the grant date with the remaining

% vesting on the fourth

anniversary of the grant date.

In our 2025 plan year, we began granting only time-based RSU awards to our eligible director level employees.

Our director level time-based RSU awards will vest

% on the third anniversary of the grant date with the

% vesting on the fourth anniversary of the grant date.

For the performance-based RSUs and the time-based RSUs with cliff vesting (issued

in 2022-2024 plan years), we

recognize the cost as compensation expense on a straight-line basis.

For the time-based RSUs with graded vesting

(issued in the 2025 plan year), we recognize the cost as compensation

expense on an accelerated basis.

As of December 27, 2025, there were

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under the 2023 Non-Employee Director Stock Incentive Plan.

RSUs are stock-based awards granted to recipients with specified vesting provisions.

In the case of RSUs, common

stock is delivered on or following satisfaction of vesting conditions.

We issue RSUs to employees that primarily

vest (i) solely based on the recipient’s continued service over time, primarily with

-year cliff vesting and/or (ii)

based on achieving specified performance measurements and the recipient’s continued service over time, primarily

-year cliff vesting.

RSUs granted to our non-employee directors primarily include

-month cliff vesting.

For these RSUs, we recognize the cost as compensation expense on a straight-line

For all RSUs, we estimate the fair value based on our closing stock

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performance-based RSUs based on our closing stock price at time of grant.

Each of the Plans provide for certain adjustments to the performance measurement

in connection with awards under

Each of the Plans provide for certain adjustments to the performance

measurement in connection with awards under

With respect to the performance-based RSUs granted under our 2024 Stock Incentive Plan, such

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without limitation, acquisitions,

divestitures, new business ventures, certain capital transactions (including share

repurchases), differences in

budgeted average outstanding shares (other than those resulting from capital

transactions referred to above),

restructuring costs, if any, amortization expense recorded for acquisition-related intangible assets (solely with

respect to performance-based RSUs granted in the 2023 and 2024 plan years),

certain litigation settlements or

payments, if any, changes in accounting principles or in applicable laws or regulations, changes in income tax rates

in certain markets, foreign exchange fluctuations, the financial impact

either positive or negative, of the difference

in projected earnings generated by COVID-19 test kits (solely with respect

to performance-based RSUs granted in

the 2022 and 2023 plan years) and impairment charges (solely with respect to performance-based

RSUs granted in

the 2023 and 2024 plan years), and unforeseen events or circumstances

affecting us.

Over the performance period, the number of RSUs that will ultimately vest

and be issued and the related

compensation expense is adjusted upward or downward based upon our

estimation of achieving such performance

The ultimate number of shares delivered to recipients and the related compensation

cost recognized as an

expense is based on our actual performance against the pre-determined performance

metrics (in each case as

Stock options are awards that allow the recipient to purchase shares of our

common stock after vesting at a fixed

price set at the time of grant.

Stock options were granted at an exercise price equal to our

closing stock price on the

divestitures, new business ventures, changes in fair value of contingent

consideration (solely with respect to

performance-based RSUs granted in the 2024 and 2025 plan years),

certain capital transactions (including share

repurchases), differences in budgeted average outstanding shares (other

than those resulting from capital

Index to Financial Statements

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(in millions, except share and per share data)

transactions referred to above), restructuring and related costs, amortization

expense recorded for acquisition-

related intangible assets, certain litigation settlements or payments,

changes in accounting principles or in

applicable laws or regulations, changes in income tax rates in certain

markets, foreign exchange fluctuations, the

financial impact either positive or negative, of the difference in projected earnings

generated by COVID-19 test kits

(solely with respect to performance-based RSUs granted in the 2023 plan

year), intangibles impairment charges and

costs related to shareholder advisory matters (solely with respect to performance-based

RSUs granted in the 2025

Over the performance period, the number of performance-based RSUs that will

ultimately vest and be issued and

the related compensation expense is adjusted upward or downward based upon

our estimation of achieving such

performance targets.

The ultimate number of shares delivered to recipients and

the related compensation cost

recognized as an expense is based on our actual performance against

the pre-determined performance metrics (in

each case as adjusted).

