What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-06-30 compared with 2025-04-08 · 139 added, 103 removed, 345 unchanged (41% of the section changed)

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We conduct our operations in facilities that are located worldwide, including but not limited to, China, Mexico, Singapore, Malaysia, and the United States.

We derived a substantial majority, 77.0% and 78.9% of net revenue, from our international operations for the three months and six months ended February 28, 2025, respectively.

We derived a substantial majority, 72.5% and 76.6% of net revenue, from our international operations for the three months and nine months ended May 31, 2025, respectively.

Our global manufacturing production sites allow customers to manufacture products simultaneously in the optimal locations for their products.

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We monitor the current economic environment and its potential impact on both the customers we serve as well as our end-markets and closely manage our costs and capital resources so that we can respond appropriately as circumstances change.

Beginning in February 2025, the U.S.

implemented tariffs on a variety of countries and commodities, including, among others, tariffs on aluminum and steel derivative products, imports of certain Canadian and Mexican goods, imports of Chinese goods, universal tariffs on imports from most countries, and reciprocal tariffs on select countries.

In response, certain countries have imposed, or are considering, retaliatory tariffs on U.S.

The global tariff landscape continues to shift rapidly, with changes impacting businesses and markets around the world.

While these increased tariffs have and may continue to impact end customer demand, we expect that we will recover the tariff costs by passing them on to our customers.

If we are unable to fully pass on these costs, our operating results and cash flows could be adversely impacted.

For additional information, refer to Part I, “Item 1A.

Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended August 31, 2024.

Refer to Item 7.

“Management's Discussion and Analysis of Financial Condition and Results of Operations” section contained in our Annual Report on Form 10-K for the fiscal year ended August 31, 2024, for further discussion of the items disclosed in Item 2.

“Management's Discussion and Analysis of Financial Condition and Results of Operations” section as of February 28, 2025, contained herein.

“Management's Discussion and Analysis of Financial Condition and Results of Operations” section as of May 31, 2025, contained herein.

Summary of Results

The following table sets forth, for the periods indicated, certain key operating results and other financial information (in millions, except per share data):

Three months ended Six months ended

February 28, 2025 February 29, 2024 February 28, 2025 February 29, 2024

Three months ended Nine months ended

May 31, 2025 May 31, 2024 May 31, 2025 May 31, 2024

Net revenue $ 7,828 $ 6,765 $ 21,550 $ 21,919

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Three months ended

February 28, 2025 November 30, 2024

February 29, 2024

May 31, 2025 February 28, 2025

Sales cycle (1)

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(3) Days in accounts receivable is calculated as accounts receivable, net, divided by net revenue multiplied by 90 days.

During the three months ended February 28, 2025, the increase in days in accounts receivable from the prior sequential quarter and the three months ended February 29, 2024, was primarily driven by timing of payments.

During the three months ended May 31, 2025, the decrease in days in accounts receivable from the prior sequential quarter was primarily driven by timing of payments.

(4) Days in inventory is calculated as inventories, net and contract assets divided by cost of revenue multiplied by 90 days.

During the three months ended February 28, 2025, the increase in days in inventory from the prior sequential quarter was primarily driven by the timing of sales.

During the three months ended February 28, 2025, the decrease in days in inventory from the three months ended February 29, 2024, was primarily driven by higher consumption of inventory to support sales during the quarter and improved working capital management.

During the three months ended May 31, 2025, the decrease in days in inventory from the prior sequential quarter and the three months ended May 31, 2024, was primarily driven by higher consumption of inventory to support sales during the quarter and improved working capital management.

(5) Days in accounts payable is calculated as accounts payable divided by cost of revenue multiplied by 90 days.

During the three months ended February 28, 2025, the increase in days in accounts payable from the three months ended February 29, 2024, was primarily due to higher purchases of customer-controlled consignment components and timing of cash payments.

During the three months ended May 31, 2025, the increase in days in accounts payable from the three months ended May 31, 2024, was primarily due to higher purchases of customer-controlled consignment components and timing of cash payments.

Critical Accounting Policies and Estimates

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In conjunction with this reorganization, there have been certain reclassifications made within the reported segments.

Three months ended Six months ended

(dollars in millions) February 28, 2025 February 29, 2024 Change February 28, 2025 February 29, 2024 Change

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(dollars in millions) May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Net revenue $ 7,828 $ 6,765 15.7 % $ 21,550 $ 21,919 (1.7) %

Net revenue decreased during the three months ended February 28, 2025, compared to the three months ended February 29, 2024.