Stock options are awards that allow the recipient to purchase shares of our

common stock after vesting at a fixed

price set at the time of grant.

Stock options were granted at an exercise price equal to our

closing stock price on the

date of grant.

Stock options issued in 2021 and 2022 vest

per year based on the recipient’s continued

Stock options issued in 2021 and 2022 vest one-third per year based

on the recipient’s continued

service, subject to the terms and conditions of the 2020 Stock Incentive Plan,

3 unchanged sentences

term acceleration upon certain events.

Compensation expense for stock options is recognized using

vesting method.

Compensation expense for stock options is recognized on

an accelerated

We estimate grant date fair value of stock options using the Black-Scholes valuation model.

During the year ended December 28, 2024, we did

During the year

ended December 27, 2025, we did

t grant any stock options.

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December 27, 2025, December 28, 2024 and December 30, 2023.

The following weighted-average assumptions were used in determining

the most recent fair values of stock options

using the Black-Scholes valuation model:

Expected dividend yield

Expected stock price volatility

Risk-free interest rate

Expected life of options (in years)

We have not declared cash dividends on our stock in the past and we do not anticipate declaring cash dividends in

the foreseeable future.

The expected stock price volatility is based on implied volatilities

from traded options on

our stock, historical volatility of our stock and other factors.

The risk-free interest rate is based on the U.S.

Treasury yield curve in effect at the time of grant that most closely aligns to the expected life of options.

year expected life of the options was determined using the simplified

method for estimating the expected term as

permitted under Staff Accounting Bulletin Topic 14.

Index to Financial Statements

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Options exercisable at end of year

Weighted Average

Remaining Contractual

Exercise Price

Life (in years)

Expected to vest

The following tables summarize the activity of our unvested RSUs for

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Grant Date Fair

Intrinsic Value

Grant Date Fair

Intrinsic Value

Value Per Share

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Outstanding at beginning of period

Performance adjustment

Outstanding at end of period

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Past service cost (credit)

Actuarial gain

Actuarial gain (loss)

Benefits paid

Participant contributions

Settlements and curtailments

Effect of foreign currency translation

37 unchanged sentences

Employee contributions

Amortization of prior service credit

Net periodic pension cost

70 unchanged sentences

eligible employees.

The amounts (credited)/charged to operations during the years ended December

December 30, 2023 and December 31, 2022 were approximately $

The amounts charged to operations during the years ended December

27, 2025, December 28,

2024 and December 30, 2023 were approximately $

million and $

respectively.

The charges are included in selling, general and administrative within our consolidated

statements of

million, respectively.

charges are included in selling, general and administrative within our consolidated

statements of income.

Note 13 – Derivatives and Hedging Activities

67 unchanged sentences

primarily due to changes in foreign currency exchange rates of the Brazilian

Real, Euro, British Pound, Canadian

Dollar, Australian Dollar,

Swiss Franc, and New Zealand Dollar.

Real, British Pound, Euro, Swiss

Franc, Israel Shekel, Canadian Dollar, Australian Dollar, and New Zealand Dollar.

The hedging gain (loss) during the years ended December 27, 2025, December

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securities excluded from earnings per share

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Note 23 – Supplemental Cash Flow Information

Cash paid for interest and income taxes was:

Cash paid for interest

Cash paid for income taxes, net of refunds:

State and local

Cash paid during the period for income taxes (prior to ASU 2023-09)

For the years ended December 27, 2025, December 28, 2024 and December

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million and $

million of non-cash net unrealized gains (losses) related to hedging

activities, respectively.

million of non-cash net unrealized gains (losses) related to hedging activities,

respectively.

Note 13 – Derivatives and Hedging Activities

1 unchanged sentence

interest rate swap agreements.

For the year ended December 30, 2023, there was approximately $

million of debt assumed as part of the

acquisitions of Biotech Dental and S.I.N.

There was approximately $

million and $

million of debt assumed as a part of the acquisitions for

the years ended December 27, 2025, December 28, 2024 and December 30, 2023,

respectively.

during the year ended December 30, 2023 primarily relates to the acquisitions

of Biotech Dental and S.I.N.

Index to Financial Statements

4 unchanged sentences

Note 24 – Related Party Transactions

In connection with the formation of Henry Schein One, LLC, our joint venture

with Internet Brands, which was

formed on July 1, 2018, we entered into a

royalty agreement with Internet Brands whereby we will pay

Internet Brands approximately $

million annually for the use of their intellectual property.

During the years

ended December 28, 2024, December 30, 2023 and December 31, 2022, we recorded

million, respectively, within selling, general and administrative in our consolidated statements of income, in

connection with costs related to this royalty agreement.

As of December 28, 2024 and December 30, 2023, Henry

Schein One, LLC had a net payable balance to Internet Brands of $

During 2018, we entered into a joint venture with Internet Brands to create Henry

Schein One, LLC.

Brands initially held a

% noncontrolling interest, which has since increased to a

% noncontrolling interest in

Henry Schein One, LLC, and a freestanding and separately exercisable right

to put its noncontrolling interest to

Henry Schein, Inc.

for fair value following the fifth anniversary of the effective date of the

formation of the joint

On January 29, 2025, Henry Schein, Inc.

signed a Memorandum of Understanding

with Internet Brands to

extend the time-based trigger for the exercise of our call option to July 1, 2032

and to pause the exercise by Internet

Brands of its put option for a period of

, to January 29, 2029.

In connection with the formation of Henry Schein One, LLC we entered

royalty agreement with

Internet Brands whereby we will pay Internet Brands approximately $

million annually for the use of their

intellectual property.

During the years ended December 27, 2025, December 28, 2024 and December

million and $

million, respectively,

comprised of amounts related to results of operations and the royalty agreement.

The components of this payable

are recorded within accrued expenses:

other within our consolidated balance sheets.

million, respectively, within selling, general and administrative in our

consolidated statements of income,

in connection with costs related to this royalty agreement.

As of December 27,

2025 and December 28, 2024, Henry Schein One, LLC had a net payable balance

to Internet Brands of $

million, respectively, comprised of amounts related to results of operations and the royalty agreement.

components of this payable are recorded within accrued expenses:

our consolidated balance sheets.

have interests in entities that we account for under the equity accounting

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for further information.

Note 25 – Subsequent Event

Index to Financial Statements

HENRY SCHEIN, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

(in millions, except share and per share data)

Note 25 – KKR Investment and Accelerated Share Repurchase Program

On January 29, 2025, Henry Schein, Inc.

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by funds affiliated with KKR, a leading

global investment firm.

In addition to KKR’s current holdings, KKR will make an additional $

investment in the Company’s common stock.

As a result, KKR will own approximately

% of the Company’s

KKR will also have the ability to purchase additional shares via

open market purchases up to a total equity

% of the outstanding common shares of the Company.

In addition, under the agreement

between Henry Schein and KKR,

independent directors will join our Board of Directors.

Upon consummation

of this strategic investment,

we will issue new shares of common stock to funds affiliated with KKR for an

investment of $

global investment firm, and entered into a Strategic Partnership Agreement

with KKR (the “Agreement”).

16, 2025, we issued

shares of common stock to funds affiliated with KKR for an investment of $

million, at approximately $

As part of the agreement, KKR has also agreed to

customary voting and other provisions.

Consummation of these transactions is subject to customary closing

conditions, including the expiration or termination of any waiting

period under the Hart-Scott-Rodino Act and

certain foreign regulatory approvals.

In addition, under the Agreement,

independent directors have

joined our Board of Directors.

On May 19, 2025, we executed an accelerated share repurchase program

to repurchase a total of $

our outstanding common stock based on volume-weighted average prices.

In May 2025 we received

shares at an estimated fair value of $

In July 2025, we received an additional

estimated fair value of $

million, representing the final amount of shares to be received under

this accelerated

share repurchase program.

On November 4, 2025, the Company and KKR entered into an amendment

to the Agreement that increased the

beneficial ownership limit from

% of the outstanding shares of the Company’s common stock that

KKR is permitted to acquire during the standstill period.

The standstill provisions, including the increased

ownership limit, continue in effect for a period of six months following the later

of the expiration of the term of the

Agreement and the date on which no KKR director appointed pursuant

to the Agreement is serving on the Board of

Index to Financial Statements

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data