Specifically, the Connected Living and Digital Commerce segment net revenue decreased 13% due to an 18% decrease in revenues primarily driven by the divestiture of the Mobility Business within our connected living business.

The decrease is partially offset by a 5% increase in revenues from existing customers within our digital commerce business.

The Regulated Industries segment net revenue decreased 8% primarily due to:

(i) a 5% decrease in revenues from existing customers within our automotive and transportation business and (ii) a 3% decrease in revenues from existing customers within our healthcare and packaging business.

The Intelligent Infrastructure segment net revenue increased 18% primarily due to:

Net revenue increased during the three months ended May 31, 2025, compared to the three months ended May 31, 2024.

Specifically, the Intelligent Infrastructure segment net revenue increased 51% primarily due to:

(i) a 40% increase in revenues from existing customers within our cloud and data center infrastructure business and (ii) a 13% increase in revenues from existing customers within our capital equipment business.

The increase is partially offset by a 2% decrease in revenues from existing customers within our networking and communications business.

Net revenue decreased during the six months ended February 28, 2025, compared to the six months ended February 29, 2024.

The Connected Living and Digital Commerce segment net revenue decreased 7% due to a 7% decrease in revenues from existing customers within our connected living business.

The Regulated Industries segment net revenue remained consistent primarily due to:

(i) a 4% increase in revenues from existing customers within our renewable energy infrastructure business and (ii) a 4% decrease in revenues from existing customers within our automotive and transportation business.

Net revenue decreased during the nine months ended May 31, 2025, compared to the nine months ended May 31, 2024.

Specifically, the Connected Living and Digital Commerce segment net revenue decreased 27% due to a 30% decrease in revenues primarily driven by the divestiture of the Mobility Business within our connected living business.

The decrease is partially offset by a 3% increase in revenues from existing customers within our digital commerce business.

The Regulated Industries segment net revenue decreased 8% primarily due to:

(i) a 4% decrease in revenues from existing customers within our renewable energy infrastructure business, (ii) a 3% decrease in revenues from existing customers within our automotive and transportation business, and (iii) a 1% decrease in revenues from existing customers within our healthcare and packaging business.

The Intelligent Infrastructure segment net revenue increased 24% primarily due to:

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The increase is partially offset by a 9% decrease in revenues from existing customers within our networking and communications business.

The Regulated Industries segment net revenue decreased 5% primarily due to:

(i) a 3% decrease in revenues from existing customers within our automotive and transportation business, (ii) a 1% decrease in revenues from existing customers within our renewable energy infrastructure business, and (iii) a 1% decrease in revenues from existing customers within our healthcare and packaging business.

The following table sets forth, for the periods indicated, revenue by segment expressed as a percentage of net revenue:

Three months ended Six months ended

February 28, 2025 February 29, 2024 February 28, 2025 February 29, 2024

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May 31, 2025 May 31, 2024 May 31, 2025 May 31, 2024

Regulated Industries 39 % 45 % 41 % 42 %

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The following table sets forth, for the periods indicated, foreign source revenue expressed as a percentage of net revenue:

Three months ended Six months ended (1)

February 28, 2025 February 29, 2024 February 28, 2025 February 29, 2024

Three months ended Nine months ended

May 31, 2025 May 31, 2024 May 31, 2025 May 31, 2024

Foreign source revenue 72.5 % 80.5 % 76.6 % 83.4 %

(1) Decrease from the prior period is primarily driven by the divestiture of the Mobility Business during the three months ended February 29, 2024.

Three months ended Six months ended

(dollars in millions) February 28, 2025 February 29, 2024 February 28, 2025 February 29, 2024

Three months ended Nine months ended

(dollars in millions) May 31, 2025 May 31, 2024 May 31, 2025 May 31, 2024

Gross profit $ 681 $ 608 $ 1,863 $ 2,013

Percent of net revenue 8.7 % 9.0 % 8.6 % 9.2 %

Gross profit as a percentage of net revenue decreased for the three months and six months ended February 28, 2025, compared to the three months and six months ended February 29, 2024, primarily due to product mix in our Connected Living and Digital Commerce segment.

Gross profit as a percentage of net revenue decreased for the three months and nine months ended May 31, 2025, compared to the three months and nine months ended May 31, 2024, primarily due to product mix in our Connected Living and Digital Commerce segment.

Selling, General and Administrative

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(in millions) February 28, 2025 February 29, 2024 Change February 28, 2025 February 29, 2024 Change

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(in millions) May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Selling, general and administrative $ 274 $ 268 $ 6 $ 835 $ 890 $ (55)

Selling, general and administrative expenses decreased during the three months and six months ended February 28, 2025, compared to the three months and six months ended February 29, 2024, primarily due to a decrease in salary and salary related expenses.

Selling, general and administrative expenses increased during the three months ended May 31, 2025, compared to the three months ended May 31, 2024, primarily due to an increase in stock-based compensation expense primarily driven by the reversal of stock-based compensation expense associated with forfeitures of time-based, performance-based and market-based restricted stock awards during the three months ended May 31, 2024.

The increase is partially offset by a decrease in business interruption and impairment charges, net and a decrease in salary and salary related expenses during the three months ended May 31, 2025.

Selling, general and administrative expenses decreased during the nine months ended May 31, 2025, compared to the nine months ended May 31, 2024, primarily due to (i) a decrease in salary and salary related expenses, (ii) a decrease in office and support costs, and (ii) a decrease in business interruption and impairment charges, net.

Research and Development

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(dollars in millions) February 28, 2025 February 29, 2024 February 28, 2025 February 29, 2024

Three months ended Nine months ended

(dollars in millions) May 31, 2025 May 31, 2024 May 31, 2025 May 31, 2024

Research and development $ 7 $ 9 $ 22 $ 29

Percent of net revenue 0.1 % 0.1 % 0.1 % 0.1 %

Research and development expenses remained consistent as a percentage of net revenue during the three months and six months ended February 28, 2025, compared to the three months and six months ended February 29, 2024.

Research and development expenses remained consistent as a percentage of net revenue during the three months and nine months ended May 31, 2025, compared to the three months and nine months ended May 31, 2024.

Amortization of Intangibles

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(in millions) February 28, 2025 February 29, 2024 Change February 28, 2025 February 29, 2024 Change

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(in millions) May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Amortization of intangibles $ 17 $ 12 $ 5 $ 45 $ 27 $ 18

Amortization of intangibles increased during the three months and six months ended February 28, 2025, compared to the three months and six months ended February 29, 2024, primarily due to (i) amortization related to the Green Point trade name, which was reclassified to a definite-lived intangible asset during fiscal year 2024 and (ii) additional amortization associated with intangible assets related to the acquisitions of Mikros Technologies LLC and Pharmaceutics International, Inc.

Amortization of intangibles increased during the three months ended May 31, 2025, compared to the three months ended May 31, 2024, primarily due to additional amortization associated with intangible assets related to the acquisitions of Mikros Technologies LLC and Pharmaceutics International, Inc.

that occurred during the first and second quarters of fiscal year 2025.

Amortization of intangibles increased during the nine months ended May 31, 2025, compared to the nine months ended May 31, 2024, primarily due to (i) additional amortization associated with intangible assets related to the acquisitions of Mikros Technologies LLC and Pharmaceutics International, Inc.

that occurred during the first and second quarters of fiscal year 2025 and (ii) amortization related to the Green Point trade name, which was reclassified to a definite-lived intangible asset during fiscal year 2024.

Restructuring, Severance and Related Charges

Three months ended Six months ended

(in millions) February 28, 2025 February 29, 2024 Change February 28, 2025 February 29, 2024 Change

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(in millions) May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Restructuring, severance and related charges $ 16 $ 55 $ (39) $ 144 $ 252 $ (108)

Restructuring, severance, and related charges decreased during the three months and six months ended February 28, 2025, compared to the three months and six months ended February 29, 2024, primarily due to higher restructuring, severance and related charges, related to the 2024 Restructuring Plan, during the three months and six months ended February 29, 2024.

The decrease is partially offset by increased restructuring, severance and related charges, related to the 2025 Restructuring Plan, during the three months and six months ended February 28, 2025.

Restructuring, severance, and related charges decreased during the three months and nine months ended May 31, 2025, compared to the three months and nine months ended May 31, 2024, primarily due to higher restructuring, severance and related charges, related to the 2024 Restructuring Plan, during the three months and nine months ended May 31, 2024.

The decrease is partially offset by increased restructuring, severance and related charges, related to the 2025 Restructuring Plan, during the three months and nine months ended May 31, 2025.

2025 Restructuring Plan

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The 2025 Restructuring Plan reflects our intention only and restructuring decisions, including the timing of such decisions, at certain locations remain subject to consultation with the Company’s employees and their representatives.

We currently expect to recognize approximately $150 million to $200 million in pre-tax restructuring and other related costs over the course of our 2025 fiscal year.

The charges relating to the 2025 Restructuring Plan are currently expected to result in net cash expenditures of approximately $100 million to $130 million that will be payable over the course of our fiscal years 2025 and 2026.

The exact timing of these charges and cash outflows, as well as the estimated cost ranges by category type, have not been finalized.

This information will be subject to the finalization of timetables for the transition of functions, consultation with employees and their representatives as well as the statutory severance requirements of the jurisdictions impacted, and the amount and timing of the actual charges may vary due to a variety of factors.

We expect to recognize approximately $200 million in pre-tax restructuring and other related costs over the course of our 2025 fiscal year.

The restructuring and other related charges are expected to include $60 million to $70 million of employee severance and benefit costs;

$65 million to $70 million of asset write-off costs;

and $55 million to $65 million of contract termination costs and other related costs.

The amount and timing of the actual charges may vary due to a variety of factors, including the finalization of timetables for the transition of functions, consultation with employees and their representatives, as well as the impact of jurisdictional statutory severance requirements.

Our estimates for the charges discussed above exclude any potential income tax effects.

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Gain from the Divestiture of Businesses

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(in millions) February 28, 2025 February 29, 2024 Change February 28, 2025 February 29, 2024 Change

Three months ended Nine months ended

(in millions) May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Gain from the divestiture of businesses $ (45) $ — $ (45) $ (45) $ (944) $ 899

In the second quarter of fiscal year 2024, we completed the divestiture of the Mobility Business and recorded a pre-tax gain of $944 million.

Certain post-closing adjustments were realized in March 2025, which will result in recognition of a $54 million pre-tax gain during the three months ended May 31, 2025.

Certain post-closing adjustments were realized in March 2025, which resulted in the recognition of a $54 million pre-tax gain during the three months ended May 31, 2025.

See Note 17 – “Business Acquisitions and Divestitures” to the Condensed Consolidated Financial Statements for additional information.

Acquisition and Divestiture Related Charges

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(in millions) February 28, 2025 February 29, 2024 Change February 28, 2025 February 29, 2024 Change

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(in millions) May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Acquisition and divestiture related charges $ 9 $ 3 $ 6 $ 17 $ 64 $ (47)

Acquisition and divestiture related charges decreased during the three months and six months ended February 28, 2025, compared to the three months and six months ended February 29, 2024, primarily due to transaction and disposal costs incurred in connection with the divestiture of the Mobility Business during fiscal year 2024.

Acquisition and divestiture related charges increased during the three months ended May 31, 2025, compared to the three months ended May 31, 2024, primarily due to transaction costs incurred in connection with pursuing acquisition opportunities.

Acquisition and divestiture related charges decreased during the nine months ended May 31, 2025, compared to the nine months ended May 31, 2024, primarily due to transaction and disposal costs incurred in connection with the divestiture of the Mobility Business during fiscal year 2024.

See Note 17 – “Business Acquisitions and Divestitures” to the Condensed Consolidated Financial Statements for additional information.

Loss on Securities

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(in millions) May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Loss on securities $ 46 $ — $ 46 $ 46 $ — $ 46

Loss on securities during the three months and nine months ended May 31, 2025, relates to an impairment of an investment in Preferred Stock.

Other Expense

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(in millions) February 28, 2025 February 29, 2024 Change February 28, 2025 February 29, 2024 Change

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(in millions) May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Other expense $ 30 $ 22 $ 8 $ 74 $ 65 $ 9

Other expense remained relatively consistent during the three months and six months ended February 28, 2025, compared to the three months and six months ended February 29, 2024.

Other expense increased during the three months ended May 31, 2025, compared to the three months ended May 31, 2024, primarily due to (i) an increase in fees primarily due to higher utilization of our trade accounts receivable sales programs and global asset-backed securitization program and (ii) lower net periodic benefit costs.

Other expense increased during the nine months ended May 31, 2025, compared to the nine months ended May 31, 2024, primarily related to lower net periodic benefit costs.

Interest Expense, Net

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(in millions) February 28, 2025 February 29, 2024 Change February 28, 2025 February 29, 2024 Change

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(in millions) May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Interest expense, net $ 37 $ 38 $ (1) $ 112 $ 132 $ (20)

Interest expense, net decreased during the three months and six months ended February 28, 2025, compared to the three months and six months ended February 29, 2024, due to lower interest rates and lower borrowings primarily on our credit facilities and commercial paper program.

Interest expense, net remained relatively consistent during the three months ended May 31, 2025, compared to the three months ended May 31, 2024.

Interest expense, net decreased during the nine months ended May 31, 2025, compared to the nine months ended May 31, 2024, due to lower interest rates and lower borrowings primarily on our credit facilities and commercial paper program.

Income Tax Expense

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February 28, 2025 February 29, 2024 Change February 28, 2025 February 29, 2024 Change

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May 31, 2025 May 31, 2024 Change May 31, 2025 May 31, 2024 Change

Effective income tax rate 23.7 % 35.7 % (12.0) % 28.5 % 16.6 % 11.9 %

The effective income tax rate differed for the three months and six months ended February 28, 2025, compared to the three months and six months ended February 29, 2024, primarily due to:

(i) a change in the jurisdictional mix of earnings, driven in part by decreased income before income taxes in low tax rate jurisdictions for the three months and six months ended February 28, 2025, (ii) an $18 million income tax benefit for the reversal of an unrecognized tax benefit due to a lapse of statute for the six months ended February 28, 2025, and (iii) the gain from the divestiture of the Mobility Business and corresponding $58 million of income tax expense during the three months ended February 29, 2024.

The effective income tax rate differed for the three months and nine months ended May 31, 2025, compared to the three months and nine months ended May 31, 2024, primarily due to:

(i) a change in the jurisdictional mix of earnings, (ii) an $18 million income tax benefit for the reversal of an unrecognized tax benefit due to a lapse of statute for the nine months ended May 31, 2025, and (iii) the gain from the divestiture of the Mobility Business, including post-closing adjustments recorded during the three months ended May 31, 2025, and corresponding $58 million of income tax expense during the nine months ended May 31, 2024.

The Organization for Economic Co-operation and Development (“OECD”) and participating countries continue to work toward the enactment of a 15% global minimum corporate tax rate.

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GAAP Financial Results to Non-GAAP Measures

Three months ended Six months ended

(in millions, except for per share data) February 28, 2025 February 29, 2024 February 28, 2025 February 29, 2024

Three months ended Nine months ended

(in millions, except for per share data) May 31, 2025 May 31, 2024 May 31, 2025 May 31, 2024

Operating income (U.S.

14 unchanged sentences

Adjustments to operating income 17 89 256 (508)

Loss on securities (5)

Net periodic benefit cost (2)

1 unchanged sentence

Adjustments for taxes (6)

(6) 14 (18) 51

Core earnings (Non-GAAP) $ 279 $ 230 $ 722 $ 786

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GAAP and Non-GAAP) 109.3 121.7 111.5 126.9

(1) Charges recorded during the three months and six months ended February 28, 2025, and February 29, 2024, primarily related to the 2025 Restructuring Plan and 2024 Restructuring Plan, respectively.

(1) Charges recorded during the three months and nine months ended May 31, 2025, and May 31, 2024, primarily related to the 2025 Restructuring Plan and 2024 Restructuring Plan, respectively.

(2) We are reclassifying the pension components in other expense to core operating income as we assess operating performance, inclusive of all components of net periodic benefit cost, with the related revenue.

There is no impact to core earnings or diluted core earnings per share for this adjustment.

(3) Charges recorded during the six months ended February 28, 2025, relate primarily to costs associated with damage from Hurricanes Helene and Milton, which impacted our operations in St.

(3) Charges recorded during the nine months ended May 31, 2025, relate primarily to costs associated with damage from Hurricanes Helene and Milton, which impacted our operations in St.

Petersburg, Florida and Asheville and Hendersonville, North Carolina.

(4) We completed the divestiture of the Mobility Business and recorded a pre-tax gain of $944 million, subject to certain post-closing adjustments that were realized in March 2025.

We incurred transaction and disposal costs in connection with the sale of approximately $46 million and $61 million during the three months and six months ended February 29, 2024, respectively.

(5) Tax adjustments for the three months and six months ended February 29, 2024, were partially driven by an income tax expense associated with the divestiture of the Mobility Business.

Charges recorded during the three months and nine months ended May 31, 2024, related to costs associated with product quality liabilities.

Charges recorded during the three months and nine months ended May 31, 2025, and May 31, 2024, are classified as a component of cost of revenue and selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.

(4) We completed the divestiture of the Mobility Business and recorded a pre-tax gain of $944 million during the nine months ended May 31, 2024.

Certain post-closing adjustments were realized in March 2025, which resulted in the recognition of a $54 million pre-tax gain during the three months ended May 31, 2025.

We incurred transaction and disposal costs in connection with the sale of approximately $64 million during the nine months ended May 31, 2024.

(5) Charges recorded during the three months and nine months ended May 31, 2025, relate to an impairment of an investment in Preferred Stock.

(6) Tax adjustments for the nine months ended May 31, 2024, were partially driven by an income tax expense associated with the divestiture of the Mobility Business.

Adjusted Free Cash Flow

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(in millions) February 28, 2025 February 29, 2024

Nine months ended

(in millions) May 31, 2025 May 31, 2024

Net cash provided by operating activities (U.S.

$ 1,052 $ 1,181

Acquisition of property, plant and equipment (“PP&E”) (1)

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Fiscal Year 2025

On June 2, 2025, we signed a binding share purchase agreement related to the anticipated acquisition of Rebound Technologies Group Holdings Limited (“Rebound Technologies”).

Rebound Technologies is a global supply chain service provider headquartered in the United Kingdom offering end-to-end solutions including global sourcing, data driven analytics, proactive shortage management and obsolescence strategies.

Completion of this transaction is subject to regulatory clearance and customary closing conditions.

On February 3, 2025, we completed the acquisition of Pharmaceutics International, Inc.

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As a result of the transaction, we derecognized net assets of approximately $1.2 billion, and recorded a pre-tax gain of $942 million in the fiscal year ended August 31, 2024.

Certain post-closing adjustments were realized in March 2025, which will result in recognition of a $54 million pre-tax gain during the three months ended May 31, 2025.

Certain post-closing adjustments were realized in March 2025, which resulted in the recognition of a $54 million pre-tax gain during the three months ended May 31, 2025.

In addition, we agreed to indemnify BYDE from certain liabilities that may arise post-close that relate to periods prior to the Closing Date.

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Cash and Cash Equivalents

As of February 28, 2025, we had approximately $1.6 billion in cash and cash equivalents, of which a significant portion was held by our foreign subsidiaries.

Most of our foreign cash and cash equivalents as of February 28, 2025, could be repatriated to the United States without potential tax expense.

As of May 31, 2025, we had approximately $1.5 billion in cash and cash equivalents, of which a significant portion was held by our foreign subsidiaries.

Most of our foreign cash and cash equivalents as of May 31, 2025, could be repatriated to the United States without potential tax expense.

Notes Payable and Credit Facilities

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Other — 1 1 — 1 1 — 4

Balance as of February 28, 2025 $ 498 $ 497 $ 595 $ 499 $ 497 $ 297 $ — $ 2,883

Balance as of May 31, 2025 $ 498 $ 498 $ 595 $ 499 $ 497 $ 297 $ — $ 2,884

Maturity Date Jan 12, 2028 Jan 15, 2030 Jan 15, 2031 Apr 15, 2026 May 15, 2027 Feb 1, 2029 Jan 22, 2026 and Jan 22, 2028 (2)

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$4.0 billion (1)

(1) As of February 28, 2025, we had $4.0 billion in available unused borrowing capacity under our revolving credit facilities.

The Credit Facility acts as the back-up facility for commercial paper outstanding, if any.

(1) As of May 31, 2025, we had $4.0 billion in available unused borrowing capacity under our existing revolving credit facilities, of which $3.2 billion was available under the credit agreement dated January 22, 2020 (as amended, the “Existing Credit Facility”).

The Existing Credit Facility acts as the back-up facility for commercial paper outstanding, if any.

We have a borrowing capacity of up to $3.2 billion under our commercial paper program.

Commercial paper borrowings with an original maturity of 90 days or less are recorded net within the Condensed Consolidated Statements of Cash Flows, and have been excluded from the table above.

(2) On June 18, 2025, we entered into a senior unsecured credit agreement (the “Agreement”).

The Agreement provides for a five-year revolving credit facility in the initial amount of $3.2 billion (the “Revolving Credit Facility”), which may, subject to the lender’s discretion, potentially be increased by up to an aggregate amount of $1.0 billion.

The Revolving Credit Facility expires on June 18, 2030, subject to unlimited successive one-year extension options (subject to the lenders’ discretion), provided that the tenor of the Revolving Credit Facility shall at no time exceed five years.

Interest and fees on advances under the Revolving Credit Facility are based on our non-credit enhanced long-term senior unsecured debt rating as determined by S&P Global Ratings, Moody’s Ratings and Fitch Ratings.

In connection with our entry into the Agreement, we terminated the Existing Credit Facility.

Interest is charged at a rate equal to either 0.00% to 0.45% above the base rate or 0.90% to 1.45% above the benchmark rate, as applicable, based on our credit ratings.

The base rate represents the greatest of:

(i) Citibank, N.A.’s prime rate, (ii) 0.50% above the federal funds rate, and (iii) 1.0% above one-month Term SOFR, but not less than zero.

The benchmark rate represents Term SOFR, EURIBOR, TIBOR or Daily Simple SOFR, as applicable, for the applicable interest period, but not less than zero.

Fees include a facility fee based on the revolving credit commitments of the lenders and a letter of credit fee based on the amount of outstanding letters of credit.

We have a shelf registration statement with the SEC registering the potential sale of an indeterminate amount of debt and equity securities in the future to augment our liquidity and capital resources.

1 unchanged sentence

A violation of these covenants could negatively impact our liquidity by restricting our ability to borrow under the notes payable and credit facilities and potentially causing acceleration of amounts due under these notes payable and credit facilities.

As of February 28, 2025, and August 31, 2024, we were in compliance with our debt covenants.

As of May 31, 2025, and August 31, 2024, we were in compliance with our debt covenants.

Refer to Note 6 – “Notes Payable and Long-Term Debt” to the Condensed Consolidated Financial Statements for further details.

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The special purpose entity in the global asset-backed securitization program is a wholly owned subsidiary of the Company and is included in our Condensed Consolidated Financial Statements.

Certain unsold receivables covering up to the maximum amount of net cash proceeds available under the domestic, or U.S., portion of the global asset-backed securitization program are pledged as collateral to the unaffiliated financial institution as of February 28, 2025.

Effective January 23, 2025, the terms of the global asset-backed securitization program were amended to extend the termination date from January 2025 to January 2028.

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In conjunction with our global asset-backed securitization program, we are required to remit amounts collected as a servicer under the global asset-backed securitization program to a special purpose entity, which in turn sells certain receivables to unaffiliated financial institutions that purchased the receivables.

The outstanding balance of receivables sold and not yet collected on accounts where we have continuing involvement was approximately $368 million and $338 million as of February 28, 2025, and August 31, 2024, respectively.

During the three months and six months ended February 28, 2025, we sold $1.0 billion and $2.0 billion, respectively, of trade accounts receivable, and we received cash proceeds of $1.0 billion and $2.0 billion, respectively.

The outstanding balance of receivables sold and not yet collected on accounts where we have continuing involvement was approximately $375 million and $338 million as of May 31, 2025, and August 31, 2024, respectively.

During the three months and nine months ended May 31, 2025, we sold $1.2 billion and $3.3 billion, respectively, of trade accounts receivable, and we received cash proceeds of $1.2 billion and $3.2 billion, respectively.

The receivables that were sold were removed from the Condensed Consolidated Balance Sheets and the cash received was included as cash provided by operating activities on the Condensed Consolidated Statements of Cash Flows.

The global asset-backed securitization program requires compliance with several covenants including compliance with the interest ratio and debt to EBITDA ratio of the Credit Facility.

As of February 28, 2025, and August 31, 2024, we were in compliance with all covenants under our global asset-backed securitization program.

The global asset-backed securitization program requires compliance with several covenants including compliance with the interest ratio and debt to EBITDA ratio of the Existing Credit Facility.

As of May 31, 2025, and August 31, 2024, we were in compliance with all covenants under our global asset-backed securitization program.

Refer to Note 7 – “Asset-Backed Securitization Program” to the Condensed Consolidated Financial Statements for further details on the program.

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In conjunction with our trade accounts receivable sale programs, we are required to remit amounts collected as a servicer under the trade accounts receivable sale programs to the unaffiliated financial institutions that purchased the receivables.

The outstanding balance of receivables sold and not yet collected on accounts where we have continuing involvement was approximately $571 million and $367 million as of February 28, 2025, and August 31, 2024, respectively.

During the three months and six months ended February 28, 2025, we sold $2.0 billion and $3.7 billion, respectively, of trade accounts receivable under these programs and we received cash proceeds of $2.0 billion and $3.7 billion, respectively.

The outstanding balance of receivables sold and not yet collected on accounts where we have continuing involvement was approximately $852 million and $367 million as of May 31, 2025, and August 31, 2024, respectively.

During the three months and nine months ended May 31, 2025, we sold $3.6 billion and $7.4 billion, respectively, of trade accounts receivable under these programs and we received cash proceeds of $3.6 billion and $7.3 billion, respectively.

The following table sets forth selected consolidated cash flow information (in millions):

Six months ended

February 28, 2025 February 29, 2024

Nine months ended

May 31, 2025 May 31, 2024

Net cash provided by operating activities

$ 1,052 $ 1,181

Net cash (used in) provided by investing activities

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Operating Activities

Net cash provided by operating activities during the six months ended February 28, 2025, was primarily due to non-cash expenses and net income and an increase in accounts payable, accrued expense and other liabilities.

Net cash provided by operating activities was partially offset by an increase in accounts receivable, an increase in inventories and an increase in prepaid expenses and other current assets.

Net cash provided by operating activities during the nine months ended May 31, 2025, was primarily due to an increase in accounts payable, accrued expense and other liabilities and non-cash expenses and net income.

Net cash provided by operating activities was partially offset by an increase in prepaid expenses and other current assets, an increase in inventories, an increase in accounts receivable and an increase in contract assets.

The increase in accounts payable, accrued expenses and other liabilities is primarily due to the timing of purchases and cash payments.

The increase in prepaid expenses and other current assets is primarily related to purchases made to procure components for customers whereby the associated revenue is expected to be accounted for on a net basis once transferred to the customer.

The increase in inventories is primarily to support expected sales levels in the fourth quarter of fiscal year 2025.

The increase in accounts receivable is primarily driven by the timing of collections.

The increase in inventories is primarily to support expected sales levels in the third quarter of fiscal year 2025.

The increase in prepaid expenses and other current assets is primarily due to the timing of payments.

The increase in contract assets is primarily due to timing of revenue recognition for the over time customers.

Investing Activities

Net cash used in investing activities during the six months ended February 28, 2025, consisted primarily of capital expenditures, principally to support ongoing business in the Regulated Industries, Intelligent Infrastructure, and Connected Living and Digital Commerce segments and the acquisition of Pharmaceutics International, Inc.

and Mikros Technologies LLC, partially offset by proceeds and advances from the sale of property, plant and equipment.

Net cash used in investing activities during the nine months ended May 31, 2025, consisted primarily of the acquisition of Pharmaceutics International, Inc., Mikros Technologies LLC and certain other third-party assets and capital expenditures, principally to support ongoing business in the Regulated Industries, Intelligent Infrastructure, and Connected Living and Digital Commerce segments, partially offset by proceeds and advances from the sale of property, plant and equipment and a working capital adjustment related to the divestiture of our Mobility Business.

Financing Activities

Net cash used in financing activities during the six months ended February 28, 2025, was primarily due to (i) the repurchase of our common stock under our share repurchase authorization, (ii) payments for debt agreements, (iii) treasury stock minimum tax withholding related to vesting of restricted stock, and (iv) dividend payments.

Net cash used in financing activities during the nine months ended May 31, 2025, was primarily due to (i) payments for debt agreements, (ii) the repurchase of our common stock under our share repurchase authorization, (iii) treasury stock minimum tax withholding related to vesting of restricted stock, and (iv) dividend payments.

Net cash used in financing activities was partially offset by (i) borrowings under debt agreements and (ii) net proceeds from exercise of stock options and issuance of common stock under employee stock purchase plan.

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As of November 30, 2024, no authorization remained under the amended 2023 Share Repurchase Program.

(3) As of February 28, 2025, 4.3 million shares had been repurchased for $636 million and $364 million remained available under the 2025 Share Repurchase Program.

As of April 3, 2025, 6.5 million shares had been repurchased for $972 million and $28 million remains available under the 2025 Share Repurchase Program.

(3) As of May 31, 2025, 6.5 million shares had been repurchased for $975 million and $25 million remained available under the 2025 Share Repurchase Program.

Under ASR agreements, we make payments to the participating financial institutions and receive an initial delivery of shares of common stock.

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In addition, we repurchased shares of its common stock through the open market as follows (in millions):

Three months ended Six months ended

February 28, 2025 February 29, 2024 February 28, 2025 February 29, 2024

Three months ended Nine months ended

May 31, 2025 May 31, 2024 May 31, 2025 May 31, 2024

Shares Cost Shares Cost Shares Cost Shares Cost

Open market share repurchases 0.2 $ 30 3.8 $ 499 2.7 $ 356 10.3 $ 1,324

0.7 $ 94 6.5 $ 824 2.5 $ 326 6.5 $ 824

(1) As of April 3, 2025, 2.7 million shares had been repurchased for $353 million through open market transactions under the 2025 Share Repurchase Program.

On December 27, 2024, we issued a warrant (the “Warrant”) to Amazon.com NV Investment Holdings LLC (“Warrantholder”) to acquire up to 1,158,539 of our ordinary shares (“Warrant Shares”) at an initial exercise price of $137.7671 per share, which is the preceding 30 trading day VWAP.

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(1) The expected volatility was estimated using the historical volatility derived from our common stock.

The following table summarizes the Warrant activity for the six months ended February 28, 2025:

The following table summarizes the Warrant activity for the nine months ended May 31, 2025:

Warrant Shares

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Shares vested (59,582)

Outstanding as of February 28, 2025

Exercisable as of February 28, 2025

Outstanding as of May 31, 2025

Exercisable as of May 31, 2025

Contractual Obligations

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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-Q

Item 2. Management’s Discussion and Analysis